New report on Chinese bauxite mining in Indochina

The Heinrich Boell Foundation, WWF and the International Institute for Sustainable Development have released a new report by Kate Lazarus on China’s involvement in bauxite mining in Indochina. Mining companies are present in Laos but have not yet started operations; in Vietnam they have so far secured construction contracts, but even that has  attracted opposition and the government may backtrack; whereas in Cambodia they have so far only been involved in road building on the Bolaven Plateau that has coveted bauxite reserves. The report points out the synergy between highly energy-intensive aluminium smelting and the development of hydropower.

The report can be downloaded here.

International Crisis Group’s new report on China-Burma relations

Following the conquest of Kokang by Burmese government troops and the reported flight of tens of thousands of refugees to China (described as Chinese businessmen in Chinese media; see earlier entry), the International Crisis Group has published a new report entitled China’s Myanmar Dilemma. The report suggests that there is a conflict of interest between Peking, which supports the Burmese government, and the Yunnan provincial government, whose primary interests lie in maximizing profits from border trade and which hence prefers to deal with the so-called “ceasefire armies” and keep the Burmese government at arm’s length. Many Burmese border towns rely on China for electricity, water, and telecommunications, which of course also provides China a powerful weapon: thus, after a series of abductions of gamblers in early 2009, the Yunnan government cut off utilities to the casino town of Maijayang to pressure the local authorities to shut down the casino. The closest relations are maintained with the 20,000-strong United Wa State Army: in March, a Yunnan Province official participated in the 20th century celebrations of the UWSA’s victory over the Communist Party of Burma (!), and its political leader, Bao You-Xiang, epxressed its thanks to China for its support. At the end of last year, both Kachin and Wa leaders wrote a letter to Hu Jintao appealing for investment and aid.

The report also details Chinese involvement in hydropower projects (at least 63, including the Tasang Dam on the Salween, which is to be the largest dam in Southeast Asia) and mining (the latest and largest project, the Tagaung Taung nickel mine, was approved in 2008 with an investment of $800 million). Official Burmese figures say that 99% of the foreign investment in 2008, or about $900 million, came from China.

While the authors of the report seem to have had privileged access to officials in China, parts of it — particularly those describing on-the-ground sentiments — appear to be based on flimsy evidence. Thus, in reporting on anti-Chinese sentiments in northern Burma, statements like “Burmese feel that they are being pushed out” and “It has been estimated that 60 per cent of Myanmar’s economy is in Chinese hands” are based on a single interview.

It is tempting to see the “special zones” in Northern Burma as a return to the “overlapping sovereignty” of precolonial times when many of the principalities in the region paid tribute to China but were under the loose military control of Burma. What continues to interest me is the role and conceptualisation of Chinese ethnicity in these borderlands today. Do people like Bao You-Xiang see themselves as Chinese, Wa, or both? And how are they seen by others?

Shan organisation reports fighting around dam site in Burma

According to 1 September press release by the Shan Sapawa Environmental Organisation, disseminated on the International Rivers mailing list,

Shan activists are calling on China to immediately halt all investment in dams on the Salween River following the recent heavy fighting between the Burmese military regime and the Kokang ceasefire army near the site of the Upper Salween Dam planned by Chinese companies in northern Shan State.

Heavy clashes have taken place just east of the town of Kunlong, about 15 kms from the planned dam site. Fighting broke out on August 27, 2009, after the regime deployed thousands of troops to seize control of the Kokang territory, shattering the 20-year ceasefire and causing over 30,000 refugees to flee to China. Kokang forces have sought to repel the Burma Army troops.

Plans to build the Upper Salween Dam, also known as the Kunlong Dam, were announced in April 2007 by two Chinese companies, Hanergy Holding Group (formerly Farsighted Investment Group) and Gold Water Resources Company. Since then a team of Chinese and Burmese technicians have been conducting feasibility studies for the 2,400 MW dam, 25 kms from the Chinese border.

The Kunlong Dam is one of five mega dams being planned on the Salween in Burma by the SPDC and Chinese and Thai companies, to produce electricity to be sold to China and Thailand. The Shan Sapawa Environmental Organisation, together with the Salween Watch coalition of environmental groups from Thailand and Burma, has been monitoring the controversial dam plans for ten years and advocating for their immediate halt.

“The renewed fighting and the flood of refugees into Yunnan should be a wake-up call to China about the risks of investing in Burma,” said Sapawa spokesperson Sai Khur Hseng.   ”Not only is there no free and informed consent to these dam projects, but they are being built over the dead bodies of our people.”

