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Beijing’s Economic Stakes: Lessons from Post-coup Sino-Myanmar Relations

4 Minutes To Read
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  • Diya Jiang explores Beijing’s interests and trade-offs in managing Sino-Myanmar relations following the Myanmar military’s February 2021 coup d’état.

    Credit: Michael Coghlan (Flickr)

    Scholars and experts in academia and policy circles have argued that China has become a dangerous and unpredictable player in recent years. Indeed, trending toward the end of its half century-long economic growth, China is establishing itself as a dominant economic power, both regionally and globally. Understanding the economic stakes and Beijing’s intentions regionally and globally is thus more important than ever when engaging in diplomatic relations with China. Although most policy analysts and academics tend to focus on China’s engagement and actions with powerful countries such as the US and Russia, one can learn from its strategies when dealing with smaller regional actors such as Myanmar. In fact, analyzing the post-coup Sino-Myanmar relations offers a great opportunity to understand Beijing’s cost-benefit analysis behind making a stance on global issues and bilateral diplomatic ties.

    Myanmar had indeed been a close economic partner for China, joining the Chinese Belt and Road Initiative or BRI under the Aung San Suu Kyi government in 2017. Host to more than US$113 million in Chinese investment, Myanmar’s geographically strategic location, bordering China and linking it to South and South East Asia, makes it an important link in the Chinese Economic corridor. For the Chinese economic initiatives in the region to be successful, Beijing has to hold Myanmar close. However, the 2021 coup has made it much more difficult for the former to have a consistent diplomatic strategy. Beijing was caught in a dilemma, largely introduced by the unstable domestic political situation in Myanmar: to side with the previous Aung San Suu Kyi government or to switch camps.

    Both choices are associated with great levels of uncertainty. Indeed, months-long protests among the public, coupled with new civil conflicts with People’s Defense Forces and existing civil conflicts with numerous Ethnic Armed Groups, call into question the ability of the Myanmar military to take control in the long term. The international support for the National Unity Government of Myanmar – the shadow government under the previous civilian leadership – also adds to the existing high level of uncertainty. If China chooses the wrong side, it risks not only the continuation of its economic initiatives but also potential conflicts on its borders. However, China’s international reputation also hinges on its attitude towards the Myanmar military. As the country itself had been under fire for human rights abuses towards its citizenry, Beijing would also consider the consequences of supporting the junta which commits such acts.

    This is a dilemma that is all too familiar to Beijing. Indeed, from Afghanistan to Russia’s invasion of Ukraine, China had difficult stances to make. The difficulties in the need to make a stance are once again manifested in the latest conflict between Israel and Palestine, with Beijing once again making ambiguous statements. These stances are made even harder with an increasingly intensified US-China rivalry and with the EU slowly shifting away from establishing further economic ties with China. This is also why understanding the stakes behind Beijing’s stances in the Myanmar situation is particularly relevant and important in today’s context.

    Immediately after the coup, Beijing adopted a strategically ambiguous rhetoric, where it refused to acknowledge the nature of the coup but instead called for the end of violence. However, it also made contact with both the Myanmar military and the pro-democracy side of the government under its “party-to-party” platform. However, Beijing’s strategic ambiguity didn’t last long. The economic pressure and the need to hold its neighbour close pushed Beijing to adopt a much more friendly stance towards the Myanmar military in the latter half of 2021. This shift was confirmed in when the then-Chinese Foreign Minister Qin Gang paid a diplomatic visit to Myanmar, calling for further economic integration.

    The pattern of Beijing’s diplomatic stance and the speed at which it shifted is significant. China can be explained and understood as a rational actor seeking to maximize its utility both in the realm of security, politics, and economics. In this vein, the strategically ambiguous tone is adopted under the short-term uncertainty associated with Myanmar’s domestic situation. When uncertainty is high, the probability of gain on clearly choosing a side is also quite low, leading to Beijing strategically adopting a neutral position. However, Beijing is also aware of the risk in the long term associated with “playing both sides”—losing both and hence the loss of its political and economic influence over the region. This makes its ambiguous position unsustainable in the long term. This is why Beijing had to choose a side in the later months.

    Moreover, a key pushback to fully siding with the Myanmar military both now and in the long term lies in the concern over its international credibility and the risk of its already questionable human rights standard. The consequence of losing its international reputation and credibility can spill over to other economic and diplomatic relations Beijing holds, thus diminishing its sphere of influence. However, despite this, China warmed up to the Myanmar military fairly fast, although Beijing has not officially declared its support of the Myanmar military diplomatically. The relatively fast speed of change nevertheless indicates that China’s traditional approach to avoiding international backlash and preserving its reputational power internationally is becoming less prevalent in its diplomatic decision-making. This may be largely due to the increasingly negative global attitude towards China following the COVID-19 pandemic as well as its inhumane treatment of its own ethnic minorities. What could further add to the diminishing importance of reputational concern is Beijing’s need to compensate for its economic slowdown. Domestic discontent stemming from economic insecurity would push Beijing to adopt an even more daring attitude on the international stage, as these instances tend to stimulate nationalistic sentiments, hence distracting the public from economic slowdowns.

    A more detailed analysis can be found in: Jiang, D, and K. Kironska, 2023. “Unraveling Chinese Bilateral Diplomatic Behavior: Evidence from Post-Coup Sino-Myanmar Relations”, International Journal of China Studies Vol 14, No.1.

    Diya Jiang is a PhD student in Political Science at McGill University and a Research Fellow at CEIAS. Her research lies in the field of International Relations and focuses on the implications and effects of de-globalization and regionalization under the US-China Rivalry. She had previously completed a BA in Economics and Journalism at New York University and a MSc in International Political Economy at the London School of Economics and Political Science.

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