CHINA IN MYANMAR(BURMA) FOR ARMS-LOGGING-DAM-COPPER-JADE etcs-PART TWO

YUN SUN STIMSON CENTER
W H AT L I E S A H E A D?
1
Chinese Investment in
Myanmar: What Lies Ahead?
1 After a reformist government re-
placed a military junta in Myanmar in
2011, Chinese investment in the na-
tion plummeted – approximately $12
billion from 2008 to 2011 to just $407
million in the 2012/2013 fiscal year.
2 The three largest Chinese invest-
ments in Myanmar – the Myitsone
Dam, the Letpadaung Copper Mine
and the Sino-Myanmar oil and gas
pipelines – have sparked local op-
position and criticism in Myanmar
to varying degrees, creating problems
and uncertainties for Chinese inves-
tors.
3 China perceives that Myanmar
is now a more unfriendly and risky
place to invest and is displeased that
the Myanmar government is not do-
ing more to protect Chinese interest
in the country.
4 In a move to gain greater accep-
tance of its investments in Myanmar,
China is improving its profit-sharing,
environmental and corporate social
responsibility programs in the nation.
5 China has learned important les-
sons about investing in other coun-
tries from the problems it has encoun-
tered in Myanmar.
6 Reduced Chinese investment in
Myanmar could hurt Myanmar’s
economy in unexpected ways. Greater
foreign investment is needed in
Myanmar, particularly in the na-
tion’s underdeveloped and inadequate
infrastructure that is acting as an
obstacle to industrialization.
7 Chinese investors and the govern-
ment of Myanmar should work to-
gether to reduce distrust and hostility
on both sides and increase responsible
and mutually beneficial investment in
Myanmar to benefit both nations.
This issue brief examines reasons for the sharp drop in Chinese investment in Myanmar since 2011,
the impact of the reduced investment, and the prospects for future Chinese investment in the nation
formerly known as Burma.
KEY FINDINGS:
This is the first of a series of four issue briefs on the changes and challenges that Myanmar faces in its
domestic and foreign policies since the beginning of democratization in the nation in 2011. These briefs will
explore how external factors and forces influence and shape various aspects of Myanmar’s internal develop-
ment, including economic growth, ethnic conflicts and national reconciliation.
This first brief focuses on the status and future of troubled Chinese investment projects in the country and
their potential implications for Sino-Myanmar relations. Future briefs will explore the development of the
Myanmar government’s peace negotiation with border ethnic groups in northern Myanmar as well as the
external factors in the process, US-China dynamics inside the country, and the roles and policies of other
regional players.
GREAT POWERS AND THE
CHANGING MYANMAR
ISSUE BRIEF NO. 1
SEPTEMBER 2013
By Yun Sun

C H I N E S E I N V E S T M E N T I N M YA N M A R
2
The drop in Chinese
investment caused
total foreign invest-
ment in Myanmar to
fall to $1.42 billion
in the past fiscal
year – down from
$4.64 billion and
$20 billion in
the two previous
years, according
to the Myanmar
government.
Overview
Chinese investment in Myanmar has fallen dramatically since Myanmar’s current
reformist government took office in March 2011, replacing a military government. From
2008 to 2011 the total Chinese cumulative investment in Myanmar jumped from the
equivalent of $1 billion to the equivalent of nearly $13 billion (US).1 Most of these com-
mitted investments – perhaps $7.5 billion according to Chinese official Xinhua News2
-- were disbursed in 2011.3 However, political reforms since 2011 have substantially
impacted Chinese projects, causing the rapid decline in Chinese investment. Myanmar
reported that Chinese companies invested only $407 million in the country in fiscal year
2012/2013, a major decrease from the previous two years.4 Other than the continued dis-
bursement of previously committed investment, few if any new major investment proj-
ects have been announced.
Until about three years ago, China was not the largest investor in Myanmar, with smaller
investments in the nation than ASEAN partners Thailand and Singapore. The boost
came primarily in 2010, with the Myitsone Dam project, the Sino-Myanmar oil and gas
pipelines and the Letpadaung Copper Mine project, collectively valued at more than $8
billion in terms of committed investments.5 The sharp reduction of Chinese investment
in 2012 is the direct result of the perceived “China-unfriendly” moves by Myanmar, as
China has warned its companies of the “rising political risk against Chinese investment”
in the country.6 From Beijing’s vantage point, the local population turned hostile against
Chinese projects and the Myanmar government has appeared reluctant to take actions to
protect Chinese commercial interests.
Despite the earlier expectation that Western investments will pour into Myanmar after
the financial sanctions were lifted, non-Chinese investment in Myanmar in fiscal year
2012/2013 is far from being enough to make up for the steep drop in investments from
China, which remains Myanmar’s largest trading partner. The drop in Chinese invest-
ment caused total foreign investment in Myanmar to fall to $1.42 billion in the past fiscal
year – down from $4.64 billion and $20 billion in the two previous years, according to
the Myanmar government.7
Domestic politics and public sentiment in Myanmar have introduced major uncertain-
ties and problems for Chinese investors. Since the current government of President
Thein Sein took office in 2011, each of the three largest Chinese investment projects in
Myanmar – the Myitsone Dam, the Letpadaung Copper Mine and the Sino-Myanmar
oil and gas pipelines – has encountered serious difficulties. Construction of the Myitsone
Dam has been suspended since September 2011 and will remain so at least until the end
of the current term of President Thein Sein in 2015. The prospects for its resumption
after that are unclear at best. The operation of the Letpadaung Copper Mine has been
suspended since November 2012, following mass local protests and demonstrations and
is likely to resume in the near future. Meanwhile, the Sino-Myanmar pipeline project has
proceeded relatively smoothly – the gas pipeline began serving China in late July, with
the oil pipeline presumably to follow – despite vocal local criticism and opposition.
These three projects symbolize China’s most important economic interests in the newly
transformed Myanmar. What happens with the projects will have major impact on

3
Bangladesh
Bhutan
China
India
Cambodia
Laos
MYANMAR
Thailand
Vietnam
China-Burma Oil
& Gas Pipelines
Myitsone Dam
Letpadaung
Copper Mine
MYANMAR

4
Sino-Myanmar economic and political relations, the future of Myanmar’s economic
development and even regional politics. China has already adapted its investment strate-
gies in light of the perceived “deterioration” of the investment environment in Myanmar.
In particular, the settlement recently reached on the Letpadaung Copper Mine between
the Chinese investor and the Myanmar government will cast important light on the
future of the troubled Chinese projects in the country.
Behind China’s Plummeting Investment
While recognizing their cooperation with the previous military junta is a major source of
local antagonism, many Chinese are displeased with the new Myanmar government for
the difficulties they have encountered. Pointing out that a large number of current senior
Myanmar government officials held high positions in the military junta that previously
ruled the country and fully supported these projects in the past, Chinese stakeholders
argue that these officials – including President Thein Sein – have now taken the opposite
position. Thein Sein was Myanmar’s prime minister from 2007 to 2011 and endorsed all
the Chinese investments inked during this period.
Despite a lot of grumbling over the perception in China that the United States has pro-
moted democratization in Myanmar in order to undercut China’s strategic interests,
the Chinese government and involved state-owned enterprises were under no illusions
about the underlying cause of their situation. China’s current top priority in Myanmar is
to protect its existing investments from further damage caused by domestic politics and
social unrest in Myanmar.
Understanding these projects’ deficiencies in profit-sharing, environmental protection
and corporate social responsibility programs, the Chinese appear willing to make con-
cessions in these areas in exchange for consent by the local community and the govern-
ment to allow the projects to move forward. This interpretation seems to be demonstrated
by the renegotiation of the contract for the Letpadaung Copper Mine and the enhanced
environmental protection efforts and corporate social responsibility projects in connec-
tion with the pipelines and the Myitsone Dam.
For now, new large Chinese investment initiatives are generally being suspended. To
reduce the negatives associated with Chinese investment, China’s investment authority
advises Chinese businesses to seek joint ventures with other foreign companies to diver-
sify their identity and reduce risks in Myanmar. The multinational nature of the Sino-
Myanmar gas pipeline is believed to have partially shielded the project from unfavorable
pressure and government decisions. Following the example, China Mobile joined hands
with the British firm Vodafone in the bidding for telecom service license in Myanmar
early this year. (However, China Mobile subsequently withdrew, saying the project did
not “meet the internal investment criteria.”)
The new trends of China’s investment in Myanmar are having mixed effects. On the
positive side, the renegotiated terms for profit-sharing and enhanced awareness and
resources designated to environmental and social issues will create more benefits for
the Myanmar government and people. In the long run, they represent a victory for
China’s current top
priority in Myanmar is
to protect its existing
investments from
further damage
caused by domestic
politics and social
unrest in Myanmar.

