China must reduce Myanmarese bias to its projects

The public in Myanmar has a strong general bias against foreign investment in the natural resource sector, a new research has warned, and added that China's Belt and Road Initiative (BRI) and the China-Myanmar Economic Corridor (CMEC) could face stiff public resistance if the projects fail to engage local communities.

Myanmar daily The Irrawaddy has quoted researchers, as saying that an explicit bias against Chinese investments in Myanmar and they further warn Beijing and Yangon to consider local context carefully before accepting such proposals.

This week, the International Growth Center, an academic policy research organisation supported by UK Aid, Oxford University and the London School of Economics and Political Science, released a policy brief titled "Public perception of Chinese investment in Myanmar and its political consequences."

Their survey concluded that Myanmar nationals have a better opinion of Japanese firms as opposed to Chinese firms.

"Chinese investors should be wary of existing negative attitudes," a majority of the researchers said.

This poor image of the Chinese in the business environment in Myanmar can only improve through careful selection of local partners and through direct and active engagement with affected communities, they added.

Myanmar is often seen as a key part of the Belt and Road Initiative.

Earlier this year, Myanmar signed a memorandum of understanding with China to collaborate on the Economic Corridor project. The corridor would start out in China's Yunnan Province and pass through Mandalay in central Myanmar, from where one branch would head south to Yangon and another west to the Kyaukphyu Special Economic Zone in Rakhine State.

Anti-Chinese sentiment in Myanmar has been there for over six decades because of dissent and opposition being repeatedly suppressed and people and their lands being exploited for access to natural resources.

This sentiment started to find a voice in 2011, when a new quasi-civilian government began a democratic reform process that freed up some space for a civil society. Myanmar soon became a more difficult place for Chinese firms - which regularly failed to engage with local communities - to do business.

Under pressure from widespread public opposition, Myanmar suspended the USD 3.6 billion Myitsone dam project in 2011. Located below the confluence of the May Kha and Mali Kha rivers, the main tributaries of Myanmar's most important waterway, the Irrawaddy, the dam would submerge important historic and cultural sites and was projected to cause irreversible damage to the country's river system and to downstream farming communities.

The Letpadaung copper mine has become another flashpoint of public resentment of China. Operated by China's Wanbao Mining Company, the site has been the scene of alleged forced evictions, land grabs and violently suppressed protests.

The Sino-Myanmar oil and gas pipeline, the world's second-largest oil consumer bypass tothe busy Malacca Strait, has emerged as a third flashpoint. This pipeline can move 22 million tons of crude across the country, from the Rakhine coast to China, but it has forced families off their land and sparked protests over safety and environmental concerns.

The Kyaukphyu Special Economic Zone is an important port project for China's regional ambitions. Under the shareholder agreement struck in 2015 with the administration of then President Thein Sein, China received an 85 percent stake in the project and Myanmar the rest.

Since taking power in 2016, the National League for Democracy (NLD) has been in negotiations with China to raise its share. Public opinion in Myanmar is wary of the added debt the project will require the country to take on.

The International Growth Center study says Chinese companies should consider a public engagement approach when investing in natural resource projects that might have strategic components and may trigger opposition.

"The China-Myanmar Economic Corridor project exists in the conflict areas, in Shan and Kachin state. China needs to consider that the project might provoke more conflict in the ethnic areas," The Irrawaddy quoted Khin Khin Kyaw Kyee, a lead researcher at the Institute for Strategy and Policy-Myanmar, as saying.