ALYAS    AMO  Lectures  for  Young  Asia  Scholars    

         

   

     

The  US  &  Political  Reforms  in  Myanmar:  Implications  for  Regional  Balance  of  Power      

         

 Blanka  Šoulavá  

               

Prague  2015    

   

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Introduction      The   series   of   political   reforms   in  Myanmar,1  which   started   in  November   2010,  took  place  amid  a  strong  alignment  of   interests  among  the  US,   India  and  Japan,  the  dynamic  ascendancy  of  China   in  Southeast  Asia  and  the  emerging  power  of  Association   of   Southeast   Asian   Nations   (ASEAN)   members.   In   2009,   the   US  President  Barack  Obama  announced  a  shift  in  US  policy  towards  Myanmar,  even  though  the  situation  inside  the  country  was  largely  the  same  as  during  the  Bush  Administration.  The  purpose  of   this  paper   is   to  answer   the   following  question:  what  were  the  key  drivers  that   led  to  the  change   in  US  policy  and  what  will  be  the  consequences  for  the  regional  balance  of  power?  In  order  to  do  so,  I  will  first  focus  on  the  development  and  consequences  of  political  reforms  in  Myanmar,  as  well   as   on   their   strategic   importance.   The   second   section   focuses   on   US-­‐Myanmar  relations,  the  failure  of  the  US’s  sanctions  policy  and  the  importance  of  Myanmar  in  the  context  of  the  US’s  policy  Pivot  to  Asia.  Finally,  the  third  section  analyses   the   impact  of   the   recent  developments   in  Myanmar  on  other   regional  powers,  most  importantly  on  China,  but  also  on  India  and  Japan.  I  will  conclude  by   emphasising   several   areas   of   possible   cooperation,   but   also   of   increasing  competition,   between   the   key   regional   powers   both   in   Myanmar   and  consequently  in  Southeast  Asia.  

1.  Recent  Developments  in  Myanmar      

1.1  Political  Reforms        

In   1988,   Myanmar  witnessed  widespread   protests   against   the  military   rule   of  General  Ne  Win.  These  demonstrations,  also  known  as  the  8888  Uprising,  were  followed  by  a  military  coup  d’état  by  General  Saw  Maung  and  the  establishment  of   the   State   Law   and  Order   Restoration   Council   (SLORC).   Two   years   later,   the  military   junta  organized  general   elections,   in  which   the  main  opposition  party,  the  National  League  for  Democracy  (NLD),  won  80%  of  the  seats  in  parliament.  However,   the   military   junta   de   facto   cancelled   the   results   and   maintained   its  rule.2  In  1992,  the  State  Peace  Development  Council  (SPDC)  replaced  the  regime  and   the   former’s   leader,   General   Than   Shwe,   stayed   in   power   until   the   2010  elections.  Despite  strong   international  criticism,   these  2010  elections  were  one  of   the   first   steps   of   the   planned   government   reforms   known   as   Road   Map   to  

                                                                                                               1  In  1989  the  new  military  government  changed  the  country’s  name  from  the  “Union  of  Burma”  to  2  „1988  Uprising  and  1990  Election”,  Oxford  Burma  Alliance,  http://www.oxfordburmaalliance.org/1988-­‐uprising-­‐-­‐1990-­‐elections.html,  (accessed  15.  2.  2015).  

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Democracy,   which   led   to   modest   democratisation   of   Myanmar. 3  As   a  consequence,  the  quasi-­‐civilian  government  led  by  president  Thein  Sein  released  a  number  of  political  prisoners,  eased  media  censorship,  initiated  several  cease-­‐fire  negotiations  with  ethnic  groups  and  held  by-­‐elections  in  April  2012,  in  which  the  NLD  won  a  landslide  victory.  Besides  the  internal  political  reforms  however,  a  change  in  the  foreign  policy  of  Myanmar  could  also  be  observed,  which  had  a  major   impact   on   bilateral   relations   with   the   key   regional   powers,   particularly  with  the  USA  and  China.    Despite  the  initial  enthusiasm  of  the  West  towards  these  political  developments,  the   reform   process   still   remains   fragile   and   uncertain.   The   preparations   and  results  of  the  general  elections,  which  should  be  held  by  the  end  of  this  year,  will  be  an  important  indicator  of  the  future  development.  One  of  the  major  problems  is  the  new  political  system.    According  to  the  2008  constitution,  25%  of  the  seats,  including  crucial  ministries,  are  still  reserved  for  the  military.    Furthermore,  the  quasi-­‐civilian   government   faces   a   major   challenge,   because   it   needs   to   solve  several  decades-­‐lasting  ethnic   conflicts  and  maintain   the   territorial   integrity  of  the   country.   This   is   extremely   important   because   most   of   these   conflicts   are  located  in  the  same  areas  as  foreign  investment  projects.  Therefore  any  internal  instability  directly  affects  the  interests  of  international  partners.    Among  the  experts,  there  is  no  agreement  as  to  what  caused  the  political  reforms  in   the   country.   However,   some   of   the  most   common   explanations   refer   to   the  desperate  economic  situation  of   the  country  and  the  top-­‐down  character  of   the  reforms,  which  might  suggest  that  the  military  is  trying  to  ‘institutionalise’  itself  through   these   reforms.   Finally,   another   common   explanation   is   the   fear   of   the  ruling   junta   of   rising   economic   and   diplomatic   dependence   on   China.     Indeed,  since   2001   China   has   became  Myanmar’s  most   important   trading   partner   and  source  of  imported  weaponry  and  military  equipment.  4  