5
As Myanmar
scrambles to deliver
economic benefits to
its people in order to
reinforce the viability
of its democratic
system, foreign
investments are
critical for the
process.
political liberalization in Myanmar and will strengthen the course of the country’s eco-
nomic progress. For China, the failures and losses generate important lessons regard-
ing its mercantilist overseas investment in less developed countries and its relationship
with authoritarian regimes and the local people, especially involving risk assessment and
crisis management. The setbacks in Myanmar have translated into retrospection and
policy adjustments by both the Chinese government and companies.
However, in the short-term, the direct impact of China’s reluctance to invest might lead
to unexpected negative consequences. As Myanmar scrambles to deliver economic ben-
efits to its people in order to reinforce the viability of its democratic system, foreign
investments are critical for the process. One major obstacle to the industrialization of
Myanmar has been its underdeveloped and inadequate infrastructure, such as a shortage
of electricity and an inadequate electric transmission system, along with a poor national
transportation network. These are areas where Chinese investors could make a key con-
tribution. In this sense, the decrease of Chinese investment could undercut the speed
and scope of Myanmar’s economic development if there is no timely substitution for the
withdrawn Chinese capital. Many foreign investors are currently deterred by Myanmar’s
volatile investment environment, as seen in the legislative-executive struggles, ethnic
and religious conflicts, poor infrastructure, and absence of an effective legal and regula-
tory regime – even without the negative experiences of Chinese investors.
Status of Major Chinese Investment
Projects in Myanmar
The three major Chinese investments in Myanmar we have been discussing – the
Myitsone Dam, the Letpadaung Copper Mine and the Sino-Myanmar oil and gas pipe-
lines – stand out due to their size and significance. All three projects were finalized
between December 2009 and June 2010, when China consciously pushed to ink these
deals before the 2010 elections to maximize its holding of Myanmar natural resources.
(The move was motivated by the concern about possible uncertain policy direction of
the new government and the potential influx of Western competitors.) However, the dra-
matic reform by the Thein Sein government – which went much further than almost
every foreign country, including the US, anticipated – undercut China’s original plan. As
already noted, two of the three major projects are currently suspended and the other one
is limping on, albeit with similar problems. Chinese investors have been working with
the Myanmar government and local communities to address the issues they face.
The Letpadaung Copper Mine
The Letpadaung Copper Mine project is a joint venture between Wanbao Mining, a sub-
sidiary of China’s state-owned China North Industries Corporation (NORINCO) and
Union of Myanmar Economic Holdings Ltd (UMEHL), with a total estimated invest-
ment of $1.065 billion. The agreement was finalized June 3, 2010 during then-Chinese
Premier Wen Jiabao’s visit to Myanmar. The production of the mine commenced in the
spring of 2012 but was halted in June due to local complaints and protests against land

6
Fully understand-
ing that seeking to
adhere to the original
unfair terms would
have threatened the
viability of the whole
investment, Wanbao
was willing to accom-
modate higher
standards on the
environment, social
issues and
land issues.
grabbing and environmental pollution. Operations were resumed in September but only
lasted for two months before mass protests completely derailed work in November 2012.
After the police brutally cracked down on the protests, generating fierce and widespread
domestic and international criticism, the Myanmar government set up an investigation
committee chaired by Daw Aung San Suu Kyi to scrutinize the project and its alleged
environmental and social damage. The investigation report released in March 2013 sup-
ported the continuation of the project. However, the report concluded that the compen-
sation to local farmers was “improper” and “lacked transparency” and that the mine
“lacked environmental protection measures and had been developed without an envi-
ronmental impact assessment, a social impact assessment or a heath impact assessment
or an environmental management plan.” 8 The report recommended that these require-
ments be fulfilled before the project continued.
Wanbao Mining and the Chinese government welcomed the report’s findings because
the report reached a favorable verdict about the continuation of the project. Since then
Wanbao, UMEHL and the Myanmar government have engaged in lengthy negotiations
over the revision of the contract. In mid-July 2013, a new contract was approved by the
Myanmar Investment Commission. The most striking revision has been on the profit-
sharing of the project. The new contract stipulates that Wanbao and UMEHL will give
up 21 percent and 26 percent, respectively, of their original 51percent and 45 percent
share of the profits and hand them over to the Myanmar government.9 Compared to the
old structure, where Wanbao, UMEHL and the government would receive 51 percent, 45
percent and 4 percent of the profits, respectively, the Myanmar government will receive
the largest share of profit – 51 percent, followed by Wanbao’s 30 percent and UMEHL’s
19 percent. The new contract also stipulates that the project will allocate $1 million for
corporate social responsibility and $2 million for environmental preservation annually,
in addition to increasing the amount of compensation to local farmers.10
Such a dramatic change of profit sharing unfavorable to the foreign investor is highly
unusual – especially for China – even though contract renegotiation is common in the
resource extraction industry. While one assumes Wanbao will still make money, the
project now will cost Wanbao more, while producing significantly less profits. The new
agreement reveals important facts about the Letpadaung project. Faced with the alterna-
tives of either complete shutdown or a 41 percent loss of profit, Wanbao made the ratio-
nal choice to pursue the latter. Fully understanding that seeking to adhere to the original
unfair terms would have threatened the viability of the whole investment, Wanbao was
willing to accommodate higher standards on the environment, social issues and land
issues. Interestingly, the military-controlled UMEHL accepted an even bigger loss, mean-
ing it either lacked or failed to exercise enough political sway to protect itself, much less
its partner, Wanbao. Given the widespread concern that hurting the military’s economic
interests might jeopardize and reverse the reform process, the new Letpadaung agree-
ment suggests that the military’s tolerance for reform and economic loss might be higher
than people expected. This has potentially significant implications for the future.
Provided that the local community is satisfied with the new agreement, the Letpadaung
project’s resumption is expected in the near future. The new contract sheds important
light on the future of troubled Chinese projects in Myanmar with similar problems. It
creates the legal, political and bilateral precedent for renegotiation on profit-sharing and
The production of
the mine commenced
in the spring of 2012
but was halted in
June due to local
complaints and
protests against
land grabbing and
environmental
pollution.

7
The enormous
project – with a
reservoir the size of
Singapore – would
send 90 percent of
electric power it
produced to China.
The Chinese Embassy
and the ambassador
appear pessimistic
and do not have “full
confidence” that
the project will be
resumed.
for how Chinese investors should address the inadequacies of their projects.
The Myitsone Dam
The agreement on the development of Myitsone Dam was finalized between the China
Power International (CPI) and the Ministry of Electrical Power No. 1 on Dec. 20, 2009
during then Chinese Vice President Xi Jinping’s visit to Myanmar. According to the orig-
inal plan, the Myitsone Dam was to be the largest of seven dams on the upper Irrawaddy
River, with 90 percent of its eventual power output to be sold and transmitted to China’s
Yunnan Province. With an estimated total investment cost of $3.6 billion,11 it is struc-
tured as a Build-Operate-Transfer (BOT) project: after 50 years, it will be transferred to
the Myanmar government at no cost.
The Myitsone Dam has drawn criticism since its beginnings for several reasons. First,
the dam is located in a sacred area for the local Kachin population and the Irrawaddy
is known as the “mother river” for all Burmese. Second, the enormous project – with a
reservoir the size of Singapore – would send 90 percent of electric power it produced
to China. Third, the dam would have tremendous environmental and social impact for
the region. It would require the relocation of local villages and affect fisheries, sediment
flows and the livelihoods of people hundreds of kilometers downstream.
The controversy has been exacerbated by the widespread belief that corruption was ram-
pant during the negotiation and implementation of the project between the military
government, CPI and its local partner – the Burmese Asia World Company. The proj-
ect stirred up massive anti-China, anti-Myitsone Dam sentiment in Myanmar society in
2011, leading to President Thein Sein’s Sept. 30 decision to suspend the Myitsone Dam
during his tenure. The project has been on hold since then.
President Thein Sein’s first term will last until at least 2015. However, the future of the
Myitsone Dam beyond that date is yet to be settled, although many in Myanmar see the
suspension (even cancellation) as a “done deal.” The Chinese Embassy and the ambas-
sador appear pessimistic and do not have “full confidence” that the project will be
resumed.12 However, CPI remains hopeful, continues to push for the resumption of the
project and is willing to wait until after 2015 for what it hopes will be a positive verdict.
CPI’s continuous efforts are based on several calculations. First, CPI sees a dire need for
electricity in Myanmar to promote industrial growth and foreign investment. The short-
age of electric power has become a major obstacle for industrial activities, with the gov-
ernment reportedly able to only provide only 4 to 6 hours of power daily to some factories
in Yangon. Although Myanmar enjoys rich natural gas reserves, CPI sees the abundant
hydropower resources as the most direct and economical solution to the poor nation’s
power shortage problem. As a result, CPI hopes Myanmar will eventually acknowledge
and support the economic benefits of the Myitsone Dam. Second, CPI is willing to engage
in renegotiation of almost all major aspects of the original contract, including the shar-
ing of the power output, the relocation and compensation of local villages, environmen-
tal preservation and the corporate social responsibility projects. Profitability is another
main consideration. Although the current suspension is not economical and will raise
the company’s costs and reduce its profit margin, in CPI’s calculation the project will still

