Myanmar Balancing Relations With US And China – Analysis


By C.S.Kuppuswamy

“There is no intent of the United States in its relation with Burma to have any certainly negative influence on Burma-China relations. China and Burma have a long history as well as a long border. They have deep economic relations in the past and it is between the two nations to determine their future”—Derek Mitchell, Special US Envoy for Myanmar at the end of a brief visit to Beijing in mid December 2011.

“We shouldn’t have a cold war mentality where good relations between two countries would necessarily be bad for a third party. This is no longer that sort of an era”—Dr. Guo Xiangang, vice-president, China Institute for International Studies.

“The Burmese cannot move away from China, because of geographic location, and the economic penetration as well as the demographic influence of China over Burma. What they want is best of both worlds”—Maung Zarni, Visiting Fellow, London School of Economics.


The year 2011 has transformed Myanmar from a country in total isolation and under military rule to a budding democracy though it is being termed as “discipline flourishing democracy”. In the last nine months, President Thein Sein had introduced some sweeping reforms in political, social and economic fronts which had made the US rethink on its policy. A string of visits from US officials to the country for assessing the ground situation and talks with officials and the opposition (particularly with Aung San Suu Kyi) prompted US President Barrack Obama to send his Secretary of State, Hillary Clinton to Myanmar (30 November to 02 December 2011) to work out the modalities for closer engagement, presumably with a view to ease the economic sanctions.

Myanmar (Burma)
Myanmar (Burma)

There have been repeated pronouncements from the US as well as Myanmar officials that the improvement of relations between Myanmar and US will not be detrimental to China-Myanmar relations. Though China has outwardly welcomed this development, there have been some mixed reactions expressed through its media and its political thinkers. Aung San Suu Kyi has also played her part by seeking to meet China’s ambassador to Myanmar and meeting him on 08 December 2011 at her residence. She also had mentioned in a different context “I am particularly pleased because we hope to maintain good friendly relations with China, our very close neighbour”.


China has maintained close relations with Myanmar for the last sixty years. Their relationship is often referred to as “Paukphaw” (fraternal). Since the crackdown on the pro-democracy protests in Myanmar in 1988 and the consequent sanctions imposed by the West, the relations between China and Myanmar have grown form strength to strength.

China had supplied arms worth about US $ 1-2 billion to Myanmar. China is Myanmar’s second largest trading partner and the top investor. China’s investment in Myanmar reached US $ 12.3 billion in 2010. Bilateral trade was over US $ 5 billion in 2010 and the balance is heavily in favour of China. Chinese companies are involved in all but one of 21 major dam projects underway in Myanmar.

For China, Myanmar is a strategic asset as it is providing access to the Indian Ocean and economically important for the development of its South Western states, particularly Yunnan. Myanmar is also crucial to China for its energy requirements and energy security. China and Myanmar have signed agreements for a dual pipeline (for crude and gas) from Kyaukphyu in Myanmar’s western coast to Kunming. This will help Chinese ships to avoid the Malacca Straits.

However there have been some hiccups in the relations. China was supporting the Communist Party of Burma from 1968 to 1985. There were anti-Chinese riots in Yangon and the Chinese Embassy was stormed in 1967. In August 2009, Myanmar military action against the Kokangs (close to the China Border) caused an influx of over 30,000 refugees into China. Recently (September 2011) China has been stunned when work on the Myitsone dam , being built by the Chinese in the Kachin state, was abruptly suspended by President Thein Sein , much to the consternation of China Power Investment Corporation—the developer of the project and the Chinese bureaucracy. Chinese media had indicated that the US has influenced the suspension of the project.

China has also been surprised by the visit of the Myanmar Defence Chief General Min Aung Hlaing to Vietnam (his first official visit). The Chiefs used to visit China first but now to an adversary of China. This has ruffled the Chinese.

