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Myanmar’s Societal Actors in Paukphaw Relations

The Belt and Road Initiative (BRI) aims to expand China’s economic, and possibly political, influence and advance the rising power’s international standing. Beijing cannot achieve its global ambition alone. Partnerships with countries along the BRI help to elevate economic relations to political and security ties. A favourable external environment is conducive to China’s rise (Yan 2014). To this end, a convergence of interests between China and the host countries is vital. In President Xi Jinping’s (2015a) own words: ‘[the BRI] will be a real chorus comprising all countries along the routes, not a solo for China itself.’ By the same token, the China–Myanmar Economic Corridor (CMEC), which is an indispensable component of the BRI, rooted in mutual benefits defined by the two countries. Naypyidaw certainly sought gains from the cooperation. However, Myanmar’s societal actors weighed in with their interpretation of a project’s costs and benefits when political space opened up in the 2010s.

Despite the paukphaw framing, Sino–Burmese/Myanmar relations have been interwoven by pragmatic interests across decades. Naypyidaw has counted on Beijing’s diplomatic and financial support to shun international pressure (Turnell 2011; Min Zin 2010). Meanwhile, Beijing has also eyed the neighbouring country’s natural resources and strategic location to sustain its economic growth and expand its geopolitical influence (Steinberg and Fan 2012). In January 2020, China and Myanmar celebrated the 70th anniversary of their diplomatic ties. Chinese President Xi even paid a two-day state visit to the neighbouring country, indicating Myanmar’s significance to Beijing. Specifically, Xi sought to accelerate the implementation of the CMEC. More infrastructure agreements were signed between the two countries.

Myanmar’s foreign relations experienced drastic change amid the country’s democratisation. State interests were still largely defined by the Thein Sein administration and subsequently the National League for Democracy (NLD)-led administration, despite state–society relations being reset. Societal actors, however, were no longer silenced in domestic politics and foreign policy. Although they usually paid less attention to foreign policy compared to public policy, they had incentives to speak out about mega bilateral development projects (see Simmons 2014). They cared about not only economic benefits but also transparency and fairness in the projects. With the change in the political landscape, societal actors were motivated to influence state-coordinated investments. Their acceptance had tangible impacts on bilateral economic agreements. Responses from Naypyidaw and Beijing to protests against BRI projects affirmed this proposition.

This chapter discusses the role of societal actors in Sino–Myanmar relations, which affected the implementation of BRI projects. It first gives an overview of China’s policy goals in the BRI. The grand strategy aims to build a China-centric world order which is pivotal to the rising power’s prestige. It also underscores the strategic calculation of host countries in joining the BRI. The second section outlines Sino–Myanmar economic cooperation, including the deepening BRI cooperation, in the reform years. Given that cordial bilateral relations laid the foundations for closer economic ties, the section reviews Sino–Myanmar relations since the two countries established diplomatic ties. After a long period of mutual hostility, pragmatic interests bound the two countries together in the final years of military rule and through the political transition. The chapter then turns to societal actors’ influence on BRI cooperation in the reform period. Societal actors were excluded in paukphaw relations traditionally. The revival of civil society in Myanmar not only transformed principal–agent relations but also influenced state-to-state economic cooperation.

Belt and Road and China’s dream

The BRI has manifested a new phase of China’s rise. President Xi’s signature international strategy has been tied to his legacy (Deng 2018; Freymann 2021). Xi has been perceived as the most powerful leader of the People’s Republic of China (PRC) since Chairman Mao Zedong (MacFarquhar 2016; Campbell 2017). Upon his assumption of the positions of the Chinese Communist Party’s (CCP) General Secretary in 2012 and subsequently the PRC’s President in 2013, Xi has consolidated power in domestic governance and projected ambition in international politics (Pei 2018; Li 2019; Tsang 2019). Internally, Xi has chaired the key leading small groups to guide and coordinate policy directions, especially on security and foreign policies (Lampton 2015). The most evident sign of Xi’s unprecedented status was his third presidential term, which aborted the two-term limit set in the constitution (Campbell 2018). Externally, Xi’s ‘strive for achievement’ (fenfa youwei) was a stark contrast to former leader Deng Xiaoping’s ‘keeping a low profile’ (taoguang yanhui) foreign policy guidance (Yan 2014; Sørensen 2015).¹ Besides the promulgation of the BRI, Beijing has behaved more assertively in international politics on all fronts. On the economic front, it has increasingly rendered economic statecraft to achieve its political and security goals. On the one hand, it has sent carrots to build ties with like-minded Global South countries through aid and investments (Piccone 2018; Smith 2021). On the other hand, it has been more willing to deploy sticks to coerce Taiwan (Lai 2022), and even South Korea and Australia, by informal sanctions (Lim, Ferguson, and Bishop 2020; Paradise 2022; cf. Goh 2014).² On the security front, it has moved quickly to claim much of the disputed waters in the South China Sea and constructed artificial islands. Moreover, it opened its first overseas military base in Djibouti in 2017 (Chubb 2019). On the diplomatic front, Beijing’s ‘wolf warrior diplomacy’³ has supplemented its soft power (Gill 2020) and sharp power (Walker 2018; Diamond 2021). On the global governance front, it has been keen to pursue its national interests by engaging in international organisations, especially the United Nations (UN). Beijing has been proactively filling the leadership vacuum by capitalising on the Donald Trump administration’s withdrawal from international organisations (Fung and Lam 2021).

The BRI is vital to materialise Beijing’s domestic and foreign policy visions. The grand strategy has been omnipresent in China’s domestic and foreign policies. At the CCP’s 19th National Congress in 2017, General Secretary Xi (2017b) held that the party should:

pursue the Belt and Road Initiative as a priority … we hope to make new ground in opening China further through links running eastward and westward, across land and over sea.

The initiative was incorporated into the CCP’s constitution (Xinhua 2017), signifying the prominence of the Xi-led policy. In domestic politics, the BRI works to achieve the ‘Chinese dream of national rejuvenation’ envisioned by Xi. Recalling a century of humiliation inflicted by imperialist powers, Xi has appealed to nationals that the revived Chinese nation would ‘stand more firmly and powerfully among all nations around the world’ (Xinhua 2012b). Beijing frequently called the initiative the 21st-Century Silk Road Economic Belt and the 21st-Century Maritime Silk Road. The BRI that recalled China’s past glory could unite nationals (Gan and Mao 2016). Economic growth has been essential to the CCP’s legitimacy and China’s social stability (Ye 2020; Zhang 2018). Some scholars depict the BRI as a ‘spatial fix’ strategy to boost China’s economy by two means.⁴ First, a reduction in spatial barriers could facilitate the flow of Chinese capital and commodities (Summers 2016; Sum 2019). Second, project loans that tie up with Chinese contractual services serve as a stimulus package to address domestic economic slowdown and industrial overcapacity (Wang 2016; Maçães 2018).

In international politics, the BRI aims to reshape the global order (Ikenberry 2018; Deng 2014; Callahan 2016), or at least the regional order (Chong 2021; see also Gong 2019). China has been discontented with its international standing in the Western-dominated world system (Deng 2008), rooted in free trade, multilateral institutions, democracy and liberal values (Moravcsik 1997; Acharya 2017). Economic isolation imposed by the West and the Soviet Union in the Cold War also made Beijing realise the importance of economic statecraft (Reilly 2021). The BRI is considered as a new institution that transforms China from a ‘norm-taker’ into a ‘norm-maker’. Beijing aspires to leverage a deepening and asymmetric interdependence embedded in the BRI to advance its economic, political and security goals (Pu 2016; Zhang and Buzan 2020; Maçães 2018).