The other mega dam being planned in Shan State is the giant 7,110 MW Ta Sang dam, 100 km from the Thai border. In early August, the regime renewed a scorched earth campaign in townships close to the Ta Sang dam site, torturing and killing civilians and driving 10,000 villagers from their homes.

In an earlier post, I noted the cooperation (or perhaps sometimes multiple identities) between environmental and ethnic organisations in northern Burma, how they represent a certain potential form of sovereignty in that highly contested terrain, and how the ethnic Chinese enclaves (like Kokang) represent another, more real form. What is particularly interesting in this news release is the claim that 30,000 refugees have fled the fighting to China. China is not a state that officially allows refugee flows across its border, so if this is true it raises additional questions about the nature of sovereignty and border in Kokang and the other “special zones.” Or are these people who possess Chinese citizenship?

Exporting China’s Development: panel at ICAS

Several of this blog’s contributors are involved in the panel “Exporting China’s Development to Africa and Southeast Asia: Aid, Investment, Migration” at the upcoming International Convention of Asia Scholars in Daejeon, Korea, on 6 August. The aim of the panel is to bring together people who have done grounded research on the subject in these two regions.

The preliminary programme of the conference is now available here. Scroll down to find the panel.

“Timor-Leste: The Dragon’s Newest Friend”

A report on China’s relations with East Timor, by Loro Horta, has been published by the French institute IRASEC
 as Discussion Paper no. 4 (May 2009). It seems to be a standard “realist” IR kind of text, about foreign policy influence. What makes it interesting is the biography of the author:

Loro Horta is a graduate of Peoples Liberation Army National Defense University (PLANDU). Previous to his Chinese education he was educated in Australia, the United States and Singapore. His [...writings] on the Chinese military and other China related topics have been published by the Military Review, Australian Army Journal, Strategic Analysis the Center for Strategic and International Studies, Washington D.C, and Yale Magazine.

Controversy over Chinese investment in Vietnam mining

The Wall Street Journal reported on 1 May (James Hookway, “Once Enemies, Vietnam Now Fights for China Funds”) that a controversy had erupted over the plan for a state company to create a $460 million venture with the Aluminium Corporation of China to extract bauxite in the Central Highlands. 97-year-old General Vo Nguyen Giap, a hero of the French and American wars, has “written open letters to the government warning of growing Chinese influence” and environmental damage, a point also made by a “chorus” of scientists and economists who question the project’s feasibility. “In comparison, there has been little outcry against a unit of U.S.-based Alcoa Inc., which is conducting a feasibility study for a possible alumina refinery in southern Vietnam.”

The Central Highlands is, of course, not only an area of relatively untouched nature but also one where the “Montagnard” ethnic groups, with their often conflictual relationship with the central government, are located. In this regard, the story is very similar to the Lao and Cambodian cases, but in a very different political environment — one where there is political alliance but also a strong sense of opposition to China (and the Chinese), both among the elite and the population, but where the state is governed to a way very similar to China’s.

Le Monde on Chinese casinos in Burma

Le Monde on 5 May ran a short article on the Chinese-run casinos in Pangwa, a town across the Chinese border controlled by the New Democratic Kachin Army. Pangwa is not one of the “special regions” but, like those, seems to be run by a combination of an ethnic Chinese civil elite and an armed faction. 

Referring mostly to reports in Chinese media, the article writes about the closure of bigger casinos to the south in the zone controlled by the Independent Kachin Army, where Chinese police has intervened. In Pangwa, rumours have it that some Chinese customers who have threatened to denounce the owners to Chinese authorities have been killed.

The article is far from being well-researched, but it does point to interesting questions about the different ways in which local elites in various “special regions” articulate with interests and powers inside China. It also suggests that in at least some cases, greater influence of Chinese authorities may be preferable to local ones. (I was reminded of Russia’s withdrawal from Chechnya: there is little doubt that now the local despot, anointed by Russia, is alone with his subjects, it will be so much the worse for them. Obviously, there are many parallels from the history of Western colonialism too.)

China plans $10 billion ASEAN investment fund

Several agencies have reported that the Chinese foreign ministry issued a statement that it was planning to create a $10 billion “investment cooperation fund” for ASEAN, plus offer $15 billion in creadig. The investmet fund will promote infrastructural development linking China with the ASEAN countries. In addition, it was planning to offer 270 million yuan ($40 million) in aid to Cambodia, Laos and Burma. (Some  reports specify that this is “new aid,” but from past experience I suspect that the statement is probably ambiguous on this.)