President Obama’s indications of the US intentions to beef up its presence in the Asia-Pacific and the subsequent visit of the US Secretary of State, Hillary Clinton to Myanmar (30 November to 02 December 2011)has churned the thinking of the Chinese Think Tanks, media, and bureaucracy on the improving relations between US and Myanmar.

China’s State Councillor, Dai Bingguo, ranked senior even to the foreign minister, who was in Myanmar for the Greater Mekong Sub-region Summit (19-20 December 2011) said that “the two nations enjoyed model relations. Both sides can appropriately resolve through development and increased cooperation any problems which arise’—indirectly referring to the Myitsone Dam issue.

Chinese media controlled by the state and the party has expressed the view that the recent overtures by US to engage Myanmar are part of the US efforts to contain China. “Myanmar is the pivot of China’s grand strategy to achieve its economic growth goal” says Li Xiguang, Director of the International Centre for Communication at the Tsinghua University. He added that the recent overtures to Myanmar for encircling China makes it all the more important for China to improve the transport routes to Myanmar.


US interests in Myanmar declined after the collapse of the Soviet Union and the cold war. The attitude towards Myanmar worsened after the 1988 democracy uprising. Since 1990 it has followed a policy of imposing economic sanctions which has hardened over the years.

The US reviewed its policy towards Myanmar in 2009 primarily with a view to contain the Chinese influence over Myanmar and the region. The concern of the US for Myanmar’s military cooperation with North Korea for acquiring missile and nuclear technology has also been a factor for the change in the policy. The Obama administration decided to engage the military junta diplomatically, while strictly enforcing the sanctions.

The process started with the visit of the Assistant Secretary Kurt Campbell to Myanmar in November 2009. Since then there has been a series of official visits to Myanmar culminating in the visit of the Secretary of State, Hillary Clinton in end November 2011. In April 2011 the US had also appointed Derek Mitchell as Special Envoy and Policy Coordinator for Burma, who has already visited Myanmar thrice.

There was much hype on Clinton’s visit and the expectations for easing of the sanctions were high. She announced only a few modest first steps for more cooperation with the country and the IMF and support for UN health, micro finance and counter narcotics programs. She categorically said that “we are not at the point yet where we can consider lifting sanctions”.

David I Steinberg, indicating a convergence of interests of US and Myanmar, writes that “It has taken the US two decades to realize that isolation and calls for ‘regime change’ would not work. The interests of both countries have become intertwined to a degree hitherto unrecognized but had always been there”.


Since a seemingly civil government came to power in March 2011, President Thein Sein has introduced a series of reforms on political, social and economic fronts, which have been acclaimed by one and all.

The immediate aim of this transition towards democracy through these reforms was to secure the chairmanship of ASEAN in 2014, which has been achieved. However, the ultimate aim is to reduce the country’s total dependence on China, seek legitimacy beyond the neighbourhood and encourage the West (US) to ease the sanctions.

BBC’s South Asia Analyst, Marie Lall gives three phenomena for the changes introduced—“Burma wants the ASEAN chair in 2014. needs the ASEAN Free Trade Area in 2015 for its economy to thrive and the current government wants to win the 2015 elections”.

There is a growing anti-Chinese sentiment in Myanmar. The reasons appear to be:

  • Chinese domination of the country’s polity and economy. The Burmans are staunch nationalists and pragmatic. “They (Chinese) have good relations with the government but not with the people of Burma” writes Aung Kyaw Zaw, a Burma Communist Party strategist in Ruili.
  • There are quite a few in the higher echelon of the military who had fought with the PLA which was supporting the ethnic rebels till 1985. Their strong anti-Chinese sentiment has been one of the factors for the change in the policy of wooing the West at the cost of China.
  • Myanmar is worried on the increasing influx of Chinese citizens. It is estimated that more than 2 million Chinese nationals (though only about 300,000 are legally registered) are in Myanmar. The Chinese especially in the border areas are involved in illegal border trade in and around Ruili in Yunnan State. In Mandaly province alone there are over 400,000 ethnic Chinese with around 70,000 in the city, who have captured the major business and the real estate. The Chinese are far better off than the Burmans.
  • China’s state sponsored companies are extracting minerals, timber and other natural resources in total disregard of environmental concerns. Most companies bring their own labour. The numerous infrastructure projects, in which the Chinese are involved, have deprived the local population of their arable land, livelihood and in many cases have displaced them form their permanent locations.