1.2  Myanmar:  High  Stakes    Myanmar,   a  member  of  ASEAN,   is   the   largest   state   in  mainland  Southeast  Asia  and  borders  five  countries,   including  China,  India  and  Thailand.  It   is  situated  in  the   crossroad   of   Southeast   Asia,   where   the   Chinese   and   Indian   spheres   of  influence  overlap.  The  country  has  access  to  the  Indian  Ocean  and  to  the  Bay  of  Bengal,  which  creates  an  alternative  route   to   the  Straits  of  Malacca,   the  key  oil  bottleneck   in   Asia.   This   is   especially   important   for   the   Chinese   strategy   of                                                                                                                  3  Road  Map  to  Democracy  was  a  plan  of  reforms,  which  the  Prime  Minister  Khin  Nyunt  announced  in  2003  as  a  result  of  tension  in  society.  It  included  reconvening  of  the  National  Convention,  drafting  of  a  new  constitution  and  its  adoption  through  national  referendum,  holding  free  and  fairs  elections  and  other  reforms.  Its  key  problem  was  that  it  didn’t  include  a  precise  deadlines  for  fulfilling  these  steps.  „Myanmar’s  Military:  Back  to  the  Barracks?“,  International  Crisis  Group  Briefing  N°143,  http://www.crisisgroup.org/en/publication-­‐type/media-­‐releases/2014/asia/myanmar-­‐s-­‐  military-­‐back-­‐to-­‐the-­‐barracks.aspx  (accessed  15.  2.  2015).    4  Jalal  Alamgir,  „Myanmar’s  Foreign  Trade  and  its  Political  Consequences“,  Asian  Survey  48,  n.  6  (November/December  2008):  989.  

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diversification  of  transportation  routes,  since  more  than  80%  of  China’s  total  oil  imports  are  transmitted  through  these  Straits.5  Economically,  Myanmar  is  one  of  the  poorest  countries  in  the  world.  Despite  the  fact   that  after  the  Second  World  War  Myanmar  was  one  of   the  richest  states   in  the   region   of   Southeast  Asia,   according   to   the   International  Monetary   Fund   its  2010  GDP  per  capita  was  approximately  only  50%  of   the  other  poorest  ASEAN  members,   Laos   and   Cambodia. 6  However,   the   poor   economic   situation  represents   a   great   opportunity   for   development   of   both   Myanmar   and   the  bordering  regions,  particularly  in  China  and  India.  There  is  a  great  potential  for  enhancement  of  connectivity  in  the  region,  given  the  long-­‐term  lack  of  social  and  economic   infrastructure.   If   successful,   Myanmar   could   become   a  major   transit  hub   in   the   Southeast   Asia   region.   Among   the   most   important   opportunities  belong   to   investments   in   telecommunications   and   manufacturing,   as   well   as  transit   infrastructure   and   electric   transmission   systems.   Finally,  Myanmar   also  possesses   large   amounts   of   natural   resources,   since   it   has   the   third   biggest  natural  gas  reserves  in  Southeast  Asia.7  Besides  those  economic  opportunities,  Myanmar  faces  a  great  security  challenge,  because  of  one  of  the   longest   lasting  civil  war  conflicts   in  the  world.  About  one  third  of  its  60  million  population  is  made  up  by  minorities,  which  live  in  half  of  its  total  land  area.  Some  of  the  largest  ones  are  Buddhis  Shan  people  who  live  in  the  north  and  northwest  of  the  country,  followed  by  Kachin,  who  are  Christians  and  live  on  the  border  with  Bangladesh.  Probably  the  most  conflict-­‐ridden  ethnic  group  is  the  Rohingya  Muslims  who  live  in  the  Rakhine  State    and  are  considered  to  be  the  most  persecuted  minority  in  the  world.8  Furthermore,  Myanmar  is  also  the   world’s   third   largest   producer   of   illicit   opium   and   part   of   the   Golden  Triangle.9          

