Chinese President Xi Jinping’s promise of “high-standard cooperation” over his signature Belt and Road Initiative (BRI) and his country’s overseas investment appears to have stumbled into trouble over a number of projects in Myanmar, including a controversial copper mine in Letpadaung.
On the face of it, China wants to be seen to be adhering to international standards.
Growing environmental and social issues with Chinese businesses in the Global South over the past decade have prompted the Chinese government to adopt policies and guidelines that require their oversea investments to adhere to international rules and best practices for environmental and social protection.
A White Paper on “China’s International Development Cooperation in the New Era”, a policy paper aiming to step up its development cooperation with the Global South especially through the BRI platform, released by the Chinese government in January 2021, states that China will “establish a new model of international relations based on mutual respect, equity, justice and win-win cooperation, and build an open, inclusive, clean and beautiful world that enjoys lasting peace, universal security and common prosperity.” President Xi in a speech at the Second Belt and Road Forum for International Cooperation in April 2019, said, “We need to pursue high-standard cooperation to improve people’s lives and promote sustainable development. This is how we can jointly promote high-quality Belt and Road cooperation.”
Can those lofty words become a reality? Are Chinese stakeholders making an effort to fulfill those promises? While such a policy shift is welcoming and it is reasonable to consider that its nascent implementation can be incremental, its approach in Myanmar raises questions as to whether this is merely empty rhetoric.
While Chinese stakeholders promise a lasting peace and high standard of cooperation to improve people’s lives and sustainable development, via their projects under the framework of the BRI in the Global South, recent incidents at the Letpadaung Copper mine project are serious cause for concern.
China’s role in aiding and abetting conflict in Myanmar through its support of the military junta contradicts their promises for “lasting peace”.
The failure of a number of Chinese businesses to adhere to international best practices contradicts their promise for “high standard cooperation”.
ABETTING ARMED CONFLICT?
The Letpadaung Copper mine project is one of the projects under the framework of the BRI as claimed by the China’s People’s Daily. Recent atrocities in the copper mine project area in the Sagaing region, a prime area of resistance against the junta, exemplifies how business operations have intentionally and unintentionally caused and contributed to armed conflict and human rights abuses. Wanbao Mining, a subsidiary of Chinese arms manufacturer NORINCO, has been operating the controversial Letpadaung copper mine in Sagaing Region, in partnership with the military-owned Myanmar Economic Holdings Company, MEHL since 2010.
Payments for the Letpadaung project to the junta and the MEHL for the 2020-2021 fiscal year are estimated to be US$417 million. Altogether it amounts to $725 million if payments from the other two Chinese-run mine projects, Sabetaung & Kyesintaung (S&K) mines and Tagaung Taung mines are included. Those revenues enable the junta to buy weaponry to consolidate its power by waging war against the Myanmar people.
This has led to a recent call by national and international organisations and revolutionary forces to deny the military junta the money, weapons and legitimacy. Some 16 local defense forces, PDFs active in Yinmabin and Salingyi townships in Sagaing Region, called on the Wanbao and Yantse Ltd operating S&K mines to halt their operations by 5 May.
A joint statement of Wanbao and Yantse on 4 May in response to the warning of the resistance forces says: “Recently there are many rumours, misperceptions and groundless accusations against our project”. They also claim that since February 2021, their copper production has been halted.
However, according to local people, the project was disrupted temporarily as some of the project workers participated in the Civil Disobedience Movement (CDM) in the wake of the coup. Then the project resumed and has been operating until the main power cable was recently blown up, allegedly by a local resistance force. The local account is also in line with the information included in the Xue Gong’s article on “Chinese Mining Companies and Local Mobilization in Myanmar.”
Analysts claim that Wanbao’s responses appear clumsy, dishonest and defensive. Their intent appears to hide their collusion with the military. Rather than making an effort to respond to the legitimate concerns of local people regarding their support to the abusive military forces and their business relationship with the military, they just brushed off such concerns.
According to interviews with local people by Radio Free Asia (RFA) since the coup, Wanbao hosted military troops to be stationed in their compound, and military-formed militia “Pyu-Saw-Htee” were also trained there. Between 25 May to 26 June 2022, junta forces raided over 40 villages in the copper mine area and approximately 20,000 villagers fled. Many households have been burnt down.
Nine villagers have been brutally killed to date, and some others disappeared. In response to these atrocities, local resistance groups attacked the military based in the copper mine area on 22 June and blew up the main power cable supplying the Wanbao facility on 24 June. On 27 June, Wanbao issued a condemnation statement over the attack and claimed that they do not want to get involved in the recent conflict. However, they have been aiding and abetting the junta’s atrocious crimes by allowing junta forces to station at their mine and launch attacks.
