Back
About RSIS
Introduction
Building the Foundations
Welcome Message
Board of Governors
Staff Profiles
Executive Deputy Chairman’s Office
Dean’s Office
Management
Distinguished Fellows
Faculty and Research
Associate Research Fellows, Senior Analysts and Research Analysts
Visiting Fellows
Adjunct Fellows
Administrative Staff
Honours and Awards for RSIS Staff and Students
RSIS Endowment Fund
Endowed Professorships
Career Opportunities
Getting to RSIS
Research
Research Centres
Centre for Multilateralism Studies (CMS)
Centre for Non-Traditional Security Studies (NTS Centre)
Centre of Excellence for National Security
Institute of Defence and Strategic Studies (IDSS)
International Centre for Political Violence and Terrorism Research (ICPVTR)
Research Programmes
National Security Studies Programme (NSSP)
Social Cohesion Research Programme (SCRP)
Studies in Inter-Religious Relations in Plural Societies (SRP) Programme
Other Research
Future Issues and Technology Cluster
Research@RSIS
Science and Technology Studies Programme (STSP) (2017-2020)
Graduate Education
Graduate Programmes Office
Exchange Partners and Programmes
How to Apply
Financial Assistance
Meet the Admissions Team: Information Sessions and other events
RSIS Alumni
Outreach
Global Networks
About Global Networks
RSIS Alumni
Executive Education
About Executive Education
SRP Executive Programme
Terrorism Analyst Training Course (TATC)
International Programmes
About International Programmes
Asia-Pacific Programme for Senior Military Officers (APPSMO)
Asia-Pacific Programme for Senior National Security Officers (APPSNO)
International Conference on Cohesive Societies (ICCS)
International Strategy Forum-Asia (ISF-Asia)
Publications
RSIS Publications
Annual Reviews
Books
Bulletins and Newsletters
RSIS Commentary Series
Counter Terrorist Trends and Analyses
Commemorative / Event Reports
Future Issues
IDSS Papers
Interreligious Relations
Monographs
NTS Insight
Policy Reports
Working Papers
External Publications
Authored Books
Journal Articles
Edited Books
Chapters in Edited Books
Policy Reports
Working Papers
Op-Eds
Glossary of Abbreviations
Policy-relevant Articles Given RSIS Award
RSIS Publications for the Year
External Publications for the Year
Media
Cohesive Societies
Sustainable Security
Other Resource Pages
News Releases
Speeches
Video/Audio Channel
External Podcasts
Events
Contact Us
S. Rajaratnam School of International Studies Think Tank and Graduate School Ponder The Improbable Since 1966
Nanyang Technological University Nanyang Technological University
  • About RSIS
      IntroductionBuilding the FoundationsWelcome MessageBoard of GovernorsHonours and Awards for RSIS Staff and StudentsRSIS Endowment FundEndowed ProfessorshipsCareer OpportunitiesGetting to RSIS
      Staff ProfilesExecutive Deputy Chairman’s OfficeDean’s OfficeManagementDistinguished FellowsFaculty and ResearchAssociate Research Fellows, Senior Analysts and Research AnalystsVisiting FellowsAdjunct FellowsAdministrative Staff
  • Research
      Research CentresCentre for Multilateralism Studies (CMS)Centre for Non-Traditional Security Studies (NTS Centre)Centre of Excellence for National SecurityInstitute of Defence and Strategic Studies (IDSS)International Centre for Political Violence and Terrorism Research (ICPVTR)
      Research ProgrammesNational Security Studies Programme (NSSP)Social Cohesion Research Programme (SCRP)Studies in Inter-Religious Relations in Plural Societies (SRP) Programme
      Other ResearchFuture Issues and Technology ClusterResearch@RSISScience and Technology Studies Programme (STSP) (2017-2020)
  • Graduate Education
      Graduate Programmes OfficeExchange Partners and ProgrammesHow to ApplyFinancial AssistanceMeet the Admissions Team: Information Sessions and other eventsRSIS Alumni
  • Outreach
      Global NetworksAbout Global NetworksRSIS Alumni
      Executive EducationAbout Executive EducationSRP Executive ProgrammeTerrorism Analyst Training Course (TATC)
      International ProgrammesAbout International ProgrammesAsia-Pacific Programme for Senior Military Officers (APPSMO)Asia-Pacific Programme for Senior National Security Officers (APPSNO)International Conference on Cohesive Societies (ICCS)International Strategy Forum-Asia (ISF-Asia)
  • Publications
      RSIS PublicationsAnnual ReviewsBooksBulletins and NewslettersRSIS Commentary SeriesCounter Terrorist Trends and AnalysesCommemorative / Event ReportsFuture IssuesIDSS PapersInterreligious RelationsMonographsNTS InsightPolicy ReportsWorking Papers
      External PublicationsAuthored BooksJournal ArticlesEdited BooksChapters in Edited BooksPolicy ReportsWorking PapersOp-Eds
      Glossary of AbbreviationsPolicy-relevant Articles Given RSIS AwardRSIS Publications for the YearExternal Publications for the Year
  • Media
      Cohesive SocietiesSustainable SecurityOther Resource PagesNews ReleasesSpeechesVideo/Audio ChannelExternal Podcasts
  • Events
  • Contact Us
    • Connect with Us