                                                                                                               5  „Shared  Energy  Interests  an  Opportunity  for  Sino-­‐Indian  Cooperation,”  Carnegie  Center  for  Global  Policy,  http://carnegietsinghua.org/2014/05/23/shared-­‐energy-­‐interests-­‐opportunity-­‐for-­‐sino-­‐indian-­‐cooperation/hbnd,  (accessed  10  March,  2015).    6  „Myanmar’s  Military:  Back  to  the  Barracks?“,  International  Crisis  Group  Briefing  N°143,  http://www.crisisgroup.org/en/publication-­‐  type/media-­‐releases/2014/asia/myanmar-­‐s-­‐military-­‐back-­‐to-­‐the-­‐barracks.aspx  (accessed  15.  2.  2015).  7  „The  World  Factbook  -­‐  Burma,”  Central  Intelligence  Agency,  https://www.cia.gov/library/publications/the-­‐world-­‐factbook/geos/bm.html,  (accessed  21  March,  2015).    8„Special  Report:  Myanmar’s  Ethnic  Divide:  The  Parallel  Struggle,”  Institute  of  Peace  and  Conflict  Studies,  http://www.ipcs.org/special-­‐report/myanmar/myanmars-­‐ethnic-­‐divide-­‐the-­‐parallel-­‐struggle-­‐131.html,  (accessed  21  February  2015).    9  „Getting  Higher,“  The  Economist,  April  12,  2014.    

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2.  US  policy  towards  political  reforms  in  Myanmar      In   2009,   President   Barack   Obama   announced   a   shift   in   US   policy   towards  Myanmar   despite   the   fact   that   the   political   situation   in   the   country   was   very  problematic  and  none  of  the  goals  of  the  US  sanctions  policy,  which  had  started  after   1988,   had   actually   been   achieved.   For  many  years,  Myanmar  was   lacking  political,   economic,   strategic   or   military   interests   for   the   US.   However,   its  importance  has  dramatically  increased  in  the  past  couple  of  years.  The  sanctions  regime  failed  in  achieving  its  goals  since  it  did  not  lead  to  democratisation  of  the  country.   It   also   caused   a   major   obstacle   to   US   relations   with   ASEAN.  Furthermore,  if  the  relations  between  Myanmar  and  the  US  improved,  they  had  the  potential  to  indirectly  counter  Chinese  interests  in  the  country.        

2.1.  Failure  of  the  Sanctions  Regime  and  the  change  in  2009      Since   the   end   of   the   Second   World   War,   US-­‐Myanmar   relations   were   on   the  decline.  After  the  8888  Uprising,  the  US  imposed  strict  sanctions  on  the  military  junta  and  the  George  W.  Bush  administration  even  increased  its  criticism  of  the  situation  in  Myanmar.10  During  most  of  the  time,  the  main  opposition  party  NLD  together  with   its   leader  Aung  San  Suu  Kyi  maintained   immense   influence  over  the   formulation   of   the   US   position   towards   Myanmar.11  The   key   goals   of   the  sanctions  policy  were  democratisation  of   the  country,   improvement   in  political  freedom   and   the   human   rights   situation   and,  most   importantly,   recognition   of  the   results   of   the   1990   May   general   elections,   which   would   have   as   a  consequence   the   resignation   of   the   military   junta   and   change   of   the   political  regime   in   Myanmar.12  However,   none   of   these   goals   were   achieved.   On   the  contrary,  according  to  some  experts,  the  US  sanctions  affected  ordinary  citizens13  and  the  military  junta  managed  to  replace  trade  with  the  US  with  other  trading  partners,  who  did  not  interfere  with  Myanmar’s  internal  affairs.  14  However,   in   September   2009   the   administration   of   President   Barack   Obama  concluded   a   comprehensive   review   of   America's  Myanmar   policy,   opting   for   a  balance   between   economic   sanctions   and   "pragmatic   engagement"   and   for  