There has been suspicion that the BRI not only encourages non-transparent bilateral loans (Dreher et al. 2022; Deng 2021), but also contests universal human rights and promotes authoritarianism (see Zhao 2020, 320; Hameiri and Jones 2021, Ch. 4). To allay international perception of the ‘China threat’ (Yan 2014; Deng 2014), Beijing portrays the initiative as an international public good (Xi 2022). President Xi (2015b; 2017a) promotes the idea of ‘a community with a shared future for mankind’, which pledges shared benefits, inclusiveness and mutual respect. Beijing assures the BRI countries that bilateral economic cooperation is based on harmony and peaceful coexistence (Zhou and Esteban 2018, 501).⁵ In the light of pushback from host countries, Beijing promises high-quality BRI cooperation that delivers high-quality infrastructure for sustainable and people-centred development (Xinhua 2021c). Apparently, Beijing yearns for a responsible power status (Zhang 2018; Jones and Zeng 2019; Wang 2017) despite the fact that it is an autocracy (Fung and Lam 2021). Respective host country governments agree that BRI agreements can boost domestic development and their performance legitimacy. It is worth examining whether local people wholeheartedly embrace Beijing’s shared community narrative.

BRI projects are largely state-coordinated investments with Beijing’s substantial political and financial backing. The signing of BRI agreements has had high-level facilitation (Deng 2021).⁶ The socialist country with Chinese characteristics has become a champion of an alternative globalisation. Beijing hosted two Belt and Road forums in 2017 and 2019 respectively to advance the vision. The attendance by world leaders and the signing of hundreds of agreements in the events bolstered China’s prestige. Beijing also used regional organisations⁷ and UN special agencies⁸ to promote the initiative. It was widely perceived that the Asian Infrastructure Investment Bank and the Silk Road Fund were meant to finance the BRI projects. In reality, Chinese policy banks, including the China Development Bank (CDB) and the China Export-Import Bank (Exim Bank), have been the main financiers of the BRI. A study shows that the CDB and the Exim Bank have accounted for 31.5 per cent and 40 per cent of loans for BRI countries, respectively, as of 2018 (Liu, Zhang, and Xiong 2020, 140). The BRI has developed rapidly with highly centralised and coordinated efforts by state and non-state actors in China (cf. Jones and Zeng 2019; Manuel 2019; Ye 2020). With Beijing’s ‘all-in commitment’ to the grand strategy (Deng 2021, 739), over 6,000 projects have been concluded by 2017 (State-owned Assets Supervision and Administration Commission of the State Council 2019).⁹ BRI projects have predominately been implemented in China’s peripheral region (Reeves 2016; Summers 2021). To date, the four economic corridors that connect China to immediate neighbours, including (1) Mongolia and Russia; (2) Pakistan; (3) Myanmar, India and Bangladesh; and (4) Southeast Asian countries, are among BRI’s strategic components.

The BRI has strategic value, economically and politically, to China. It is bewildering that a few projects were disrupted amid Myanmar’s democratisation. Building on a voluminous literature that analyses BRI’s implications for the existing global order, studies investigate host countries’ responses to the BRI burgeon (e.g. Calabrese and Cao 2021; Oliveira et al. 2020; Kuik 2021b). In any bilateral agreement, both parties must obtain net gains in cooperation. Otherwise, no agreement can be reached. Small and medium states should not simply be regarded as passive targets in asymmetric BRI cooperation (Ba 2019; Lampton, Ho, and Kuik 2020). They do not automatically accept Beijing’s narrative and commit to agreements without weighing benefits against costs. Chen (2018) highlights BRI countries’ agency in bilateral cooperation. Their enthusiasm or scepticism about the China-backed initiative depends on their policy priorities, such as economic growth and security (see also Blanchard 2018; Liao and Dang 2020). Numerous host countries from the developing world are impressed by China, which shares similar development trajectories and political values with them (Zhang 2018). Oh (2018) further stresses that BRI countries can obtain bargaining leverage in negotiations with China because of their ‘fallback position’; that is, a cost-free consequence of reaching no agreement. Furthermore, Reeves (2016) articulates increasing concerns over insecurity in BRI countries, for instance, erosion of state legitimacy (see also Freymann 2021) and growth of social discontent due to the home country’s intervention in domestic institutions (Fung et al. 2022). O’Neill (2014a, b) investigates negotiations between Beijing and authoritarian states’ ruling elite in BRI cooperation (see also Hameiri and Jones 2021, Ch. 4). These studies demonstrate that domestic politics in specific countries is at play in BRI cooperation, yet societal actors’ roles have been overlooked. This book fills this gap by examining the impacts of societal actors’ policy preferences on changing international outcomes in BRI cooperation. In addition, it answers the puzzle of Beijing’s accommodation in economic disputes caused by societal actors’ pushback.

Sino–Myanmar economic cooperation

Myanmar has been a staunch supporter of the BRI. Despite the paukphaw framing, it was a myth that bilateral economic cooperation has been strong since both sides established diplomatic ties. Sino–Burmese/Myanmar relations have always been based on pragmatic considerations and respective state interests. The two neighbouring countries had complicated relations in the pre-reform period. After a decade of friendship, the nominally paukphaw relations were characterised by animosity in the 1960s–1980s. Sino–Myanmar ties only transformed from hostility into asymmetric interdependence in the late 1980s. Chinese foreign direct investment (FDI) in Myanmar peaked in 2010 after signing major BRI project agreements. Myanmar’s political transition in 2011–2021 sparked speculation over an reorientation of Sino–Myanmar relations. Although Naypyidaw was eager to diversify foreign relations, domestic politics fostered closer Sino–Myanmar economic cooperation during the reform period. No matter ups and downs in state-to-state relations, Beijing’s ties with the military junta and ethnic armed organisations (EAOs) have sowed the seeds of social actors’ distrust of Chinese investments, which contributed to the instability of BRI projects in Myanmar.