Myanmar has perhaps realized after two decades of isolation, that in the interest of the nation, it has to open up to the other countries and thereby reduce its total reliance on China. Myanmar has by its actions signalled to China, that it will henceforth follow a more balanced and independent foreign policy, by suspending the Myitsone dam being built by the Chinese and its Defence Chief going to Vietnam on his first visit.

However, Myanmar is aware that it has to maintain good relations with China. Foreign Minister Wunna Maung Lwin was sent to Beijing within a few days of the suspension of the Myitsone project for talks with Vice President Xi Jinping and his Chinese counterpart Yang Jiechi on this issue. Myanmar Vice-President Tin Aung Myint Oo was in China to attend the 8th China-ASEAN Expo in Nanning and met Premier Wen Jiabao on the sidelines and perhaps settled the “misunderstanding” created by the media on the suspension of the dam. The Defence Chief, General Min Aung Hlaing was in Beijing (29 November 2011) on the eve of Clinton’s visit and signed a defence cooperation agreement with his Chinese counterpart, giving the indication that the improvement in US-Myanmar relations will not affect the strong bond between these two allies.

Myanmar is also aware that China can pressurize the government by providing help to the ethnic rebels on China-Myanmar border. Besides Myanmar has a still lot of distrust of US because of its penchant for human rights and obsession towards Suu Kyi. Myanmar has thus no recourse except to follow a balanced approach in its relations with US and China.

News Analysis

Myanmar has had very close relations with China till date due to necessity and not out of choice.

China has expressed through various channels that the US efforts to engage Myanmar are part of the US strategy to contain China’s influence in Myanmar and the region. China has also alleged that US has played a part in the suspension of the Myitsone dam.

China has very high stakes in Myanmar. A stable and prosperous Myanmar will be in the best interest of China even after Myanmar opening up to the Western nations except that it will face competition from other nations.

The US has finally realized that its policy of imposing sanctions and calls for regime change has failed and Myanmar has on its own taken the initiative in this transition to democracy and not because of the sanctions.

Even though the US administration has made it clear that the stepping up of its presence in Asia Pacific region is not out of fear of China or for excluding China, the increasing Chinese influence in Myanmar and the region has been a major factor for revision of its policy towards Myanmar.

US is still very guarded in its engagement with Myanmar and is rather circumspect on the possibility of the reversal of the reforms. The US insistence on human rights and democratic reforms without any time frame for relaxing the sanctions has made it difficult for Myanmar. The US must also be aware that it cannot replace Chinese influence over Myanmar because of its own domestic compulsions and credentials.

By sending Derek Mitchell, Special Envoy and Policy Coordinator for Burma, to Beijing in early December to “explain the US approach to Burma” US has made it clear that it does not intend its relations with Myanmar to have any negative impact on the Sino-Myanmar relations.

As of now, Myanmar has propped up Aung San Suu Kyi, by frequent consultations with her, allowing her party to re-register and giving her access to foreign dignitaries and the media She is also playing the game with Thein Sein in expressing full confidence on the measures taken by the government so far and in encouraging other nations to engage with Myanmar.

Myanmar is an unenviable situation to improve relations with US without detriment to its relations with China. For this purpose it has to go ahead with its reforms, improve the human rights situation and be more transparent in its military cooperation with North Korea. US has to encourage and support Myanmar in this process and China redefine its strategy to the changing geo-political situation.


SAAG is the South Asia Analysis Group, a non-profit, non-commercial think tank. The objective of SAAG is to advance strategic analysis and contribute to the expansion of knowledge of Indian and International security and promote public understanding.

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