China’s “Charm Offensive” Loses Momentum in Southeast Asia [Part II]

Publication: China Brief Volume: 10 Issue: 10

The change in Southeast Asian attitudes toward China’s growing economic profile in the region and its military build-up in the South China Sea is significant (See "China’s "Charm Offensive" Losing Momentum in Southeast Asia [Part I]," China Brief, April 29). In mainland Southeast Asia, governments have not only been worried about the rising tide of Chinese imports, but also the environmental impact of Chinese dams in Yunnan province that some groups claim have led to falling water levels in the Mekong River. In addition to having to respond to these accusations, Beijing has also had to contend with the political instability that continues to flare up in two of its closest partners in Southeast Asia—Burma (Myanmar) and Thailand—and the potential negative economic fallout on its southwestern provinces.

China’s Public Relations Debacle on the Mekong River

During his speech to the Jakarta-based Association of Southeast Asian Nations (ASEAN) Secretariat in January 2010, State Councilor Dai Bingguo declared China and Southeast Asia to be inseparably joined by "mountains and rivers" [1]. Yet the most important of these rivers—the 3,000-mile long Mekong, also known as Lancang in Chinese, which rises in the Tibetan plateau and flows down through Burma, Thailand, Laos, Cambodia and Vietnam—has become a bone of contention in ASEAN-China relations. The root of the problem is that water levels have fallen to their lowest point in nearly half a century, and this is adversely affecting the livelihoods of more than 65 million people in the Mekong Basin who depend on the river for drinking water, irrigation, fishing and transportation. Environmentalists have blamed record low water levels on dams constructed along the upper reaches of the river in Yunnan province where the Chinese authorities have planned a cascade of eight hydroelectric dams; three are already in operation, two more are nearing completion [2]. The most controversial of these hydroelectric projects is the Xiaowan Dam, which at 958-feet is the largest arch dam in the world and the second biggest dam in China after the Three Gorges. Filling the Xiaowan’s 73-square mile reservoir began in 2009, and is expected to be completed in 2012. Critics claim the dam filling is draining water off downstream areas and wreaking environmental havoc. They accuse Beijing of being insensitive to the problems faced by the lower riparian countries.

Although the problem of falling water levels in the Mekong has been apparent for several years, regional governments—some of which have close ties to Beijing—have been reluctant to confront China for fear of losing economic aid. Yet as the situation has worsened, Southeast Asian officials have become less reticent about raising the issue with their Chinese counterparts. The most high-level expression of concern occurred in March when Thai Prime Minister Abhisit Vejjajiva told visiting Chinese Assistant Foreign Minister Hu Zhengyue that Thailand expected China’s cooperation in dealing with the problem (Straits Times, March 8). Although Abhisit did not criticize China directly, his message was clear: The PRC must take account of regional concerns and act accordingly.  

As criticism accumulated, China launched a three-pronged defense of its dams. First, Beijing argued that the hydroelectric power projects in Yunnan have no significant impact on downstream levels and that, to the contrary, the dams provide a regular flow of water that prevents floods and improves river navigation. Chinese officials have repeatedly stated that the Lancang only contributes 13.5 percent of the Mekong’s total volume, though as noted historian Milton Osborne has argued, this is disingenuous in that during the dry season the Lancang sustains flows of up to 40 percent in certain areas [2]. Second, in Hu’s words, China would "never do anything to damage mutual trust with neighboring countries in the Mekong," and that the country’s southwestern provinces are also suffering acutely from a prolonged drought. Third, claims made by environmentalists are "scientifically groundless" and the real cause of falling water levels is low rainfall (The Nation, March 8). The intergovernmental body charged with promoting sustainable use of water resources in the river, the Mekong River Commission (MRC), has partially backed China’s position by pointing out there is no proven link between Chinese dams and low water levels, and that the primary reason appears to be drought in southwest China, northern Laos and Thailand (Straits Times, March 8). MRC members include Thailand, Vietnam, Laos and Cambodia, while China and Burma are dialogue partners. China has resolutely refused to join the MRC because it does not wish to be bound by the organization’s decisions.