Wobbly paukphaw relations, the 1950s–1990s

Taking account of China’s enormous size, population, military power and economic clout, Myanmar has always been mindful of how to live with its immediate neighbour (Lanteigne 2019). The Union of Burma (renamed as Myanmar by the military junta in 1989)¹⁰ gained independence from British colonisation in 1948. In 1949, the CCP toppled the Kuomintang (KMT or Chinese Nationalist Party) government and formed the PRC. Burma was the first non-communist country to establish diplomatic ties with the PRC in 1950 (Fan 2012, 234). Their bilateral relations were established based on equality, mutual benefits and mutual respect for sovereignty and territorial integrity. These were later consolidated in the ‘Five Principles of Peaceful Coexistence’ in 1954 (Xi 2014).¹¹

In the early years of Sino–Burmese relations, frequent bilateral visits implied personal friendship between leaders. Notwithstanding hurdles caused by the KMT troops¹² and the territorial disputes,¹³ the two sides could settle these controversies peacefully (see Maung Aung Myoe 2011, Ch. 2). After a decade of harmony, Sino–Burmese relations deteriorated rapidly after the coup in Burma. In 1962, a military coup overthrew parliamentary democracy in Burma. The self-proclaimed socialist regime led by Ne Win’s Burma Socialist Programme Party (BSPP) soon clashed with Beijing over the Vietnam War¹⁴ and then the Cultural Revolution.¹⁵Paukphaw ties reached a low point. Beijing reneged on its promise that it would not export revolution. It supported the Burma Communist Party (BCP), not only with telecommunication facilities, propaganda dissemination and road construction, but also arms supplies and military training (Fan 2012; Maung Aung Myoe 2011, 75–89). Sino–Burmese relations normalised after the leadership change in the PRC. Chairman Mao passed away in 1976. Deng Xiaoping rose to power two years later. Chinese foreign policy, as well as domestic policy, have been guided by pragmatism since then (Steinberg and Fan 2012, 309; Reilly 2013, 145). Weighing Burma’s geopolitical value to China, Beijing gradually withdrew support for the BCP¹⁶ in the 1980s to mend ties with Rangoon¹⁷ (Maung Aung Myoe 2011, 89).

Domestic political crises and international opprobrium faced by China and Burma in the late 1980s inadvertently improved Sino–Burmese/Myanmar relations. The 1988 Uprising in Burma was mirrored by the 1989 pro-democracy movement in China. Both ended in bloodshed.¹⁸ Shared principles of national sovereignty and noninterference in domestic affairs cemented paukphaw ties (Holliday 2009, 489). The State Law and Order Restoration Council (SLORC, 1988–1997), later renamed the State Peace and Development Council (SPDC, 1997–2011), ousted the BSPP in the 1988 coup. It held multiparty elections in 1990, the first parliamentary elections since 1962. The Aung San Suu Kyi-led NLD won by a landslide in the elections. The SLORC refused to honour the electoral results and intensified political repression. To pressure the military junta for political change, the United States and its allies imposed several rounds of economic sanctions on Myanmar.¹⁹ New investments in the country were prohibited. Tougher sanctions were imposed in 2003 after Aung San Suu Kyi and her supporters were violently attacked by pro-government mobs.²⁰ Trade and banking transactions with Myanmar were banned (Martin 2013; Holliday 2011, Ch. 5).

Economic ties ahead of the political transition

Some scholars argue that international pressure unwittingly pushed Myanmar towards China (Min Zin 2010; Reilly 2013). Nevertheless, depicting Sino–Myanmar ties as ‘patron–client’ relations is inaccurate (Zhao 2011a; Huang 2015). Chinese investments in Burma/Myanmar were insignificant until the late 2000s. China’s FDI to Myanmar was recorded at USD 2 million only in 2006 (ASEAN Secretariat 2015).²¹ Chinese investments started shooting up in 2007. In January 2007, the United States and the United Kingdom tabled a draft resolution at the United Nations Security Council (UNSC).²² Both claimed that the situation in Myanmar was a threat to regional peace. China and Russia jointly vetoed the draft resolution (United Nations Security Council 2007).

The SLORC/SPDC inevitably relied on Beijing’s economic and political support as Western intervention mounted. Beijing’s diplomatic protection, however, was ‘not entirely cost-free’ (Haacke 2016, 6). China’s natural resources demand soared in the course of economic reform. Its neighbour, Myanmar, had become a convenient source of minerals, natural gas, hydropower, timber and so on. Beijing has also sought to utilise Myanmar’s geographical location to access the Indian Ocean (Sun 2012b). An alignment of interests between Naypyidaw and Beijing deepened Sino–Myanmar economic cooperation. More Chinese capital flowed to Myanmar in subsequent years. Chinese FDI in Myanmar amounted to USD 349 million (or 48.8 per cent of the host country’s overall FDI) in 2007, USD 349 million (35.8 per cent) in 2008 and USD 371 million (38.5 per cent) in 2009 (ASEAN Secretariat 2018). Chinese FDI in Myanmar skyrocketed in 2010 following the signing of agreements for the Myitsone dam, the Letpadaung copper mine and the China–Myanmar oil and gas pipelines in 2009–2010. These projects were negotiated without Myanmar societal actors’ endorsement. Chinese investments in Myanmar were recorded at a new high at USD 1.52 billion (67.6 per cent) (ASEAN Secretariat 2018). These data have not yet included Hong Kong’s investments in Myanmar, which were possibly linked to Chinese state-owned enterprises’ (SOE) projects in the host country (see Figure 1.1).²³

Since the 1990s, US policy on Myanmar has been dominated by human rights concerns. Under the Obama administration, Washington rolled out the pivot to Asia policy. President Barack Obama’s pragmatic engagement with the SPDC starkly contrasted with the isolation policy of his predecessor, President George W Bush (Clapp 2010). The drastic foreign policy shift demonstrated that Washington took strategic interests into account while promoting universal values (Campbell and Andrews 2013). Following the dissolution of the SPDC and the release of Aung San Suu Kyi, Obama visited Myanmar in November 2012. The normalisation of US–Myanmar relations ignited debates on Naypyidaw’s foreign policy reorientation. Bordering with China, Naypyidaw has always been mindful of maintaining cordial relations with Beijing. Naypyidaw trod a fine line between strengthening ties with the West but not upsetting its giant neighbour during the reform period.

Figure 1.1: China’s FDI in Myanmar, 1995–2018.

Note: The Association of Southeast Asian Nations (ASEAN) has stopped reporting FDI in Myanmar from Hong Kong and China since 2016 and 2019 respectively.

Source: Data compiled from ASEAN statistical yearbooks (2005, 2015, 2019).

Economic cooperation during the political transition

In August 2003, the junta announced a seven-step roadmap to a disciplined democracy, including drafting a new constitution²⁴ and holding parliamentary elections.²⁵ Aung San Suu Kyi was finally released after the military-backed Union Solidarity and Development Party (USDP) swept most seats in the 2010 elections. The SPDC dissolved and handed over power to the nominally civilian government headed by President Thein Sein, the prime minister of the previous regime.²⁶ Thein Sein took the presidency on 30 March 2011. Within two months after assuming power, he visited China, in May 2011. He underscored that diplomatic ties with China were ‘the closest and most important’ for Myanmar (Xinhua 2011b). Assuming the transitional government led by Thein Sein would not deviate from its predecessor’s foreign policy, Beijing signed the ‘comprehensive strategic cooperative partnership’ agreement with Naypyidaw that signified an upgrade of bilateral relations (Xinhua 2011b; Dossi and Gabusi 2022). Surprisingly, the Myitsone dam was unilaterally shelved by Thein Sein in September 2011. The Letpadaung copper mine was temporarily suspended in November 2012. It was only resumed under a revised contract in the following year. The China–Myanmar oil pipeline was shortly delayed due to Naypyidaw’s request for gains redistribution. The project finally entered into operation in 2017 after completing construction in 2014.

