Burma Delivers Its First Rebuff to China ---China angry over Burma's decision to suspend work on £2.3bn dam

-Burma Delivers Its First Rebuff to China --
-China angry over Burma's decision to suspend work on £2.3bn dam



Burma Delivers Its First Rebuff to China
Shelving of gigantic Chinese hydroelectric dam could be a signal to the West
Bertil Lintner
YaleGlobal, 3 October 2011

Blocking the dam: Burmese protesters in Thailand oppose China’s Irrawaddy dam project (top); Burmese president U Thein Sein (r) receiving Xu Caihou, Vice Chairman of China's Central Military Commission
CHIANG MAI: At a time when Asian countries are increasingly worried about China’s growing assertiveness, Burma’s rejection of a huge Chinese hydroelectric dam project has raised new questions: Is this a rare victory for civil society in a repressive country? Or does it indicate an internal dispute over the country’s dependence on China? Regardless of the answers to these questions, the public difference over a close ally’s project marks a new stage in the Burma-China relationship.

On September 30, Burma’s new president, Thein Sein, sent a statement to the country’s parliament announcing that a joint venture with China to build a mega-dam in the far north of the country had been suspended because “it was contrary to the will of the people.” The US$3.6 billion The Myitsone Dam would have been world’s 15th tallest and submerged 766 square kilometers of forestland, an area bigger than Singapore.

It’s unclear if Chinese counterparts were consulted before the decision was made public. Burma has depended on its powerful northern neighbor for trade, political support and arms deliveries since the West shunned the Burmese regime following massacres of pro-democracy demonstrators in 1988.

Public opinion may have played its part. Under the 2006 deal, 90 percent of power generated from Myitsone would have gone to China. Anger over environmental destruction galvanized people against the regime in a way that the country had not seen for years. The dam was a dagger in the heart of the Kachins, the predominant ethnic minority in the area. Pro-democracy leader Aung San Suu Kyi threw her support behind the anti-dam movement. Many made their voices heard over Facebook – a new tool for anti-regime activists.

Burma depends on China for trade,
political support and arms deliveries – but the president said no
to the Myitsone Dam.

People inside Burma can’t protest openly, but "Save the Irrawaddy" meetings have been held in Rangoon. Burmese exiles have staged anti-Chinese demonstrations outside Burmese and Chinese embassies abroad. Anti-Chinese sentiment is growing in Burma, especially in the north where Chinese influence is the strongest. According to reports from Kachin State, many Chinese nationals working in the state, including traders, have fled to China following the outbreak of hostilities between the Kachin Independence Army and government forces.

But public opinion has never been a strong factor when it comes to influencing the Burmese regime. The regime doesn’t want to risk another outbreak of anti-government protests similar to the 2007 monks’ movement and invite international condemnation with more US and EU sanctions.

Dissatisfaction within the armed forces over China's growing influence in Burma is a more likely reason for the move to suspend the dam project.

Burma has historically had a strained relationship with its northern neighbor. From the establishment of the People’s Republic of China in 1949 until 1962, Beijing maintained a cordial relationship with the non-aligned democratic government of Prime Minister U Nu. Burma was the first country outside the communist bloc to recognize the new regime in Beijing. After General Ne Win staged a coup d’etat in 1962, the Chinese, long wary of the ambitious, sometimes unpredictable general, prepared for all-out support for the insurgent Communist Party of Burma (CPB).

Anti-Chinese riots in Rangoon in 1967 – orchestrated by military authorities to deflect public anger over a deteriorating economy – provided an excuse for Chinese to intervene. On New Year’s Day 1968, armed CPB units entered northeastern Burma from China’s Yunnan Province. Over the next decade, China poured more aid into the CPB effort than any other communist movement outside of Indochina.

Dissatisfaction within the armed forces over China's influence in Burma is a more likely reason to suspend the dam.

A clandestine radio station, the People’s Voice of Burma, began transmitting from the Yunnan side of the frontier in 1971. Thousands of Chinese streamed across the border, providing additional support to the CPB.

Mao’s death in 1976, and the subsequent return to power of pragmatist Deng Xiaoping, marked the beginning of the end of massive Chinese aid to the CPB. Supporting revolutionary movements in the region was no longer in Beijing's interest. Still, China coveted Burma’s forests, rich deposits of minerals and natural gas, and hydroelectric power potential.

Ending Chinese support to the CPB ushered in a more cordial era in Sino-Burmese relations, the relations growing by leaps and bound after the 1988 bloody suppression of pro-democracy movement in Burma. Apart from supplying Burma with vast quantities of military hardware, by 1991, Chinese experts assisted in a series of infrastructure projects. Chinese military advisers soon arrived, the first foreign military personnel stationed in Burma since the 1950s. Cross-border trade between China and Burma boomed.

More recently, China has provided Burma with low-interest loans, and Chinese investment in the sanctions-hit economy is substantial, particularly true of the energy sector. For example, an agreement on a gas pipeline from the Bay of Bengal will be supplemented with an oil pipeline designed to allow Chinese ships carrying Middle Eastern oil to skirt the congested Malacca Strait.