      rsis.ntu
      rsis_ntu
      rsisntu
      rsisvideocast
      school/rsis-ntu
      rsis.sg
      rsissg
      RSIS
      RSS
      Subscribe to RSIS Publications
      Subscribe to RSIS Events

      Getting to RSIS

      Nanyang Technological University
      Block S4, Level B3,
      50 Nanyang Avenue,
      Singapore 639798

      Click here for direction to RSIS

      Get in Touch

    Connect
    Search
    • RSIS
    • Publication
    • RSIS Publications
    • CO15219 | Sino-Myanmar Ties: Lessons from the “Myitsone Dam Event”
    • Annual Reviews
    • Books
    • Bulletins and Newsletters
    • RSIS Commentary Series
    • Counter Terrorist Trends and Analyses
    • Commemorative / Event Reports
    • Future Issues
    • IDSS Papers
    • Interreligious Relations
    • Monographs
    • NTS Insight
    • Policy Reports
    • Working Papers

    CO15219 | Sino-Myanmar Ties: Lessons from the “Myitsone Dam Event”
    Lu Guangsheng

    16 October 2015

    download pdf

    Synopsis

    Myanmar-China relations, strained by The “Myitsone Event”, have avoided the worst situation. However only safe and sustainable Chinese investments will bring benefits and restore mutual confidence.

    Commentary

    ON 30 SEPTEMBER 2011, Myanmar’s president Thein Sein “abruptly” announced the temporary suspension of the Myitsone Dam Project (hereinafter referred as the “Myitsone Event”) during his tenure. The Myitsone Dam Project entailed a total investment plan of US$3.6 billion, the biggest Chinese investment in Myanmar to date. The suspension of the project can be regarded as a landmark event for causing the Chinese government and the public to be “highly concerned” and seriously undermining Chinese investment and even bilateral relations.

    The controversial Myitsone Event is still not settled today and has become a “thorn” in Sino-Myanmar relations. On 8 November 2015, Myanmar will hold a new general election which is likely to further disrupt Chinese investment and even worsen Sino-Myanmar relations. During this period, it is necessary to review the Myitsone Event and assess present and future bilateral ties.

    No solution in the short term

    Over the past few years, the Myitsone Event had featured at all levels of bilateral talks between China and Myanmar, involving the president, president’s special envoy and other officials. Restarting the Myitsone Dam Project is China’s intent, but Myanmar avoids the issue all the time, and as a result, there has been no substantive progress.

    On 21 May 2015, the first meeting of the Sino-Myanmar electric power cooperation committee working group was held in Beijing to discuss solutions for the Myitsone Dam Project. However, in the face of the coming election, the Myanmar government refuses to present a clear statement. This makes it hard for both sides to arrive at a solution in the short term.

    Although the hydropower plant project did not resume operations, the two countries have already dealt with the Myitsone Event and did not allow it to strain bilateral relations. In China, the general public opinion is that China has been “slapped” by Myanmar: despite massive Chinese support during the junta period from 1988 to 2010, Myanmar has turned its back on China by treating Chinese projects badly. Since its 2010 democratic reform, Myanmar is now in an all-out effort to appease its general public and please the West. Under these conditions, China must make a strong response to safeguard other projects, especially the Sino-Myanmar Oil and Gas Pipeline Project.

    On the other hand, some Burmese organisations and individuals regard the Myitsone Event as “a landmark achievement” of Myanmar’s democratic transition. They claim that they “never make concession to the powerful northern neighbour”. In the face of pressure from China, some Burmese call for a national donation to pay for the loss of China’s state-owned enterprise, China Power Investment Corporation (CPI). Besides, they protest against Chinese investment by means of mass demonstrations and bad publicity.

    Solving the problem

    Fortunately, China and Myanmar are trying to resolve the problem. Many Burmese leaders, including President Thein Sein and Aung San Suu Kyi, claimed that Myanmar always welcome Chinese investment; that China is Myanmar’s important neighbour and partner; and that Myanmar has no intention to alienate or even oppose China.

