With no direct access to the Indian Ocean and vital shipping lanes passing through disputed and potentially blockaded waters, it is strategically natural for China to seek an outlet through a friendly neighboring country that opens on to the strategic waterway.

From China’s perspective, only two countries would fit that description: Pakistan and Myanmar. Although the Chinese completed a highway connection through its westernmost areas with Pakistan in 1979, it is too far from China’s industrial centers and the mountainous terrain on the border too rugged for it to be of much use for large-scale trade.

Myanmar was thus the obvious choice. China’s interest in securing such a corridor through that much easier route down to the Indian Ocean predates the One Belt One Road (Obor) initiatives by more than three decades. But China’s strategic planners seem to have overlooked Myanmar’s age-old apprehensions of its powerful northern neighbor.

China first expressed its intentions in an obscure article in the official mouthpiece Peking Review (now Beijing Review) on September 2, 1985. Titled “Opening to the Southwest: An Expert Opinion” and written by Pan Qi, a former vice minister of communications, the piece outlined the possibilities, as well as the need, to find an outlet for trade from China’s landlocked southwestern provinces through Myanmar to the Indian Ocean.

Detail of a desktop globe of the earth showing China.
Map showing Myanmar as an opening for China’s southwestern regions to the Bay of Bengal. Photo: iStock/Getty Images

After dwelling on how a road supposedly existed during the 202 BC – 220 AD Han Dynasty that connected the southern Chinese provinces of Yunnan and Sichuan with Southeast Asia as part of the “southern Silk Road”, Pan went on to investigate several passages from Yunnan to the outside world.

The article mentioned that a highway leads from Tengchong in Yunnan to Myitkyina in Myanmar’s northern Kachin State, where “a railroad is available to transfer cargo to the sea.” He also mentioned a second highway to the Myanmar railhead of Lashio in Shan State, and a road from China to Bhamo on the Irrawaddy River, which empties into the Indian Ocean.

But he failed to mention that at the time nearly the entire 2,204-kilometer Sino-Myanmar frontier was controlled by the insurgent Communist Party of Burma (CPB), which China had provided with massive support throughout the 1960s and 1970s, and further to the north by the insurgent Kachin Independence Army.

Myanmar government control was thus limited to a narrow corridor near Namkham and Muse in northern Shan State along the Chinese border.

All that changed after the hill-tribe rank-and-file of the CPB’s army rose in mutiny in March-April 1989. The aging, orthodox Maoist and predominantly ethnic Bamar leadership of the party was driven into exile in China, and the CPB’s army split up into four ethnic forces, of which the United Wa State Army (UWSA) was and is still the strongest.

All former CPB forces entered ceasefire agreements with the Myanmar government and began to engage in large-scale cross-border trade.

United Wa State Army (UWSA) soldiers march during a media display in Pansang, Wa territory in northeast Myanmar October 4, 2016. Picture taken on October 4, 2016. REUTERS/Soe Zeya Tun - RTX2WSCA
United Wa State Army (UWSA) soldiers march during a media display in Pangshang, Wa territory in northeast Myanmar October 4, 2016. Photo: Reuters/Soe Zeya Tun

China’s new post-Mao market-oriented leaders were pleased, but were foresighted enough not to give up their foothold inside Myanmar. The UWSA, in the end, received more material support from China than the CPB ever did. By the time of the mutiny, China had already signed a bilateral trade agreement with the Myanmar government.

When the West subjected Myanmar to sanctions and boycotts because of its human rights abuses, China emerged as the country’s most important foreign trade partner. By late 1991, Chinese technicians were working on a number of infrastructure projects in Myanmar, fulfilling the vision set by Pan Qi in 1985.

In 2007, 2008 and 2009, China signed a series of agreements with Myanmar to build oil and gas pipelines connecting Yunnan with the port at Kyaukphyu in Rakhine State designed to allow Chinese ships carrying fuel imports from the Middle East and gas obtained in the region to skirt the congested Malacca Strait.

In the 1990s and early 2000s, China also sold more than US$1.4 billion worth of military equipment to the diplomatically isolated Myanmar regime. China even began helping the Myanmar Navy upgrade its bases and facilities along the Bay of Bengal and the Andaman Sea, including the Myanmar Coco Islands north of India’s Andaman Islands.