8
be profitable if it is to be resumed after 2015. The original profit margin was large enough
to allow for the delay, which is not optimal but still better than halting work on the dam.
The cancellation of the project by the Myanmar government would generate major legal
battles and create financial consequences. Although the specific terms on the unilateral
breach of the agreement are not known to the public, the common expectation is that if
the Myanmar government unilaterally cancels the project, it will have to fulfill its legal
obligation and make proper compensation to CPI. This is the other source of CPI’s belief
that the losses and interest expenses incurred during the suspension will eventually be
paid by the Myanmar government, making the cancellation a less desirable option for
Myanmar.
CPI currently continues to engage in corporate social responsibility programs in the
Kachin state, lobbying both opinion leaders and the general public about the benefits of
the Myitsone Dam and pushing for a favorable judgment about its future. One initiative
that CPI is particularly interested in is an investigation commission similar to the one
formed after the Letpadaung Copper Mine protests to objectively examine the merits
and weaknesses of the dam project. CPI claims privately to be committed to full trans-
parency to such a commission regarding all documents, data and records necessary to
dispel what it calls the public’s misunderstanding and doubts.
The Sino-Myanmar Oil and Gas Pipelines
The Sino-Myanmar oil and gas pipeline project was finalized between China National
Petroleum Company (CNPC) and Myanmar’s Ministry of Energy in December 2009
duringXiJinping’svisittoMyanmar,withatotalinvestmentof$2.54billion.Construction
commenced in summer 2010 and the gas pipeline was completed in May 2013 and is
now operational. The oil pipeline is expected to be completed in late 2013. Labeled as
China’s “fourth largest energy transportation route” after the Central Asia pipelines, sea
transportation and the Sino-Russia pipelines, the project is seen to be of national strate-
gic importance by diversifying China’s energy transportation system.
The problems faced by the pipeline projects are less severe than those related to the
Myitsone Dam and the Letpadaung Copper Mine. This is fortunate for China, because
the pipelines are perceived to be a national strategic project with significant implications
for the nation’s energy security. Therefore, Beijing’s tolerance for any problems is much
lower – a point that Chinese officials and analysts have made abundantly clear since the
suspension of the Myitsone Dam in both official and private discussions with Myanmar.
In addition, although the pipelines have a Chinese identity, the project is a multina-
tional endeavor. The gas pipeline involves six stakeholders from four countries (China,
Myanmar, India and South Korea) and is aimed at delivering gas from a Daewoo-led
consortium operating in the Shwe field to China. The participation of other countries
effectively helps to mitigate the risks for China alone.
Controversy over the pipeline project is focused on its social and environmental impact.
Shwe Gas Movement, a Thailand-based nongovernmental organization, has been vocal
about the “human rights abuses, environmental damage and poor revenue distribution”
The cancellation of
the project by the
Myanmar govern-
ment would generate
major legal battles
and create financial
consequences.

9
The economic
success of the new
democratic system in
Myanmar is critical to
the sustainability of
the nation’s political
transition.
associated with the pipeline project. These accusations were echoed by local Rhakhine
residents, who have staged multiple protests and demonstrations. However, compared
to the scale and depth of the criticisms and opposition against the Myitsone Dam and
Letpadaung Copper Mine, the pressure on the pipeline project is significantly less. Since
the suspension of the Myitsone Dam, CNPC and the Chinese government have made
considerable efforts to address the criticisms of the pipelines and to meet local demands.
For instance, on profit-sharing, the project agreement allows for allocating a maximum
of 2 million tons of crude oil and 20 percent of the natural gas annually to Myanmar for
local consumption.13 CNPC has also enhanced its spending on local communities, com-
mitting $2 million per year for the local corporate social responsibility programs.
Interestingly, the controversy over the pipelines’ environmental and social impact does
not only apply in Myanmar, but also in China itself. As a part of the pipeline project,
CNPC has been building a refinery near Kunming, the capital city of Yunnan, as the first
such facility in the province. Since the beginning of this year, the province has planned to
build a paraxylene (PX) project related to the refinery.14 But the PX project raised major
concern about pollution among local population. In May, thousands of local residents
staged protests in Kunming that so far reportedly have delayed the approval of the proj-
ect. The explosion of a PX plant in Fujian in late July will likely reinforce the opposition.15
Look Ahead
Not all Chinese investment projects have had difficulties in Myanmar. The Tagaung Taung
Nickel Mine that drew investment from the China Nonferrous Metal Mining Group, the
Shweli River Hydropower Project I that drew investment from China’s Huaneng Group,
and many other smaller projects have encountered no major problems in their construc-
tion and operation. Including the three major projects discussed here that have sparked
widespread opposition, Chinese investors are navigating their course by making conces-
sions, correcting their mistakes and working with the Myanmar government and people.
Although they are paying the price for their past behavior, the Chinese are not with-
out grievances of their own. Chinese officials and companies have privately complained
about the Myanmar government’s dramatic change of position. The lack of consistency
and credibility of the Myanmar side, in their view, will further damage foreign investors’
confidence and hurt Myanmar’s effort to develop its economy.
The economic success of the new democratic system in Myanmar is critical to the sus-
tainability of the nation’s political transition. Therefore, looking ahead, there is a need
for both Chinese investors and Myanmar to recalibrate their positions to reduce distrust
and hostility, and assume mutually beneficial cooperation that is not perceived to be a
one-sided “exploitation” of the other side. As the Myanmar politicians and government
prepare for the 2015 elections, their economic policies may well experience further con-
flicts between near-term political needs and long-term economic gains. It will be a true
test for both Chinese investors and the Myanmar government to amend their terms and
navigate through the inevitable turbulence.
The future of Chinese investments in Myanmar has a critical impact on their bilateral

10
relations. China’s state-run newspaper Global Times has warned: “The implementation
of agreed projects is the important foundation of the normal Sino-Myanmar relations.
Myanmar must be serious about its relationship with China.”16 China essentially holds
a zero-sum perception about its national interests in Myanmar and sees the warming
ties between Myanmar and the West (especially the US) as undercutting its positions.
The view is problematic and needs to adapt to the new realities of the country. Strategic
thinkers in Myanmar and in US should also contemplate how potential pushbacks by
Beijing, such as falling investment, will impact the future of Myanmar and its reforms.

12
ENDNOTES
1. “China Now No.1 Investor in Burma,” Mizzima News, Jan 18, 2012.
http://www.mizzima.com/business/6436-china-now-no-1-investor-in-burma.html
2. “Myanmar Attracts More than 8bl USD Foreign Investment in 2011,” Xinhua News Agency, Mar 13, 2012.
http://news.xinhuanet.com/english/business/2012-03/16/c_131472176.htm
3. The data from the Myanmar government are slightly different due to its fiscal year system (from April 1 to March 31), but
Chinese investment still added up to $4.35 billion and $8.27 billion in Myanmar fiscal years 2009/2010 and 2010/2011.
4. “Myanmar Attracts More than 8bl USD Foreign Investment in 2011,” Xinhua News Agency, Mar 13, 2012.
http://news.xinhuanet.com/english/business/2012-03/16/c_131472176.htm
5. “New Chinese Foreign Investment Commitment Exceed $8 billion,” The Myanmar Times, August 16-20, 2010,
http://www.mmtimes.com/2010/business/536/biz001.html.
6. Interview with Chinese analysts, Yangon, August, 2012.
7. “Chinese Investment in Myanmar Falls Sharply,” Wall Street Journal, June 3, 2013,
http://online.wsj.com/article/SB10001424127887324063304578525021254736996.html
8. Complete Final Report of Investigation Commission into Letpadaung Taung Copper Mining Project, SarlingyI Township,
Monywa District, Sagaing Region;
9. “Commission Approves Contract Giving Government Larger Share of Letpadaung profits,”
Democratic Voice of Burma, July 16, 2013.
10. Win Ko Ko Latt and Soe Than Lynn, “Copper Project to Resume in September after New Contract Signed,”
The Myanmar Times, July 29, 2013.
http://www.mmtimes.com/index.php/national-news/7644-copper-project-to-resume-in-september-after-new-contract-signed.html
11. This number is now strongly disputed by CPI, which argues that the full investment significantly exceeds $3.6 billion.
Conversation with CPI senior management, Kunming, June 2013.
12. “Future for Myitsone dam resumption remains unclear, Chinese companies are treated unfairly in Myanmar,”
[中缅密松电站重启前景不明中企在缅甸遭遇不公], Dongfang Daily, July 23, 2013
13. “China Myanmar Starts Delivering Gas,” China News Agency, July 29, 2013,
http://www.china.org.cn/world/2013-07/29/content_29555333.htm
14. Paraxylene (PX) is used primarily as a feedstock for the manufacture of purified terephthalic acid (PTA),
which is an important chemical in the production of fiber and plastic bottles, as well as polyester. In recent years, similar PX projects
have met with fierce local oppositions in China due to its environmental impact, including demonstrations in Dalian, Ningbo,
Chengdu and Fujian.
15. “Public Objection of Paraxylene Project Should Be a Warning to the Government,” China Daily, August 1, 2013,
http://www.chinadaily.com.cn/opinion/2013-08/01/content_16863653.htm
16. “Oil and Gas Pipelines Are the Test Stone of Myanmar’s Attitude toward China,” [油气管道缅甸对华态度的试金石],
Global Times, July 29, 2013.