Involvement in armed conflict by Chinese stakeholders is not only at a local level, but also at a national level. Weapons supplied by China have been used to commit war crimes and crimes against humanity in ethnic areas even prior to the coup and to kill unarmed civilians, peaceful protestors and its opponents since the coup. Wanbao’s parent Chinese state-owned company, China North Industries Group Corporation, Norinco, is among the biggest suppliers of arms and military equipment to the Myanmar military. In addition, in ethnic areas, Chinese illegal business activities in natural resource extraction are booming in collusion with local militias backed by the military. This has not only caused social and environmental destruction but also fueled the conflict by providing funding to the Myanmar military.
COLLUSION WITH THE JUNTA?
Failing to conduct international best practices such as heightened human rights due diligence, HRDD and their complicity in the junta’s severe human rights violations contradict promises and policies of “high-standard cooperation”.
If the Letpadaung mine project is supposed to adhere to international standards, they should have done HRDD by meaningfully consulting with affected rights holders, local human rights defenders and experts. Conducting HRDD is required to identify, prevent and mitigate any negative impact on human rights directly or indirectly contributed by their business operations and their business partners. It also requires businesses to report locally and widen the number of stakeholders on how they have managed to reduce and avoid any potential negative impact and to give access to remedy if there is any grievance.
HRDD norms have been established in the UN Guiding Principles on Business and Human Rights, UNGPs, and also echoed in the OECD Due Diligence Guidance on Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. The Chinese Due Diligence Guidelines for Responsible Mineral Supply Chain have UNGP and OECD Due Diligence guidance as their basis.
While there have been calls to conduct HRDD in high-risk circumstances in Myanmar, there are no signs that Wanbao and other Chinese companies are conducting HRDD.
Rather than a HRDD, Wanbao ‘s statement on 27 June, highlights how they have been providing welfare support to their workers and communities. They detailed how their Community Social Development, CSD projects have benefited communities via their health, education and welfare programmes. Wanbao has been carrying out the CSD projects according to recommendations made by the Letpadaung Investigation Commission established in December 2012 after peaceful protestors against the project were injured by smoke bombs fired by the police in November 2012.
In fact, due to grievances related to land acquisition, lack of transparency in providing compensation and environmental destruction, since the inception of the Letpadaung project, locals have staged a series of protests over the years. In December 2014, one villager was shot to death, and several others were injured during the crackdown on protest. Until recently, not all complaints have been addressed, and there remain some outstanding land resettlement and compensation issues. The disregard for international environmental and social safeguard systems since the conception of the project has led to social difficulties.
In fact, Wanbao’s Corporate Social Responsibility programmes should have been an added value after meeting a threshold of their responsibility not to have a negative impact on local communities and the environment, if they were supposed to adhere to international best practices.
Conducting necessary assessments and adopting management plans at the beginning of the project such as environmental and social impact assessments, EIA, SIA, human rights impact assessments, HRIA and rehabilitation and resettlement action plans, livelihood restoration plans and grievance mechanisms would have helped prevent local grievances and provide access to remedy if there is any grievance arisen not to escalate to protests and clashes. Although Wanbao conducted EIA at a later stage in accordance with the recommendation of the Letpadaung Investigation Commission, failure to conduct one at the beginning stage has led to these grievances.
Critics point out ways of doing business by Chinese stakeholders and one is partnering with “local companies with ties to corrupt or autocratic governments with little transparency or accountability.”
Wanbao’s partnership with the military has tarnished Wanbao’s reputation, given the authoritarian practice of the latter without paying respect to the rights of local people and consulting with them.
While Wanbao’s figures in their statements indicate several community members benefitted from Wanbao’s CSR activities, this does not excuse their collusion with the military.
It appears that lessons learned from the Letpadaung project do not last long, and Wanbao and the Chinese Government has gone back to their old ways with the belief that the military will be able to protect their interests. They made an assessment that finally the military will be able to consolidate its rule all over the country like in the 1990s and confirmed their support for the junta. However, this assessment needs to consider that in the past, the revolutionary forces in this era were non-existent. Today, the situation is different.
The recent visit by Chinese Foreign Minister Wang Yi to Myanmar reinforces China’s depth of cooperation with the Myanmar junta. China legitimized the junta by recently allowing Myanmar to host the meeting of the Lanchang-Mekong Cooperation group, a Chinese-led initiative that includes the countries of the Mekong Delta. After the meeting, China announced that Myanmar will commit to pushing forward the process of democratic transition, and China hopes for “lasting peace and stability at an early date with the framework of the constitution and laws.”
This announcement just reinforces the self-aggrandizement message and approach Chinese stakeholders have adopted since the coup.
“The process of democratic transition” to be pushed by the Myanmar junta is to consolidate its rule by manipulating an electoral process and hold a sham election in 2023 so that the military-backed party wins and continues enjoying an electoral legitimacy and impunity from the severe crimes it has committed.
However, China’s belief that the military will win at the end of the day, and its full support for the junta - against the will of Myanmar people – may only aggravate grievances and anti-China sentiments.
What the Chinese stakeholders have been pushing ahead with since the coup has manifested in an escalation of conflict as in the example of the Letpadaung project area and the failure of their grand promises for “an open, inclusive, clean and beautiful world”.
Editorial Note: This commentary does not necessarily reflect the views of Mizzima Media.
