Beijing’s ‘Two Oceans Policy’ Looms Large

By WAI MOE

China last week announced it would increase its military budget by nearly 15 percent this year, underlining the potential superpower’s desire to press forward with its “Two Oceans Policy” and reminding Burma that it is very much just a pawn in China’s chess game.

According to the Xinhua News Agency, the spokesman for China’s National People’s Congress, Li Zhaoxing, announced on March 3 that the Chinese military budget will be increased this year by 14.9 percent—by Yuan 62.48 billion—to a figure of Yuan 480.68 billion (about $ 70 billion).

Zhaoxing said the increase will be used to upgrade military equipment, raise salaries for soldiers and increase China’s capacity to engage in disaster relief and anti-terrorism missions.

Although the official figure keeps China’s military spending at just 1.4 percent of Gross Domestic Product (GDP), analysts say that China’s real military spending is more in the region of three or four percent of the country’s GDP, which currently stands at some US $ 3.5 trillion.

“China keeps a lot of defense spending off the official defense budget (a technique long favored by Communist nations), and actual spending is more like three to four percent of GDP,” said The StrategyPage, a US military think tank.

The Chinese navy opened a new chapter in its history in December: two of its destroyers and a supply ship were sent to waters off the Somali coast to join an international effort aimed at anti-piracy operations. It was first time that the Chinese navy had operated outside its own territory.

However, Beijing’s strategy of extending its tentacles into the Indian and Pacific oceans has been running for decades. Adopted from the United States’ desire to dominate the oceans on its eastern and western seaboards, China’s “Two Oceans Policy” is not only a military strategy, but is a vehicle for the country’s economic ambitions.

A part of this strategy, Beijing has scheduled to build oil and gas pipelines from its southwestern province of Yunnan through Burma to Kyaukpyu Port on the Bay of Bengal this year.

The project, which was signed into agreement last year, is worth some $2.5 billion and includes railway, road and waterway construction, as well as upgrading the port at Kyaukpyu. On top of the pipeline project, China has secured a 30-year deal from the Burmese junta for the natural gas tapped off the coast.

The additional benefit for China is that it will also use the pipelines for importing natural gas and oil from the Middle East and Africa, which currently supply 85 percent of China’s demand for oil.

“Geopolitically, the significance of the route though Myanmar [Burma] is its direct access to the sea,” said Voon Phin Keong, an East Asian expert.

He said a Burmese route would reduce China’s overdependence on transporting oil by ship through the Straits of Malacca.

However, although China has impressed the Burmese generals and turned them into kowtowing lackeys, it has far from won the hearts and minds of the Burmese people.

According to local journalists, much of the Burmese population resents China’s support of the repressive military regime and the ever-increasing number of Chinese migrants into upper Burma.

“The Chinese regime has financially supported the junta, while Chinese businessmen have taken over our local businesses and property in Mandalay and other towns. I would guess we have 6 million Chinese living in upper Burma,” said a veteran journalist in Mandalay who spoke on condition of anonymity.

“Now they are going to build a pipeline through the country. It’s clear China has long-term interests in Burma. But a lot of Burmese see China as a national threat,” he said.

Indeed, analysts say that the general population’s abhorrence of China could setback its long-term strategy to dominate the region.

“I sensed a great deal of animosity towards Chinese in Mandalay last year, and their growing economic presence is bound to spark a backlash against China,” Jeff Kingston, a director of Asian Studies at Temple University, told The Irrawaddy by e-mail.

As there is no sign of China pulling back, this is likely to be a smoldering keg that could ignite into popular unrest directed against China’s economic interests in Burma, he added.

As Beijing’s dependence on energy and its dominance of the Indian Ocean increases, the world’s only superpower—or declining superpower—the United States, will face competition.

Robert D Kaplan, an influential American writer in international relations, wrote in the Foreign Affairs’ March/April issue that the Indian Ocean—the world’s third largest body of water—already forms center stage for the challenges of the twenty-first century, noting that the potential challengers are the two giants in the region, China and India—not the US.

He added that the ocean is dominated by two immense bays, the Arabian Sea and the Bay of Bengal, mouths to Pakistan and Burma respectively, which are two of the least stable countries in the world.

As a parting shot, he warned: “The collapse of the junta in Myanmar [Burma]—where competition over energy and natural resources between China and India looms—would threaten economies nearby and require a massive seaborne humanitarian intervention.”