Some perceived that Chinese economic setbacks marked Naypyidaw’s shift in foreign policy.²⁷ Moreover, some even attributed these to the US–Myanmar rapprochement (Harrington 2012; Sun 2012b). In subsequent years, Chinese investments plummeted significantly. In 2011, Chinese FDI to Myanmar was reported at USD 671 million (ASEAN Secretariat 2018), down from USD 1.52 billion in the previous year. Nevertheless, the two countries continued negotiating bilateral economic agreements. In December 2015, the outgoing Thein Sein administration awarded the Kyaukphyu special economic zone (SEZ) project to the CITIC Group, a Chinese SOE. After taking power in 2016, State Counsellor Aung San Suu Kyi, who championed transparency and accountability in governance, even fostered closer economic cooperation with China compared to the previous government.

In the reform period, Naypyidaw built ties with other Western and regional powers, but it never intended to distance itself from Beijing (Haacke 2012; Lanteigne 2019). Both Thein Sein and Aung San Suu Kyi conceded that Beijing’s support was pivotal in Myanmar’s peace process and Rohingya crisis.²⁸ After Burma gained independence, the country descended into civil wars. Beijing’s relationship with Burma/Myanmar’s EAOs has impeded the paukphaw ties. Even though Beijing cut support for the BCP in the late 1980s, it has maintained engagement with the United Wa State Army (UWSA) and the Myanmar National Democratic Alliance Army (MNDAA). UWSA and MNDAA were situated in ethnic Chinese-dominated Wa and Kokang regions respectively (Perlez and Wai Moe 2016). Private actors in China’s Yunnan province were accused of supporting EAOs financially and militarily (Sun 2017; USIP China Myanmar Senior Study Group 2018). Naypyidaw considered Beijing an influential player in the country’s national ceasefire agreement. Through the 2010s, Beijing played the facilitator role in negotiations between Naypyidaw and EAOs (Li 2020; USIP China Myanmar Senior Study Group 2018).

To dispel Beijing’s worries that the Nobel Peace Prize laureate might tilt to the West and undermine its geopolitical interests, the Aung San Suu Kyi-led administration signalled its commitment to the paukphaw relations at the cost of its reputation. Before taking office, Aung San Suu Kyi insisted that she has always been a politician instead of human rights defender (Democratic Voice of Burma 2013). After taking office, her administration offered unequivocal support for Beijing’s policy on Hong Kong and Xinjiang. Myanmar joined dozens of countries to support Beijing’s enactment of the national security law in Hong Kong (Xinhua 2020) that posed threats to civil and political rights (Shamdasani 2022). Likewise, her administration praised China’s policy to counter terrorism and extremism in Xinjiang, in the wake of the West’s criticism of Beijing’s treatment of Uyghurs (Putz 2020). In the maritime disputes over the South China Sea, China has had territorial disputes with Vietnam, the Philippines, Malaysia, Brunei and Taiwan (see Song and Fabinyi 2022). Naypyidaw did not stand with its Association of Southeast Asian Nations (ASEAN) neighbours. In response to the ruling by the international tribunal on the disputed waters, which was welcomed by Washington and its allies, it called for restraint and negotiations (Ministry of Foreign Affairs of the Union of Myanmar 2016). Its position was appreciated by Beijing.

The Rohingya crisis in 2017 further redefined diplomatic relations between Naypyidaw and the West during the reform period (Passeri 2021; Han 2021; Dossi and Gabusi 2022). Beijing’s position in the crisis, contrasted with the West’s condemnation, reinforced paukphaw ties. Civil and political rights were better protected since 2011, whereas persecution of Rohingya remained. Worse still, military violence against Rohingya was compounded by civilian discrimination (David and Holliday 2018). In July 2012, an anti-Muslim riot broke out in Rakhine State. The clash between Rohingya Muslims and Buddhists left 200 dead and displaced thousands (Lipes 2014; BBC News 2014).²⁹ Communal violence continued over the next few years.³⁰ In August 2017, agitated Rohingya militants launched deadly attacks on roughly 20 police posts. The offensive sparked a military operation against not only the militants but also innocent civilians. The new wave of violence against Rohingyas forced approximately 700,000 people to flee to Bangladesh. The UN High Commissioner of Human Rights, the Special Rapporteur on Myanmar, the International Court of Justice, and even the General Assembly have criticised the grave human rights violations against the Rohingya population. UNSC members also attempted to discuss the humanitarian crisis but were opposed by China. China called on Bangladesh and Myanmar to handle the refugee issue but downplayed persecution of Rohingyas (Xinhua 2019; Nichols 2018).³¹ State Counsellor Aung San Suu Kyi and Commander-in-Chief of Defence Services Min Aung Hlaing welcomed Beijing’s nonintervention stance. Similar to its response to armed conflicts in Myanmar, Beijing offered to mediate the Rohingya crisis (USIP China Myanmar Senior Study Group 2018).

Beijing advocated economic development in conjunction with mediation in Myanmar conflicts.³² It has been portraying the BRI as a ‘road for peace’ (Xi 2017a). Following the Rohingya crisis, Western investors hesitated to invest in Myanmar. FDI in Myanmar plunged to USD 1.61 billion in 2018 from USD 4 billion in 2017 (ASEAN Secretariat 2019). Chinese investment has become increasingly attractive to Myanmar. Aung San Suu Kyi, who prioritised the peace process and economic growth, contended that the BRI could be the country’s opportunity. Before taking office, Aung San Suu Kyi reiterated the importance of harmonious relations with regional neighbours, including China (Han 2021). More BRI projects were under negotiations during her tenure. In 2018, her government signed a memorandum of understanding (MOU) with Beijing to establish the China–Myanmar Economic Corridor (CMEC). Along with the China-backed deep sea port and SEZ in Kyaukphyu,³³ Naypyidaw agreed to construct a cross-border railway and highway connecting China’s Yunnan province to Myanmar’s Kyaukphyu. Moreover, three cross-border economic zones in Kachin State and Shan State were under planning to boost economic development in the ethnic states. These dismissed the assumption that the democratic leader would tilt towards the West. More interestingly, these also refuted the belief that the democratic leader would be more transparent when entering into bilateral economic negotiations.

Societal actors in paukphaw relations

Traditionally, societal actors had no place in Sino–Myanmar relations, no matter the ups and downs in purported paukphaw friendship. Yet, this does not imply that people in Myanmar did not have opinions towards the growing asymmetric interdependence between Myanmar and China. During Myanmar’s reform period in the 2010s, the formerly repressed civil society became a force to be reckoned with. Non-governmental organisations, activists, villagers, workers and other societal actors could sometimes affect the implementation of state-coordinated investments. That explains project disruption to BRI projects. Beijing amended its state-to-state diplomacy to dual-track diplomacy. By reaching out to societal actors, it affirmed BRI projects’ stability could no longer be guaranteed by its counterpart.

Political transition in Myanmar

Political transition requires both political liberalisation and democratisation (Viola and Mainwaring 1985, 194). Political liberalisation features less state repression and more human rights protection (Mainwaring 1989; O’Donnell and Schmitter 1986, 7; Viola and Mainwaring 1985, 194). An expansion of political opportunities can be observed by accommodation to new political actors, shift in political alignments, emergence of influential allies, and division among political elites (Tarrow 2011). These signs increase challengers’ prospects of positive social movement outcomes (see also McAdam 1982; Goldstone and Tilly 2001). Meanwhile, democratisation involves institutional reform in a closed political system. The expansion in political contestation gradually moves towards universal suffrage (Mainwaring 1989; Viola and Mainwaring 1985, 195). Nonetheless, the authoritarian incumbents retain discretion over new rules of the game (O’Donnell and Schmitter 1986).