Myanmar's military parade to mark the 72nd Armed Forces Day in the capital Naypyitaw, Myanmar March 27, 2017. Photo: Reuters/Soe Zeya Tun
Myanmar’s military parade to mark the 72nd Armed Forces Day in the capital Naypyitaw, Myanmar March 27, 2017. Photo: Reuters/Soe Zeya Tun

This sparked strategic panic in India, particularly when some security analysts claimed that Myanmar had leased the Coco Islands to the Chinese to establish a base. Those reports, however, were grossly exaggerated and even false.

Chinese technicians had helped the Myanmar Navy install radar equipment on Great Coco, the main island, and it was clear that China would get reciprocal access to whatever intelligence Myanmar’s naval officers were able to pick up.

But China’s strategic move into the region was enough for India to establish its Andaman Islands-based Far Eastern Naval Command in 2001 and to strengthen naval cooperation with allies such as the United States, Japan and Australia.

But Myanmar’s dependence on China became a burden, and, according to internal Myanmar military documents compiled in 2004 and seen by this correspondent, a “threat” to the country’s “independence.”

In October that year, China’s main man in Myanmar’s military hierarchy, prime minister former intelligence chief Lt Gen Khin Nyunt was ousted, ostensibly for corruption, a charge that can be easily leveled against any Myanmar military officer.

The real reason, according to Myanmar insiders, was that the country’s leadership had embarked on a plan to downgrade relations with China and improve ties with the West.

US President Barack Obama extends his hand to shake with Myanmar's President Thein Sein (R) during their meeting at the regional parliament building in Yangon on November 19, 2012.  Obama met Myanmar's reformist leader Thein Sein during a landmark visit to Yangon aimed at encouraging political reforms.    AFP PHOTO / Jewel Samad / AFP PHOTO / JEWEL SAMAD
Former US President Barack Obama extends his hand to shake with Myanmar’s then President Thein Sein (R) during a meeting in Yangon on November 19, 2012. Photo: AFP/ Jewel Samad

Among the general public, there was rising concern about large numbers of Chinese moving into Myanmar cities, establishing businesses there and even, through corrupt local officials, acquiring citizenship. Rampant Chinese purchases of properties in the central city of Mandalay, for instance, is an increasingly sensitive case in point.

The shift could not be done without a degree of democratization. An election was held in November 2010, Myanmar got a quasi-civilian government and the following year then president Thein Sein, a former army general, decided to suspend a US$3.6 billion China-sponsored, hydroelectric power project at Myitsone in Kachin State. For decades a diplomatic pariah, Myanmar quickly became a new darling of the West.

Sanctions were lifted and Western aid began to flow into the country. Anti-Chinese sentiments could be noticed in Myanmar’s previously highly censored press as well as expressed in private discussions with government officers. China had apparently gone too far in its quest to turn Myanmar into a client state and a stepping stone to the Indian Ocean.

But Myanmar is strategically too important for China to let it drift fully into the Western camp and has since launched a new charm offensive in Myanmar. Dignitaries, politicians and even journalists are invited to all-expenses-paid trips to China, while Chinese businessmen are instructed to show more sensitivity towards the people of Myanmar — at the same time as China has increased its support for the insurgent UWSA.

Myanmareses living in Malaysia display placards in protest against the Myitsone dam project, outside Myanmar embassy in Kuala Lumpur September 22, 2011. A group of Myanmar activists on Thursday staged a protest against the Myitsone hydroelectric power development project on the Irrawaddy River in the Myanmar's northern state of Kachin. REUTERS/Bazuki Muhammad (MALAYSIA - Tags: CIVIL UNREST POLITICS BUSINESS) - RTR2RNHU
Myanmar protestors display placards in protest against the China-backed Myitsone dam project. Photo: Reuters/Bazuki Muhammad 

This carrot-and-stick policy has enabled China to present a friendlier face and show that only they can help solve Myanmar’s decades-long ethnic conflicts, many of which are active along the two countries’ shared border.

In the process, they have outmaneuvered and sidelined the host of Western outfits that have tried since 2011 to mediate between authorities and combatants. China has also been helped by a communal conflict between Buddhists and local Muslims in western Rakhine State, which outlets to the Indian Ocean.

While the West has condemned Myanmar for human rights abuses against minority Muslim Rohingyas, China has blocked attempts to raise the issue at the UN’s Security Council.

Myanmar, once an isolated and almost forgotten backwater, has now become a focal point of the new emerging Cold War in the Indian Ocean. And China, with its long history of engagement and intervention in the smaller neighboring country, still has the upper hand in the rising competition.