China-Myanmar border trade fell by US$562 million in the fourth quarter of 2018, according to the Global New Light of Myanmar, a state media outlet.
The paper’s commentator attributed the decline to tighter Chinese controls on border trade, including the suspension of some agricultural product imports from Myanmar, and the closure of a key cross-border trading post near Muse in Myanmar’s northern Shan State.
It isn’t immediately clear if the trade-slowing measures were taken in response to China’s economic slowdown, which has seen Beijing impose new controls in various economic areas, or are part of a wider strategy to press Myanmar into new commercial concessions, including renewed pressure to resume the stalled China-backed $3.6 billion Myitsone dam.
The recent decline in border trade is unlikely to affect long-term plans to develop a physical infrastructure corridor connecting China’s landlocked southern Yunnan province to Myanmar’s main cities of Mandalay and Yangon to the southern port at Kyaukphyu, which opens onto the Bay of Bengal. China sees the route as an important trade outlet for its lesser-developed landlocked provinces.
Other places where cross-border trade is active include Muse itself, Lweje (Loije) and Kanpiketee (Kampaiti) in northern Kachin state, Chinshwehaw in the Kokang area of northeastern Shan State, and Mong La north of Kengtung in eastern Shan State.
According to the Global New Light of Myanmar report, border trade at Muse over in the fourth quarter totaled $1 billion while Lweje transacted $43.4 million, $163.6 million at Chinshwehaw, $28 million at Kanpiketee and $1 million at Mong La-Kengtung.
Myanmar’s main exports to China include rice, sugar, pulses, sesame seeds, corn, dried tea leaves, fishery products, minerals and animal products. Chinese exports to Myanmar consist of agricultural machinery, electrical appliances, iron and steel-related materials, raw industrial goods, and assorted consumer items.
China has been Myanmar’s main foreign trade partner since the early 1990s while the planned China-Myanmar Economic Corridor (CMEC) aims to accelerate that trade through improved infrastructure and trade links. The CMEC is a key part of China’s US$1 trillion Belt and Road Initiative’s designs for Southeast Asia.