February 14, 2014edge review

Photo: A girl in Mae La refugee camp, the largest along Thailand’s border with Myanmar (Brennan O’Connor)

Profound changes on the main gateway connecting Myanmar with Thailand

By most standards, there’s nothing remarkable about the Moei River, a muddy, shallow and narrow tributary of the mighty Salween River. But as Myanmar begins to emerge from 50 years of mismanaged military rule, the Moei is at the epicentre of a momentous change.

Since last August, foreign visitors have been allowed to cross the Thailand-Myanmar Friendship Bridge and travel overland into the heartland of central Myanmar – a route closed to outsiders for five decades. While goods and migrants have flowed freely over the notoriously porous border for decades, this new openness is an indication of the changes in store for the area. Myanmar is keen to forge links with India, China and the rest of the states of the Association of Southeast Asian Nations – a combined market encompassing nearly half of the world’s population.

The Thai city of Mae Sot sits in the Moei valley, separated from the plains of central Thailand by the northernmost extent of the Tenasserim Range that extends all the way to Singapore. Myawaddy, on the western bank of the river five kilometres away, is nestled in the shadows of the conflict-ridden Dawna Range, where Karen insurgents have battled the Myanmar government on and off for nearly all of the country’s independent existence.

The relative isolation afforded by the two mountain ranges gives the Myawaddy-Mae Sot area a unique backwater character, neither entirely Thai nor Burmese. One might be hard pressed to notice that there’s an international border at all. Day labourers cross the river every morning by boat to work at factories on the Thai side, and a steady stream of Thai-made goods – clothing, food, cars – is shipped to Myanmar by way of illicit-but-tolerated river ports, mostly controlled by non-state armed groups in ceasefire agreements with the government. Gems and jade make the journey in the opposite direction.

Although the changes to date have been subtle, Mae Sot is on the verge of an economic boom. The city offers the shortest route between Bangkok and Yangon, and the highway on both sides of the border is an official leg of the main Asian Highway route linking the Pacific Ocean to the Mediterranean. New condo and hotel projects are springing up regularly, and the crowds of NGO workers that dominate the city’s expat scene are already giving way to traders and businesspeople.

Border areas often showcase the exploitive side of capitalism in its most raw form, and Mae Sot is no exception. Offered scant legal protections, workers at factories there are routinely paid below minimum wage and contend with a litany of abuses on a daily basis. In January 2013, the Thai government announced its intention to establish a special economic zone at Mae Sot, starting out with some 900 hectares immediately adjacent to the Moei. Plans to construct a second bridge over the river are also in the works.

In 2012, Thailand introduced a nationwide daily minimum wage of 300 baht (US$10), but few migrants receive this much. For manufacturers willing to contend with Myanmar’s spotty electrical grid and shoddy infrastructure, the savings associated with shifting production to the other side of the border could be great. Although Naypyidaw is set to introduce an official minimum wage by the end of the year, that amount has not yet been decided upon, and average salaries for manufacturing jobs hover around a dollar per day in Myanmar.

Authorities in Myawaddy have attempted to capitalise on this, and a long-mooted industrial zone is currently in the preliminary stages of development a few kilometres from the border. Another industrial zone was established in late 2012 just outside of Hpa-An, the capital of Karen State, 150 kilometres away. Hpa-An is located just an hour’s drive from the deep-water port of Mawlamyine at the mouth of the Salween.

But before the cross-border bonanza can get underway, some logistical issues need to be sorted out. The highway from Myawaddy over the mountains to Kawkareik, 65 kilometres away, was built by the Japanese during World War II and has barely been maintained since. It’s a treacherous ride: cars, trucks and buses ply the unpaved road single-file, with five-hundred-foot drops and certain death awaiting inattentive drivers and their passengers. Landslides and accidents are common, especially in the rainy season. Because the road is too narrow to accommodate two-way travel, traffic is routed in opposite directions on alternating days.

Construction of an alternate road to Kawkareik is currently underway, financed in large part by Thailand and the Asian Development Bank, as part of its vision to construct an “East-West Economic Corridor” linking the South China Sea to the Bay of Bengal. While there is no firm date for when the road will open, many expect construction to be finished by early 2015, when the much-vaunted Asean Economic Community (AEC) is set to go into effect. A tentative first step towards Asean-wide economic integration, the AEC is intended to form the basis for a future common market. Owing to economic disparity between Asean member states and widespread protectionism, however, this is unlikely to be fully realised for many years to come.

With cross-border links set to improve soon, tourist arrivals to Hpa-An will likely increase markedly. The area’s sheer limestone pinnacles, temple-filled caves and lush paddy fields have already made Hpa-An and its environs a popular stop on Myanmar’s burgeoning tourist trail. Last year, the government, in partnership with a Malaysian company, Special Methods and Engineering Techniques Sdn Bhd of Penang, announced plans to build a cable car to the peak of Mount Zwegabin, among the most important sites in Karen Buddhism.

Reimagining Hpa-An as a manufacturing base or major tourist centre would have been implausible as little as three years ago, when the area was still subject to skirmishes between government forces and allied paramilitary groups, on one side, and the Karen National Liberation Army and its allies, on the other. But in January 2012, a preliminary ceasefire was signed – pausing the slow-burning conflict for the time being – and further steps have since been taken to bring Karen non-state armed groups into a nationwide ceasefire agreement.

While such an arrangement would not mean a permanent political resolution or guarantee lasting peace, the government and ethnic armed groups have proposed that such an agreement be used as a the basis for further negotiations.

Ethnic armed groups would like to see devolution of power to ethnic areas, something Myanmar’s military has steadfastly opposed. The next round of negotiations was supposed to take place in Hpa-An last year, but has been postponed until March.

Around 120,000 refugees from Myanmar are confined to camps in Thailand, and their fate remains in limbo.  The Thai government has made no secret of its desire to see the refugees return home. Although the peace process appears to be well underway, the risk of violence flaring up again is very real, and will remain so until a durable political solution is reached. Further complicating matters is the danger posed by of thousands of uncleared landmines, laid by both government and insurgent armies over decades of fighting.

In February, the United States ended its resettlement program for refugees in nine camps along the border, prompting speculation that Thailand intends to repatriate the rest after elections in Myanmar next year. While a few refugees have decided to try their luck back home, most are choosing to take a wait-and-see approach.

As the “New Myanmar” strives to further distance itself from its military past, the future of the border areas is far from certain. How the region continues to evolve, and how non-state armed actors, investors and refugees react to these changes, will serve as an important bellwether for the durability of Naypyidaw’s political and economic reforms more broadly.

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