    More importantly, China is increasingly aware of the inevitability of the Myitsone Event and other related events amid Myanmar’s transition to democracy. A normal relationship will replace the “special relationship” between the two countries. Based on this understanding, the two sides should collaborate and rationally discuss the solutions for some disputes. From this perspective, the two countries avoided the worst outcome of the Myitsone Event and laid a new and costly but solid foundation for bilateral relations.

    Changes in Chinese investment in Myanmar

    Chinese investment in Myanmar peaked at US$8.3 billion in 2011 but sharply declined soon after —$4.6 billion in 2012, $0.4 billion in 2013 and US$0.3 billion in 2014. From the data, we can conclude that “Chinese investment in Myanmar sharply declined after the suspension of the Myitsone Dam Project”.

    However, this conclusion is just “one side of the coin”. According to investigations and studies over the years, Chinese investment in Myanmar is changing. Firstly, China is always the number one source of foreign investment for Myanmar. By the end of 2014, Chinese total investment reached $14.67 billion, accounting for 27.7% of Myanmar’s total amount of foreign capital. China is still Myanmar’s largest trading partner and investor.

    Secondly, there are some new changes in Chinese investment in Myanmar. Unlike the wait-and-see strategy adopted by state-owned enterprises, some Chinese private enterprises, small and medium-sized enterprises, remained active in the Myanmar market in recent years. Although some Chinese investors registered their companies in Hong Kong, Macau, Singapore and then invested in Myanmar, these statistics are excluded from the total of Chinese investment in Myanmar. This shows that statistics on Chinese investment in Myanmar is undervalued.

    Thirdly, some Chinese investors have learnt from experience and adopted some positive measures to improve. For example, they shifted their focus from resources and energy to industries endorsed by the Myanmar government such as manufacturing, infrastructure, communication, hospitality, financial services, and other industries. Other measures include improving project transparency and environmental protection standards, actively carrying out corporate social responsibility, upgrading local management expertise, attracting local workers and improving work standards, etc.

    Obviously, to a certain extent, these positive phenomena can be attributed to lessons learnt from the Myitsone Event. Ensuring safe and sustainable development of Chinese investment in Myanmar will bring benefits and restore confidence in Sino-Myanmar relations.

    About the Author

    Lu Guangsheng is professor at Yunnan University and currently a Visiting Senior Fellow with the China Programme at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore.

    Categories: RSIS Commentary Series / International Politics and Security / Non-Traditional Security / Regionalism and Multilateralism / Country and Region Studies / Southeast Asia and ASEAN / East Asia and Asia Pacific

    Synopsis

    Myanmar-China relations, strained by The “Myitsone Event”, have avoided the worst situation. However only safe and sustainable Chinese investments will bring benefits and restore mutual confidence.

    Commentary

    ON 30 SEPTEMBER 2011, Myanmar’s president Thein Sein “abruptly” announced the temporary suspension of the Myitsone Dam Project (hereinafter referred as the “Myitsone Event”) during his tenure. The Myitsone Dam Project entailed a total investment plan of US$3.6 billion, the biggest Chinese investment in Myanmar to date. The suspension of the project can be regarded as a landmark event for causing the Chinese government and the public to be “highly concerned” and seriously undermining Chinese investment and even bilateral relations.

    The controversial Myitsone Event is still not settled today and has become a “thorn” in Sino-Myanmar relations. On 8 November 2015, Myanmar will hold a new general election which is likely to further disrupt Chinese investment and even worsen Sino-Myanmar relations. During this period, it is necessary to review the Myitsone Event and assess present and future bilateral ties.

    No solution in the short term

    Over the past few years, the Myitsone Event had featured at all levels of bilateral talks between China and Myanmar, involving the president, president’s special envoy and other officials. Restarting the Myitsone Dam Project is China’s intent, but Myanmar avoids the issue all the time, and as a result, there has been no substantive progress.

    On 21 May 2015, the first meeting of the Sino-Myanmar electric power cooperation committee working group was held in Beijing to discuss solutions for the Myitsone Dam Project. However, in the face of the coming election, the Myanmar government refuses to present a clear statement. This makes it hard for both sides to arrive at a solution in the short term.

    Although the hydropower plant project did not resume operations, the two countries have already dealt with the Myitsone Event and did not allow it to strain bilateral relations. In China, the general public opinion is that China has been “slapped” by Myanmar: despite massive Chinese support during the junta period from 1988 to 2010, Myanmar has turned its back on China by treating Chinese projects badly. Since its 2010 democratic reform, Myanmar is now in an all-out effort to appease its general public and please the West. Under these conditions, China must make a strong response to safeguard other projects, especially the Sino-Myanmar Oil and Gas Pipeline Project.