For decades, the Tatmadaw has maintained tight control in the country. Human rights campaign groups generally disbelieved the country’s political transition. To them, the Thein Sein administration was an extension of the military dictatorship (ALTSEAN-Burma 2011; Farmaner 2011; International Federation for Human Rights 2011). The extent of political reform took many domestic actors and international experts by surprise (Pedersen 2014). Nevertheless, some cautioned that the Tatmadaw-initiated transition remained precarious and fragile. They warned that the junta could reverse the reform for their interests (Kyaw Yin Hlaing 2012; Pedersen 2014; Egreteau 2016). With hindsight, the 2021 coup proved these warnings were prophetic.

It is not easy to pin down a starting point for Myanmar’s democratisation. Yet, it was undisputable that consistent signs of political liberalisation were observed in the early phase of the Thein Sein administration. Thein Sein’s inaugural speech in March 2011 set the tone for the political transition. He promised economic and political reform without hampering the Tatmadaw’s core interests (Steinberg 2012, 1; Callahan 2012, 124). The first observable reform in the early phase of the Thein Sein administration was press freedom. Media censorship has been relaxed since April 2011. The state-owned media removed the propaganda statement against the exiled and foreign press in August 2011. In the following month, the authorities unblocked websites of the independent media. In August 2012, the government even ended the prepublication censorship that had been in place for half a century. In 2013, it granted publishing licenses to media groups to print daily newspapers (Kean 2018). Alternative sources of information facilitated policy discussion.

On political rights, Pyidaungsu Hluttaw (the bicameral legislature of Myanmar)³⁴ passed the Peaceful Assembly and Peaceful Procession Act in December 2011. In spite of criticism that the law fell short of international human rights standards (Human Rights Watch 2012), it was a big step forward as demonstrations were previously prohibited. More mass protests took place across the country from 2012 onwards (Buschmann 2018). Thousands of people participated in candlelight vigils in Yangon and other major cities to protest against the electricity shortage for four consecutive days in May 2012. Naypyidaw swiftly adopted emergency measures to boost electricity supplies within a week (Holliday 2013). In July 2012, a farmer protest over a land dispute marked the first authorised demonstration in Myanmar in 50 years (Aye Nai 2012). Police cracked down violently on protests against the 2014 National Education Law, but Naypyidaw offered concessions to student protests by increasing the education budget. Protests even erupted in ethnic states where political control was tighter than in central Myanmar. Meanwhile, trade unions were legalised under the 2011 Labour Organisation Law. Trade unions and labour organisations proliferated. Labour strikes mushroomed in Yangon’s industrial zones (Kyaw Soe Lwin 2014; Bernhardt, S Kanay De, and Mi Win Thida 2017). The regime granted legal recognition for civil society organisations (CSOs) in the 2014 Association Registration Law. CSOs’ inputs were incorporated in the legislation process (Fink and Simpson 2018).³⁵

On human rights protection, the National Human Rights Commission (NHRC) was established in September 2011. It received 3,000 human rights complaints from September 2011 to November 2012 (Myanmar National Human Rights Commission 2012). Regardless of its effectiveness, the number of complaints indicated people’s confidence in the human rights mechanism. The newly founded NHRC called on President Thein Sein to release all prisoners of conscience in its statement issued in October 2011 (Myanmar National Human Rights Commission 2011). In early 2012, hundreds of political prisoners were freed, including veteran activists from the 1988 Uprising. These former political prisoners played significant roles in major social movements throughout the reform period.

In terms of democratisation, division among ruling elites was observed. USDP lawmakers resembled the opposition party that demanded accountability from the Thein Sein administration (Kyaw Yin Hlaing 2012). Naypyidaw also demonstrated willingness to accommodate political opposition. The NLD could stand for the parliamentary by-elections in April 2012. Aung San Suu Kyi and her colleagues swept almost all the contested seats (Holliday 2013).³⁶ The peaceful power transition to the NLD after the largely free and fair 2015 elections dispelled mistrust of the political reform. Despite the electoral defeat, Thein Sein (2016) hailed the success of the country’s democratic transition in his final speech to the Pyidaungsu Hluttaw. Aung San Suu Kyi was barred from the presidency due to a constitutional hurdle.³⁷ The Tatmadaw refused to relinquish constitutional veto power even though the popular NLD repeatedly pushed the envelope. The NLD-dominated legislature circumvented the constitutional constraint and created a new prestigious role, State Counsellor, for the country’s de facto leader. Myanmar could not be classified as a democracy in the shadow of the military’s influence. However, the hybrid regime s electoral process went ‘beyond electoral authoritarianism’ (Farrelly 2015).

A revival of civil society

Civil society was vibrant in the short-lived parliamentary democracy until the military coup in 1962 (Steinberg 2000). The BSPP outlawed all organisations which posed political threats to the regime by the 1964 National Security Act (Kyaw Yin Hlaing 2004). The 1974 Constitution further prohibited political activities (South 2004). Self-help programs, such as providing local infrastructure, funeral services and education, were tolerated (Lorch 2008), whereas advocacy groups were eradicated. As such, David Steinberg (1999, 8) pointedly opines that civil society was murdered by the BSPP. The enactment of the 1988 Law Relating to Forming of Organisations offered some space for civil society in the post-BSPP period.³⁸ Nevertheless, those groups remained apolitical and weak. The catastrophic Cyclone Nargis in 2008, which caused 140,000 dead and missing, became a milestone of an upsurge of CSOs. Humanitarian responses created space for CSOs, including international non-governmental organisations (INGOs), to operate (Holliday 2011, Ch. 5; Wells and Kyaw Thu Aung 2014). Some of the organisations went beyond aid delivery. Environmentalists raised public awareness of environmental issues by cultivating grassroots activism in the hope of reducing destruction in future disasters (interviews: N01, N02). Developmental organisation Paung Ku, founded in 2007, played a critical role in providing funding for community-based organisations (CBOs) for the Cyclone Nargis relief. The network has sustained after the relief projects (Wells and Kyaw Thu Aung 2014; Holliday 2011, Ch. 3). The promulgation of the 2008 Constitution and the 2010 elections were landmark events that cultivated political participation (Asian Development Bank 2015, 3). Activists often invoked provisions in the 2008 Constitution, mainly Chapter 8, to claim their civil and political rights (interviews: N03, N04). Even before the dissolution of the military regime, societal actors who perceived a less politically repressive environment began to advocate policy change.

A widening political space was observed under the Thein Sein administration, even though political threats did not melt away overnight after decades of repression under military rule. In the early phase of the political transition, only a handful of dissidents dared to test the boundaries of their freedom. When some exercised their rights without punishment, it gradually persuaded others to follow suit (see O’Donnell and Schmitter 1986). More citizens began to speak their minds and demand policy change. With a commitment to stay in power by winning elections, political leaders were more cautious about political consequences for acting contrary to citizens’ expectations. As such, the transitional government could no longer dictate the policymaking process. Societal actors, including CSOs, activists and ordinary citizens, could sometimes constrain Naypyidaw’s policy options. In bilateral economic cooperation, societal actors questioned the benefits of the BRI agreements and at whose costs. Naypyidaw faced a dilemma between domestic constituents and the international partner who held opposite policy views.