                                                                                                               10  In  2005,  Condoleeza  Rice  identified  Myanmar  as  one  of  the  „outposts  of  tyranny“,  together  with  Cuba,  Iran,  North  Korea,  Zimbabwe  and  Belarus.  „Rice  Names  ‘Outposts  of  Tyranny‘”,  BBC  News,  January  19,  2005.  11  David  I.  Steinberg,  „Aung  San  Suu  Kyi  and  US  Policy  towards  Burma/Myanmar”,  Journal  of  Current  Southeast  Asian  Affairs  29,  n.  3  (2010):  36.      12  David  I.  Steinberg,  „The  United  States  and  Myanmar:  a  ‘Boutique  Issue‘?”,  International  Affairs  86,  n.  1  (2010).  13  Toshihiro  Kudo,  „The  Impact  of  US  Sanctions  on  the  Myanmar  Garment  Industry”,  Asian  Survey  48,  n.  6  (November/December  2008):  998.      14  Jalal  Alamgir,  „Myanmar’s  Foreign  Trade  and  its  Political  Consequences“,  Asian  Survey  48,  č.  6  (November/December  2008):  987.  

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augmenting  contacts  with  the  higher  levels  of  the  Myanmar  military.15  This  led  to  a  series  of  visits  of  US  officials  to  Myanmar  from  2009  until  2011.  In  2011,  after  the   appointment   of   former   general   Thein   Sein   into   the   president’s   office,  Myanmar’s  political  reforms  began.  At  the  end  of  the  year,  Hillary  Clinton  became  the  first  Secretary  of  State    to  visit  Myanmar  since  John  Foster  Dulles  in  1955  and  in  2012  the  US  responded  by   lifting  some  of  the  sanctions,  which  was  followed  by  the  visit  of  President  Barack  Obama    to  the  country.16    The  immediate  reaction  of  the  US  to  the  reform  process  was  criticized  by  Aung  San  Suu  Kyi  for  being  too  “optimistic”  and  in  2014  the  US  extended  some  of  the  sanctions.17  Some  human  rights  advocates  and  some  members  of  Congress  have  been  concerned  that  the  strategic  and  security  interests  in  the  region  has  taken  priority   over   demands   for   governments   to   respect   free   speech   and   safeguard  religious   and   ethnic   minorities.  18  Despite   this   criticism,   the   administration   of  President  Obama,  which  decided  to  abandon  the  sanctions  policy  as  the  only  way  to  achieve  its  goals  in  Myanmar,  managed  to  improve  both  the  bilateral  relations  between  the  two  countries  and  the  US’s  position  in  the  region.      

2.2  The  Role  of  Myanmar  in  the  context  of  the  Pivot  to  Asia    In   2011,   Hillary   Clinton   introduced   the   concept   of   the   US   Pivot   to   Asia.19  The  main   goal   of   the   policy   was   to   enhance   diplomatic,   economic   and   military  engagement  in  the  region  of  the  Asia-­‐Pacific.  Even  though  this  was  not  a  radical  turn   in   US   policy   given   the   long-­‐term   US   involvement   in   the   region,   the   Bush  Administration’s   foreign   policy   was   mostly   focused   on   the   situation   in   other  regions.  Also,  during  his  presidency  most  of  the  cooperation  was  on  the  bilateral  level,  which   led   to   criticism   from  ASEAN  member   states.  Therefore,   for  Barack  Obama,   there   was   a   space   to   not   only   improve   bilateral   relations   with   the  countries   in   Southeast   Asia,   but   also   to   enhance   cooperation   with   regional  multilateral   organizations. 20  ASEAN   is   the   most   important   one,   since   its  

                                                                                                               15  "Timeline:  US-­‐Burma/Myanmar  Relations."  Contemporary  Southeast  Asia  32,  no.  3  (2010):  434-­‐436.    16  „US  to  Ease  Sanctions  against  Burma“,  BBC,  April  5,  2012;  „Burma’s  Thein  Sein  Embarks  on  Historic  US  Visit“,  BBC,  September  24,  2012;  „US  President  Barack  Obama  to  Visit  Burma“,  BBC,  November  9,  2012.  17  Paul  Mooney,  „Myanmar’s  Suu  Kyi  says  Reforms  Stalled,  West  too  Optimistic“,  Reuters,  November  5,  2014;  „Obama  Extends  Some  Sanctions  against  Myanmar  Despite  Reforms“,  Reuters,  May  15,  2014.  18  David  Nakamura,  „Obama’s  Next  Challenge  in  Asia:  Rights  Groups  Criticize  U.S.  priorities  in  Burma,“  The  Washington  Post,  November  12,  2014.    19  Hillary  Clinton,  „America’s  Pacific  Century“,  Foreign  Policy,  October  11,  2011.  20  Robert  Sutter,  „The  Obama  Administration  and  US  Policy  in  Asia“,  Contemporary  Southeast  Asia  31,  n.  2  (2009):  192;  Kurt  Campbell  and  Brian  Andrews,  „Explaining  the  US  ’Pivot’  to  Asia“,  Chatham  House,  http://www.chathamhouse.org/sites/files/chathamhouse/public/Research/Americas/0813pp_pivottoasia.pdf  (accessed  10.  1.  2015);  Congressional  Research  Service,  „United  States  Relations  

