Standing Up to the Dragon: Opinions and Suggestions
‘As a rule, the police are soft on the tough and tough on the soft,’ recounted Zha Jianguo, on his time behind bars in China. The veteran democracy activist and political commentator, in a piece by his sister, described how prisoners of conscience were at the top of the hierarchy of inmates within the Chinese prison system.
This respect for political prisoners had been borne out of an admiration-from both fellow inmates and officers alike-for their personal courage and indomitable fortitude. Yet this honor is conditional-the second one’s spirit breaks and plea deals are taken to reduce sentences, said prisoner of conscience becomes subjected to ridicule and bullying, his honor lost forever. ‘If they sense a weakness in you, it will bring out the bully in them,’ Zha had remarked.
It would be wise for Myanmar’s leaders from both the government and civil arenas to take note of this. The 2nd Belt and Road Initiative (BRI) Forum had been followed by Myanmar and China inking three bilateral agreements: an agreement on economic and technical cooperation, an MoU on a five year economic and trade development cooperation plan and an MoU on the China-Myanmar Economic Corridor (CMEC) Plan spanning from 2019 to 2030.
There has been a gradual show of caution regarding the BRI, exemplified by Myanmar’s recent approval of only 9 out of China’s proposed 38 ‘early harvest’ projects. State Counselor Aung San Suu Kyi’s remarks at the forum over how projects need to, ‘not only be economically feasible but also socially and environmentally responsible’ and fully backed by the local population further reinforces a growing caution in dealing with her neighbor. The most significant declaration has been that, regarding the CMEC MoU, the conditions agreed to have been that Myanmar be: 1) allowed to seek international financial institutions’ financing when implementing projects 2) allowed to invite international tenders for investment and 3) allowed to choose projects to maximize mutual benefit.
All these point towards a shift in Myanmar’s China approach-one of treading more cautiously. Yet with that said, there are still numerous issues which need to be addressed. To date, the promise of transparency regarding the finer details of BRI projects in Myanmar has largely not been realized. The public remain in the dark over how the much hated Myitsone project will progress, especially given outgoing Chinese ambassador Hong Liang’s condescending remarks that ‘foreign forces’ had been at play behind opposition to the dam’s construction, sending a parting blow designed to fuel unrest. Whether or not Beijing will instruct his successor to follow the same line remains to be seen.
This lack of transparency from the government has continued fostering a pervasive sense of resignation from the public, civil society and even government officials regarding China’s endeavors within the country. A long history of distrust and bad blood does not go away easily. ‘What can we do against China?’ is still a collective moan followed by an equally united sigh of defeat, despite a degree of progress being made.
The ‘Save the Irrawaddy by Offering Compensation’ campaign illustrates the problem with discourse on the BRI in Myanmar. In a televised panel spearheaded by a handful of celebrities and literati, the campaign had implored citizens to donate a thousand kyats each towards a compensation fund to meet the $US 800 million figure provided by the CPI Yunnan International Power Investment Company (CPIYN), the Myitsone project’s primary stakeholder. The campaign failed to call those figures into question and instead became yet another awareness raising effort at a time where the country has gone past this. Indirectly, it ended up becoming an endorsement of faith at the figure quoted.
Over-inflation of estimated costs has already seen precedence along the BRI. In 2018, Malaysian Prime Minister Mahathir suspended two China backed pipelines upon discovering that only 13% of work had been accomplished after 90% of the estimated $ US 2.3 billion in costs had been paid. More telling had been the revision of the East Coast Rail Link, in which the Chinese state owned China Communications Construction Company (CCCC) acquiesced to the reduction of costs by a third upon review.
Asking the wrong questions at the right time has unfortunately been characteristic of Myanmar’s approach towards China, dictated too much and too long by reaction and too little by tact. What we need to ask is no longer about what the risks of the BRI in Myanmar are, but on how we can build up on the momentum made in pushing back against overt encroachment. Coinciding with China’s likely re-calibration of its approach, now is the time to act.
