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Can Suu Kyi Control Myanmar’s Rich Natural Resources? – Analysis

Burma's Aung San Suu Kyi. Photo by Claude TRUONG-NGOC, Wikipedia Commons.Burma's Aung San Suu Kyi. Photo by Claude TRUONG-NGOC, Wikipedia Commons.

By Amitava Mukherjee*

Although Aung San Suu Kyi, the Foreign Minister and State Counsellor of Myanmar, has shown prevarication and some sort of policy paralysis on her part with regard to the Rohingya problem, her decision to freeze renewal of existing permits for operating jade mines and suspend licensing of new ones in her country has come as a positive move towards solving the nearly 70-year-old Kachin insurgency in northeastern Myanmar.

If Suu Kyi is successful in finding a solution to the ethnic Kachin rebellion then it is sure to influence the course of events involving other rebellious ethnic groups, including the most intractable Wa Self-Administered Division.

But there are likely to be two other very important fallouts. The first will be the tremor that Sino-Myanmar relations are sure to experience in the wake of the Myanmar government’s clampdown on jade mining as this sector is being run on huge amount of Chinese investments. Trade in jade, the mystique-associated green stone regarded as the most important status symbol in China, has already crossed the $31 billion-mark in Myanmar and accounts for nearly half of Myanmar’s Gross Domestic Product (GDP). The second will be its salutary effect in different countries of Southeast Asia which are plagued by similar kinds of ethnic conflicts.

So far Suu Kyi and her government have progressed well. Her next logical step should be reaching out to other rebellious ethnic groups like the WAs, Shans, Karens etc. who are also locked in armed conflict with the Naypidaw government mainly over the issue of exploration and exploitation of natural resources. For example the WAs have barred the central government from coming anywhere near the mineral deposits – mainly tin – within their ethnic jurisdiction and the WA administration has been selling tin ore to different European and American industrial behemoths through different Chinese trading conglomerates.

However, the Myanmar army, which still enjoys considerable space in the country’s governmental structure, has its fingers deep inside the trade in jade stones. This has been made possible by the fact that during the ceasefire agreement of 1994 the army could retain control over the Hpakant area in the western Kachin state where most of the jade mines are situated. According to a study conducted into this contentious issue, three military-controlled trade organisations namely the Union of Myanmar Economic Holdings Ltd., Myanmar Economic Corporation and Northern Star Gems sold jade worth $283 million in 2013 and 2014.

Although Than Shwe, the former Myanmar army strongman and Commander-in-Chief, has retired from service, he still holds enormous influence over the army. It is widely believed in international circles that the Myanmar Naing Group and the Kyaing International, two big names in jade trade in South and South-East Asia, are actually controlled by Kyaing San Shwe and Hiten Naing Shwe, two sons of Than Shwe. According to some very reliable estimates the families of Than Shwe; Maung Maung Thein, another retired general; and Ohn Myint, the highest serving former general in Kachin state and also a post-junta Minister; sold jades worth $220 million in 2014.

Now it is to be seen as to what extent Suu Kyi can go towards eradicating corruption in jade mining and bringing it under a sound state regulatory system. Eighty percent of jade stones mined in Myanmar are smuggled to China and a huge and bustling jade trade centre has come up in the latter’s Yunnan province. In China, one gram of jade is priced at $160 which is more than three times the price of gold. It is no wonder that nearly 70 percent finance for big jade mining companies in Myanmar comes from China.

It is only hoped that Suu Kyi’s initiative will usher in a congenial atmosphere in spite of the fact that the Kachin Independence Army ( KIA) is also alleged to be involved in illegal shipment of jades for filling up its coffers. Nban La, Vice Chairman of the Kachin Independence Organisation (KIO), sister organisation of the KIA, is alleged to have interests in jade trade. Since mining operations in and around Hpakant are carried on in violation of all kinds of norms and regulations, Chinese companies own most of the jade mining concerns through proxies.

The political atmosphere in Myanmar is likely to experience a major qualitative shift if Aung San Suu Kyi succeeds in establishing state control over the country’s natural resources. No doubt she has an advantage as most of the hydro power resources, the biggest natural resource of the country, are situated in areas dominated by the majority Burman community. But the lion’s share of mineral deposits is in the hands of the several ethnic minority organisations.

It makes Suu Kyi’s task a bit complicated. But she has made a mature beginning. If she succeeds in her task then democracy will send a strong message across Southeast Asia which is still dominated by dictators of different shades.

*Amitava Mukherjee is a senior journalist and commentator. Comments and suggestions on this article may be sent to: [email protected]


About the Author

South Asia Monitor
South Asia Monitor
South Asia Monitor is an independent web journal and online resource dealing with strategic, political, security, cultural and economic issues about, pertaining to and of consequence to South Asia and the whole Indo-Pacific region. Developed for South Asia watchers across the globe or those looking for in-depth knowledge, reliable resource and documentation on this region, the site features exclusive commentaries, insightful analyses, interviews and reviews contributed by strategic experts, diplomats, journalists, analysts, researchers and students from not only this region but all over the world. It also aggregates news and views content related to the region.

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