Inland
China's route to prosperity By
David Fullbrook
BANGKOK - The "Gun Bridge"
shut last year, replaced by a parallel stronger
and wider span across the Shweli River on the old
Burma Road between Myanmar and Yunnan. A few
kilometers north, most lanes at the modern 12-lane
immigration checkpoint lie unused, so light is the
traffic humming along the road to Ruili in Yunnan,
which is not noticeably busier despite homes,
markets and offices multiplying over the past few
years.
Locals are excited about the trains
expected to begin services
between Ruili and Kunming,
provincial capital of Yunnan, by 2008. Early
last year, transport mandarins unveiled plans to
spend
billions of dollars
over a decade on a national highway network that
will put Ruili, among other places, on the map.
This seems more than adequate for trade as
it now stands. Aside from equipment and weapons
occasionally passing through for delivery to the
Myanmar military, exports are mostly cheap
motorcycles and household goods exchanged for
imports of fish, gems and jade bound for cities
across southern China, plus the heroin heading for
the markets of eastern China's mega-cities and
North America. Traffic jams exist in television
soap operas, not on the roads around Ruili.
As yet there do not appear to be any
proposals to make Ruili, home to perhaps 20,000
people, and its surrounding fields a new Shenzhen,
so why the national highway, railway, checkpoint
and new bridge? Clearly, there are expectations
for a substantial surge in trade and traffic. This
is not, however, going to come from the paddies
and hills around this picturesque corner of
Yunnan.
A few hours south of Ruili in
Myanmar, Lashio is a busy market town and the end
of the line for the rickety railway along which
geriatric trains crawl from Mandalay. Beijing and
Yangon agree a railway should connect Lashio and
Ruili, completing plans first sketched out more
than a century ago only for World War II to come
along and put the kibosh on the project.
Meanwhile, Chinese engineers and laborers
are laying surfaced roads from Tengchong to the
splendid bridge built by the Chinese over the
Irrawaddy River at Myitkyina, which is linked to
Mandalay by a railway also desperately in need of
refurbishment, and Loije, near Ruili, to the
Irrawaddy port at Bhamo. Chinese planners want to
dredge the Irrawaddy to allow large vessels to
sail between Bhamo, Mandalay and Yangon
year-around. Chinese money and trade could see
many more cargo boats cruising on the broad but
shallow Irrawaddy, recalling busy days under the
British Empire.
Barring a chill in
relations, pipelines will as early as 2010
transport oil and gas from substantial fields off
Myanmar's coast to Yunnan. PetroChina's vice
chairman signed a memorandum with Myanmar's energy
minister for 6.5 trillion cubic feet of gas
shipped via an 800-kilometer pipeline to Kunming
in December, reported Mizzima News last January.
An oil pipeline from Sittwe to Kunming was
approved by China's National Development and
Reform Commission, reported the China Daily in
April.
Roads, railways and pipelines along
the Sittwe-Kunming corridor promise to allow much
more trade to pass through in a shorter time and
at a lower cost. The Andaman Sea ports are, for
much of central China, as close as, if not closer
than, those on China's own coast. Moreover,
shipping through Myanmar's Andaman Sea ports
should mean lower bills and shorten journeys to
all points west by lopping off the 2,900km journey
from Guangzhou or Shenzhen through the Strait of
Malacca.
Later, tankers from the Middle
East should be discharging their cargoes into the
pipelines' Andaman Sea taps, saving the cost and
time of shipping deliveries through the Malacca
Strait to China's ports and then by pipe or train
to inland provinces such as Yunnan, Guizhou, Sichuan and Chongqing.
However, the expected boom in traffic will
only come to pass when Yangon and Beijing end
their haggling over transit fees. Nor will
transport be as smooth as it should if they cannot
agree to split the bills for upgrading roads and
railways between Yunnan and the Andaman Sea ports
at Sittwe, base for the offshore oil and gas
projects, Kyaukphyu, a deepwater port allegedly
financed in part by Chinese money via Hong Kong,
and Yangon, where Shanghai Jinqiao Export
Processing Zone Development Co, partly
state-owned, is investing in a special trade zone
at the port.
For the Chinese Communist
Party (CCP), pushing these routes makes political
sense. Opening reliable and rapid bulk-trade
routes through Myanmar to the Andaman Sea ports
would cut costs and time, making slow-growth
inland provinces with their large, eager
workforces more attractive to investors, mostly
private, with their job-creating money and
know-how.
Since shedding the caring aspect
of socialism and dumping communist economics in
favor of partially free markets, the party's
legitimacy has come to rest on providing jobs,
higher incomes and better lifestyles. If it fails
to spread the good life shown on television dramas
about east-coast cities into the real lives of
hard-up rural folk, the party could have a
problem. Increasing riots in recent years are a
clear sign that Beijing has to tackle inequality
and abusive local officials.
Prospects for
these trade routes only started to take shape when
Beijing withdrew its support for the Communist
Party of Myanmar in favor of the military junta in
the mid-1980s. When the world turned against
Myanmar after thousands of demonstrators were shot
in 1988, and then against China a year later for
the same reason, each rallied to the other.
Progress has been slow, partly because
only in the past few years has the Myanmar army
secured control of land running between the
Chinese border and Mandalay, through a mixture of
dodgy ceasefire deals, bribes, and offensives to
co-opt, weaken and push back Shan and Karen
rebels.
Fearing that the growing gulf in
wealth, opportunities and comfort between the
coastal and inland provinces could spark revolt,
of which there is a rich history in these
provinces, the CCP has been pushing policies -
such as "Go West"- to encourage investors to put
their money and know-how into creating jobs in
these distant lands.
Though not a failure
- Intel, for example, opened a factory in Chengdu
and property magnate Vincent Lo's Shui On Group is
redeveloping Chongqing in Hong Kong's image - it
is hardly a roaring success. Higher energy,
commodities and materials costs, plus slow and
expensive transport to the coastal ports, leave
many investors cold. However, that appears to be
changing.
Moreover, revitalized trade
routes do not end with Myanmar. Academics from
Bangladesh, China, India and Myanmar have been
discussing plans for roads and even railways to
bring together their economies and markets.
However, sour relations between India and
Bangladesh and a shaky detente between India and
China have not encouraged officials and
politicians to embrace the plans.
Meanwhile, a new route linking Kunming
with Bangkok will open next year when work
finishes on the road through northwestern Laos. An
all-weather route is almost complete between
Yunnan and Cambodia's Sihanoukville port thanks to
the Asian Development Bank, China, Japan and other
aid donors stumping up cash for roads and bridges
in Laos and Cambodia. Trade has been picking up,
with Chinese shopkeepers, market traders and
investors now spreading south from northern Laos.
With a sizable Chinese community growing
in Cambodia, it seems only a matter of time before
goods start flowing down from Yunnan and Guizhou
through Laos to the Chinese wholesalers and
retailers in Cambodia. Prospects may also be
rising for more firms to get in on exporting the
bits and bobs of daily life via Cambodian ports to
Southeast Asia's islands, avoiding congested and
expensive ports geared for large loads and huge
ships in Guangdong.
Shorter routes and faster trips for
imports and exports appear to be moving closer to
reality thanks to good political ties and
construction crews laboring on roads and rails.
For factory owners in Guangdong struggling to
balance their books in the face of labor shortages
and rising wages, redoing their central China
arithmetic might show profits are to be had.
Inland China's time may have come. On hand to take
the credit will, of course, be the CCP.
(Copyright 2006 Asia Times Online Ltd. All
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