Domestic actors in paukphaw ties

BRI projects in Myanmar undoubtedly have strong political support from the home country and host country. The disruption to BRI projects was triggered by opposition from societal actors during the political transition. A survey conducted by the ISEAS–Yusof Ishak Institute in 2019 suggested that elites in the government, business and social sectors in Myanmar were sceptical about fairness in BRI loans. Only 2 per cent of the respondents had full confidence in BRI loans. Roughly 36 per cent stated that they were somewhat confident in them. Meanwhile, respondents with no confidence and little confidence in BRI loans were reported at 23 per cent and 39 per cent respectively (Tang et al. 2020). Furthermore, the 2019 Asian Barometer Survey Report on Myanmar found that 56 per cent of respondents perceived China as having done more harm than good to Myanmar. Only 15 per cent of respondents thought otherwise (Welsh et al. 2020). A Myanmar collaborator in the survey pinpointed that a lack of transparency in Chinese investments, exacerbated by land disputes, damaged China’s image in Myanmar (interview: N05).

Societal actors echoed their civilian leaders’ assessment that the country should maintain cordial relations with China. Even though they might hold an unfavourable view towards Beijing due to its close ties with the SPDC (see Min Zin 2010, 279–80), they did not fundamentally oppose Chinese investments. Instead, they demanded mutual benefits in bilateral economic cooperation. In the 2000s, the SPDC signed several mega infrastructure agreements with Chinese SOEs. An open bidding process was usually absent in those unsolicited projects. Project transparency, including costs, loan conditions and repayment terms, was in question (Lee 2017, Ch. 2; see also Taylor and Zajontz 2020; 288–89, Dreher et al. 2022).³⁹ The project scale often drew controversy as it might exceed the host country’s needs (see Zhang and Smith 2017, 2339). The downsizing and cost reduction of the Kyaukphyu deep sea port in Myanmar appeared to corroborate these concerns. The NLD-led administration renegotiated the scale of the Kyaukphyu deep sea port with CITIC in 2018. Both sides agreed to construct two berths, rather than the original ten, in the first phase of the development. As a result, the project cost plummeted from USD 7.2 billion to USD 1.3 billion (Chan Mya Htwe 2018).⁴⁰ By the same token, the New Yangon City project, awarded to the China Communications Construction Company in 2018,⁴¹ was divided into smaller components to invite competition from other companies (Kyaw Phyo Tha 2020). The 99-year lease of the Hambantota Port in Sri Lanka has frequently been cited as an outcome of unsustainable infrastructure cooperation with Beijing (Hurley, Morris, and Portelance 2018; Sum 2019; cf. Brautigam 2020). Such a narrative has been powerful in influencing political and social elites’ consideration about cooperation with Beijing, regardless of the accuracy of the claim (Fung et al. 2022). To avoid Myanmar falling into the ‘debt trap’ (see Taylor and Zajontz 2020), the NLD-led government signed an MOU with Beijing that set terms for allowing Naypyidaw to acquire international loans and open tender processes to non-Chinese companies (Nan Lwin 2019f).

Impacted communities usually learned about the state-coordinated investments when they faced forced evictions before Myanmar’s political transition. An environmental and social impact assessment (ESIA) aims to identify a project’s potential risks and recommend mitigation measures before the contract is signed. It can increase a project’s legitimacy and probability of success. Beijing has also adopted more guidelines to regulate Chinese overseas businesses (McDonald, Bosshard, and Brewer 2009; Kirchherr et al. 2017; United Nations Development Programme and China Development Bank 2019). The authorities’ commitment to the ESIA enforcement, however, is dubious (Liu 2021, Liao 2019).⁴² A Chinese Government-led survey with 543 Chinese companies in 2017 revealed that a third of respondents did not conduct environmental impact assessments. Meanwhile, half of the respondents did not conduct social impact assessments (Chinese Academy of International Trade and Economic Cooperation of the Ministry of Commerce of the People’s Republic of China, Research Centre of the State-owned Assets Supervision and Administration of the Commission of the State Council of the PRC, and United Nations Development Programme China 2017; Zou and Jones 2020). Chinese companies, state-owned and private alike, have a propensity to prioritise profit over compliance (Hameiri, Jones, and Zou 2019). In Myanmar, ESIA was not mandatory until the 2015 Environmental Impact Assessment (EIA) Procedure came into effect. As such, many Chinese SOEs did not carry out an ESIA before 2016.⁴³ Impacted community members were not consulted or informed about the benefits and risks of BRI projects. Villagers were particularly vulnerable to drastic degradation in their natural environment. To them, landlessness and poverty did not square with the promise of development.

When concluding the bilateral infrastructural agreements, both Beijing and host country governments always promise job opportunities for local people (Sun 2020a; Xi 2017a). BRI projects are often backed by policy banks. The loan conditions require a borrower to procure equipment, technology and services from China. For example, the Export-Import Bank of China specifies that no less than 50 per cent of project procurement be made from China (Davies 2010). During the construction period of the Myitsone dam, the Letpadaung copper mine and the China–Myanmar oil and gas pipelines in the early 2010s, over 10,000 workers were brought by Chinese contractors to Myanmar (see Figure 1.2).⁴⁴ Local people lamented that they were only hired as informal workers and compensated with meagre wages while Chinese workers enjoyed more favourable payment and treatment (interviews: N06, V01). Chinese SOEs’ refusal to engage with villagers, labour unions and CSOs added fuel to the fire. SOEs’ lack of public engagement could be attributed to a weak civil society in China (Gonzalez-Vicente 2011). More importantly, Beijing did not recognise societal actors as legitimate stakeholders in bilateral relations (Foot 2020; Chan and Pun 2022). In the light of criticism of Chinese overseas investment, the Chinese embassy in Myanmar reached out to the media and CSOs, including the Myanmar Centre for Responsible Business and Institute for Human Rights and Business which championed corporate social responsibility (CSR) (Gong 2020). Additionally, it opened a Facebook page to communicate with Myanmar netizens (Maung Aung Myoe 2015). SOEs gradually strengthened CSR programs under the state’s guidance (Liu 2021). Chinese SOEs, such as China Power Investment (CPI), Wanbao, the China National Petroleum Corporation (CNPC), and the CITIC Group, were keen to donate food, provide scholarships and even build schools and roads for local people. Benefits to impacted communities, however, could not remedy a lack of prior local consent in BRI projects.

