For most Chinese, Libya is a far-away and out-of-reach country, owing to China’s limited capacity to project power. So the emphasis on restoring Chinese commercial interests is accepted reluctantly if not completely understood. But Myanmar and the other Mekong River countries are supposed to be the country’s “good neighbours,” and are completely within reach of Chinese power, so public anger over threats to the country’s interests in these places is intense.
Those interests include a new oil pipeline linking Myanmar to Kunming, the provincial capital of Yunnan province. China is also working on “connectivity” projects – namely, a rail and highway network – aimed at boosting economic and social ties between China and the ASEAN countries. The Myitsone and Mekong incidents have now cast a shadow over these projects, fuelling fear of a chain reaction that could wreck China’s two-decade-long effort to achieve deeper regional integration.
Obviously, Myanmar’s new government does not want to aggravate sentiment in its already-unstable border areas, where rebel groups were using the dam project to rally new supporters. The new government’s effort to share power with political forces in Myanmar’s volatile regions, and thus weaken local warlords, clearly contributed to the decision to halt construction.
The dam’s Chinese investors, for their part, relied too heavily on the depth of the two countries’ bilateral ties, and so heavily discounted the project’s political risks. Their behavior also reflects the implied guarantee of official government mercantilism, as well as the complacency of China’s state-owned enterprises, which account for most Chinese overseas investment. Operating on the assumption that the government will back them – or bail them out if they fail – they can afford to be cavalier.