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members   have   increasing   diplomatic   importance,   control   over   key   maritime  routes  and  large  quantities  of  natural  resources.  However,  one  of  the  key  issues  in  US-­‐ASEAN  relations  was  the  different  approach  of   the  US  and  member   states   toward   the  military   regime   in  Myanmar,  because  the   American   sanctions   policy   differed   from   the   ASEAN   policy   of   non-­‐interference   in   internal  affairs.  The   turn   in   the  US  approach   towards  Myanmar  had  as  a  consequence  an  improvement  in  US  relations  with  ASEAN,  which  led  for  example   to   the   signature   of   the   Treaty   of   Amity   and   Cooperation   (TAC)   in  Southeast   Asia   in   2009.21  Improvement   in   the   multilateral   relations   was   also  important   because   while   China   was   operating   at   every   level   in   Myanmar,   top  Bush   Administration   officials   had   periodically   missed   summits   of   ASEAN   and  thereby   lacked   the   same   influence   as   China   in   Myanmar.  22  The   crucial   factor  behind   the   Pivot   to   Asia   policy   is   also   the   rapidly   increasing   rise   of   Chinese  influence   in   the  Southeast  Asia  region  and  ASEAN.23  In  2002,  China  and  ASEAN  signed  a  free  trade  agreement,  in  2003  it  became  the  first  country  to  sign  the  TAC  and  it  has  become  a  major  provider  of  development  aid,  economic  assistance  and  investment,  particularly  in  Laos,  Cambodia  and  Myanmar.24  According  to  Hillary  Clinton,   the  US  did  not   change   their  policy   towards  Myanmar   to   compete  with  China:    

„And  we  welcome  –  as   I  specifically  told  the  president  and  the  two  speakers,   we   welcome   positive,   constructive   relations   between  China  and  her  neighbors.  We  think  that’s  in  China’s  interest  as  well  as  the  neighborhood’s  interest.  We  think  that  being  friends  with  one  doesn’t  mean  not  being  friends  with  others.  So  from  our  perspective,  we   are   not   viewing   this   in   light   of   any   competition   with   China.  We’re   viewing   this   on   its   merits   as   an   opportunity   for   us   to  reengage  here.  And  we  think  that  that  is  a  very  open  possibility.  And  that’s  why  I’m  here  to  assess  it  for  myself.”  25  

                                                                                                                                                                                                                                                                                                                             with  the  Association  of  Southeast  Asian  Nations  (ASEAN)“,  Congressional  Research  Service,  http://fpc.state.gov/documents/organization/133919.pdf  (accessed  30.  1.  2015).  21  United  States  Accedes  to  the  Treaty  of  Amity  and  Cooperation  in  Southeast  Asia“,  U.S.  Department  of  State,  http://www.state.gov/r/pa/prs/ps/2009/july/126294.htm  (accessed  20.  1.  2015);  Andrew  Selth,  „United  States  Relations  with  Burma:  From  Hostility  to  Hope“,  Griffith  Asia  Institute  Regional  Outlook  36  (2012):  7;  „Special  Report  –  How  the  U.S.  Coaxed  Myanmar  in  from  the  Cold“,  Reuters,  December  22,  2011.  22  Robert  D.  Kaplan,  Monsoon:  The  Indian  Ocean  and  the  Future  of  American  Power,  (New  York:  Random  House,  2010),  p.  219    23  Robert  Sutter,  „The  Obama  Administration  and  US  Policy  in  Asia“,  Contemporary  Southeast  Asia  31,  n.  2  (2009):  193;  David  Shambaugh,  „China  Engages  Asia:  Reshaping  the  Regional  Order",  International  Security  29,  n.  3  (Winter  2004/05):  64-­‐99.      24  Congressional  Research  Service,  „United  States  Relations  with  the  Association  of  Southeast  Asian  Nations  (ASEAN)“,  Congressional  Research  Service,  http://fpc.state.gov/documents/organization/133919.pdf  (accessed  30.  1.  2015).  25  Hillary  Clinton,  „Press  Availability  in  Nay  Pyi  Taw,  Burma“,  U.S.  Department  of  State,  http://www.state.gov/secretary/20092013clinton/rm/2011/12/177994.htm,    (accessed  23.  1.  2015).    