The changes in Chinese investors’ business practices were contingent upon domestic constraints on the ground (Chan and Pun 2022). In the SPDC era, opposition activists reached out to the Chinese embassy but were given the cold shoulder (interview: N07). Conceding Naypyidaw could no longer set public opinion aside in the BRI projects’ signing and implementation, Beijing adopted dual-track diplomacy to improve its investment environment in the host country (Transnational Institute 2016; Passeri 2021). Beijing gradually realised changes in Myanmar’s political landscape could hamper its economic and political interests. Beijing started cultivating relations with non-state actors in 2012. The Chinese embassy contacted CSOs, opposition parties and journalists in Myanmar. An array of Beijing-backed institutions – for instance, the CCP, the China–Myanmar Friendship Association, the China NGO Network for International Exchanges, the China Foundation for Poverty Alleviation and the Yunnan University – also built ties with non-state actors in Myanmar through meetings, press conferences and cultural events (Chan 2020). These Chinese organisations even invited Myanmar guests to visit China. Tour itineraries often included visits to mega infrastructure, and meetings with current and prospective Chinese investors (interviews: J01, N08, P02, P03, P04, P05). Many Myanmar participants valued the opportunities to discuss various issues, from bilateral economic cooperation to the peace process, with Chinese government officials and business actors. The Chinese tours, however, did not change their perception of Beijing. Some argued that Beijing’s actions were more important than their words (interviews: J01, N07, P06). Others stated that fundamental differences in political values between Myanmar and China impeded Beijing’s public diplomacy (interviews: P02, P07, P08).⁴⁵

Figure 1.2: Chinese labour dispatched for contracted projects in Myanmar by the end of the year (2010–2020).

Source: China Trade and External Economic Statistical Yearbooks (2014, 2018 and 2021).

Concluding remarks

The BRI has exhibited Beijing’s ambition to reshape the US-dominated world order. The transcontinental infrastructure program aims to create a more favourable external environment for China’s rise. The CMEC is a component of Beijing’s grand strategy. The signing of the CMEC MOU signified robust bilateral relations between China and Myanmar. Although Beijing and Naypyidaw have often described the two countries’ relations as paukphaw, bilateral economic cooperation was insignificant until the late 2000s. Beijing’s geopolitical strategy and Naypyidaw’s development needs explained the closer economic ties between the two countries. Several BRI project agreements, including the Myitsone dam, the Letpadaung copper mine, and the China–Myanmar oil and gas pipelines, were signed in the late 2000s. Certainly, these agreements were concluded due to mutual benefits perceived by the home country and the host country. However, reciprocity was solely defined by state actors. Societal actors were traditionally disregarded in paukphaw relations. Myanmar’s political transition brought in new policy actors in BRI implementation. They rose to challenge BRI agreements that were deemed illegitimate and harmful to local communities when political space opened up. The transitional regime sought to retain power by competitive elections was suddenly caught in a tug-of-war between societal actors and Chinese investors. Beijing’s public diplomacy in Myanmar affirmed the influence of societal actors in state-coordinated investments.

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1. 1 Then Chinese leader Deng Xiaoping (1994, 311) laid out famous foreign policy guidance: ‘observe calmly; secure our footing; cope with changes with confidence; hide our capabilities and bide our time; skilfully keep a low profile; never claim leadership’ (see also Deng 2008, 41).

2. 2 China has been engaging in ‘chequebook diplomacy’ to induce Taiwan’s international allies to shift diplomatic ties (Shattuck 2020; see also Zhang and Smith 2017). At the same time, it has imposed trade and tourist bans on Taiwan to coerce the island to change its policy towards China (Lai 2022). Beijing perceived that South Korea’s terminal high-altitude area defence missile system would threaten its security and therefore imposed informal economic sanctions on its neighbour in 2016–2017 (Lim and Ferguson 2021). Beijing adopted similar measures towards Australia when Sino–Australia relations turned to a low point during the Morrison administration (Ferguson, Waldron, and Lim 2022).

3. 3 Chinese ambassador to France Lu Shaye claimed that he was proud to be named a ‘wolf warrior’ in the face of attacks on China by ‘mad dogs’ (Yusha Zhao 2021).

4. 4 The term ‘spatial fix’ was first used by David Harvey (2001) to describe capitalism’s geographic expansion to cope with overaccumulation crises.

5. 5 After manifesting the rise of China in 2003, Chinese President Hu Jintao downplayed the country’s status, describing its peaceful rise and later on peaceful development to dissuade the impression of China as a revisionist state (Cheng 2016, 165; Zhang 2018).

6. 6 To date, there is no official list of BRI projects. Many private companies have capitalised on Beijing’s loosely defined grand strategy to seek loans for their investments (Freymann 2021, Ch. 4). The Shwe Kokko special economic zone, which was involved in gambling, online scams and human trafficking, was also claimed by the Chinese investors to be a BRI project.

7. 7 For instance, the Asia-Pacific Economic Cooperation, the Forum on China–Africa Cooperation, the China–Arab States Cooperation Forum, the Association of Southeast Asian Nations, and the Shanghai Cooperation Organization.

8. 8 The United Nations Peace and Development Trust Fund, that advises the UN Secretary-General which projects to fund, is one of the platforms Beijing can leverage to promote the BRI. Beijing is the sole financial contributor to the fund (Fung and Lam 2021). Four out of five of the fund’s steering committee members are Chinese officials. Under-Secretary-General for Economic and Social Affairs Liu Zhenmin also used his position to promote the initiative.

9. 9 The State-owned Assets Supervision and Administration Commission of the State Council (2019) reported that state-owned enterprises had undertaken 3,116 projects, roughly half of the total projects, along the Belt and Road.

10. 10 In June 1989, the Tatmadaw’s State Law and Order Restoration Council (SLORC) changed the country’s name from Burma to Myanmar. Similarly, it changed the names of cities and administrative regions. For example, Rangoon was renamed as Yangon, Irrawaddy Division was renamed as Ayeyarwady Division, Magwe Division was renamed as Magway Division, Pegu Division was renamed as Bago Division, Tenasserim Division was renamed as Tanintharyi Division, Arakan State was renamed as Rakhine State, Karen State was renamed as Kayin State, and Karenni State was renamed as Kayah State.

11. 11 The ‘Five Principles of Mutual Coexistence’ are: mutual respect for sovereignty and territorial integrity, mutual non-aggression, noninterference in each other’s internal affairs, equality and mutual benefit, and peaceful coexistence. The principles were jointly developed by China, India and Burma in 1953–1954. The Bandung Conference in 1955 and the non-alignment movements that emerged in the 1960s also adopted these principles in governing international relations (Xi 2014).

12. 12 After the founding of the PRC, around 12,000–16,000 of the defeated KMT troops fled to Burma’s Shan State. Burma’s sovereignty would be infringed if the PRC’s People’s Liberation Army (PLA) chased after the KMT on Burmese soil. The tension only abated after the United States evacuated the KMT forces out of Burma in 1961 (Charney 2009, 79–80; Han 2019, Ch. 3).

13. 13 Initially, the disputed territories claimed by Beijing and Rangoon varied between 10,000 km² and 18,000 km². Ultimately, Beijing only claimed 18 per cent of the disputed territory in 1960 (Shen and Lovell 2015, 102; Maung Aung Myoe 2011, 40–51).

14. 14 CCP Chairman Mao Zedong received Ne Win in China in 1965. Mao underscored that the Vietnam War was a worldwide struggle against colonialism. Yet, Ne Win refused to display socialist solidarity (Huang and Shih 2014, 112–13; Maung Aung Myoe 2011, 58–63).

15. 15 The feverish Cultural Revolution in China spilled over into Burma. Ne Win clamped down on the Cultural Revolution in the country. Anti-Chinese riots broke out in June 1967. Over 30 Chinese were murdered, including a Chinese embassy’s technician. Beijing accused their Burmese counterpart of manipulating the attacks (Maung Aung Myoe 2011, 67–69; Fan 2012; Han 2019, Ch. 5).