ABOUT THE AUTHOR
Yun Sun is a fellow with the East Asia program at Stimson. She was previously a visiting fellow at the Brookings Institution,
a China analyst for International Crisis Group based in Beijing from 2008 to 2011, and earlier worked on US-Asia relations
at the Maureen and Mike Mansfield Foundation and the Asia Society in Washington. Her expertise is in Chinese foreign
policy, US-China relations, and China’s relations with neighboring countries and authoritarian regimes. She earned her mas-
ter’s degree in international policy and practice from George Washington University, an MA in Asia Pacific studies, and a BA
in international relations from the Foreign Affairs College in Beijing.
The Stimson Center
Founded in 1989, the Stimson Center is a nonproﬁt and nonpartisan think tank that seeks pragmatic solutions for some
of the most important peace and security challenges around the world. Stimson’s analysts, who travel the globe for their
research, make the Center a trusted source of expert knowledge, fresh perspectives, policy prescriptions and creative ideas.
By engaging policymakers, policy implementers, nongovernmental institutions as well as other experts, Stimson is able to
craft recommendations that cut across political party lines and are actionable and effective. The Center has been honored as
one of the top think tanks in the world and received the prestigious MacArthur Award for Creative and Effective Institutions
in 2013.
For more information on Stimson, please visit www.stimson.org.
STIMSON’S EAST ASIA AND SOUTHEAST ASIA PROGRAMS
This issue brief on China and Myanmar covers topics studied by Stimson’s East Asia and Southeast Asia programs. The pro-
grams seek to illuminate and fashion pragmatic solutions to many of the complex security challenges confronting both
regions.
Stimson’s East Asia program, led by Alan Romberg, focuses on security in the region. It works on China and US-China rela-
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„„„ Journal of Current Southeast Asian Affairs 1/2012: 73-96 „„„
China’s Strategic Misjudgement on
Myanmar
Yun SUN
Abstract: Yun Sun argues that China’s policy failures on Myanmar in 2011
are rooted in several strategic post-election misjudgements. Following Presi-
dent Thein Sein’s inauguration in March 2011, the Sino–Myanmar relation-
ship was initially boosted by the establishment of a “comprehensive strategic
cooperative partnership,” and China sought reciprocation for its long-time
diplomatic support in the form of Myanmar’s endorsement of China’s posi-
tions on regional multilateral forums. A series of events since August have
frustrated China’s aspirations, however, including Myanmar’s suspension of
the Myitsone dam and the rapid improvement of its relationship with the
West. Several strategic misjudgements contributed to China’s miscalcula-
tions, including on the democratic momentum of the Myanmar government,
on the U.S. –Myanmar engagement and on China’s political and economic
influence in the country. China’s previous definition of Myanmar as one of
China’s “few loyal friends” and the foundation of its strategic blueprint has
been fundamentally shaken, and China is recalibrating its expectations re-
garding future policies.
„ Manuscript received 18 February 2012; accepted 23 April 2012
Keywords: PR China, Myanmar, Myitsone dam
SUN Yun was the China Analyst of International Crisis Group based in
Beijing from 2008 to 2011. This paper was finished during her tenure as a
visiting fellow at the Center for Northeast Asia Policy Studies at Brookings
Institution, USA. Her research mainly focuses on China’s foreign policy,
especially China’s relations with developing countries and authoritarian re-
gimes.
E-mail: <eve_sun79@hotmail.com>

„„„ 74 Yun SUN „„„
1 Overview
2011 marked a year of significant setbacks for China’s relationship with
Myanmar. The rapid changes in Myanmar’s domestic politics brought seri-
ous challenges to both China’s existing interests in the country and its stra-
tegic planning for the future. Early in the year, after the March inauguration
of the new Myanmar government, China possessed a well-developed strate-
gic blueprint for its relations with its south western neighbour. Key elements
of this blueprint – border stability, energy transportation, and economic
cooperation – remained China’s basic considerations in Myanmar. Beijing,
however, began to envision and foster an additional layer of strategic coop-
eration based on the traditional fraternal friendship and economic ties be-
tween the two nations. This additional diplomatic aspiration was manifested
during the visit by the No. 4 military leader of China’s Central Military
Commission six weeks after the inauguration of Thein Sein’s government, as
well as through the establishment of a “comprehensive strategic cooperative
partnership” two weeks later. “Coincidentally,” during the same time period,
Yunnan province launched the “bridgehead campaign” aimed at turning
Yunnan and Myanmar into China’s bridgehead into the Indian Ocean.
Meanwhile, as reciprocation for China’s long-term diplomatic support, Chi-
na solicited Myanmar’s endorsement of its positions on regional multilateral
forums (especially the ASEAN), most notably on the issue of the South
China Sea.
Since August, however, a series of events has frustrated China’s Myan-
mar aspirations. The suspension of the controversial Myitsone Dam project
and the rapid improvement of Myanmar’s relationship with the West, espe-
cially with the United States, fundamentally shook Beijing’s previous under-
standing of Myanmar as one of China’s “few loyal friends” and rocked the
foundation of its strategic blueprint. As a result, China is carefully recalibrat-
ing its expectations about Myanmar and, subsequently, adjusting its policies
and commitments.
The setbacks China has encountered are deeply rooted in several strate-
gic misjudgements about post-election Myanmar. From prior to the No-
vember 2010 elections until the announcement of the Myitsone Dam sus-
pension, the Myanmar policy circle in China believed the elections would
prompt no fundamental change in Myanmar’s domestic politics. China un-
derestimated the democratic momentum encouraged then tolerated by the
former military officials, along with their willingness to adapt and change. In
China’s perspective, privileged military rulers would never give up their
power willingly, and the new civilian government would be only marginally
and negligibly different from the old junta. Secondly, China mistakenly re-
garded the U.S. engagement as failed and thought that it had ended after the

„„„ China’s Strategic Misjudgement on Myanmar 75 „„„
2010 elections, when Washington pronounced those elections as “neither
free nor fair.” Most Chinese policy analysts believed that Myanmar had
embarked on a long path of slow political changes and economic reforms
conducive to China’s economic and strategic endeavours in the country.
Last, but not least, China overestimated its political and economic influence
in Myanmar and underestimated the anti-China sentiment of the local peo-
ple, which led to a rather blind confidence in China’s policy towards Myan-
mar and the concomitant failures of 2011.
2 China’s Basic Interests in Myanmar
2.1 Border Stability
Beijing’s fundamental interests in Myanmar include three basic factors: bor-
der stability, economic cooperation, and an energy transportation route.
Among these, border stability remains the top priority (Interviews with Chi-
nese officials, Beijing, Kunming, July 2011). During 2009’s Kokang conflict,
China learned the danger of a premature military resolution to hostilities
among border ethnic groups. The conflict sent more than 37,000 refugees
into China’s southwest Yunnan province and generated tremendous pres-
sure for the Chinese authorities to maintain stability along the border (Inter-
national Crisis Group 2010: 4).
Prior to the 2010 elections, the Kokang conflict led China to prioritize
“peaceful negotiation” as a solution to the ethnic group issues. During this
period, there was a genuine fear in China that Naypyidaw’s repeated ultima-
tums for ethnic groups to disarm and transfer into Border Guard Forces
would escalate tensions and result in a full military confrontation (Interna-
tional Crisis Group 2010: 4). To prevent such a disastrous scenario, China
mobilized its diplomatic influence and quietly intervened between Naypyi-
daw and the two main ethnic armed forces along the Sino–Burmese border:
the Kachin Independence Army (KIA) and the United Wa State Army
(UWSA).1 A strategy of “persuading for peace and promoting talks” (
) was pursued at both central and local levels. Senior Chinese leaders
openly lectured Myanmar leaders on maintaining “peace and stability” at the
border (Ministry of Foreign Affairs 2009; BBC 2010; China News Agency
2010). Local Yunnan officials also made “restraints” and “no war” their
1 For example, senior Chinese leaders made border stability a top priority during
their visits of Myanmar, including the December 2009 visit by Vice-President Xi
Jinping and the May 2010 visit by Premier Wen Jiabao.

„„„ 76 Yun SUN „„„
lobbying key words whenever they met with leaders from KIA and UWSA
(Interviews with local officials, Kunming, July 2011).
China was pleased to see the relatively peaceful and smooth power
transition in Myanmar during 2011. This had a determining impact on Chi-
na’s attitude toward the ethnic groups. Under the assumption that Myanmar
would remain China’s loyal friend and warrant China’s help in resolving its
ethnic group issue, China’s position on the ethnic groups gradually shifted
from maintaining the status quo towards promoting reconciliation. This new
point was made repeatedly by top Myanmar specialists in Beijing and Yun-
nan: “[t]he national unity of Myanmar is Naypyidaw’s natural right. The
ethnic groups cannot hope to maintain their semi-independent and armed
status forever” (Interviews with government analysts, Beijing and Kunming,
July 2011).
This thinking has dominated China’s policy towards the armed conflicts
between KIA and Tatmadaw since early June 2011. Unlike the Kokang
conflict, during which China expressed great displeasure and demanded that
Naypyidaw respect the border stability, the Kachin conflict resulted in little
reaction from Beijing. China strengthened its border patrols against potential
refugee flows2 and called for restraints and negotiations (Press Conference,
Ministry of Foreign Affairs, June 16, 2011). However, it declined the KIA’s
public appeal for China to be the referee during its negotiations with
Naypyidaw (Dongfangwang 2011).
Besides genuine interest in resolving the ethnic group issue, several ad-
ditional factors contributed to China’s indifference toward the KIA. Firstly,
the conflict did not result in a large flow of refugees over the Chinese bor-
der, as most of the refugees gathered at KIA headquarters in Laiza, alleviat-
ing China’s deepest concerns over border security (Interview with KIA
officers, Ruili, July 2011). Secondly, from China’s perspective, it was the
KIA that attacked the Tatmadaw over the control of the Chinese Dapein
Dam in Shan State, using the project as leverage in an attempt to force Chi-
na to intervene (Dong Fang Zao Bao 2011a). The KIA’s lack of respect for
Chinese commercial interests is also perceived through its strong opposition
to the Chinese Myitsone Dam project in Kachin State (Interviews, Beijing
and Kunming, July 2011). Thirdly, China sees the KIA’s political aspirations
as “unrealistic.” It believes that the KIA is ultimately seeking independence
and the conflict is merely a way to strengthen its negotiating position against
Naypyidaw. According to a local Chinese official, “KIA’s stubborn adher-
ence to the 1947 Panglong Agreement was completely out of touch with
2 However, the Kachin conflict did not result in major refugee flows into China.
Interviews, Kunming and Ruili, July 2011.