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 The   primary   focus   of   US   policy   towards   Myanmar   was   the  democratisation   and   development   of   the   country.   Consequently,   the  rapid   change   in   the   US   policy   managed   to   indirectly   counter   Chinese  interests   in  Myanmar.  Therefore,   the   improvement  of  US  relations  both  with  Myanmar   and   ASEAN  will   inevitably   counter   Chinese   influence   in  the  strategically  important  region  of  Southeast  Asia.    

   3  Implications  for  Regional  Balance  of  Power  

3.1  Reaction  of  China        Since   1990,   China   was   one   of   Myanmar’s   most   important   economic   and  diplomatic   partners   and   its  main   goal  was   to  maintain   a   stable   position   in   the  country.  For  instance,  China  strongly  supported  the  military  government  when  it  vetoed   the   2007   Security   Council   draft   resolution   that   condemned  Myanmar’s  human  rights  situation.    For  China,  Myanmar  has  a  crucial  strategic  and  security  importance.  It  shares  a  border   with   Yunnan   Province,   which   is   one   of   its   most   underdeveloped  landlocked  regions  and  therefore  would  profit  from  gaining  access  to  the  Bay  of  Bengal  through  Myanmar.  Furthermore,  Myanmar  plays  an  important  part  in  the  strategy  of  diversification  of  trade  transportation  routes,  as  well  as  it  represents  a  security  threat  mainly  because  of  the  Kachin  Conflict,  which  is  located  near  its  borders.    However,   the   political   reforms   and   opening   in   Myanmar   challenged   China’s  dominant  position,  which  created  a  space  for  other  regional  powers’  interests.    Firstly,   China   had   good   relations   with   the   ruling   military   junta,   not   with   the  opposition   leaders.   Therefore,   China   had   to   initiate   contacts   with   the   new  emerging  political   leaders,  which   it  was  not  prepared   for.   Furthermore,   one  of  the   most   important   consequences   was   an   enormous   reduction   in   the   Chinese  Foreign  Direct   Investment   in  Myanmar,  which  decreased  by  90%  from  2011  to  2012,  mainly   because   of   several   cancellations   of   infrastructure   projects.  26  The  most   significant   one   was   the   suspension   of   a   major   Chinese-­‐backed  infrastructure  project,  the  Myitsone  Dam  in  September  2011.27    One  of   the  widely  criticised  projects  by   the   local  population  was  also   the  Sino-­‐Myanmar  oil  and  gas  pipeline  project,  which  was  completed  in  May  2013  and  is  

                                                                                                               26  Yun  Sun,  „China  Adapts  to  New  Myanmar  reality,“  Asia  Times,  http://atimes.com/atimes/Southeast_Asia/SEA-­‐04-­‐231213.html,  (accessed  March  15,  2015).    27  „China’s  Influence  in  Myanmar  Facing  Growing  Scrutiny,”  The  Diplomat,  http://thediplomat.com/2015/01/chinas-­‐influence-­‐in-­‐myanmar-­‐facing-­‐growing-­‐scrutiny/,  (accessed  February  27,  2015);  Thomas  Fuller,  „Myanmar  Backs  Down,  Suspending  Dam  Project”  New  York  Times,  September  30,  2011.    

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China’s   fourth   largest  energy  transportation  route,  which  has  national  strategic  importance  by  diversifying  China’s  energy  transportation  system.28  According  to  some  analysts,  China  did  not  expect  the  political  reform  process  in  Myanmar   to   have   such   a   big   impact   on   its   foreign   policy.   As   a   response   to   it,  China  has  established   relations  with   the  key  opposition   leaders,   in  order   to  be  able  to  maintain  its  position.  Furthermore,  China  helped  to  arrange  negotiations  between  Myanmar  leaders  and  the  Kachin  Independence  Organization,  because  of   the   Chinese-­‐owned   pipeline,  which   carries   natural   gas   from  Kachin   State   to  China.  Chinese  investors  are  also  enhancing  their  public  relations  and  correcting  their  mistakes,  while   trying   to   cooperate  more  with   the  Myanmar   government  and  people.29  However,  China  will  keep  its  strong  position  thanks  to  the  several  infrastructure  projects  and  competition  for  energy  resources  in  Southeast  Asia.30  