What can be done? A number of steps can be undertaken, in fact. Broadly speaking, here are a number of suggestions.
- Reformation of the BRI Steering Committee
In its current form, not a single person in the Aung San Suu Kyi-led BRI Steering committee currently has in depth expertise regarding China. Analysts and relevant civil society actors versed with experience in China can only do so much from the sidelines through forums, panels and articles. Incorporating experts from think tanks and relevant civil society actors on a more in depth level can allow for collaborative input being made-a united, inclusive front capable of plugging holes in Myanmar’s engagement strategy across multiple sectors. Civil society leaders must be keyed in continuously and not be treated as bystanders in relation to the BRI in Myanmar. Too often, relevant civil society organizations have been treated as afterthoughts and rally points for politicians rather than genuine partners. This needs to change, and giving them a place at the negotiating table can help mend and foster trust.
2. Heightened transparency and scrutiny
It is imperative that details of conditions set, contracts signed and breakdowns of figures agreed to be made accessible to the public. The longer the promise of transparency remains unanswered, the stronger will public sentiment of confusion and helplessness linger. The freedom to scrutinize contracts made by the government under the BRI banner can lead the government to narrow the trust deficit existing with the public.
Establishing a designated, easily accessible portal on the BRI in Myanmar highlighting official declarations, documents and consistent updates would be a start. It may also be advisable to form a parliamentary committee on the BRI, in order to better aid a reformed BRI Steering Committee and as a means to integrate parliamentary oversight and investigate irregularities. Yet this can risk perpetuating bureaucracy if not managed with capable and well informed lawmakers at the helm, falling into a trap of ‘over-committee-fication.’ Strengthening the participation and role of the Anti Corruption Commission (ACC) with a specific desk on BRI projects in Myanmar can also aid in this endeavor. A drawback to this is the relative ineffectiveness of the ACC up to this point-in 2018, the body recorded a successful prosecution rate of 0.43%, with only 46 cases being investigated and prosecuted out of more than 10,000 complaints.
3. Pro-Myanmar regulatory governance
Weak regulatory governance in Myanmar is not news-the majority of countries signed on as BRI partners lack strong regulatory frameworks. Yet it is worth noting that the problem in regulation is a two way street.
BRI projects, contrary to assumption, are not tightly controlled by Beijing. In fact, Beijing faces massive difficulties in managing and directing them. This is due to how BRI projects are driven primarily by the interests of provincial governments and state owned enterprises (SOE), backed by Chinese policy banks offering concessional loans.
To date, provincial and SOE leaders’ impetus for currying favor through showing loyalty to President Xi Jinping far outranks considerations for local dynamics in BRI partner countries, even with Xi’s ostensible declaration that companies participating in the BRI were to be ‘ambassadors for China’. In essence, projects which have the least barriers towards attaching the BRI banner get pushed through. This line of practice may be feasible in countries with authoritarian, one party regimes. In fledgling democracies such as Myanmar, this is far from sustainable.
Thus, it is vital that we take the lead in developing a robust regulatory framework to protect our citizens and interests. Waiting on China’s central, provincial and SOE leaders to re-calibrate the BRI’s engagement approach would be naïve, and would feed into the narrative that we are being dictated by foreign terms. Developing and enforcing our own set of reformed regulations and going beyond paper thin, vaguely worded assurances is crucial in mitigating the BRI’s risks in Myanmar.
A good start here would be the development of compliance mechanisms as a means of ‘helping realize’ the ‘Green Belt and Road Initiative.’ Beijing’s green-dressed pledge to uphold environmental laws in partner countries is, in actuality, bare on policy details. Promises for observance of environmental standards and green finance become called into question when 91% of energy loans by Chinese banks to BRI countries have been towards fossil fuel projects from 2014 to 2017. In 2018, 42% of all energy sector investments along the BRI went towards coal-by far the largest share. Within Myanmar, the environmental impact of projects under the BRI banner has already been felt, from contaminated water to thousands displaced villagers.