Stung by critical reporting in the regional press, and reacting to pressure from environmental groups and prodding from the Thai government, the PRC has moved into damage control mode. For the first time ever, China invited officials from downstream countries to inspect some of the dams, explained that it had ceased filling the Xiaowan Dam reservoir (though this probably had more to do with the drought than anything else), and promised to improve information sharing with the MRC. In another gesture designed to show it took the concerns of neighboring countries seriously, China sent a 27-member delegation led by Vice Foreign Minister Song Tao to a summit of MRC leaders in Hua Hin, Thailand on April 4-5. Yet the results of the summit were predictably disappointing. Song simply reiterated that China stood ready to enhance cooperation with the lower riparian states, including flood and drought relief and strengthening environmental protection, and that it would share hydrological information with the MRC—though the nature of this information remained unclear (Xinhua News Agency, April 4). The summit concluded with agreement among the six countries to confer before initiating new hydroelectric power plants; crucially though, no commitment was made to scale back or cancel existing projects (The Nation, April 5).

Despite appearing to be proactive and cooperative, the PRC did little to mitigate concerns over the ecological repercussions of its hydroelectric dams in Yunnan, which has reinforced the perception that Beijing takes little account of the environmental impact of its economic development projects on neighboring countries.

Rumors of War Unsettle Sino-Burmese Relations

While PRC officials were trying to defray criticism at Hua Hin, a far more serious situation was unfolding on the Sino-Burmese frontier, where the threat of conflict between the central government of Burma—known as the State Peace and Development Council (SPDC)—and ethnic separatist groups in the north and northeast has put relations between Naypyidaw and Beijing under strain.

The cause of the tension is the Burmese regime’s April 2009 demand that, in accordance with the country’s new Constitution and "One Country, One Army" slogan, ethnic groups that had signed ceasefire agreements with the government in 1989-1991 should disarm or transform their militias into smaller, lightly armed Border Guard Forces (BGF) under the command of the armed forces, known as the Tatmadaw. The largest of the ceasefire groups such as the Wa, Kachin and Shan have rejected the SPDC’s demand because it would mean giving up two decades of autonomy, and surrendering lucrative business interests including narcotics production. In a move widely seen as a demonstration of what would happen if these groups continued to defy the government, in August 2009 the Tatmadaw routed the 700-strong Kokang militia, forcing 37,000 refugees to flee across the border into Yunnan (See "Emerging Fault Lines in Sino-Burmese Relations: The Kokang Incident," China Brief, September 10, 2009). Beijing was not given advanced notification of the operation against the Kokang—who are predominantly ethnic Chinese—and reacted angrily by calling on the SPDC to restore peace and stability along the Sino-Burmese border.

Since last August, negotiations between the SPDC and the various ceasefire groups have continued in an effort to stave off armed conflict. As a pressure tactic, the government has issued a series of "final deadlines" after which the ethnic armies would be declared illegal—the most recent being April 22—all of which came and went. As talks have dragged on, all sides have begun gearing up for confrontation; the Tatmadaw has reportedly sent tens of thousands of troops and heavy artillery closer to territory held by the ceasefire groups, while the ethnic armies have been actively recruiting new soldiers (The Irrawaddy, February 9). China has also strengthened its military presence along the Sino-Burmese border by as many as 5,000 troops (The Irrawaddy, April 30).

The tense situation between the SPDC and ethnic ceasefire groups has put Beijing in an invidious position. Since the early 1990s, China has built up extensive commercial interests in Burma, including in the country’s energy sector. In return, Beijing has furnished the regime with economic and military aid and provided diplomatic cover for the SPDC at the U.N. Security Council (See "Burma’s Relations with China: Neither Puppet nor Pawn," China Brief, May 9, 2007). Yet at the same time, the Chinese government has also maintained close ties to the main ceasefire groups along the border, especially the United Wa State Army (UWSA). The Wa previously served as foot soldiers for the Burmese Communist Party, which waged war against the Burmese government with arms and money provided by Beijing from the 1960s until 1989. Renewed hostilities between the UWSA and the Tatmadaw would be highly damaging to China’s interests. It would disrupt the lucrative border trade and damage the economy of Yunnan; put at risk the lives of tens of thousands of PRC citizens living in Wa-controlled areas; trigger a flood of refugees across the border; and result in increased flows of illegal narcotics into China as the Wa steps up production of methamphetamines to pay for military operations.

