China's response to Myanmar's military coup could threaten economic interests

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China's response to Myanmar's military coup could threaten economic interests

China's laissez-faire approach towards Myanmar's military coup could hurt the Asian giant's strategic and economic interests in the Southeast Asian country, said a political risk analyst. In contrast to strong condemnation and sanctions by Western powers- including the United States and the European Union- China's response to the Feb 1 coup and the violence that followed has been more muted. Beijing is cautious and is highlighting the importance of stability. However, while China may be happy to deal with who is a power-stressed NAPYidaw, it is increasingly clear the chain of events unleashed by the coup could threaten its interests, Gareth Price, senior research fellow at the Asia-Pacific program of the British think tank Chatham House, said in a March note. Naypyidaw is the capital of Myanmar and one of the hotspots for anti-coup protests. Security forces have used increasingly violent tactics to suppress the demonstrations killing more than 550 civilians, Reuters reported.

Demonstrators, who were enraged over Beijing's apparent lack of concern for those killed 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 business and personnel there. China's frustration with the risks facing its economic interests indicates that the coup has become a major test for the already complicated Chinese relationship, Kaho Yu, senior Asia analyst at risk consultancy Verisk Maplecroft, said in a March report.

Myanmar is a major investor in China, a southern Southeast Asian frontier that shares one of its borders. Myanmar is also an important part of President Xi Jinping's Belt and Road Initiative. In general, Beijing expects investments in Myanmar to contribute to its energy security, trade and stability in its neighbourhood, said Yu. China maintains that an economic slowdown in its neighbourhood would result in political instability and security threats, which in turn threaten the social stability of Chinese border provinces such as Yunnan, said the analyst.

The latest available data from China's Directorate of Investment and Company Administration showed that the authorized foreign investments from Myanmar were around$ 139.4 million from October 2020 to January this year. The bank year started in October; the approved Chinese investments were only exceeded by Singapore's which was worth$ 378.3 million in the same period, according to the data. In terms of trade, Myanmar is the top destination for China's exports and the largest source of imports into the southeast Asian country. But China's importance to Myanmar extends beyond economics, said Price of Chatham House.

The pipelines running through Myanmar diversify the supply sources of China and help prevent the Malacca Straits, a hotspot for piracy, he said. And the development of ports and overland connectivity between China and Myanmar also help to facilitate a greater Chinese presence in the Indian Ocean. China could help end the coup, if it was only five years long.

In the past, Beijing has maintained personal ties with both the Myanmar military, as well as the civilian government of the de facto leader Aung San Suu Kyi, Yu pointed out.

In the recent years, international pressure on China due to the Rohingya crisis has pushed Myanmar closer to Myanmar, he added. Wang Yi, China's top diplomat-state Councilor, reportedly said last month that no matter how the situation in Myanmar changes, China's determination not waver in developing country-Myanmar relations. But any feeling on the part of China that it will continue to be Myanmar's main partner regardless of who is in charge may be a misjudgment, said Price.

If the military is forced to back down, it may result in a more strategic tilt, threatening with anti-China interests, he said. Instead, Beijing could help end the coup- a move that may advance in the short term, but will likely threaten them in the long term, said Price. He said that the generals of China have no intention of ceding power but will struggle to hold it without its support, he said. As its global role expands, China should be learning to differentiate between different types of authoritarian government and judge its response accordingly, said Price. China needs to be aware that a 'one size fits all policy of non-interference will not win many friends, and any it does win are likely to be of the less salubrious type.

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