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Stratfor-Myanmar Set to Play Japan



Subject: Stratfor-Myanmar Set to Play Japan Off China 

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0031 GMT, 991221 - Myanmar Set to Play Japan Off China=20

Myanmar's foreign minister Win Aung traveled to Beijing Dec. 21 for a =
goodwill visit at the invitation of his Chinese counterpart, Tang =
Jiaxuan. Earlier in the month, Japan held an economic conference with =
Myanmar. These meetings have come just as the government in Yangon has =
denounced a scathing World Bank report on the country's economic =
problems.

The report argued that long-standing political, economic and human =
rights issues stand in the way of healthy economic development. Myanmar, =
in dire economic straits, desperately needs outside assistance. Foreign =
investment from ASEAN countries has plummeted by 70 percent since the =
1997 regional economic crisis. And inflation hovers near 30 percent. =
Meanwhile, U.S. and European economic sanctions continue.

The country's ruling State Peace and Development Council (SPDC) =
continues to resist Western reform demands that could lead to financial =
aid. By exploring relations with regional powers, the ruling council =
appears to be looking for a way to skirt the West's objections. Both =
China and Japan, eager to play leading roles in a developing pan-Asia =
bloc, are vying for influence in Myanmar. This competition will put =
Myanmar in an excellent position to bargain.

Working through the United Nations and the World Bank, the West has made =
many attempts in recent years to reconcile with Myanmar, hoping to =
exploit the country's precarious economic position to extract =
concessions. In October 1998, for example, the two groups offered the =
ruling military government $1 billion in exchange for a dialogue with =
the opposition National League for Democracy. These initiatives will =
likely continue, as Myanmar's alleged human rights violations remain the =
major stumbling block to potentially lucrative engagement between the =
European Union and ASEAN, which defends Myanmar's right to membership.=20

The ruling council's reaction to the World Bank report suggests that the =
government is not anywhere near reconciling with the West. Myanmar will =
instead play off an ongoing trend toward Asian self-reliance -- the same =
trend that has sent both Japan and China in pursuit of increased =
influence in the region. Both have long-term strategic interests in =
making Myanmar an ally. The nation sits on the edge of Southeast Asia, =
making it a key foothold in the region. More importantly, its southern =
coast opens to both to the Bay of Bengal and the western end of the =
Straits of Malacca, the region's most important trade route.

Japan has courted Myanmar actively during the past year. Among other =
diplomatic initiatives, Keizo Obuchi in November became the first =
Japanese prime minister in 15 years to meet with his Myanmar =
counterpart. Like the West, Japan has pressured the country to reform =
its political and economic systems, both based on rigid central control. =
Yet Yangon may see Tokyo as an Asian alternative to capitulation to the =
West.

Japan's interest in Myanmar in part derives from awareness that it has =
competition: China. In addition to goodwill visits such as the one this =
week, China has attempted to acquire naval bases on Myanmar's coast, =
according to several reports. Beijing has denied the reports but it has =
a number of strategic interests. Like Japan, Beijing seeks to position =
itself as Asia's regional leader.

In forging bonds with Myanmar, China accomplishes two additional goals. =
First, it counters U.S. containment strategy in the region, which =
attempts to maintain an arc of influence around China's coast. A =
foothold in Myanmar would snip the end off this arc. Second, naval =
access to one of Myanmar's ports could someday give China the =
opportunity to influence traffic in the Straits of Malacca.=20

With Japan, China and even the European Union competing for influence, =
Myanmar will profit by playing the three off each other. Myanmar may be =
able to extract much and concede little.=20


