The Myanmar challenge in China’s “String of Pearls” strategy
The Myanmar challenge in China’s “String of Pearls” strategy
WRITTEN BY DON MCLAIN GILL
12 August 2020
In a surprising turn of events, the government of Myanmar has decided to involve international partners in the mega Yangon City Project, which is a key element of the Beijing-funded China-Myanmar Economic Corridor (CMEC). The CMEC aims to connect the Yunnan province in China to Mandalay in central Myanmar, Yangon New City in the south, and the Kyaukphyu Special Economic Zone in the west. Once completed, this project will give China significant access to the Bay of Bengal and the eastern portion of the Indian Ocean.
Myanmar is a key pillar of China’s Belt and Road Initiative; however, Chinese interests in Myanmar go much beyond economics and development. Moreover, Beijing has long been pursuing a particular geopolitical strategy that has been likened to a “string of pearls” by policy analysts and scholars. This strategy encompasses a network of Chinese commercial facilities that are being developed in the Indian Ocean Region (IOR). These ports and infrastructural investments serve as potential platforms to boost Beijing’s military and power projection capabilities in the region.
By opening the project to other foreign firms aside from the China Communications Construction Company (CCCC), Myanmar is indicating its unwillingness to allow one state to dominate and monopolise the construction and operation of its mega city project. This move reflects a critical push-back from a key state in China’s overall strategic calculus in the Indian Ocean Region and could be a harbinger of similar resistance from other key states in Beijing’s “string of pearls” strategy.
Challenges within China-Myanmar relations
This decision has been taken in response to a brewing controversy between Myanmar and China. In a recent interview with a Russian state-run channel, Myanmar’s Senior General Min Aung Hlaing said that terrorist organisations active in Myanmar are backed by “strong forces”.
Myanmar’s recent decision may open avenues for other key states to act as a counterweight to China. Among these states, India has indicated its willingness to heavily involve itself in Myanmar’s infrastructure and defence sectors.
Myanmar’s military spokesperson Brigadier General Zaw Min Tun later clarified that General Hlaing was referring to the Arakan Army (AA) and the Arakan Rohingya Salvation Army (ARSA), which are terrorist organisations active in the Rakhine State in western Myanmar that borders China. It was also emphasised that a foreign country is backing the Arakan Army (AA). The spokesperson also stated that weapons made in China had been used in terror attacks against the military in 2019.
Additionally, fears concerning China’s “debt-trap diplomacy” and the economic slowdown due to the coronavirus pandemic have also impeded the progress of the megacity project. Myanmar’s National League for Democracy (NLD)-led civilian government inspected and reduced several high-profile Chinese projects worth billions of dollars in 2018 due to concerns that it could leave the south-east Asian state heavily indebted. Myanmar’s officials indicated that the government wants to avoid any debt-related issues by accepting huge loans from China that come with high-interest rates. Myanmar’s government has also refused to provide sovereign guarantees for any loans and has said it will require independent third-party audits of project spending.
The devastating effects of the coronavirus pandemic have also affected the project. The pandemic has severely strained Myanmar’s economy, especially since China dominates the state’s tourism, trade, agricultural, and industrial sectors. Chinese businessmen have returned home taking their equipment and machinery with them. Due to the closure of border crossings in January, the country has lost $8 million per day via the Muse border gate alone. This may significantly affect Myanmar’s ability to commit to high-profile Chinese projects in the future, which would further dent the capacity and the feasibility of the CMEC.
More trouble for China?
Myanmar’s unwillingness to commit fully to China’s plans complicates Beijing’s strategic calculus. China’s intentions in the IOR are aligned with the larger objective of increasing its power projection capabilities beyond its immediate neighbourhood. The China-Myanmar Economic Corridor was supposed to be a major platform for China to increase its strategic footprint in the Indian Ocean.
There are two possible outcomes associated with Myanmar’s recent move. First, other states in the Indian Ocean, particularly in South Asia, such as Pakistan, Bangladesh, and Sri Lanka with pending Chinese megaprojects may decide to follow suit to safeguard their national interests and autonomy. China’s role in causing unsustainable debt burden on Belt and Road countries in the region gained global attention in 2017 when an impoverished Sri Lanka handed over the China-financed Hambantota Port to a Chinese state-run company on a 99-year lease. This gave rise to the popular narratives of “China’s debt-trap diplomacy” and “predatory economics”, which made different South Asian states review several Chinese projects.
Second, Myanmar’s recent decision may open avenues for other key states to act as a counterweight to China. Among these states, India has indicated its willingness to heavily involve itself in Myanmar’s infrastructure and defence sectors. In a meeting between Gen Hlaing and Indian Defence Minister Rajnath Singh in June, both explored the maximisation of Myanmar-India cooperation. The two discussed security cooperation to ensure the successful implementation of the India-funded Kaladan Multimodal Transit Transport Project across the Mizoram border. This project aims to open sea routes and a highway transport system that will link the eastern Indian seaport of Kolkata with the country’s landlocked northeastern state of Mizoram through Myanmar’s Rakhine and Chin.
This turn of events coupled with the disastrous effects of the coronavirus pandemic could significantly affect the trajectory of China’s strategy in the IOR, especially since governments in the region seem to be sitting on the fence in terms of either continuing or postponing the Chinese-led mega projects. As a result, China may need to recalibrate its approach in dealing with states in the Indian Ocean Region as coercion will not work.
DISCLAIMER: All views expressed are those of the writer and do not necessarily represent that of the 9DASHLINE.com platform.
Author biography
Don McLain Gill is pursuing his master’s degree in International Studies at the University of the Philippines Diliman. He has written extensively on issues of regional geopolitics and Indian foreign policy. Image credit: William/Flickr.