by Waleed Ahmad 8 September 2023
The China-Myanmar Economic Corridor (CMEC) is a strategic infrastructure project of China’s Belt and Road Initiative (BRI) aimed at connecting China with Myanmar’s major economic centers. It was endorsed by Chinese President Xi Jinping during his visit to Myanmar in January 2020, marking the culmination of China’s efforts to reconstitute Sino-Myanmar relations after Myanmar’s democratic transition.
CMEC was first suggested as a stand-alone economic corridor in 2014, initially a component of the Bangladesh-China-India-Myanmar Economic Corridor (BCMIEC). In 2017, due to escalating Sino-India tensions, India refused to participate in BCMIEC. Under CMEC strategic infrastructure developments, like roads, trains, and ports, are located along the 1,700-kilometer inverted Y-shaped corridor that links Myanmar’s vital commercial hubs with China’s Yunnan region. The project involves hard and soft connections, including human resource development, collaborative research, interpersonal interaction, and physical connectivity such as infrastructure, manufacturing, agriculture, transit, telecommunications, and other technologies. CMEC aims to provide coMyanmar with consistent supply chains of essential resources like food, fertilizer, and constant energy.
With CMEC, China has become Myanmar’s largest trading partner, with bilateral trade reaching around $2.16 billion between April 2022-Jan 2023. The CMEC has the capacity to stabilize the coastal region of Myanmar. Chinese companies are implementing resource-sharing links, including power projects, specifically hydropower plants in the region. In October 2022, the Kyaukphyu Special Economic Zone (SEZ) inaugurated a 135-MW power plant worth $180 million.
Notably, China has been using a 770-kilometre oil pipeline that runs from Yunnan in China to Rakhine in Myanmar since February 2023. The pipeline is built at the Ramree Island-based Kyaukphyu deep-sea port. This pipeline plays a vital role in enabling the delivery of Russian oil to China. It is an essential part of China’s broader Belt and Road Initiative (BRI). A connection to Yangon, Myanmar’s present economic center, the development of distinctive commercial zones along the China-Myanmar border, and cooperation in areas like scientific and educational exchange are all included in the CMEC proposals. The implementation of CMEC would considerably improve China’s overall geopolitical standing in the Southeast Asian region.
The CMEC has a significant impact on the Rohingya crisis, Myanmar’s relations with neighboring countries and overall, regional stability. The Rohingya, a minority Muslim ethnic group, primarily found in the Rakhine state, have faced discriminatory laws since the 1970s. The UN referred to the military campaign against Rohingya as “a textbook example of ethnic cleansing.” In 2017, Myanmar’s military campaign led hundreds of thousands to escape into Bangladesh, escalating the issue. The Rohingya crisis has hampered collaboration between Myanmar and Bangladesh, as well as created a persistent state of insecurity in the Bay of Bengal area and the Rakhine state.
China is actively involved in trilateral meetings and discussions to resolve the Rohingya crisis, with China’s role being considered significant. The Kyaukphyu project in Rakhine state is essential for the CMEC’s success and China’s economic interests in Myanmar. Infrastructure initiatives in the region can significantly impact economic development, benefiting both the Rohingyas and Rakhines. Rakhine strategically influences China’s military objectives and Indian Ocean influence. A stable Rakhine state would boost tourism, alleviate unemployment, and promote peace.
China has supported the civilian administration of Myanmar on the international level and at the UN Security Council during the international outcry over Myanmar’s genocidal assault against the Rohingya. In a failed attempt to arbitrate the migration issue between Myanmar and Bangladesh, China put up a procedure to resolve the dispute. Myanmar has strained relations with Western nations and numerous states in the Southeast Asia because of the Rohingya crisis which has led to an increased reliance on China for diplomatic and economic support. China’s support for Rohingya Muslims in Rakhine state turned the local militants against China that lead to targeted attacks at the Chinese infrastructure.
As part of CMEC, China has also attempted to improve Myanmar-Bangladesh relations to better integrate the project into rest of the region. According to a statement from the Chinese Foreign Ministry, Minister Qin Gang told the head of the Junta in Myanmar, “China supports Myanmar improving its relations with Bangladesh, with related issues to be resolved through consultation, adding that China is willing to work with the two countries to expand China- Myanmar-Bangladesh pragmatic cooperation.” China has spent US $113 million in Myanmar since the military takeover. The repatriation of Rohingya refugees from Bangladesh may also ease international pressure on Myanmar’s military government.
Myanmar is crucial from a geopolitical perspective for China due to its proximity to the Bay of Bengal and the larger Indian Ocean. China partially allays its worries about its strong dependence on the constrained Malacca Straits by transferring oil and gas via pipelines across Myanmar to the province of Yunnan. To escape the effects of a trade war, China can move manufacturing from its coastal regions to its southwestern areas if CMEC is successful. It will also be a part of the bid to avoid the middle-income trap in southwestern provinces.
Recently, Bangladesh has also expressed a tilt towards the US Indo-Pacific Strategy, especially during the visit of Secretary of State Anthony Blinken. As a result, China seeks to build confidence and trust with Bangladesh to counter the influence of the US. Bangladesh aims to maintain good relations with China and avoid rivalries.
In contrast, the Western world has not exerted significant pressure to resolve the Rohingya crisis or facilitate their repatriation to Myanmar. While they discuss potential measures such as economic sanctions, their actions have been largely symbolic, lacking any practical impact. Comparatively, China’s active involvement and cooperation are deemed vital in resolving the Rohingya crisis.
India, on the other hand, has been wary of China’s growing influence in Myanmar and the region and has been working to counterbalance China’s influence through its own initiatives such as the India-Myanmar-Thailand Trilateral Highway and the Kaladan Multi-Modal Transit Transport Project.
Amidst the increasing regional competition between China and India, and the global competition between China and the United States, CMEC attained importance as one of key corridors that China envisioned to avert the so-called Malacca Dilemma. Malacca Dilemma referred to concern among the Chinese decision-makers on what alternative should the country have in case of blockade of maritime transport at the narrow Strait of Malacca, from where more than 80% of the country’s trade passes. The Overland route through CMEC would provide one of the alternatives to avert such a scenario.
China seeks to have multiple corridors to continue free flow of trade and grow its underdeveloped southwest & western regions and further solidify its influence in Asia. Successful implementation of CMEC and similar projects like CPEC addresses China’s development priorities and oil supply vulnerabilities.
Just like CMEC, CPEC is another project under BRI that faces almost the same challenges. The CPEC passes through Pakistan’s Gilgit-Baltistan region (which India claims as part of its territory) to Balochistan. China’s investment in Pakistan has been witnessed with great concern within India and in the Western world. Both CMEC and CPEC are at the coastal belt close to the Indian ocean and both face instability in the regions (routes) along the corridors due to militant insurgencies. The security threat of terrorism persists, despite the economic benefits that CMEC and CPEC offer. Furthermore, the political instability in both Myanmar and Pakistan has significantly affected the pace of CMEC and CPEC projects thus leading to delay.
China prioritizes implementation and development of CMEC. For this reason, it also supports the stability of Myanmar’s Rakhine State for its interests. The Rakhine State holds strategic importance for the China-Myanmar Economic Corridor, providing infrastructure projects and connectivity to the Indian Ocean. It addresses China’s development priorities and oil supply vulnerabilities. Convergence of similar interests can also be seen in CPEC. China seeks to have multiple corridors to continue free flow of trade and grow its underdeveloped southwest and western regions to further solidify its influence in Asia.