China is Myanmar’s top trading partner and accounts for the lion’s share of Myanmar’s imports and exports. According to 2019 data, bilateral trade is worth around $ 12 billion out of the overall trade of nearly $ 36 billion, accounting for roughly one-third of the total.
In 2019, China had a 31.7 per cent proportion of its exports and a 34.7 per cent share of its imports, significantly outpacing any other country, including India, which did not even make the top five in either category despite sharing a long land border. Myanmar has imported the majority of its commodities from China since 2001. China’s imports mostly consist of equipment metal products vehicles and telecommunication equipment.
Myanmar’s main source of FDI (Foreign Direct Investment) is China, which contributed $ 21 billion in March 2020. Besides energy and gas, China has been diversifying its investments in recent years. China and Myanmar signed several Belt and Road Initiative projects in 2020. But now due to an increase in instances of COVID-19 infection, China has closed the remaining two of its ten border crossings with Myanmar, halting cross-border commerce and stranding over 1,300 vehicles on the Myanmar side, informed sources told ET.
On July 8, 2021, the Muse–Jin San Jiao and Muse–Wanding border crossings were closed, while the Laukkai–Yanglong and Chinshwehaw borders were forced to close earlier this year. Following Muse Port, Qingshuihe Port, a recognized national-level tier 1 port, located on the China–Myanmar border in the northern section of Myanmar’s Shan State, is China and Myanmar’s second-largest border commerce port was closed on October 6.
Myanmar’s major avenue for exporting agricultural products to China is through the port. The country has been unable to ship agricultural products to its neighbour as a result of the port shutdown, prices of different items imported from China are projected to rise as a result. The closing of Qingshuihe Port, according to local merchants, is a major setback for Myanmar’s already ailing export sector. Before the pandemic, the city of Muse accounted for a significant percentage of the border trade between the two countries, with daily trade volumes exceeding $10 million.
There are a total of eight land ports that conduct border commerce between China and Myanmar in regular conditions. Most of these ports have been closed indefinitely. After the closure of Qingshuihe Port on October 6, All land trade ports linking China and Myanmar are now blocked due to disease prevention and control efforts.
Myanmar exports timber, fruits, and agricultural goods to China predominantly through Ruili, with fruits entering China mostly at the Jin San Jiao border. Before its closure, freight vehicles filled with fruits were forced to queue nearby since this was the last border crossing to be shut down. 1,000 freight vehicles were stopped at the border at one time as a result trade has come to a total halt now that this crossing has also been closed.
Myanmar’s exports to China of watermelon and cantaloupe are the largest in the world, with yearly export volumes topping 800,000 tonnes. Every day, around 400–500 fruit trucks would pass the pass the borders. With these border closures Myanmar would no longer be able to export watermelons to China.
Fruit farming and exports have been hampered not only due to the pandemic but also due to political unrest. The number of mangos shipped through Muse has approximately half, and the halt in exports has resulted in enormous quantities of fruit perishing while in transit. Although many fruit exporters, including mango exporters, have shifted to sea shipments, but a lack of shipping containers and rising reefer freight rates have increased the price and dangers of such exports. According to Than Gyaw, joint secretary of the Myanmar Eels Entrepreneurs Association, Myanmar’s fishermen are also facing big losses, because China did not offer any early notice that the border gates would be shut.
According to Myanmar’s Ministry of Commerce, bilateral trade between China and Myanmar totalled $6.13 billion in the first seven months of the fiscal year 2020–2021. This amount is made up of $3.18 billion in exports from Myanmar to China and $2.95 billion in Chinese imports into Myanmar. This has led to a huge economic loss to both the nations, as well as massive job losses in both the regions.
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