reality” (Interview, Kunming, August 2011). Finally, China’s historical suspi-
cion of the pro-West, Christian, Kachin population deepened during the
past twelve months when Kachin organizations sent several delegations to
Washington seeking help, thus triggering China’s deepest fear of “Americans
being invited in to meddle with affairs on the Chinese border” (Conversa-
tion with Chinese analysts, Spring 2011).
While the Kachin conflict continues with no speedy resolution in sight,
the negotiations between Naypyidaw and the UWSA yielded promising
results. In September, it was reported that the two sides reached a prelimi-
nary agreement over a ceasefire and the reopening of peace talks (McCartan
2011). Although the agreement does not resolve fundamental issues, such as
the armed status of the UWSA and the scope of its autonomy, China finds
such an agreement highly desirable as it includes peace and stability in the
mutually accepted agreement.
2.2 Economic Cooperation
China identified the new civilian government in Myanmar as opening up
tremendous business opportunities for Chinese commercial endeavours
within the country (China News Agency 2011). A relatively smooth power
transition consolidated the legitimacy of the new government. With Naypyi-
daw’s top security concern resolved, Beijing believed the Myanmar govern-
ment would next focus on domestic economic development in an effort to
boost its legitimacy (Interviews, Beijing and Kunming, August 2011). This is
where China wished to step in, continuing to fill the void created by West-
ern sanctions in the country.
Both bilateral trade and Chinese investment in Myanmar had grown
substantially before the inauguration of the Thein Sein government. Accord-
ing to the Chinese Ambassador in Myanmar, bilateral trade grew by 52.3 per
cent to 4.4 billion USD in 2010 (Chinese Embassy in Myanmar 2011). Ac-
cording to Myanmar official statistics, between April 2010 and March 2011,
China invested 7.75 billion USD in Myanmar, focused mostly in the natural
resources and energy sectors.3 (The Chinese statistics showed a total invest-
3 “By the end of fiscal year 2010/2011, total foreign investment in Myanmar reaches
36 billion USD”, [ 2010/2011 360 ],
Economic and Commercial Counselor’s Office of Chinese Embassy in Myanmar,
May 4, 2011. <http://mm.mofcom.gov.cn/aarticle/jmxw/201105/20110507531
906.html> (12 March 2012).

„„„ 78 Yun SUN „„„
ment of 12.32 billion USD in 2010; Xinhua News 2011a).4 China continues to
emphasize Myanmar as an important hydropower supplier to energy-thirsty
south western China. Approximately 54 per cent of China’s total investment
in the country has been focused on hydropower dam projects (Li 2011). In
May 2010, during Thein Sein’s visit to Beijing, the two countries signed nine
economic agreements, including one hydropower project and a 745 million
USD credit provided to the Myanmar Ministry of Finance by China Devel-
opment Bank (BBC 2011).
2.3 Energy Transportation Route
Currently, the oil and gas pipeline project from Myanmar to Yunnan prov-
ince is seen by China as the most important project in Myanmar (Interview
with Chinese analyst, Beijing, January 2012). China hopes the project will
mitigate its dependence on the Malacca Strait for most of its oil imports
from North Africa and the Middle East (IHN 2010). Since the beginning of
its construction in June 2010, the pipeline project has enjoyed smooth pro-
gress. Some key components, such as the bridges over the Myitnge River
and the Maday Island reservoir, were completed in the fall of 2011 (CNPC
News 2011). China is optimistic that, by 2013, the pipelines will be able to
transfer 22 million tons of crude oil from North Africa and the Middle East,
as well as 12 billion cubic meters of natural gas from Myanmar’s offshore
gas fields into China (Xinhua Net 2010).
Although Chinese analysts acknowledge that such pipelines will not
free China from its strategic vulnerability in the event of a military blockade
of the Malacca Strait (International Crisis Group 2010: 9), expectations re-
mains high that, once completed in 2013, the pipeline project will serve as a
prequel to China’s expansion of trade relations with, not only, Myanmar but,
also, Southeast Asia and South Asia (Xinhua News 2011b). Meanwhile, local
authorities aspire for the pipelines to bring refineries to Yunnan and turn the
province into the new energy and trade hub of south western China (People’s
Daily website 2010).
4 The difference between the Myanmar and Chinese statistics is due to the different
definition of fiscal year, which in Myanmar starts by April 1 each year and ends on
the end of March the following year.

3 China’s Strategic Blueprint for Myanmar
3.1 Evolution of China’s Strategic Perception of
Myanmar
China’s strategic perception of Myanmar has undergone different stages
since the establishment of diplomatic relations between the two countries.
At various times, Myanmar’s importance to China has fluctuated. In 1949,
just after the founding of the People’s Republic of China, Burma, as the first
non-socialist country to establish diplomatic relationship with Beijing, was a
third-world friend that helped China to break its international isolation (Zhu
2009). Before 2000, political friendship (or paukphaw friendship) was the one
– and almost only – highlight of bilateral relations (Interview with former
Chinese Ambassador to Myanmar, November, 2009). Political ties were
strong, but other factors, such as economic cooperation, lagged behind.
During this period, Burma was seen as China’s political friend.
Around 2000, as China began to seek new resources and markets, the
economic cooperation between the two countries picked up speed. Myan-
mar, conveniently located along the Chinese border and rich in natural re-
sources (such as hydropower, minerals, timber, and jade), turned out to be a
natural destination for Chinese investment and business (Guo Ji Shang Bao
2006). First led by border trade, the economic campaign soon became dom-
inated by large Chinese state-owned enterprises seeking energy and mineral
supplies from Myanmar (Interview with Chinese analysts, Kunming, August
2011). By 2010, China became Myanmar’s biggest investor and second-
largest trading partner (People’s Daily 2011b; Xinhua News 2011a). During this
period, Myanmar, as a supplier of natural resources and raw materials,
achieved a highly important status as an economic partner to China (Inter-
view with former Chinese Ambassador to Myanmar, August 2011).
Thus, political friendship and economic cooperation were the two cor-
nerstones of China’s relationship with Myanmar, with little or no specific
mentioning of the country’s strategic importance. Analysts and officials
talked about Myanmar as a corridor into the Indian Ocean, but the purpose
was mostly for trade and transportation routes. The U.S. attempt to alienate
the Myanmar–China friendship was also discussed, but the focus was Wash-
ington’s strategic intention, rather than Myanmar’s own strategic utility.
China, in general, did not actively seek to build a formal or strong strategic
relationship with Myanmar.
Some Chinese analysts explained China’s reluctance as a careful calcula-
tion not to antagonize other regional players, such as India (Interview with
Chinese analysts, Kunming, August 20). Others emphasized the xenophobic
nature of the military government and its deep suspicion of and unwilling-

„„„ 80 Yun SUN „„„
ness to form too close a strategic tie with its northern neighbour (Interview
with Chinese analysts, Beijing, July 2011). More importantly, China, in the
past, could afford not to look at Myanmar through a strategic and regional
lens because its strategic priority had remained primarily domestic and along
the border. However, as China’s national interests and influence expand in
the region, Myanmar’s strategic importance has increased substantially. This
importance is manifested through four initiatives China has taken since the
inauguration of the Thein Sein government: the establishment of a compre-
hensive strategic cooperative partnership; China’s seeking of Myanmar’s
support in regional diplomacy; the potential enhancement of military coop-
eration; and Yunnan’s bridgehead strategy.
3.2 A Comprehensive Strategic Cooperative Partnership
During Thein Sein’s visit to Beijing in May 2011, China and Myanmar an-
nounced the elevation of their bilateral relations to a “comprehensive strate-
gic cooperative partnership” (Xinhua News 2011d). This is the first time that
the Chinese government defined the bilateral relationship as a strategic one,
clearly signalling a new definition of the affiliation. Indeed, Song Qingrun,
the Myanmar specialist at one of China’s top think tanks, the China Institute
for Contemporary International Relations, publicly commented that such an
elevation was a natural next step following decades of cordial political
friendship and economic cooperation (Guo Ji Zai Xian 2011). The expecta-
tion was extremely high for the Sino–Myanmar “kinship” to get closer and
closer (Guo Ji Zai Xian 2011).
In outlining the specifics of what the comprehensive strategic coopera-
tive partnership constitutes, Chinese President Hu Jintao emphasized four
basic components: elevating bilateral relations and expanding exchanges and
cooperation at all levels, strengthening mutual strategic support, deepening
pragmatic cooperation, and maintaining border stability (Xinhua News 2011e).
The first and the last components revisit old territory, as China has always
aspired to improve relations and maintain border stability. The other two,
however, indicated certain new elements in China’s aspirations in Myanmar.
Firstly, “mutual strategic support” signals China’s expectation for reci-
procity between China and Myanmar on strategic issues. Domestically,
China respects the development path and political system chosen by
the Myanmar people and supports the efforts of the new government
to maintain stability, develop economy, and improve the livelihood of
Myanmar people. And China highly compliments the Myanmar gov-
ernment’s unswerving support of the One China policy.

