China calls for ceasefire and negotiations to protect Chinese projects in Myanmar

China is closely monitoring the situation in northern Myanmar and has urged relevant organizations to negotiate and halt the fighting to ensure the security of the border, Chinese projects, and the residents of the border areas. This statement was made by Mao Ning, the spokesperson for the Chinese Ministry of Foreign Affairs, yesterday.

Mao Ning made these remarks during the regular press briefing of the Chinese Ministry of Foreign Affairs on July 25, in response to questions about the conflict situation in Lashio, northern Shan State.

“China is closely following the situation in northern Myanmar. We have called on relevant parties in Myanmar to uphold dialogue and consultation, end the hostilities as soon as possible, settle disputes peacefully, avoid escalation of the situation, and in particular, make sure no harm is done to the security of Chinese borders and the safety of people living in the border area as well as Chinese projects, businesses and personnel in Myanmar. China will continue to promote talks for peace and encourage northern Myanmar to maintain the momentum of ceasefire and peace talks,” Mao Ning said.

The second phase of the ongoing 1027 military operation has seen increased attacks by the Northern Alliance. These attacks are expanding across the central regions of Myanmar, where Chinese projects are located, stretching from Kunming to the Kyaukphyu project areas, creating widespread military conflicts in these territories.

The MNDAA is carrying out attacks around Lashio and its surroundings, while the TNLA, in collaboration with PDFs, is attempting to launch and maintain attacks in areas including Kyaukme, Nwangkhio and even up to Mogok in Mandalay Region. The AA is also engaging in widespread battles across Rakhine State, aiming to control the significant Chinese project in Kyaukphyu.

Additionally, PDFs and allied groups, under the banner of the Shan Mon Operation, are conducting battles around Mandalay and Sagaing Regions. These conflicts are spreading to include Chinese projects such as the Alpha Cement Factory and the Tagaung Nickel Plant in these regions.

Currently, looking at the widespread offensives being carried out by the Northern Alliance and allied groups, it is evident that significant activities are occurring along China’s BRI projects, the natural gas pipeline projects, hydroelectric projects, and other initiatives. Analysts estimate that these conflicts could result in losses exceeding $10 billion for China.

As of the end of June 2024, records indicate that China has around 600 investment projects in Myanmar, with a total value of approximately $21.993 billion. This constitutes over 23% of the total foreign investment in Myanmar, with the largest share of Chinese investments being in the electricity sector.

Among these projects, Kyaukpyu Special Economic Zone and Deep Sea Project have an investment amount of more than 1.3 billion dollars for the first phase and a total investment value of more than seven billion dollars.

“A total of 90 per cent of the weapons owned by the three northern brotherhood alliances and other groups that are currently fighting and trying to gain control of the territories are made in China. In particular, the weapons of the three northern brotherhood alliances are imported from China, and supplied by China through the "Wa" weapons factories. Due to the wars caused by these weapons, China's investment is facing a situation where it can lose immeasurably. They are manufactured by six Wa weapons factories and supported through the Wa region. Weapons factories from KIA are supporting all armed groups. In particular, 80 per cent of the weapons used in battles now come from the weapon factories from Wa. So if China changes its policies and only controls arms from Wa, its investment losses may be reduced. If not, the war will be endless and the losses could be immeasurable. And the investments are not coming again. Furthermore, if the war lasts for 20 years and becomes as widespread as a civil war, the extent of these weapons will depend on China's policy. Therefore, China's losses in the civil war depend more on China's arms control policy than on the stakeholders in the conflict. The loss of China's investment is not dependent on the armed groups and Tatmadaw that are currently fighting but on the ability to control weapons through Wa. If this cannot be controlled, wars are likely to be more extensive and long-lasting. Then we will face the risk of losing China's investment, and China is also likely to experience the consequences more widely," said a political analyst.

On October 27, 2023, the three northern brotherhood alliances conducted an operation named Operation 1027, and attacked security posts in northern Shan State, causing large and small skirmishes. After China urged the parties to maintain peace in the northern Shan border region and hold a cease-fire as soon as possible, through their negotiation, a delegation of SAC and the three northern brotherhood alliances held talks, and a cease-fire agreement was reached in January 2024.

After that, starting from June 27, 2024, the second phase of the Operation 1027 war began again, and the Ta’ang National Liberation Army (TNLA) attacked Mogok, Nawnghkio, Kyaukme and Hsipaw and MDY PDF in collaboration with the TNLA attacked in Madaya-Singu areas. Since July 3rd, the MNDAA and joint groups attacked Lashio city, and until July 26, fighting has been going on in these areas.

During the fighting called the second phase of Operation 1027, the MDY PDF, which cooperated with the TNLA, attacked the security camp of the Alpha Cement factory project involving Chinese investment in Mandalay Region's Madaya Township, and the buildings in the factory were damaged during the fighting.

MDY PDF alleged that the factory building was set on fire by the security forces during the retreat.

In addition, it is said that PDF was occupied at the Tagaung nickel factory, which is a Chinese investment project in Htigyaing Township, Sagaing Region.

In January 2022, the three legs steel tubular electrical self-supporting high voltage power transmission towers that were connected to the Tagaung nickel factory were detonated and destroyed.

During the first phase of Operation 1027, the TNLA and PDF occupied the building of the Kyaukpyu-Kunming oil pipeline control station in Kyaukme Township, causing some damage to the building.

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