China’s non-interference could hurt China, analyst says

China’s “laissez-faire” approach to Myanmar’s military coup could hurt the Asian giant’s strategic and economic interests in the Southeast Asian country, a political risk analyst said.

In contrast to strong condemnations and sanctions by Western powers – including the US and the European Union – China’s response to the February 1 coup and the violence that followed it has been more muted. Beijing has been cautious and stresses the importance of stability.

“But while China may be keen to do business with whoever wields power in Naypyidaw, it is becoming increasingly clear that the chain of events that triggered the coup could jeopardize its interests,” said Gareth Price, Asia-Pacific senior research fellow program from the British think tank Chatham House, said in a note from March.

Naypyidaw is Myanmar’s capital and one of the hotspots for anti-coup protests. Security forces have used increasingly violent tactics to suppress the demonstrations, which killed more than 550 civilians, Reuters reported.

Protesters, outraged by Beijing’s apparent lack of concern over the deaths in protests, attacked Chinese factories in Myanmar last month, the Associated Press reported. In response, Beijing urged Myanmar to “ensure the safety of life and property of Chinese companies and personnel” there.

“China’s frustration with the risks facing its economic interests indicates that the coup has become an important test of the already complex relationship between Myanmar and China,” said Kaho Yu, senior Asia analyst at risk consultancy Verisk Maplecroft, in a statement. March report.

China is a major investor in Myanmar, a Southeast Asian border country that shares one of its borders. Myanmar is also an important part of President Xi Jinping’s signature Belt and Road Initiative.

“Overall, Beijing expects investment in Myanmar to contribute to energy security, trade and stability in its environment,” said Yu.

China claims that an economic slowdown in its neighborhood would lead to social instability and security threats, which in turn would threaten the political stability of Chinese border provinces such as Yunnan, the analyst added.

The latest available data from Myanmar’s Investments and Business Administration Directorate showed that approved foreign investment from China was around $ 139.4 million between October 2020 and January this year. Myanmar’s fiscal year starts in October.

The approved Chinese investments were only surpassed by Singapore’s, which totaled about $ 378.3 million in the same period showed the data.

In terms of trade, China is the main destination for Myanmar’s exports and the largest source of imports to the Southeast Asian country.

But Myanmar’s importance to China extends beyond economics, Price of Chatham House said.

“The oil and gas pipelines running through Myanmar are diversifying China’s supply sources and helping to avoid the use of the Straits of Malacca, a piracy hotspot,” he said. “And the development of ports and land connections between China and Myanmar is also contributing to a greater Chinese presence in the Indian Ocean.”

Beijing has maintained cordial ties with both the Myanmar military and the civilian government of de facto leader Aung San Suu Kyi in the past, Yu said. In recent years, international pressure on Myanmar due to the Rohingya crisis has pushed the country closer to China, he added.

China’s top diplomat State Councilor Wang Yi reportedly said last month that “no matter how the situation in Myanmar changes, China’s determination to advance relations between China and Myanmar will not falter.”

But any sense on the part of China that it will remain Myanmar’s main partner, regardless of who is in charge, could be a “misjudgment,” Price said.

“If the military is forced to withdraw, it could result in a more pronounced anti-China tilt, threatening (China’s) strategic interests,” he said.

Instead, Beijing could help end the coup – an action that could threaten its interests in Myanmar in the short term, but is likely to advance in the longer term, Price said. Myanmar’s generals have no intention of relinquishing power, but will struggle to hold on to that power without China’s support, he said.

“As its global role grows, China should learn to differentiate between different types of authoritarian governments and judge its response accordingly,” said Price.

“China needs to be aware that a ‘one size fits all’ policy of non-interference won’t win many friends, and that what it does gain is likely to be of the less healthy kind.”