Linn Maung
Another significant project that has been revitalized inside the CMEC is the Kyaukphyu Deep Seaport. Its location on the edge of the Bay of Bengal gives China access to the Indian Ocean, allowing it to implement its “two-ocean strategy” and lessen its reliance on the “Strait of Malacca”. Since the first Memorandum of Understanding was signed in 2009, China has had interests in Kyaukphyu. A two-year feasibility study was approved in 2011 but contract was awarded to a consortium led by the China International Trust Investment Corporation (CITIC) for the development of the seaport and industrial zone in Dec’ 2015. As per new provisions made by NLD Govt. in 2018, stake of Myanmar Govt. was increased to 30% from 15% & Chinese-led consortium has been reduced to 70% only from 85%. The first phase’s expenditures reduced to US$1.3 billion. No doubt, these changes reflected a successful illustration of Myanmar’s hedging approach but China still benefits from the pact. The overall cost of US$7.3 billion has not changed despite being divided into phases. Second, although Myanmar has managed to grow its share from 15% to 30%, the country had to pay for its additional 15% stake in order to do so.
In addition, CITIC has the sole authority to run the port for a 50-year period with a further 25-year extension option. A relevant comparison to the agreement governing the Thilawa Yangon port, a similar facility funded by Japan, in which Myanmar maintains a 51% majority share, may be made to highlight the benefits to China even under the renegotiated new arrangement.
By exercising its veto power in the UN Security Council on many occasions, China exercises its dominance over Myanmar. China, in contrast to western nations, has actively attempted to prevent more international participation in the situation and has supported the Myanmar government’s handling to the Rohingya issue.Wang Yi traveled to Myanmar in December 2019 for bilateral negotiations, just before ASSK took a flight to The Hague for the International Court of Justice genocide tribunal. Wang Yi urged the CMEC to move more quickly during the meeting and reaffirmed China’s commitment to supporting the Myanmar people in their national development.In order to avoid any international action regarding the Rohingya crisis, collaboration with China became essential for both the NLD and the Junta. Many believe that international pressure has pushed Myanmar towards China, and China indeed provided Myanmar with a diplomatic shield, emerging as a key ally in resisting pressure from and involvement by the UN.
The Junta made an effort to diversify politically and lessen its reliance on China, but as the Rohingya issue grew worse, so did the Junta’s position. Naypyidaw was unable to provide information on the peace process or the Rohingya situation as a result of hostilities between the NLD and the Junta, which made the administration more dependent on Beijing. These developments along with those involving the Kyaukphyu port showed that Myanmar needed China’s assistance to maintain domestic security and fend off outside meddling. Myanmar tried to balance its relationship with China politically and economically, but the Rohingya issue drew Myanmar closer to China and reduced its room for maneuver.
Although Kyaukphyu is a commercial port, it could also have dual-use capacity, fitting in with both China’s ‘string of pearls’ concept and the modernization programmes in the People’s Liberation. Although the Myanmar constitution does not allow a foreign military presence in the country, the question remains whether it will have the capacity to effectively contain China’s use of the port for intelligence gathering and other geopolitical purposes. This is likely to put Myanmar in the middle of geopolitical competition and further constrain its room for hedging.