16. 16 It was alleged that the armed groups in Wa and Kokang were separated from the Burma Communist Party in the 1980s. They maintain a close but unofficial relationship with China (Sun 2017, 3; Lintner 2015).

17. 17 Rangoon, then Yangon, was the capital of Burma/Myanmar before the State Peace and Development Council (SPDC) moved the capital to Naypyidaw in November 2005.

18. 18 Deep-seated political and economic frustration ignited the pro-democracy movement on 8 August 1988 in Burma. The six-week 1988 Uprising was repressed by the State Law and Order Restoration Council (SLORC) in September. At least 3,000 people were killed through the uprising. Some even estimated the death tolls at 10,000 (Charney 2009, 148–61; Fink 2009, Ch. 3). In parallel, a nationwide pro-democracy movement in China was also suppressed by the PLA in 1989. Red Cross China once revealed that at least 2,600 people died but retracted its estimate later (Frontline 2006; Amnesty International 2015a).

19. 19 The SLORC changed the country’s name from Burma to Myanmar in 1989. See footnote 10.

20. 20 Aung San Suu Kyi and her supporters were attacked by thugs during her trip to Depayin, Sagaing Division, in May 2003. Seventy people died, while many others were injured in the incident (Zarni Mann 2020).

21. 21 ASEAN Secretariat (2016) reported that Myanmar’s FDI was recorded at USD 428 million in 2006, of which USD 2 million was from China. Data obtained from the ASEAN Secretariat by email communication also showed that Hong Kong’s FDI in Myanmar amounted to USD 54.4 million in the same year. The data differed from the FDI approved by Myanmar’s Directorate of Investment and Company Administration, which might decrease or increase in the course of project implementation. It was reported that all three Chinese state-owned oil and gas companies – China National Petroleum Corporation (CNPC), Sinopec and China National Offshore Oil Corporation – were involved in onshore and offshore oil and natural gas projects in Myanmar in the 2000s (Earth Rights International 2008).

22. 22 The draft resolution called on the Myanmar government to stop the military offensive against civilians in ethnic states, enter into a political dialogue with the opposition and release all political prisoners, including Aung San Suu Kyi (United Nations Security Council 2007).

23. 23 Sometimes, Chinese investments in Myanmar were channelled through Hong Kong. For instance, the China-Myanmar oil and gas pipelines are operated by two international consortiums led by CNPC. Both joint ventures were registered in Hong Kong (China National Petroleum Corporation 2017). Likewise, the Chinese investor of the Letpadaung copper mine, Myanmar Wanbao Mining, was also registered in Hong Kong (Amnesty International 2015b).

24. 24 The constitutional referendum was held a week after the catastrophic Cyclone Nargis in May 2008. The turnout was reported at 98 per cent, in which 92 per cent of voters voted in favour (Holliday 2011, 82). The credibility of the referendum was in question.

25. 25 Ban Ki-moon, then UN Secretary-General, commented that the elections in Myanmar were ‘held in conditions that were insufficiently inclusive, participatory and transparent’ (United Nations Secretary-General Ban Ki-moon 2010). In addition, the National League for Democracy, the leading opposition party, boycotted the elections.

26. 26 For the debate on Myanmar’s democratisation, see Morten Pedersen (2014), Renaud Egreteau (2016), Roman David and Ian Holliday (2018, Ch. 3) and Roger Lee Huang (2020).

27. 27 Additionally, a Memorandum of Understanding (MOU) of the Kunming–Kyaukphyu high-speed railway that was signed in April 2011 (Xinhua 2011a) expired in April 2014.

28. 28 For the legal status of Rohingyas in Myanmar, see footnote 4 of the introductory chapter.

29. 29 Over 140,000 Rohingyas were displaced following the intercommunal violence. Many were ‘resettled’ in internally displaced person camps managed by the UN High Commission of Refugees (2013). Their freedom of movement was restricted by the government.

30. 30 Waves of violent incidents continued in 2013 and 2014. In June 2014, the clash between Muslims and Buddhists killed two and injured five in Mandalay (Lipes 2014; BBC News 2014).

31. 31 International non-governmental organisations (INGOs) and international media documented systematic and widespread human rights violations experienced by Rohingyas (Human Rights Watch 2017; Amnesty International 2017).

32. 32 The Advisory Commission on Rakhine State (2017), appointed by the Myanmar government to provide recommendations for political, socio-economic and humanitarian challenges, hailed social and economic development in Rakhine State as a way to ease tensions in the ethnic state. It also suggested that the Kyaukphyu SEZ would work towards this endeavour.

33. 33 Kyaukphyu is the starting point of the China–Myanmar gas pipeline and a gateway to the Indian Ocean.

34. 34 Pyidaungsu Hluttaw (Assembly of the Union or parliament) comprises Pyithu Hluttaw (House of Representatives or the lower house) and Amyotha Hluttaw (House of Nationalities or the upper house).

35. 35 One survey found that a myriad of administrative obstacles hampered CSOs’ operations during the political transition (Buschmann and Soe 2020; see also Egreteau 2016).

36. 36 The NLD won 43 out of 44 seats in the 2012 parliamentary by-elections.

37. 37 Article 59(f) of the 2008 Constitution stipulated that the president ‘himself [or herself], one of the parents, the spouse, one of the legitimate children or their spouses not owe allegiance to a foreign power, not be subject of a foreign power or citizen of a foreign country. They shall not be persons entitled to enjoy the rights and privileges of a subject of a foreign government or citizen of a foreign country.’ Owing to the foreign citizenship of her sons, Aung San Suu Kyi was not eligible to be the president of Myanmar.

38. 38 By 2006, roughly 214,000 civil society organisations (CSOs), mostly community-based organisations (CBOs), operated in the country (Asian Development Bank 2015, 1; Heidel 2006, 43).

39. 39 These non-transparent practices also arouse suspicion about corruption (see Zhao 2014; Abadi 2021; Zelikow et al. 2020).

40. 40 Likewise, the Mahathir administration also demanded contract renegotiation of the East Coast Rail Link with China Communications Construction Co Ltd. The project cost was reduced approximately by a third, from MYR65 billion (USD 15.8 billion) to MYR44 billion (USD 10.7 billion) in 2019 (Sipalan 2019).

41. 41 See footnote 6 of the introductory chapter.

42. 42 Beijing has shown its awareness of ESIA in overseas investments. More guidelines have been issued, ranging from reducing pollution to improving work safety and respecting local customs (Kirchherr et al. 2017; Liu 2021).

43. 43 The Thein Sein administration passed several laws to strengthen environmental governance. In 2012, the Environmental Conservation Law was enacted. It was substantiated by the 2014 Environmental Conservation Rules. In 2015, the Environmental Impact Assessment Procedure was adopted (Asian Development Bank 2017). A Yangon-based Chinese SOE’s senior staff shared that it was normal for foreign investors to comply with the minimum legal requirements (interview: C01). Wanbao conducted ESIA only after the Letpadaung copper mine project was suspended in 2012.

44. 44 The number of Chinese workers decreased upon completing the China–Myanmar oil and gas pipelines in 2013–2014.

45. 45 During his visit to Beijing, one interviewee and his colleague witnessed an arrest of a protester near Tiananmen Square (interview: P02).