China’s non-interference could hurt China, says analyst

China’s “laissez-faire” approach to Myanmar’s military coup could harm the Asian giant’s strategic and economic interests in the Southeast Asian country, a political risk analyst said.

In contrast to strong condemnation and sanctions from Western powers, including the United States and the European Union, China’s response to the February 1 coup and the violence that followed has been more silent. Beijing has been cautious and is emphasizing the importance of stability.

“But while China may be happy to deal with whoever holds power in Naypyidaw, it is increasingly clear that the chain of events unleashed by the coup could threaten its interests,” said Gareth Price, principal investigator for the Asia-Pacific program. British think tank Chatham House said in a March note.

Naypyidaw is the capital of Myanmar and one of the hot spots for the protests against the coup. Security forces have used increasingly violent tactics to suppress the demonstrations, killing more than 550 civilians, Reuters reported.

Protesters, outraged by Beijing’s apparent lack of concern for those killed in the protests, attacked Chinese-run factories in Myanmar last month, the Associated Press reported. In response, Beijing urged Myanmar to “ensure the safety of life and property for Chinese companies and personnel” there.

“China’s frustration with the risks facing its economic interests indicates that the coup has become a major test for the already complex relationship between Myanmar and China,” said Kaho Yu, senior Asia analyst at risk consultancy Verisk Maplecroft. , in a March report.

China is a major investor in Myanmar, a Southeast Asian border country that shares one of its borders. Myanmar is also an important part of President Xi Jinping’s Belt and Road Initiative.

“Overall, Beijing hopes that investment in Myanmar will contribute to its energy security, trade and stability in its neighborhood,” Yu said.

“China maintains that an economic slowdown in its neighborhood would result in social instability and security threats, which in turn would threaten the political stability of Chinese border provinces like Yunnan,” the analyst added.

The latest data available from the Myanmar Directorate of Investment and Business Administration showed that China’s approved foreign investments were around $ 139.4 million from October 2020 to January this year. Myanmar’s financial year begins in October.

Approved Chinese investments were second only to Singapore’s, which totaled around $ 378.3 million. in the same period, the data showed.

In terms of trade, China is the main destination for Myanmar’s exports and the largest source of imports for the Southeast Asian country.

But Myanmar’s importance to China extends beyond the economy, said Price of Chatham House.

“The oil and gas pipelines running through Myanmar diversify China’s supply sources and help prevent the use of the Straits of Malacca, a hotbed of piracy,” he said. “And the development of ports and land connectivity between China and Myanmar also helps facilitate a greater Chinese presence in the Indian Ocean.”

In the past, Beijing has cultivated cordial ties with both the Myanmar military and the civilian government of de facto leader Aung San Suu Kyi, Yu noted. In recent years, international pressure on Myanmar due to the Rohingya crisis has brought the country closer to China, he added.

China’s top diplomatic State Councilor Wang Yi said last month that “no matter how the situation in Myanmar changes, China’s determination to promote Sino-Myanmar relations will not waver.”

But any sentiment on the part of China that it will remain Myanmar’s main partner, regardless of who is in charge, may be a “misjudgment,” Price said.

“If the military is forced to back down, it may result in a more pronounced anti-China lean, threatening (China’s) strategic interests,” he said.

Instead, Beijing could help end the coup, a move that could threaten its interests in Myanmar in the short term, but will likely move them forward in the long term, Price said. Myanmar’s generals have no intention of giving up power, but will fight to keep it without the support of China, he said.

“As its global role expands, China should learn to differentiate between various types of authoritarian government and judge its response accordingly,” Price said.

“China should be aware that a ‘one-size-fits-all’ non-interference policy will not win many friends, and whoever wins is likely to be the least healthy kind.”