The heavy dependence on China has led to consternation among many Burmese military leaders. Those leaders do not forget that they once fought against the China-backed CPB, that their comrades were killed by Chinese arms. Aung Lynn Htut, a former intelligence officer who sought US political asylum in 2005, drew on those memories in a September commentary for The Irrawaddy, a website run by Burmese exiles.

China has called for “talks” after President Thein Sein’s statement, but skeptics point out that a 2009 internal report by the China Power Investment Corporation, the company behind the dam, said that the size was unnecessary and called for the project to be scrapped. And China still has contracts to build six other mega-dams on the Irrawaddy and source rivers. That Thein Sein dared to make his public statement reveals a wrinkle in Sino-Burmese relations – and how Burma may try to balance foreign relations, perhaps returning to its former policy of strict neutrality and non-alignment.

Burma may try to balance foreign relations, perhaps returning to its former policy of strict neutrality and non-alignment.

Some academic observers assert that Beijing’s influence over the Burmese government is exaggerated. China, the argument goes, “has not been as successful in winning Burma’s confidence as often is reported,” as suggested by Andrew Selth, author and strategic studies researcher. The source of Burma’s arms suppliers offers evidence: Although China provided Burma with up to US$1.6 billion worth of military hardware since 1989, the regime has recently turned to Russia, the Ukraine and North Korea to diversify its arms-procurement program.

Instead of democratizing the country, Burma’s new government seems to have chosen to play “the China card,” an attempt to win support of the West. An unsigned opinion piece in The Bangkok Post, written by a Burmese government official, reportedly approved at the highest level in Naypyidaw, lays out its position: “We do not want our country to become a satellite state of the Chinese government. However, Western countries should not force us into a corner where we have no option but to increasingly rely on China.”

In this context, “force” means insistence on genuine democratic reforms. From the regime’s point of view, improved relations with the West could be accomplished simply by playing up the Chinese threat, with the hope of diminishing Western criticism of the regime.

But the regime has time and again stressed that how the country is governed is an internal matter. The West must decide if it will play along.


Bertil Lintner is a Swedish journalist based in Thailand and the author of several works on Asia, including “Blood Brothers: The Criminal Underworld of Asia” and “Great Leader, Dear Leader: Demystifying North Korea under the Kim Clan.” He can be reached at lintner@asiapacificms.com

Rights:Copyright © 2011 Yale Center for the Study of Globalization






China angry over Burma's decision to suspend work on £2.3bn dam

Beijing threatens legal action as Burma halts dam because it is 'against the will of the people'




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Jonathan Watts
guardian.co.uk, Tuesday 4 October 2011 19.46 BST
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Technicians inspect the hydropower plant at the Three Gorges project in China. Beijing is angry that Burma has cancelled a similar project. Photograph: Du Huaju/AP
Burma's decision to suspend the country's biggest hydroelectric project has shocked and enraged China, the government's most influential backer on the international stage.

Senior officials in Beijing have castigated their south-east Asian ally and threatened legal action. It emerged that they were not consulted before President Thein Sien of Burma announced last Friday a halt to building the $3.6bn (£2.3bn) hydropower dam on the Irawaddy – known as the Myitsone project – because it was "against the will of the people".

China is the impoverished nation's second-largest trading partner and biggest foreign investor. Such public displays of discord are unusual. Its reaction contrasted sharply with the response of the US government, which praised Burma's "significant and positive step" towards listening to public concerns and promoting national reconciliation.

This may be because Beijing has more at stake. China Power Investment is the primary funder of the project. Its manager, Lu Qizhou, told domestic media that he was astonished by the announcement.

"I hear about this through media reports. I was very shocked. Before this, Burma did not communicate with us about plans for a suspension," he said, in a warning that a halt to construction would precipitate legal action.

Lu said the project had received the necessary approval in both countries. He described the sudden suspension as "incomprehensible" and the cost for both countries as "immeasurable".

He said the loss was not just about the direct investment, but it was also a missed opportunity to generate electric power and there was damage to the country's reputation because of a breach of contract. In total, he calculated that the cascade of hydropower projects – of which Myitsone is just one – would have earned the Burmese government $54bn in tax revenues, shared profits and free electricity.

Lu downplayed the human and environmental impact of the dam, saying the Myitsone reservoir would necessitate the relocation of only 2,146 people in five villages. He said the Chinese company had provided them with two-storey houses, 21in colour televisions and a 100,000 kyat living allowance.

At the weekend, Hong Lei, a Chinese Foreign Ministry spokesman, called on Burma to hold consultations over the dam and noted that both countries agreed to move ahead with the project after a thorough assessment of the impact.

Opponents of the dam accuse China of being disingenuous. The Burma Rivers Network, which represents communities affected by the hydropower project, said Beijing had negotiated its investments with the military government without considering the will of the people.

"The villagers at the dam site, numerous political and community organisations, international human rights organisations have attempted to contact China Power Investment and discuss the concerns about the impacts and process of the project. Even though CPI never responded to all these attempts at dialogue, they cannot claim to be unaware of the feeling about this project by the people of Burma," the group said.

Far from benefiting Burma through flood control, the group argue that the dam would put the demands of power generation for China before the needs of local people.

"Chinese engineers running the dams will decide how much water to release downstream according to orders from Beijing ... As seen with the Mekong, this can cause unexpected and devastating water surges and shortages," it said.