The prospect of chaos and bloodshed along the Sino-Burmese border has prompted China to assume an active role in facilitating talks between the SPDC and the UWSA, as well as smaller groups allied to the Wa. Reports indicate that in February, for instance, PLA officers attended an inconclusive meeting between UWSA Chairman Bao Youxiong and SPDC point man on the BGF proposal Lieutenant-General Ye Myint (The Irrawaddy, February 26). Senior Chinese and Burmese officials have also discussed border stability at meetings in Beijing and Naypyidaw (The Irrawaddy, April 5).

These diplomatic maneuverings suggest that shrouded from view, a complex game is being played out between the Chinese and Burmese governments. As noted, the PRC has strongly vested interests in a peaceful resolution to the problem, and is eager to use its influence with the SPDC and Wa, while at the same time not wishing to appear as overtly interfering in Burma’s internal affairs for fear of offending the fiercely nationalistic and erratic military regime. For its part, as the series of "final deadlines" indicates, the SPDC is also keen to avoid conflict and looks to China to cajole the UWSA into accepting the BGF proposal.  And Naypyidaw may be using the prospect of improved relations with the United States to pressure China into leaning on the Wa. Should the SPDC run out of patience and decide on military action, it is difficult to predict with any certainty how Beijing would react, though its most likely course of action would be to continue supplying ammunition to all parties while working behind the scenes to end hostilities. As war clouds gather, Beijing is once again confronted with the problems of dealing with the unpredictable behavior of its troublesome ally in Naypyidaw.

China Looks on with Concern at Events in Thailand

No less worrying for the Chinese government is the deteriorating political situation in Thailand, China’s most important economic and political partner in mainland Southeast Asia. Thai politics have been in a constant state of turmoil since Prime Minister Thaksin Shinawatra was ousted by the military in September 2006. Since then, Sino-Thai relations have moved forward in fits and starts as the country’s foreign policy has essentially been on hold. It is of little wonder that following a crack-down on anti-government protesters in Bangkok on April 10, that killed 25 people and injured 800, China expressed "deep concern" about the worst outbreak of political violence in Thailand since 1992 (Straits Times, April 12).

The political crisis in the Kingdom has negatively impacted the development of Sino-Thai defense ties which are among the most extensive between the PRC and a Southeast Asian country (See "China and Thailand: Enhancing Military-Security Ties in the 21st Century," China Brief, July 3, 2008). Whereas the annual U.S.-Thai Cobra Gold military exercises went ahead as scheduled in February, a proposed Sino-Thai amphibious landing exercise has had to be postponed. China first suggested the exercise in 2009, and even offered to fund Thai participation when Bangkok demurred over the cost (Bangkok Post, December 3, 2009). The Thai government eventually agreed in principle to the exercise—though politely declined the offer of financing—but only on the understanding it would involve no more than 50-100 Marines from each side. Reflecting its long-standing policy of balancing relations between the United States and China, the Chief of the Royal Thai Navy (RTN) said he hoped Washington would understand that Bangkok "needs to have a drill with other friendly countries as well" (Bangkok Post, January 9). The United States is not opposed to Sino-Thai military cooperation per se, but has reservations about this particular exercise for two reasons: first, as the Thai Marines take their doctrine from their U.S. counterpart, the Chinese would be exposed to U.S. amphibious landing tactics; second, U.S. requests to observe the exercise have not yet been approved by the Thais, though it is unclear whether it is Bangkok or Beijing that is reluctant to see American observers. In fact, it remains in doubt whether the exercise will take place at all this year considering the Thai military is preoccupied with the national political crisis, the ongoing insurgency in the country’s far south, and the tense border stand-off with Cambodia.

Events over the past year indicate that as China’s economy grows and its military power strengthens, Southeast Asian officials have become more willing to voice their anxieties, both in meetings with Chinese officials and in public, forcing China to respond. In addition, Beijing faces major headaches along its southern periphery as the Burmese regime gears up for military confrontation with ethnic armies, Thailand teeters on the brink of civil war, and Vietnam pushes the South China Sea up ASEAN’s agenda. The high-point of China’s regional "Charm Offensive" appears to be well and truly over.

[The author would like to express his thanks to Milton Osborne and David Mathieson for their insights.]


1. Address by H.E. Dai Bingguo, State Councilor, The People’s Republic of China, at the ASEAN Secretariat, Jakarta, January 22, 2010.
2. Milton Osborne, "Mekong: China damned if it doesn’t,"