Myanmar, U.S.: Re-engagement and the Chinese Reaction

U.S. Assistant Secretary of State for East Asian and Pacific Affairs Kurt Campbell arrived in Yangon on Nov. 4 as the head of a U.S. delegation that met with government officials in the Myanmar capital of Naypyidaw on Nov. 3. In Yangon, the delegation will hold discussions with opposition politicians from the National League for Democracy (NLD) and ethnic representatives. Campbell is the highest-ranking U.S. official to visit Myanmar since then-Secretary of State Madeleine Albright traveled there in 1995. His trip comes amid reports that Myanmar Prime Minister Thein Sein may meet with U.S. President Barak Obama during talks among the leaders of the Association of South East Asian Nations (ASEAN) and the United States following the Asia-Pacific Economic Cooperation (APEC) summit in Singapore in mid-November. The meetings represent the new U.S. policy of engagement toward Myanmar, a revision to the policy of relying on sanctions and criticism to bring about change in the reclusive regime — one that could spark an uneasy reaction in China. Internal U.S. assessments (as well as those in several European nations) have agreed that sanctions and isolation alone do not necessarily bring about change, particularly in countries that have other economic lifelines. In the case of Myanmar, that lifeline is primarily China, but also India and to a lesser degree Thailand and South Korea. Each of these countries has shown a strong interest in tapping Myanmar's natural gas and other primary commodities. The same day Campbell arrived in Naypyidaw, China National Petroleum Corp. announced it finally began construction on an oil pipeline that will run from the deep-water port on Myanmar's Maday Island across the country into China. The pipeline ultimately will carry Middle Eastern and African oil loaded at an oil terminal on Maday, shortening the shipping time for oil and bypassing the Strait of Malacca, a strategic chokepoint that much of the energy supplies of China, Japan and South Korea pass through. For China, the pipeline is part of a broader strategic initiative to supplement sea routes with alternative and complementary land routes, thereby reducing China's vulnerabilities at sea and adding redundancies to the country's energy supplies. A major part of this has been China's involvement in oil and natural gas projects in Central Asia, and the construction of pipelines from Central Asia to China and then across China to the Chinese east coast. Myanmar will serve as another significant spoke in China's oil and natural gas hub. Plans are under way for Korea's Hyundai Heavy Industries to begin construction by the end of the year in coordination with Daewoo International and Korea Gas Corp. on a natural gas pipeline to link off- and on-shore natural gas fields in Myanmar with China. Over the past decade, China has worked to increase its influence in Myanmar, to capture natural gas and other resource deals, and to assist in infrastructure projects designed to bypass the Strait of Malacca. India, Myanmar's neighbor to the west, has also been active in this regard, and New Delhi and Beijing have engaged in a rivalry for access and influence. Chinese facilities on Myanmar's west coast give Beijing closer access to the Indian Ocean, something that has caused some consternation in New Delhi. Indian officials have gone so far as cautioning that Chinese port and maritime activities in Myanmar, Pakistan and Sri Lanka represent a Chinese plan to encircle India and threaten its strategic position in the Indian Ocean basin. This rivalry and sense of competition is something Washington may use as it engages the government of Myanmar. Myanmar's government is looking for ways to lift U.S. and other Western sanctions and to give itself more room to maneuver in its efforts to balance its two much larger neighbors, China and India. This gives the government incentives to engage with Washington and make at least partial political concessions toward the return of an elected democratic government. Both India and China will seek to insert themselves in the process to guarantee their own interests and stymie each other's. China in particular may be worried about the sudden U.S. interest in Myanmar. Beijing considers Myanmar within China's sphere of interest, and a vital part of China's future energy security. This makes China much more sensitive to U.S. moves in Myanmar. For the United States, the Myanmar initiative is less strategic than it is just a reflection of the broader push by the Obama administration to shift its image abroad and appear cooperative rather than as a self-proclaimed global hegemon. Engagement with Myanmar, then, is something left to the bureaucrats in the U.S. State Department, not necessarily something rising to the level of top priorities, and falls far below issues like Iraq, Iran, Afghanistan and Russia. The different levels of significance between Washington and Beijing, however, could lead to misunderstandings and impact the way bilateral China-U.S. relations develop. For Washington, Myanmar is insignificant and far away, and engagement is of little immediate significance. Because the U.S. government views Myanmar policy as just a small piece of a larger international initiative — and one primarily about image shaping at that — there may not be the attention paid to how the policy will be perceived by China. For Beijing's part, U.S. bilateral engagement with Myanmar — like the emerging U.S. bilateral engagement with North Korea — appears to be part of a long-term initiative to surround China and slowly break off its regional levers. And as a critical element in China's future energy policy, the idea that Washington could come in, come to terms with the government, and then start shifting Myanmar's energy contracts from Chinese companies to U.S. and other Western companies represents a major threat to China's long-term planning. This difference in perception could end up unintentionally affecting other aspects of U.S.-Chinese relations, from maritime policy and naval security to resource competition and North Korean disarmament.