In essence, China’s support of the new government in Myanmar has been
and will continue to be met and matched by Naypyidaw’s support of the
“One China–policy” (Xinhua News 2011e). In terms of foreign policy, China
wishes to “strengthen the cooperation with Myanmar on regional frame-
works, including ASEAN+3, ASEAN+1, and Greater Mekong Sub-
Regional Economic Cooperation.” In other words, Beijing hopes for more
coordination with Myanmar to support each other’s positions on the region-
al multilateral platforms, turning Myanmar into a useful ally to support the
Chinese regional foreign policy agenda (Interview with Chinese analysts,
Beijing, July 2011). (Further discussed below).
Secondly, “mutually beneficial and pragmatic cooperation” clarifies that
China’s economic relationship with Myanmar has to benefit not only My-
anmar, but also China (Interview with Chinese analysts, Kunming, August
2011). Hu detailed several areas for expanded cooperation in which China is
interested, including energy, power, transportation and agriculture. He also
specifically emphasized the importance of the on-schedule completion of
large cooperation projects currently under construction (Xinhua News 2011e).
Some analysts argue that China’s “partnership” diplomacy is nothing
new. China established strategic partnerships with Russia and the U.S. in the
1990’s, and gradually expanded the scope of “strategic partners” to other
powers (UK, French, Germany, India) and neighbouring countries (Pakistan,
Indonesia, South Korea, Laos, Cambodia, Vietnam) over the past ten years.5
However, given the importance of Myanmar to China and the close ties
between the two countries, the fact that a “strategic partnership” with My-
anmar was not established until 2011, by itself, is intriguing. The coincidence
of the timing (the partnership was established immediately after the inaugu-
ration of the new civilian government) is a clear indicator of China’s chang-
ing perception of Myanmar from a political and economic friend (under the
junta) to a strategic partner (under a legitimate civilian government). Alt-
hough Chinese analysts maintain that this partnership does not have a mili-
tary component nor is it targeted at other regional countries (Interviews with
Chinese analysts, Beijing and Kunming, July 2011), some developments in
bilateral relations might prove otherwise.
5 Li Chenyang, presentation at the conference “China and Myanmar: the Dilemmas
of Mutual Dependence”, Georgetown University, November 4, 2011.

„„„ 82 Yun SUN „„„
3.3 China Seeking Myanmar’s Support on Multilateral
Platforms
According to the statement made by Chinese President Hu Jintao on the
establishment of the comprehensive strategic cooperative partnership, a key
component of the partnership concerns Myanmar’s role in the regional
multilateral platforms. China wishes to “coordinate with Myanmar on
ASEAN+3, ASEAN+1, and the Greater Mekong Sub-Regional Economic
Cooperation to protect the interests of Myanmar and China” (Xinhua News
2011e). The underlying logic here is: now that Myanmar has finally achieved
some legitimacy at home and abroad, its international status and reputation
have improved. (Myanmar will become the chair of ASEAN in 2014, a sce-
nario unthinkable during the military government.) As Myanmar gradually
re-integrates into the international community, it has the potential to be-
come a solid, powerful diplomatic supporter of China’s national interests
and policy preferences in the region (Interviews with Chinese analysts, Bei-
jing and Kunming, July 2011). After years of shielding Myanmar internation-
ally, the time has come for Myanmar to “reciprocate” (Interviews with Chi-
nese analysts, Beijing and Kunming, July 2011).
China’s most immediate expectation of Myanmar is support for China’s
position on South China Sea issues at ASEAN. Three key ASEAN members
– Vietnam, the Philippines and Malaysia – have major territorial disputes
with China in the South China Sea, with the tension’s reaching an historic
high during the first half of 2011 (Thayer 2011: 5). ASEAN claimants have
been seeking to engage in multilateral negotiations with China, through
ASEAN as a group, to mitigate the overwhelming leverage of a powerful
China during bilateral negotiations with individual countries (Interviews with
Vietnamese, Philippine and Malaysian diplomats, Ho Chi Min City, Decem-
ber 2010). China, however, has consistently pursued a bilateral negotiation
formula to settle the disputes. China has insisted that Myanmar support its
positions, especially the “bilateral negotiations” formula at ASEAN. This
expectation was directly conveyed to Myanmar officials before the 2011 July
ASEAN Regional Forum in Bali (Interview, Rangoon, August, 2011).
Another instance of China’s seeking Myanmar’s support on Chinese
policy is the establishment of the joint patrol of Mekong River by China,
Myanmar, Thailand, and Laos after the October killing of 13 Chinese ship-
men. Allegedly, the original proposal by China met strong opposition from
Thailand (Interview, Beijing, October, 2011). Myanmar’s support of the
joint patrol scheme helped China reach a speedy resolution of the differ-
ences (Interview, Beijing, October, 2011).

3.4 Potential Military Cooperation
Preceding the establishment of the comprehensive strategic cooperative
partnership, China dispatched to Myanmar the most senior military delega-
tion in recent years,6 headed by the No. 4 leader of China’s supreme military
command, Central Military Commission (CMC) Vice Chairman Xu Caihou
(Xinhua News 2011c). Prior to this, the most recent visit by a senior Chinese
military leader to Myanmar was more than two years ago by the PLA Chief
of Staff, Chen Bingde, in March of 2009 (Chinese Embassy in Myanmar
2009).
There has been no public disclosure of the results of Xu’s visit regard-
ing any details of military cooperation between China and Myanmar, dis-
cussed by the two sides “enthusiastically and at length” (Xinhua News 2011c).
Many different interpretations of the trip have emerged from within China.
Various Chinese analysts have downplayed the significance of the visit, call-
ing the head of the delegation, Xu Caihou, a “random choice among senior
Chinese leaders” and his presence there a “regular visit by PLA to Myanmar”
(Interview with Chinese analysts, Beijing, July 2011).
A close look at the composition of Xu’s delegation reveals a rather dif-
ferent story. Along with the regular senior leaders of the Chengdu Military
Region (under which the Sino–Myanmar border falls),7 Xu was accompanied
by the Deputy Chief of the General Armament Department and the Political
Chief of the South Sea Fleet (PLA Daily 2011). The General Armament
Department is in charge of arms sales, and the South Sea Fleet recently had
two vessels visit Myanmar during their return trip from the Gulf of Arden in
2010 (Xinhua News 2011f). Given that each member of Chinese delegations
is always carefully selected to fulfil a certain mission, the inclusion of these
two officials serves, at least, as an indication of China’s emphases on its
military relations with Myanmar: arms sales and naval cooperation.8
3.5 Yunnan’s Bridgehead Strategy
As part of the “Twelfth Five Year Plan” launched in 2011, China formally
introduced the national “bridgehead strategy,” which proposes to turn Yun-
6 Although the Vice President Xi Jinping, also a Central Military Commission (CMC)
Vice Chair visited Myanmar in the December of 2009, he was visiting under his ci-
vilian capacity as the Vice President of China.
7 Chengdu military region is in charge of the security of southwest China, including
Yunnan province and China’s border with Myanmar.
8 South Sea Fleet has carried most of the escort missions in the Gulf of Arden,
sending naval vessels such as “GuangZhou” and “ChaoHu” through the Indian
Ocean.

„„„ 84 Yun SUN „„„
nan into a strategic corridor and a bridgehead for China’s strategic engage-
ment in the Indian Ocean (Yunnan Wang 2011). As the Vice Governor of
Yunnan explained, China’s main theater of international relations is the
oceans. China’s coastal line is on the east side, leading naturally to the strate-
gic prioritization of the Pacific. For inland China, however, it is more con-
venient and active to use the Indian Ocean as the outlet. The bridgehead
strategy will free China from the “strategic passiveness” of the “One Ocean
Strategy” (China News 2011). the bridgehead strategy itself is a manifestation
of China’s pursuit of the “Two Ocean Strategy” and represents China’s
strategic aspirations in the Indian Ocean. Although most of the reports, by
far, have focused on the economic, trade, and transportation aspects of the
bridgehead strategy, government analysts from both Beijing and Yunnan
privately acknowledged that the orientation of such a strategy has an eventu-
al political and security component and that “the bridgehead strategy itself is
China’s strategic offensive into the Indian Ocean” (Interviews, Beijing and
Kunming, November 2011).
There are ample analyses in China calling for a more active Indian
Ocean strategy and for turning Pakistan and Myanmar (two of China’s most
loyal friends) into outposts of China’s strategic outreach into the Indian
Ocean (Interviews, Beijing, May 2011). To facilitate this goal, many assert
that China must go beyond the existing political and economic ties with
Myanmar and pursue security and military cooperation. Some hardliners
even go as far as calling for the expansion of China’s naval forces and the
establishment of a military base in the Indian Ocean to protect the security
of communication sea lines, as well as to maximise China’s geopolitical in-
terests (Interviews, Beijing, May 2011). By comparison, the bridgehead strat-
egy seems to be the least threatening, among all the choices, in establishing
and enhancing China’s strategic outreach into the Indian Ocean.
4 Major Setbacks in China’s Myanmar Strategy
Although China has crafted specific plans to enhance Myanmar’s strategic
importance to China, such plans have encountered unanticipated obstacles
and setbacks since the fall of 2011. Spearheaded by President Thein Sein’s
decision to suspend the Myitsone Dam project on September 30 and fol-
lowed by the rapid improvement of relations with the United States, Myan-
mar’s moves surprised and frustrated many in China, forcing China to re-
consider its strategies towards its south western neighbour.