Setting up a stringent system of preference for projects employing environmentally friendly technology is one suggestion. Failure by companies to mitigate any negative environmental impact within a set period of time should be penalized and then permanently blacklisted from operating within Myanmar, with local partners equally liable to punishment.
On the subject of employment, it is also crucial that two key issues be tackled via regulation-knowledge transfer and local labor usage. Establishing a set quota for EQUAL PAY employment of Myanmar workers by Chinese companies for projects, along with a requirement for safe working conditions is a pivotal step towards this. Companies should also be made to set up training programs to transfer knowledge to Myanmar partners, with upward mobility ensured to promote Myanmar workers to managerial positions. This is not advocating tokenism-a failure to appreciate local talent WILL cultivate significant resentment towards projects and lead to an ‘us Vs them’ mentality developing.
Private military or security contractors (PMSCs) employed by companies partaking in the BRI must also be examined. In Myanmar, Erik Prince’s Frontier Services Group (FSG) is setting up shop as the security contractor of China’s CITIC Group, Kyaukphyu’s chief developer. Prince had previously been at the helm of Blackwater, the firm implicated in the deaths of 14 unarmed Iraqi civilians in 2007 in what came to be known as the Nisour Square massacre. Privatized security provision for infrastructure projects have a chequered history in Myanmar; human rights abuses had been widely reported to have been perpetrated by forces providing security for the Yadana gas pipeline.
PMSCs, to date, are not regulated by a binding and specific international treaty. The Montreux Document (2008) and the International Code of Conduct for Private Security Providers (2013) are two non-binding, voluntary initiatives aimed at regulating PMSCs’ practices through a set of principles and a clarifying the chain of accountability. China and three Chinese firms, respectively, are signatories to both documents. In the absence of international law enforcement and Chinese domestic law not applying towards companies’ overseas practices, it is vital for Myanmar to establish laws regulating the activities of any PMSCs operating in the country. With 20 Chinese private security companies providing international services, Prince’s FSG will most certainly not be the last entrant into Myanmar.
An ambitious solution to this would be the development of a designated national body to monitor and regulate PMSCs. Said body would ideally be equipped to enforce newly created laws that make it mandatory for PMSCs to provide information in the form of incident reports, equipment and weapons stockade, and details of personnel involved in operations. There could also be the requirement for PMSCs to be certified members of the International Code of Conduct Association (IcoCA). FSG is currently not a member of IcoCA, and only one Chinese company, Hua Xin Xhong An (Beijing) Security Services Co Ltd, has IcoCA certification. Entrusting this national body the power to carry out inspections based on reports might also be a possible stipulation.
‘If they sense a weakness in you, it will bring out the bully in them.’
These suggestions provided might seem overly ambitious, given Myanmar’s existing weak institutions, as well as China’s continued influence on Myanmar through diplomatic defense at the UN security Council and its role in the peace process.
However, caving in to our perceived weakness will lead to Myanmar continuing to relinquish control over her fate. Even if said institutions fail to effectively remedy our weak bargaining position, striving towards them is preferable to not attempting them at all.
The BRI can and will offer numerous opportunities for bettering lives in Myanmar-now, and beyond. The ongoing trade war between China and the US serves as an opportunity for Myanmar to capitalize on-provided adequate power generation and safe, sustainable infrastructure be constructed.
We must be equipped to take opportunities as best we can for our citizens, and simultaneously mitigate risks to their well beings. This does not need to be a zero sum game. As a nation, it is crucial that we be reliable and responsible for the most important stakeholder of all by far-the people.
*An edited version of this piece had been published in Frontier Myanmar entitled, ‘The Belt and Road Initiative: Staring Down the Dragon,’ published on August 2nd, 2019 as a contributing Op-Ed.