3.2  Reaction  of  India      Until   a  policy   shift   in  1993,   India  was  one  of   the  key   supporters  of  Myanmar’s  opposition   movement.   Since   then   however,   it   has   refused   the   US   sanctions  approach   and   pursued   a   pragmatic   policy   instead.31  For   India,  Myanmar   is   the  only   ASEAN   country   it   shares   borders  with.   It   represents   a   bridge   to   the   East  with  great  potential   for  growing   India’s   regional  power,   since   there  are  no   rail  links  and  just   insecure  road  connections  between  the  two  countries.  Therefore,  India   aims   to   fill   the   strategic   gap   left   by   China   and   invest   in   a   series   of  infrastructure   projects.   Those   could   enhance   trade   both   with   the  underdeveloped   North-­‐eastern   states   via   land   routes   and   already   existing   sea  connectivity  with  the  Indian  city  of  Chennai.  Even  though  the  bilateral  trade  has  grown   from  USD   $12,4  million   in   1980-­‐1981   to   $2,18   billion   in   2013-­‐2014,   it  was  mainly  thanks  to  the  sea  trade.  32  For  that  reason,  India  wants  to  enhance  the  land   routes   and   facilitate   trade   exchange   with   its   underdeveloped   northeast  regions   by   investing   in   the   India-­‐Myanmar-­‐Thailand  Trilateral  Highway,  which  should  be  finished  by  the  end  of  2016.33    Furthermore,  India  has  been  trying  to  

                                                                                                               28  „Great  Powers  and  the  Changing  Myanmar,  Issue  Brief  No.  1:  Chinese  Investment  in  Myanmar:  What  Lies  Ahead?”  Stimson,  http://www.stimson.org/images/uploads/Yun_Issue_Brief1.pdf  (accessed  February  13,  2015).    29  „Great  Powers  and  the  Changing  Myanmar,  Issue  Brief  No.  1:  Chinese  Investment  in  Myanmar:  What  Lies  Ahead?”  Stimson,  http://www.stimson.org/images/uploads/Yun_Issue_Brief1.pdf  (accessed  February  13,  2015).    30  „United  States  Relations  with  the  Association  of  Southeast  Asian  Nations  (ASEAN)”  Congressional  Research  Service,  http://fpc.state.gov/documents/organization/133919.pdf,  (accessed  March  10,  2015).    31  Maxwell  Harrington,  „Conference  Report:  China–Myanmar  Relations:  The  Dilemmas  of  Mutual  Dependence”  Journal  of  Current  Southeast  Asian  Affairs,  31,  n.1  (2012):137  .    32  „The  Strategic  Importance  of  Myanmar  for  India”,  The  Diplomat,  http://thediplomat.com/2014/08/the-­‐strategic-­‐importance-­‐of-­‐myanmar-­‐for-­‐india,  (accessed  March  10,  2015).    33  Muralidhar  Reddy,  „India,  Thailand  Hopeful  of  Trilateral  Highway  by  2016,”  The  Hindu,  http://www.thehindu.com/news/national/india-­‐thailand-­‐hopeful-­‐of-­‐trilateral-­‐highway-­‐by-­‐2016/article4766782.ece,  (accessed  February  20,  2015).    

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bolster   bilateral   military   ties   and   assists   Myanmar   in   building   offshore-­‐patrol  vessels.   In  March  2013,   India   and  Myanmar  even   conducted  a   joint   exercise   in  the  Bay  of  Bengal.34    

3.3  Reaction  of  Japan      Japan,  Asia’s  second  most  important  power  and  a  close  ally  of  the  US,  has  a  long  historical  relationship  with  Myanmar,  because  from  1948  until  1988  it  was  one  of  its  main  aid  donors.35  However,  after  the  military  coup  in  1988  the  interaction  between  Myanmar   and   Japan   shrank   dramatically   and  most   of   the   loans  were  stopped.  Japan  was  replaced  by  China  and  now  the  Japanese  government  is  keen  to   improve   the   relationship,   mainly   for   economic   reasons   and   Myanmar’s  potential  to  reach  India’s  market.  As  a  consequence,  in  April  2011  Japan  waived  $3,7   billion   of   Myanmar’s   unpaid   debt   during   a   summit   in   Tokyo.36  In   2012,  Myanmar   and   Japan   also   agreed   that   Japan   would   support   Thilawa   Special  Economic  Zone  project,  which  would  enable   Japan   to  have  direct  access  across  the   Bay   of   Bengal   to   the   Indian   market. 37  Since   the   new   liberal   foreign  investment   law  was   introduced   in  Myanmar,   Japanese  major   banks  were   very  successful   in   obtaining   licenses.   Japan   has   been   using   the   aid   program   to  enhance   its   engagement   in   Myanmar,   which   is   important   in   both   geostrategic  and   economic   terms   and   in   2014   it   launched   an   alliance   with   the   US   for  cooperation  in  Myanmar.38  

