At the time of publishing, Chinese president Xi Jinping’s first visit to Myanmar in 19 years will be only one day away. His visit will not only mark the 70th anniversary of diplomatic relations between the two countries, it will also mark a high point for Myanmar and China’s economic relationship, one that may come to define the future of the Myanmar economy.
Of course, Myanmar’s largest neighbor has always been one of its closest economic partners. For example, China has the world’s highest demand for jade, while Myanmar has the world’s largest supply. In Mandalay, after two devastating fires in the 1980s, Chinese investors began buying up property at rock-bottom prices, and now the city is the capital of Chinese investment. In the democratic era, as civil wars and a human rights crisis warded away Western investors, China launched its China-Myanmar Economic Corridor, a vast infrastructure initiative that will eventually include highways, railways, oil and gas pipelines, river ports, power plants and special economic zones.
And in 2019, the year before its president’s historic visit, trade with China has reached a high mark. Despite violence along key trade routes in Shan and Kachin States, trade between the two countries ended 2019 at USD 17.71 billion, a full 28.5 percent increase from 2018, according to official data. China upped its import demands for Myanmar rice. Myanmar, in turn, issued some of its most lucrative liquid natural gas tenders to Chinese companies, including four to Hong Kong-listed VPower group. Airlines expanded their fleets and schedules specifically for Chinese travelers, and more than 400,000 Chinese tourists visited the city of Mandalay.
Other Asian neighbors, especially Korea, Japan, Singapore and Thailand, have made their own MOUs and investments, developing the special economic zones in Dawei and Yangon Region, opening new factories and buying up stakes in Myanmar banks and other major corporations. But they all play second fiddle to the tiger that has dominated trade in Myanmar’s north.