Logistics article(s)
June 1, 2019
rail in Myanmar iStock-976472170
Any road or railway linking Mandalay with China will have to pass through Shan, above, and Kachin States, both areas where there are armed conflicts.

Some details have emerged of the slow progress being made in a key Belt and Road Initiative project – the China-Myanmar Economic Corridor (CMEC).


CMEC includes the New Yangon City project, the Kyaukphyu Special Economic Zone (SEZ) Deep-Sea Port project and the China-Myanmar railway project. These are dubbed important and, according to official published Chinese sources such as Xinhua, “have made significant progress.”


This was news in Myanmar where there are concerns about the projects, principally about being caught in a China debt trap. Nor is it helped by the lack of basic information about what CMEC could expand to, as the accord signed last year has yet to be published by either side.


The working assumption is that the CMEC will initially connect Kunming, the capital of China’s Yunnan province, to Myanmar’s major economic centre at Mandalay. It is thought that the project will then expand with branches east to Yangon and west to the Kyaukphyu on the coast, giving China access to the Bay of Bengal.


Currently the official line is there is progress with the railway project initiated last year, attendees of the second China-Myanmar Economic Corridor Forum held in Kunming were told earlier this year. This is a reference to a survey being done ahead of construction but only for the border-to-Mandalay leg – which might not be that optimistic a sign in itself.


“Clearly the Chinese want the link all the way to Kyaukphyu, and the Myanmar government will only allow them to survey to Mandalay. A train to Mandalay will only serve Myanmar interests, so I don’t think it will happen until the Chinese get what they want,” Allan Davidson, head of vehicle leasing and rental at hauliers Yoma, told Asia Cargo News.


While official sources were not available for comment, one usually reliable news site, Irrawaddy, reported the survey period as being one year, with ground survey being carried out until April for some sections of the route.


What’s at stake is a piece of infrastructure that could be a game-changer for both Myanmar, where the hardware is usually old and failing, and Yunnan, which is landlocked. 


Actually, it’s a dual piece of kit, as the plan is for an expressway to parallel an electrified railway linking border town Ruili in China with Kyaukphyu on Myanmar’s coast. 


At the border there are to be three SEZ’s: Kanpiketi in Kachin state, and Muse and Chinshweshaw, both in Shan state. Muse is opposite Ruili so there is a logic, but the practicality of building SEZs in a region where armed conflicts are ongoing doesn’t seem to have been factored in. It has also reported that construction of Chinshwehaw was to start in April.


For the border-to-Mandalay leg, the 431-km railway route is to have at least seven freight stations, although locations have not yet been set.


Kyaukphyu Deep Sea Port, at other end, is facility of some 520 hectares, of which 400 will be for an industrial park. Phase 1 will reportedly involve the construction of two jetties with a total investment of US$1.3 billion.


Figures like that – and others suggest that US$ billion will be spent in the initial stages, with the complete Kyaukphyu-Muse-Ruili rail link being priced at USD20 billion – are another reason why the CMEC is causing concern in Myanmar, although it has not yet reached the level of pushback seen in other countries such as Malaysia and Pakistan.  


“It looks like another way of China lending money to Myanmar to build infrastructure that will benefit China and then leave Myanmar to pay for. I am a [Belt and Road] cynic as I see what is happening around the world,” said Paul Apthorp, vice chairman of trade group GMS-FRETA.


There are also fears about the environmental damage they could bring – especially in Kyaukphyu, where there are also worries over maritime safety.


These concerns are found in many BRI projects, but Myanmar has its own set. Chief among these is the ongoing conflicts within Myanmar: any road or railway linking Mandalay with China will have to pass through Shan and Kachin States, both areas where there are armed conflicts.


In turn, this brings into the foreground and politicizes China’s role. Beijing has started to build a role for itself as a mediator in the various conflicts the Myanmar government has that is irritating some inside the Southeast Asian country and worrying some outside it.


Chinese involvement in other projects in Myanmar is not well-liked and has resulted in the suspension of projects such as the Myitsone dam, all of which raises doubts about the viability of CMEC projects in the long term.


Offsetting this, though, are clear signals of government support, the most high-profile being the role given to state counselor Aung San Suu Kyi, who chairs a committee tasked with overseeing implementation of the projects.


“Being a country located at a strategic position for the BRI, Myanmar needs to participate in the initiative,” Irrawaddy reported Suu Kyi as saying. But like so many other Asian countries, Myanmar might find the price too high and the process too long.


By Michael Mackey

Southeast Asia Correspondent | Bangkok

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