MEMO FOR THE NATIONAL SECURITY COUNCIL U.S. INTERESTS IN THE SINO-BURMESE RELATIONSHIP

OBJECTIVE: Current Obama Administration policy is to support a unified, peaceful, prosperous, and democratic Burma that respects the human rights of its citizens. The U.S. aims to support a stable Sino-Burmese relationship aligned with U.S. interests. In pursuing this policy, the U.S. has interests in the Sino-Burmese relationship that derive from political, economic, and security concerns.

BACKGROUND: Over the majority of the past 25 years the U.S., many other Western countries, and Burma did not have formal relations. The international community was trying to isolate the repressive military junta ruling Burma. During this time, China, which shares a border with Northeast Burma, was a lifeline for the regime, providing political, military and economic support. Since the Thein Sein administration in Myanmar, the relationship has changed, with Myanmar exerting some push back on Chinese influence in the country, at the same time relations with the U.S. have improved.

POLITICAL

1. It is in the U.S. interest to support the Sino-Burmese relationship to communicate to China that U.S. involvement in Burma is not part of a containment strategy nor an attempt to drive a wedge in the bilateral China-Burma relationship.
   
2. After U.S. diplomats visited the Kachin State, China was wary of a potential U.S. intervention in the conflict. Partially to avoid U.S. involvement in its border, China has been the host of the recent ceasefire negotiations with the Kachin Independence Organization (KIO) and the Burmese Government. Border stability is in China’s interest, and China is fearful that a disintegration of the Kachin Independence Army (KIA) would present an opportunity for Kachin guerilla fighters to attack targets indiscriminately in the region, posing risks to Chinese investments such as the dual oil and gas pipeline. However, it is in the interest of the U.S. that the KIO and the Burmese Government peace talks lead to a permanent integration solution of the KIA and Burmese Army. Continued conflict with the ethnic minorities could present a barrier to the elections in 2015, and it is in the U.S. best interest that free and fair elections are held on time.
   
3. China recently appointed Wang Yingfan, a very senior diplomat and former Vice Minister of Foreign Affairs, the first special representative on Asian affairs. Wang Yingfan will primarily be focused on the Sino-Burmese relationship, and it is in the U.S. interest for Patrick Murphy, the U.S. Special Representative and Policy Coordinator for Burma, to establish a relationship and open communication channel with Wang Yingfan immediately.
   
4. As 2014 is the first year Myanmar is chair of ASEAN, the U.S. has an interest in increasing its influence relative to China in Myanmar so that China’s influence does not weigh unduly over Myanmar’s leadership of ASEAN.
   
5. China has started to build relationships with democratic oppositions in Myanmar. The U.S. currently has the strongest relationship with Aung San Suu Kyi and the National League for Democracy (NLD), and Thein Sein and the reform supporters in the Union Solidarity and Development Party (USDP). In light of the uncertain outcome of the elections of 2015 it is in the U.S. interest to also build relations with opposition parties in Myanmar as China is doing.
   
6. It is in the U.S. interest to promote a stable Sino-Burmese relationship so that the Chinese are close observers to the strategies and benefits of the transition. A successful and prosperous transition to democracy in Myanmar could be a good example for Chinese who may push for reform in the future to refer to.

ECONOMIC

1. China is the largest source of Burma’s FDI inflows, about a third of the total $42 billion the country received in 2012. The majority of the Chinese investment is in the hydro, oil and gas, and mining sectors. However, a significant amount has gone into infrastructure. Chinese companies view Burma’s need for infrastructure as a great opportunity. It is in the U.S. interest for China to invest in Burma’s infrastructure because infrastructure investments take a very long time to realize profits and will facilitate the entrance and ease of business for American companies in Burma.
   
2. The U.S. has an interest in responsible Sino economic involvement in Myanmar to prevent environmental and humanitarian disasters, and to protect the land for the benefit and enjoyment of generations to come.
   

SECURITY

1. China has provided a vast amount of military support to the Burmese military and ethnic minority militias in Burma. It is suspected that China conducts military intelligence gathering activities from Burma. It is in the U.S. interest to understand the extent of the Sino- Burmese military relationship. It is in the best interest of the U.S. that China does not fund the ethnic militias.

POLICY RECOMMENDATIONS

1. To gain a greater understanding of the Sino-Burmese military relationship the U.S. should propose a joint security exercise with U.S., Chinese, and Burmese partnership aimed at cutting down illegal drug activities in the Golden Triangle. Thailand has been frustrated by Burma’s inability to curb the flow of methamphetamines across the border, and China is not likely to welcome U.S. forces on its border, but a Sino-Burmese-American join effort may be possible on the Burma, Laos, Thai border.
   
2. Patrick Murphy should invite Wang Yingfan for an official visit to Washington D.C. to discuss which policies in Burma the U.S. and China can work together on in order to show China that the Burma – U.S. relationship is not part of a containment strategy, emphasizing, as Ambassador Derek Mitchell said, that “U.S. involvement in Burma is about Burma.”
   
3. USAID should design projects for public private partnerships involving American and Chinese companies in Myanmar. The partnerships will be mutually beneficial because the Chinese companies can bring the capital and state financing while American companies can bring the training and technological know how that Chinese and Burmese companies are hungry for.
   
4. To enable the U.S. to invest with confidence in Burma and partner with Chinese enterprises, the USG executive branch should ask the 113th Session of Congress to make it a priority to pass new legislation fully removing the old sanctions.
   
5. China desires to be seen as a responsible international power. The U.S. should publically commend China for taking a leadership role in the KIO/Burmese government peace process and encourage further facilitation of the peace process.
   
6. High-level U.S. Government representatives should plan to be present at as many of the 2014 ASEAN meetings in Burma as feasible in order to demonstrate commitment to the pivot and maintain an element of U.S. influence on Burma’s leadership of ASEAN.
   
7. U.S. diplomats fluent in Chinese and Burmese should be trained at FSI and posted in Yangon to strengthen and facilitate communication between the three nations.
   

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