4.1 The Myitsone Dam Suspension
President Thein Sein’s decision, during the fall of 2011, to suspend the Myit-
sone Dam project came unexpectedly for Beijing. Although the Myitsone
Dam had always been controversial and garnered tremendous public oppo-
sition, China did not think that Naypyidaw would dare to jeopardise a pro-
ject of such large scale and great importance to China – an opinion firmly
held by analysts and officials prior to the announcement (Interviews with
Chinese analysts, Beijing, Kunming and Rangoon, July and August 2011).
This extreme confidence was based on the fundamental belief that an isolat-
ed and sanctioned Myanmar would not risk angering its largest political and
economic patron over a dam project. Despite the repeated appeals by
Naypyidaw for China to reconsider the project and reassess its environmen-
tal impact, China brushed off such messages, believing the government was
effectively “silenced.”9
China attributes the suspension decision to both internal and external
factors in Myanmar. On the one hand, China feels the dam project is the
victim of Myanmar’s urge to improve relations with the U.S. (Interviews,
Beijing, October 2011. And People’s Daily 2011a). Chinese analysts noted that
the suspension decision was made after rounds of heated engagement be-
tween Naypyidaw and Washington and concluded that the encouraged
Naypyidaw “felt the urge to show Washington that it is not China’s client
state and truly represents the people” in an effort to solicit more rewards
from the U.S. (Interviews, Beijing, October 2011. And People’s Daily 2011a).
The Myitsone Dam project, as a controversial and therefore easy target, was
“unfortunately” sacrificed.
On the other hand, while China recognizes there is strong anti-China
sentiment in Myanmar, it refuses to acknowledge that such sentiment is
indigenous (Interviews with analysts, Kunming and Rangoon, July and Au-
gust 2011). China did not believe that Myanmar could transform from an
authoritarian state to a liberal democracy within a few months and that pub-
lic opinion could, seemingly overnight, become a determining factor in My-
anmar politics (Interviews with Chinese analysts, October 2011). In China’s
view, therefore, the cancelation was the result of Western countries and
NGOs’ instigating the anti-Myitsone movement within and outside Myan-
9 It is said that the Chinese government had left the “government relations” related
to the Myitsone dam primarily to the China Power International, the Chinese inves-
tor of the project, which used large amount of resources to “obtain” the support of
certain senior Myanmar officials. Interviews, Kunming, July 2011. One week before
the announcement of the suspension, the Minister of Electric Power, Zaw Min,
publicly proclaimed that the project will proceed as planned and the project is in
Myanmar’s national interest. UPI 2011.

„„„ 86 Yun SUN „„„
mar (People’s Daily 2011a). The Wikileak reports on the U.S. Embassy’s fund-
ing of anti-Myitsone activities within and outside Myanmar confirmed such
suspicions and reinforced China’s perception that Western efforts to sabo-
tage Chinese projects and alienate China–Myanmar relations are primarily
motivated by the geopolitical goal of curbing Chinese influence (World
Knowledge 2011).
Under these circumstances, China’s initial response to the Myitsone
Dam decision was hawkish and resolute. According to the statement made
by the Chinese Ministry of Foreign Affairs, the legitimacy and validity of the
Myitsone Dam is not an issue since the project has “gone through scientific
verification and strict examination by both sides.”10 At this point, any issues
about the project are merely “relevant matters arising from the implementa-
tion of the project” and “should be handled appropriately through bilateral
friendly consultation.”11 During his October 21 meeting with Myanmar Vice
President Tin Aung Myint Oo, Premier Wen Jiabao urged the Myanmar
government to “keep its promises” and “implement the consensus reached”
(Dong Fang Zao Bao 2011b). Apparently for China, the issue to be discussed
was not whether the project should or would be implemented, but how to
resolve any differences on the specifics of its implementation.
Meanwhile, China hoped that differences on the project could be re-
solved through negotiations. Some analysts suggested that the original plan
could be revised but the project should continue. Otherwise, a complete
abandonment would be excessive unnecessary, and “humiliating” for China
(Interviews with Chinese analysts, Beijing, October 2011). Furthermore, if
Naypyidaw insisted on abandoning the project, China – especially China
Power International (CPI) – would not offer a waiver for compensation.
CPI has invested more than 42 million USD in the Myitsone Dam, including
18 million USD on the relocation of local populations alone (Interviews
with Chinese analysts, Beijing, November 2011). Other spin-off infrastruc-
ture projects include factories, bridges and roads. The total amount of the
compensation could be astronomical and well beyond the solvency of the
Myanmar government.12
As these harsh responses failed to reverse Thein Sein’s decision, China
readjusted its initial position to prepare for an eventual, complete abandon-
ment of the Myitsone Dam project (Interviews with Chinese analysts, Wash-
ington DC, January 2012). According to Chinese analysts, Beijing has decid-
10 Ministry of Foreign Affairs Press Conference, Chinese Ministry of Foreign Affairs,
October 1, 2011.
11 Ibid.
12 Later, it was said that the compensation would be deducted from the tolls to be
paid by China for the oil and gas pipelines upon its completion.

ed to redefine the project as a commercial project between Chinese and
Myanmar companies, mitigating the government’s involvement and the
project’s political significance (Interviews with Chinese analysts, Washington
DC, January 2012). Chinese investors still need to be compensated for in-
vestments already made but will relinquish punitive claims for collateral
damage (Interviews with Chinese analysts, Washington DC, January 2012).
The Myitsone suspension has a major impact on China’s perception of
and relationship with Myanmar. It is cited as a third case of Naypyidaw’s
openly challenging China’s national interest while embarrassing China inter-
nationally. (The other two cases are the 2005 relocation of the capital from
Rangoon to Naypyidaw without advance notice to Beijing and the Tatma-
daw’s military attack at Kokang in 2009; Interview with Chinese analysts,
Beijing, November 2011). Some Chinese analysts believe that the suspension
“fundamentally shook Chinese leaders’ trust and confidence in Myanmar as
a partner, and is going to have a long-term impact over how they perceive
Myanmar’s reliability and trustworthiness” (Conversations with Chinese ana-
lysts, Washington, DC, November 2011).
4.2 U.S.–Myanmar Engagement
China’s strategic blueprint for Myanmar was based on the assumption that
the domestic politics of Myanmar would not undergo drastic changes in the
near future, keeping the country isolated and subject to economic sanctions
by the West. Naypyidaw’s need for economic development to enhance its
legitimacy and the lack of foreign investment sources other than China laid
the foundation for China’s absolute position and leverage. However, the
rapid improvement of relations between the U.S. and Myanmar since the fall
of 2011 altered these assumptions, causing China to lose its monopolistic
edge.
Although the Obama Administration announced its engagement strate-
gy towards Myanmar as early as in 2009, China’s concern over the engage-
ment was greatly eased during 2010 and early 2011.13 Up until the summer
of 2011, China was extremely pleased to see the engagement “going no-
where” due to Washington’s “obsession” over Myanmar domestic politics,
especially the issue of Aung San Suu Kyi (Interview with Chinese analysts,
Beijing, July 2011). The American condemnation of the 2010 elections as
“neither open nor democratic” reassured China that a rapid improvement of
bilateral relations and the removal of western sanctions were still far out of
13 China had seen the U.S. engagement with Myanmar as a key component of its
“return to Southeast Asia” to undercut China’s security interests in the region. In-
ternational Crisis Group 2010: 9-10.

„„„ 88 Yun SUN „„„
sight (Interview with Chinese analysts, Beijing and Kunming, July 2011).
China could still enjoy its “monopoly” of Myanmar’s economic resources
and external relations.
However, beginning with President Thein Sein’s meeting with Aung
San Suu Kyi, U.S.–Myanmar relations began to improve at a “dazzling speed”
(Interview with Chinese analysts, Beijing, November 2011). Not only has
U.S. Special Envoy Derek Mitchell paid an historic number of visits to the
country since September, Secretary of State Hillary Clinton also travelled to
Myanmar three months later, the first U.S. Secretary of State in five decades
to make a state visit. That steps toward diplomatic normalization are being
taken is crystal clear, highlighted by Clinton’s announcement that the U.S.
would start exchanging ambassadors with Myanmar in January 2012 (BBC
2012). The two countries have engaged in substantive dialogues about the
new government’s domestic policies and how the U.S. would adapt its eco-
nomic sanctions to reward certain developments (Interviews with U.S. gov-
ernment officials, Washington DC, November, 2011).
China’s fear of the rapid improvement of U.S.–Myanmar relations is
multi-fold. First and most importantly, the warmer ties between the U.S. and
Myanmar are essentially seen by Beijing as a conspiracy to encircle and con-
tain China, with potential threats to the Chinese south western border, Indi-
an Ocean access, and the oil and gas pipelines (Guangzhou Daily 2010). In
terms of economics, the easing of sanctions could open the floodgates for
Western companies to return to Myanmar, creating competition for Chinese
companies that have thrived under the sanctions during the past two dec-
ades. Furthermore, China is concerned that, as multilateral financial institu-
tions return to Myanmar offering technical assistance, these pro-Western
institutions will help Naypyidaw formulate a set of economic, financial, and
monetary systems without China’s participation, forcing China to accept
potentially unfriendly rules in its future economic activities in the country
(Interview with Chinese analysts, Beijing, October 2011). (For example, if
experts from International Monetary Fund convince the Myanmar govern-
ment to accept a new foreign exchange mechanism pegged to US dollars,
the existing trade with China in Chinese currency would come under severe
challenges.)
In terms of regional influence, Washington’s relationship with Myan-
mar is being scrutinized within the broader scope of U.S. competition with
China in Southeast Asia. Beijing sees the U.S. attempting to economically
replace China’s leadership in the East Asia Free Trade Zone with the Trans-
Pacific Partnership and politically sabotage the U.S.-free East Asia Commu-
nity by inserting itself into the East Asia Summit (Interviews with Chinese
analysts, Beijing, November 2011). Washington’s engagement with Naypyi-