Conclusion    In  summary,  stability  and  prosperity  in  Myanmar  would  be  in  the  interest  of  all  major  powers  in  the  region,  because  Myanmar  has  the  potential  to  develop  into  an   energy   and   transportation   hub,   uniting   the   Indian   subcontinent   and  

                                                                                                               34  Vijay  Sakhuja,  „Myanmar  Expanding  Naval  Ties  with  India,”  Institute  of  Peace  and  Conflict  Studies,  http://www.ipcs.org/article/peace-­‐and-­‐conflict-­‐database/myanmar-­‐expanding-­‐naval-­‐ties-­‐with-­‐india-­‐3876.html,  (accessed  March  10,  2015).    35  „What  Myanmar  Means  for  the  U.S.-­‐Japan  Alliance,”  Carnegie  Endowment  for  International  Peace,  http://carnegieendowment.org/files/myanmar_us_japan.pdf  (accessed  March  14,  2015);  „Japan  Chair  Platform:  Japan  and  Myanmar:  Relationship  Redux,”  Center  for  Strategic  and  International  Studies,  http://csis.org/publication/japan-­‐chair-­‐platform-­‐japan-­‐and-­‐myanmar-­‐relationship-­‐redux  ,(accessed  March  14,  2015).  36  Aye  Aye  Win,  „Japan  Gives  Burma  $504  Million  Loan,  Forgive  Debt”  The  Irrawaddy,  http://www.irrawaddy.org/burma/japan-­‐gives-­‐burma-­‐504-­‐million-­‐loan-­‐forgives-­‐debt.html,  (accessed  February  10,  2015).    37  James  Reilly,  „China  and  Japan  in  Myanmar:  Aid,  Natural  Resources  and  Influence,"  Asian  Studies  Review  37,  no.  2:  141-­‐157.  38  „Fact  Sheet:  U.S.-­‐Japan  Global  and  Regional  Cooperation,”  White  House,  www.whitehouse.gov/the-­‐press-­‐office/2014/04/25/fact-­‐sheet-­‐us-­‐japan-­‐global-­‐and-­‐regional-­‐cooperation,  (accessed  March  14,  2015).      

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connecting  underdeveloped  regions.  Therefore,  it  represents  a  great  opportunity  for  cooperation  between  the  major  powers.  Firstly  in  dealing  with  the  problem  of  ethnic  conflicts,  there  is  a  great  incentive  to  find  a  peaceful  solution  in  order  to  get   more   investment   and   secure   already   existing   investments.   Furthermore,  there   is   opportunity   for   cooperation   in   countering   the   organized   crime   and   in  improving  the  health  situation  in  the  country.  For  these  reasons,  in  January  2014  the  US  and  China  announced  their  intension  to  pursue  cooperation  in  Myanmar  and  there  was  a  similar  agreement  made  between  the  US  and  Japan.    However,   the   stakes   are   high,   because   the   interests   of   major   powers   are  overlapping.    Most  important  is  the  role  of  China,  whose  interests  were  undercut  by   the  reform  development.  Therefore,   in   the  near   future  we  might  observe  an  increase   in  conflict  over   influence   in   the  country  on  several   levels.  Firstly,  on  a  diplomatic  level  between  the  US  and  China,  secondly,  regarding  competition  over  the   investment   projects   between   China,   India   and   Japan   and   finally,   on   the  maritime  security  and  military  cooperation  between  China  and  India.  Finally,  the  future  development  is  going  to  be  greatly  influenced  by  the  internal  affairs   in   Myanmar,   particularly   by   the   preparations   and   outcome   of   general  elections   at   the   end   of   2015,   the   resolution   of   the   conflicts   with   the   ethnic  minorities   and   the   success   of   economic   reforms,   which   would   enhance   the  development  of  the  country.          

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