    On the other hand, some Burmese organisations and individuals regard the Myitsone Event as “a landmark achievement” of Myanmar’s democratic transition. They claim that they “never make concession to the powerful northern neighbour”. In the face of pressure from China, some Burmese call for a national donation to pay for the loss of China’s state-owned enterprise, China Power Investment Corporation (CPI). Besides, they protest against Chinese investment by means of mass demonstrations and bad publicity.

    Solving the problem

    Fortunately, China and Myanmar are trying to resolve the problem. Many Burmese leaders, including President Thein Sein and Aung San Suu Kyi, claimed that Myanmar always welcome Chinese investment; that China is Myanmar’s important neighbour and partner; and that Myanmar has no intention to alienate or even oppose China.

    More importantly, China is increasingly aware of the inevitability of the Myitsone Event and other related events amid Myanmar’s transition to democracy. A normal relationship will replace the “special relationship” between the two countries. Based on this understanding, the two sides should collaborate and rationally discuss the solutions for some disputes. From this perspective, the two countries avoided the worst outcome of the Myitsone Event and laid a new and costly but solid foundation for bilateral relations.

    Changes in Chinese investment in Myanmar

    Chinese investment in Myanmar peaked at US$8.3 billion in 2011 but sharply declined soon after —$4.6 billion in 2012, $0.4 billion in 2013 and US$0.3 billion in 2014. From the data, we can conclude that “Chinese investment in Myanmar sharply declined after the suspension of the Myitsone Dam Project”.

    However, this conclusion is just “one side of the coin”. According to investigations and studies over the years, Chinese investment in Myanmar is changing. Firstly, China is always the number one source of foreign investment for Myanmar. By the end of 2014, Chinese total investment reached $14.67 billion, accounting for 27.7% of Myanmar’s total amount of foreign capital. China is still Myanmar’s largest trading partner and investor.

    Secondly, there are some new changes in Chinese investment in Myanmar. Unlike the wait-and-see strategy adopted by state-owned enterprises, some Chinese private enterprises, small and medium-sized enterprises, remained active in the Myanmar market in recent years. Although some Chinese investors registered their companies in Hong Kong, Macau, Singapore and then invested in Myanmar, these statistics are excluded from the total of Chinese investment in Myanmar. This shows that statistics on Chinese investment in Myanmar is undervalued.

    Thirdly, some Chinese investors have learnt from experience and adopted some positive measures to improve. For example, they shifted their focus from resources and energy to industries endorsed by the Myanmar government such as manufacturing, infrastructure, communication, hospitality, financial services, and other industries. Other measures include improving project transparency and environmental protection standards, actively carrying out corporate social responsibility, upgrading local management expertise, attracting local workers and improving work standards, etc.

    Obviously, to a certain extent, these positive phenomena can be attributed to lessons learnt from the Myitsone Event. Ensuring safe and sustainable development of Chinese investment in Myanmar will bring benefits and restore confidence in Sino-Myanmar relations.

    About the Author

    Lu Guangsheng is professor at Yunnan University and currently a Visiting Senior Fellow with the China Programme at the S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University, Singapore.

    Categories: RSIS Commentary Series / International Politics and Security / Non-Traditional Security / Regionalism and Multilateralism / Country and Region Studies

    Popular Links

    About RSISResearch ProgrammesGraduate EducationPublicationsEventsAdmissionsCareersVideo/Audio ChannelRSIS Intranet

    Connect with Us

    rsis.ntu
    rsis_ntu
    rsisntu
    rsisvideocast
    school/rsis-ntu
    rsis.sg
    rsissg
    RSIS
    RSS
    Subscribe to RSIS Publications
    Subscribe to RSIS Events

    Getting to RSIS

    Nanyang Technological University
    Block S4, Level B3,
    50 Nanyang Avenue,
    Singapore 639798

    Click here for direction to RSIS

    Get in Touch

      Copyright © S. Rajaratnam School of International Studies. All rights reserved.
      Privacy Statement / Terms of Use
      Help us improve

        Rate your experience with this website
        123456
        Not satisfiedVery satisfied
        What did you like?
        0/255 characters
        What can be improved?
        0/255 characters
        Your email
        Please enter a valid email.
        Thank you for your feedback.
        This site uses cookies to offer you a better browsing experience. By continuing, you are agreeing to the use of cookies on your device as described in our privacy policy. Learn more
        OK
        Latest Book
        more info