daw is seen as another layer in the behind-the-scenes manoeuvring of the
U.S. to alienate the traditional friendship between China and continental
ASEAN states, thereby strengthening the U.S.’s standing in ASEAN, based
on its traditional ties with the maritime ASEAN states (Interviews with
Chinese analysts, Beijing, November 2011). Specifically, China is fearful that
Myanmar’s improved reputation and regional status might be exploited by
the U.S. to advance its agenda at ASEAN on regional issues such as the
South China Sea (Interviews with Chinese analysts, Beijing, October 2011).
Viewed from these perspectives, China’s assessment of the U.S. pres-
ence in Myanmar is essentially zero-sum. Any gains made by Washington
will come at China’s expense, either now or in the future. Such a perception
is pre-determined by the bipolar power structure and competition in South-
east Asia – a consensus shared by U.S. and Chinese analysts alike (Interviews
with American and Chinese analysts, Washington DC and Beijing, Novem-
ber 2011).
Paradoxically, from November to December 2011, the Chinese Foreign
Ministry made several statements welcoming the improvement of relations
between Myanmar and the West, including the U.S.14 These seemingly con-
tradictory messages by Beijing, however, can be seen as a diplomatic tactic
(or diplomatic rhetoric) rather than an authentic reflection of how China
perceives Myanmar’s relations with the West. Since China is in no position
to alter or slow down the course of such improvements, it may as well ap-
pear to publicly welcome them rather than be seen as bitter and territorial
(Interviews with Chinese analysts, Washington DC, January 2012). Further-
more, any open opposition by China to the improvement of U.S.–Myanmar
relations would constitute interference in Myanmar’s internal affairs and
damage China’s relationship with both Naypyidaw and opposition parties
(Ding 2011). Therefore, it makes no sense for China to pick a fight that it
cannot win while risking more stress over its already-strained relationship
with Myanmar.
5 China’s Strategic Misjudgements on
Myanmar
China was surprised and frustrated by the unexpected developments in My-
anmar’s domestic politics and in its foreign policy, developments which have
a direct impact on Beijing’s original strategic planning. The turbulence in
China’s relationship with Myanmar during 2011 revealed several basic stra-
14 Press Conferences of the Ministry of Foreign Affairs, Chinese Ministry of Foreign
Affairs, November 29, 2011, December 2, 2011 and December 19, 2011.

„„„ 90 Yun SUN „„„
tegic misjudgements by the Chinese policy community about Myanmar and
its bilateral relations with China.
Firstly, China fundamentally underestimated the political momentum of
democratization within Myanmar. Prior to the 2010 elections, most Chinese
analysts concluded that the new civilian government would be nothing more
than old wine in a new bottle. In their assessment, its transformation into a
civilian government was clearly the military’s tactic to strengthen its legiti-
macy with no clear intention to give up power. According to a government
analyst speaking after the elections,
Thein Sein is a transitional figure designed to maintain the stability
and balance of power within the new government, not a democratic
leader to guide the country towards democracy (Interviews with Chi-
nese analysts, Beijing, November 2010).
The judgment that domestic politics would remain unchanged led to the
conclusion that Myanmar’s relations with the West would not improve in
the near future, thereby guaranteeing China’s existing and expanding inter-
ests in Myanmar, as it remained the primary source of political and econom-
ic support for the isolated country.
Ignorance of the domestic political momentum was also reflected
through China’s approach toward the anti-China sentiment in Myanmar.
From China’s perspective, public opinion in Myanmar did not constitute a
critical challenge to China’s interest as long as the government backed Chi-
nese projects. Such support could always be acquired using the “powerful
lubricant” favoured during the junta era – bribes (Interview with govern-
ment analyst, Kunming, June 2010). This logic prompted CPI to rely on
“government relations” to smooth obstacles such as public opposition to
the Myitsone Dam (Interview with Chinese analyst, Kunming, July 2011).
This approach indicated that Chinese government and companies assumed
the new government was essentially the same as the military government,
prompting them to adopt the same old methods when dealing with it.
Secondly, up until the summer of 2011, China mistakenly assumed that
the U.S. engagement had failed, ending after the 2010 elections, when Wash-
ington pronounced the elections as “neither free nor fair.” Convinced that
U.S. domestic politics, especially in Congress, would not favour acceptance
of the new government, Chinese analysts shifted their focus from U.S. en-
gagement to the expansion and deepening of the Chinese presence in My-
anmar. Even after the appointment of Derek Mitchell as Special Envoy,
China still maintained that the U.S. diplomatic efforts would not produce
any results in the near future (Interview with Chinese analyst, Kunming, July
2011). This conclusion is based primarily on the belief that Naypyidaw
would not make concessions on issues such as Aung San Suu Kyi and ethnic

groups simply to cater to Washington as they, in China’s view, represented
fundamental challenges to the rule of the new government and its 2008
Constitution (Interview with Chinese analyst, Kunming, July 2011). This
explains why China was repeatedly “surprised” by the level of compromises
Thein Sein’s government agreed to and was repeatedly hopeful that Wash-
ington had driven Naypyidaw to its bottom line, prompting Naypyidaw to
soon push back. China has been quite disappointed that such push-back is
yet to take place.
Thirdly, China overestimated its absolute political and economic influ-
ence in Myanmar. As the biggest investor in Myanmar, as well as the provid-
er of critical international political shielding for Myanmar’s junta (including a
UN veto in early 2007), China believed it deserves certain privileges in My-
anmar (Interview with Chinese analyst, Kunming, July 2011). With no re-
moval of Western sanctions in sight, China was comfortably positioned for
Myanmar’s continued reliance on China for economic development and
political support. Under this premise, China intentionally ignored public
opposition to Chinese projects and the anti-China sentiment on the ground,
believing that an isolated Myanmar would not dare to challenge Chinese
projects and jeopardise future economic patronage.
The failure to accurately assess and predict the future of Myanmar’s
politics and bilateral relations reflects a deep-rooted issue with China’s for-
eign policy toward developing countries. China has a strong tendency to
view other non-democratic countries’ politics through its own lens and ex-
periences. Beijing’s reluctance to accept political reform is translated into a
general disbelief that any non-democratic government would willingly give
up its absolute power. The priority of such governments in China’s view will
always be to maintain the current power structure. Rapid political changes,
voluntary or not, are often seen as “threats to stability.” In the case of My-
anmar, this thinking underlines China’s misjudgement of the aspiration and
policies of the Thein Sein government and its policy toward democratic
opposition (especially, Aung San Suu Kyi) and ethnic groups.
This “mirror effect” also dominates China’s economic and political re-
lations with many less-developed countries. China believes the fundamental
legitimacy of any government should come from its ability to generate eco-
nomic growth and improve the livelihood of its people. Such a mercantilist
value system also characterises the dominant theme in China’s external rela-
tions – as long as China helps the local government deliver growth and
revenue, Chinese presence should be embraced and welcomed, regardless of
any negative impact. In China’s own history, it made similar social and envi-
ronmental sacrifices during the early years of reform and opening up. The
repetition of this development model in less-developed countries, such as

„„„ 92 Yun SUN „„„
Myanmar, is perfectly justifiable and acceptable in China’s perception (Inter-
view with Chinese analysts, Kunming, June 2010). China fails to understand
or accept other non-mercantilist approaches toward economic and social
development, especially for countries without many alternatives. Therefore,
opposition to the Chinese presence in these countries is often interpreted as
non-indigenous, instigated by hostile Western forces stirring up local resent-
ment.
6 Conclusions
2011 marked a turbulent year in China’s relationship with Myanmar. After
two decades of relatively smooth political friendship and economic coopera-
tion, China had hoped to bring the bilateral relations to a higher strategic
level and turn Myanmar into China’s strategic asset in Southeast Asia and
the Indian Ocean. However, such expectations have been greatly frustrated
by recent developments in their bilateral relations and Myanmar’s rapidly
improving relations with the West. These have served as a wake-up call for
China as it attempts to implement its strategic blueprint in Myanmar.
The setbacks China encountered in Myanmar reveal its several strategic
misjudgements about the political reality and foreign relations of its south
western neighbour. China missed key signs of the democratic momentum
inside Myanmar after the inauguration of the Thein Sein government and
underestimated the government’s determination to pursue democracy and
national reconciliation. Consequently, it failed to anticipate the pace and
result of U.S. engagement with Myanmar, miscalculating the degree of Chi-
na’s economic and political influence in the country. These misjudgements
originated from China’s perception of its own political development and
economic model, which plays a dominant role in its interpretation of other
countries and its external relations with them.
As a result, China has been taking a different look at its policy toward
Myanmar. In the near future, China most likely will maintain a “wait and see”
posture, refraining from making further political, economic, and strategic
commitments to the country, while focusing on the implementation of the
existing agreements. Chinese companies and the government have learned
from the Myitsone Dam incident to place increased emphasis on and re-
sources into improving relations with the local communities and developing
more corporate social responsibility programs. The policy community seems
to have accepted the new reality that China will no longer be the sole domi-
nant power and are preparing for new competition in the country.
Given its geopolitical reality, Myanmar’s best strategy always lies in
seeking a balanced diplomacy among big powers to maximize its leverages

and gains. It is an extremely delicate balancing act that requires wisdom and
accurate calculations. Naypyidaw certainly doesn’t want to become China’s
satellite state; it does not, however, make sense for it to alienate China. What
the world has seen in 2011 between China and Myanmar are the natural
consequences of Myanmar’s correction of its previous over-dependence on
China. At a certain point, Naypyidaw will have to recalibrate its relationship
with the U.S., China, and other powers in the region and bring its foreign
policy to its traditionally non-aligned, balanced path.
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CHINA’S MYANMAR DILEMMA
Asia Report N°177 – 14 September 2009

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