In some of the countries, this puts China into competition with the IMF, which as usual has negotiated loans conditional on strict monetary criteria.

Undercurrents issue on rubber boom in northeast Burma

The current issue of Undercurrents, the bulletin of the Lahu National Development Organisation, deals with changes in the economy of northeastern Burma, largely as a result of contacts with Yunnan.

The issue can be downloaded here. The editors write that Chinese agents have been handing out traps, poison, and skinning tools in Lahu and Akha villages in Shan State while contracting trappers to look for various wild animals. “These days in every village either the headman of an agent of a Chinese boss keeps a certain amount of cash” to buy animals and forest products, as well as gemstones from villagers (p. 4). This is reminiscent of the networks of Chinese tax farms in remote villages in the colonial era, when they served as both collectors of primary products, providers of consumer goods and of cash loans (as well as collectors of taxes and suppliers of opium). Souchou Yao writes about this in his ethnography of Chinese shopkeepers in North Borneo, but the situation was similar in the Russian Far East at the turn of the 20th century. Incidentally, today, similar accusations of poaching of endangered species, ginseng, trepang etc. are again being made against Chinese in the Russian Far East.

According to a report by the Yunnan Hongyu Group to the Yunnan Province Narcotics Control Commission, the group plans to plant 100,000 ha of rubber in Shan State (notably in the ethnic Chinese-run Special Region No. 2) in 2004-2014 under the Chinese government’s opium eradication provisions (p. 9). Much as in Laos, these large plantations coexist with smaller ones owned by various army and militia commanders, as well as with villagers planting rubber trees under contract to Chinese entrepreneurs, who provide seedlings and some cash (3 Thai baht per tree planted). As in Laos, Akha villagers in particular see rubber as a lucrative crops because they associate it with the higher incomes of Akha in China.

What is different from Laos is that both the Burmese army and the various former rebel armies have used a mixture of paid and corvee labour to clear the forest for their own as well as Hongyu’s plantations, according to the report. Also, because of the lack of a civilian administration, land confiscation is far more arbitrary. The United Wa State Army, which controls the essentially ethnic Chinese-run Special Region No. 4 in Mong La, has promoted rubber as an opium substitution crop and has benefited from Chinese policies supporting this. The commander of the region, Lin Ming Xian (like his colleague in the No. 2 region, a former drug lord), ordered his officials to grow rubber but was later disappointed with the production. Some Wa commanders have forbidden villagers to cut forest for rice fields but allow it for rubber plantations. The report points to the dangers of rubber monoculture for food security, especially in the short term, before the rubber trees mature.

Finally, the report mentions the opening of new mines, usually as cooperative ventures between local armies, Chinese, Thai and/or Japanese investors, and individuals linked to the ruling elites (such as family members of the Burmese junta and of the former Shan drug lord, Khun Sa). Some of these mines employ some Chinese workers. There are also freelance Chinese miners, poor farmers who cross the border to prospect for ore on their own.

One effect of Chinese involvement, then, appears to be the strengthening of local military elites who can now command more resources, and the relative further marginalisation of powerless highland groups, a situation similar to Laos and Cambodia. Yet, clearly, individual Akha and Lahu do benefit, or hope to benefit in the future. China has become a more attractive market not just for endangered wildlife but also for other things, such as water buffaloes, which fetch higher prices there.

The Lahu National Development Organisations seems to have a partnership with the Burma Rivers Network. I don’t know what kind of organisation it is, but it writes in the language and with the imagery of professional Western environmental activists. On the other hand, there are Wa and Shan groups that write in Chinese, in a language very close to that of the Chinese state. I suppose that in Burma’s border areas, there are all sorts of client groups/client polities, or simply groups that espouse varying development agendas. Perhaps it is lowland groups, which stand to benefit more from the export of Chinese development, that embrace Chinese models, while highland groups remain under the protection of Western NGO patrons. If so, this would create interesting political tensions over time (not unlike those that played out in Laos and Vietnam during the Vietnam War).

VU student’s critical book on development aid in Cambodia

In her new book, somewhat mysteriously titled Swimming in a New Aquarium, Gea Wijders, a PhD student at the Culture, Organisation and Management department of the VU and until recently an advisor to Cambodia’s Ministry of the Environment, concludes that Western development aid to the country has failed. More generally, it is a critique of the idea of “doing good” in a “different culture” (or a new aquarium, in her metaphor). Gea is now engaged in a project looking at the role of Cambodian returnee migrants, most of them Sino-Khmer. I am looking forward to discussions with her about China’s position in the process.