The Yunnan-Burma Road played an important role in the victory of China and other Asian countries against Japanese invasion over 70 years ago. A recent journey along the northern Myanmar section of the road left an impression that the local economy remains backward due to armed conflicts and it is China who can help alleviate poor living conditions of local residents.

Decades of conflicts hinder economic development

The reporter found in Shan state and Kachin state that certain villages, especially mountain villages, remain poor and most villagers live in huts with few household appliances. Although the region is rich in natural resources, decades of armed conflicts have severely hindered local economic development, leading to poor roads, lack of electricity and backward infrastructures. The Myanmar government is unable to invest heavily in its northern regions inhabited by ethnic minorities and slow economic development has inevitably disrupted the national unity.

Many local residents told the reporter that they hope the central government and ethnic militias can reach a peaceful agreement as soon as possible because foreign investors and tourists will not come to northern Myanmar and local economy will not develop healthily without a stable environment and the policy of opening up.

Burma Road, Myanmar's busiest highway

The Burma Road has become an artery boosting the economic and personnel exchanges between northern Myanmar and southwest China.

There are many restaurants, hotels and water stations in the cities and towns along the Yunnan-Burma Road which mainly serve truck drivers. A driver said that Myanmar's border town of Muse sits next to Ruili, China, and it is a logistics hub for Chinese goods in Myanmar. Trucks carrying Chinese goods are first transported to Muse, and then distributed to other places in the country. Chinese goods are always in short supply in Myanmar.

Chinese supplies and goods were crucial to the survival of Myanmar's economy when the country suffered from Western economic sanctions and blockade. The Yunnan-Burma Road remains extremely important to Myanmar, though the country has re-opened its door to the outside world.

Young people in the village used to work in Thailand while many of them do import and export business along China-Myanmar border, in hopes of making a fortune,” said an over 60-year-old Shan villager.

A store owner in Kyaukme said that China and Myanmar share a long border, which is a natural favorable condition for foreign trade between two countries. Many goods in Myanmar come from China because Chinese goods are affordable and leave dealers enough room for profits.

The United States is far away while China is quite close. "China is more helpful to Myanmar," the store owner said.

Investment in manufacturing industry deepen the complementary of two economies

China and Myanmar have close trade and investment ties, but trade and investment mainly focus on resource-intensive industries such as jade mining and processing, timber and other primary raw materials. This cooperation model is rather fragile.

Northern Myanmar near the Chinese border has complex ethnic problems. China-Myanmar border trade faces great risks given the unstable situation in northern Myanmar.

Analysts believe that Chinese investment has limited influence over Myanmar's economy as resource-based trade can only produce limited impetus to upstream and downstream industries.

Many businessmen in Myanmar believe that Chinese investment in Myanmar's manufacturing and agricultural sectors has great potential. Many labor-intensive Chinese enterprises, including textile manufacturers and agricultural companies, have sent representatives to conduct market investigations in Myanmar. These Chinese enterprises will soon invest in Myanmar as the country further improves its investment environment, which will make the two economies more complementary.