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<H3><IMG alt=3D"0STRATCOMMEN.jpg (3025 bytes)" height=3D16=20
src=3D"http://www.stratfor.com/images/0STRATCOMMEN.jpg"; =
width=3D246></H3>
<P class=3DMsoNormal><FONT face=3DArial size=3D3><B>0031 GMT, 991221 =
&#8211; </B><B>Myanmar=20
Set to Play Japan Off China</B> </FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>Myanmar&#8217;s foreign =
minister Win Aung=20
traveled to Beijing Dec. 21 for a goodwill visit at the invitation of =
his=20
Chinese counterpart, Tang Jiaxuan. Earlier in the month, Japan held an =
economic=20
conference with Myanmar. These meetings have come just as the government =
in=20
Yangon has denounced a scathing World Bank report on the country&#8217;s =
economic=20
problems.</FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>The report argued that =
long-standing=20
political, economic and human rights issues stand in the way of healthy =
economic=20
development. Myanmar, in dire economic straits, desperately needs =
outside=20
assistance. Foreign investment from ASEAN countries has plummeted by 70 =
percent=20
since the 1997 regional economic crisis. And inflation hovers near 30 =
percent.=20
Meanwhile, U.S. and European economic sanctions continue.</FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>The country's ruling =
State Peace and=20
Development Council (SPDC) continues to resist Western reform demands =
that could=20
lead to financial aid. By exploring relations with regional powers, the =
ruling=20
council appears to be looking for a way to skirt the West&#8217;s =
objections. Both=20
China and Japan, <A=20
href=3D"http://www.stratfor.com/asia/commentary/m9912092305.htm";>eager =
to play=20
leading</A> <A=20
href=3D"http://www.stratfor.com/asia/commentary/m9912092305.htm";>roles</A=
> in a=20
developing pan-Asia bloc, are vying for influence in Myanmar. This =
competition=20
will put Myanmar in an excellent position to bargain.</FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>Working through the =
United Nations=20
and the World Bank, the West has made many attempts in recent years to =
reconcile=20
with Myanmar, hoping to exploit the country's precarious economic =
position to=20
extract concessions. In October 1998, for example, the two groups =
offered the=20
ruling military government $1 billion in exchange for a dialogue with =
the=20
opposition National League for Democracy. <U><A=20
href=3D"http://www.stratfor.com/asia/commentary/m9910161545.htm";>These =
initiatives=20
will likely continue</A></U>, as Myanmar's alleged human rights =
violations=20
remain the major stumbling block to potentially lucrative engagement =
between the=20
European Union and ASEAN, which defends Myanmar's right to membership.=20
</FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>The ruling =
council&#8217;s reaction to the=20
World Bank report suggests that the government is not anywhere near =
reconciling=20
with the West. Myanmar will instead play off an ongoing trend toward =
Asian=20
self-reliance -- the same trend that has sent both Japan and China in =
pursuit of=20
increased influence in the region. Both have long-term strategic =
interests in=20
making Myanmar an ally. The nation sits on the edge of Southeast Asia, =
making it=20
a key foothold in the region. More importantly, its southern coast opens =
to both=20
to the Bay of Bengal and the western end of the Straits of Malacca, the =
region's=20
most important trade route.</FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>Japan has courted =
Myanmar actively=20
during the past year. Among other diplomatic initiatives, Keizo Obuchi =
in=20
November became the first Japanese prime minister in 15 years to meet =
with his=20
Myanmar counterpart. Like the West, Japan has pressured the country to =
reform=20
its political and economic systems, both based on rigid central control. =
Yet=20
Yangon may see Tokyo as an Asian alternative to capitulation to the=20
West.</FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>Japan's interest in =
Myanmar in part=20
derives from awareness that it has competition: China. In addition to =
goodwill=20
visits such as the one this week, China has attempted to acquire naval =
bases on=20
Myanmar's coast, according to several reports. Beijing has denied the =
reports=20
but it has a number of strategic interests. Like Japan, Beijing seeks to =

position itself as Asia's regional leader.</FONT></P>
<P style=3D"MARGIN: 0in 0in 0pt"><FONT face=3DArial size=3D3>In forging =
bonds with=20
Myanmar, China accomplishes two additional goals. First, it counters =
<U><A=20
href=3D"http://www.stratfor.com/asia/commentary/m9910231510.htm";>U.S. =
containment=20
strategy</A></U> in the region, which attempts to maintain an arc of =
influence=20
around China's coast. A foothold in Myanmar would snip the end off this =
arc.=20
Second, naval access to one of Myanmar's ports could someday give China =
the=20
opportunity to influence traffic in the Straits of Malacca. </FONT></P>
<P class=3DMsoNormal><FONT face=3DArial size=3D3>With Japan, China and =
even the=20
European Union competing for influence, Myanmar will profit by playing =
the three=20
off each other. Myanmar may be able to extract much and concede =
little.</FONT>=20
</P></FONT></DIV></BODY></HTML>

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