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Long Reliant on China, Myanmar Now Turns to Japan Long Reliant on China, Myanmar Now Turns to Japan
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YANGON, MYANMAR — On a street in central Yangon the final moments of Kenji Nagai’s life were captured in a Pulitzer Prize-winning photo, an image that exemplified the brutality of military rule in Myanmar. YANGON, Myanmar — On a street in central Yangon, the final moments of Kenji Nagai’s life were captured in a Pulitzer Prize-winning photograph, an image that exemplified the brutality of military rule in Myanmar. Mr. Nagai, a Japanese journalist, was shot five years ago during a crackdown on protesters by security forces, and his death was a low point in relations between Myanmar and Japan.
Mr. Nagai, a Japanese journalist, was shot five years ago during a crackdown on protesters by security forces, and his death was a low point in relations between Myanmar and Japan. Now, as Myanmar seeks to shed its authoritarian past, a much different picture is emerging. Japan is rapidly ramping up its presence in the country with a heavyweight deployment of government assistance and corporate investment that is challenging China’s dominant position in Myanmar.
Now, as Myanmar seeks to shed its authoritarian past, a much different picture is emerging. Japan is rapidly ramping up its presence in the country with a heavyweight deployment of government assistance and corporate heft reminiscent of the large investments at the height of Japan’s global economic power in the 1980s. One block away from the spot where Mr. Nagai was killed, on the fourth floor of City Hall, two dozen Japanese engineers are drawing up a master plan to remake the roads, telephone and Internet networks, and water supply and sewage systems of Yangon, the country’s long-neglected commercial capital.
One block away from the spot where Mr. Nagai was killed, on the fourth floor of City Hall, two dozen Japanese engineers are drawing up a master plan to remake the roads, telephone and Internet networks, water supply and sewage systems of Yangon, the country’s long-neglected commercial capital. “Myanmar is saying, ‘Welcome! Please help us,’ ” said Ichiro Maruyama, the deputy chief of mission at the Japanese Embassy in Yangon.
With the attention to detail they are famous for, Japanese engineers are measuring traffic patterns in Yangon, inspecting 70-year-old water pipes and poring over maps and blueprints. President Thein Sein, who traveled to Tokyo this year to plead for help, is outsourcing to the Japanese crucial parts of his drive to redevelop the country. In addition to the makeover of Yangon, a Japanese consortium has been asked to build a large industrial zone and satellite city on the city’s outskirts.
“Myanmar is saying, ‘Welcome! Please help us,”’ said Ichiro Maruyama, the deputy chief of mission at the Japanese Embassy in Yangon. “I’ve been somewhat astonished by the extent of the Japanese involvement and alacrity with which they’ve moved,” said Sean Turnell, an expert on Myanmar’s economy at Macquarie University in Sydney, Australia.
President Thein Sein, who traveled to Tokyo earlier this year to plead for help, is outsourcing crucial parts of his drive to redevelop the country to the Japanese. In addition to the makeover for Yangon, a Japanese consortium has been tasked with building a large industrial zone and satellite city on Yangon’s outskirts. The totality of Japanese assistance has stunned those who watch the country closely. By choosing Japan for these crucial projects, Myanmar is diversifying away from China, its largest foreign investor in recent years, making Myanmar something of a strategic battleground between Asia’s two economic titans, China and Japan. “This is a competition for pre-eminence and influence in Asia,” Mr. Turnell said.
“I’ve been somewhat astonished by the extent of the Japanese involvement and alacrity with which they’ve moved,” said Sean Turnell, an expert on Myanmar’s economy at Macquarie University in Sydney. China and Japan have diverging interests in the country. Japan is eager to tap into Myanmar’s cheap labor force and extend its extensive network of factories in the region spanning Thailand and Indochina. China is more focused on extracting Myanmar’s natural resources like natural gas, gems, timber and rubber as well as generating electricity from its hydroelectric dams.
By choosing Japan for these crucial projects, Myanmar is diversifying away from China, its largest foreign investor in recent years.
Myanmar has become a sort of strategic battleground between Asia’s two economic titans, China and Japan, Mr. Turnell said.
“This is a competition for pre-eminence and influence in Asia,” he said.
China and Japan have diverging interests in the country. Japan is eager to tap into Myanmar’s cheap labor force and extend its massive network of factories spanning Thailand and Indochina. China is more focused on extracting Myanmar’s natural resources like natural gas, gems, timber and rubber as well as electricity from hydroelectric dams.
The impression that China is robbing the country of these resources has led to an anti-China backlash, including recent protests against a copper mine near the central city of Monywa and the suspension last year of the Myitsone hydroelectric dam.The impression that China is robbing the country of these resources has led to an anti-China backlash, including recent protests against a copper mine near the central city of Monywa and the suspension last year of the Myitsone hydroelectric dam.
John Pang, the chief executive of CARI, a research organization based in Malaysia, says the Myanmar government’s pivot toward Japan “is not so much an attraction to Japan as much as a revulsion against the Chinese.” John Pang, the chief executive of CARI, a research organization based in Malaysia, said the Myanmar government’s shift toward Japan “is not so much an attraction to Japan as much as a revulsion against the Chinese.”
“It’s a game the Chinese gave away,” he said. “It’s a game the Chinese gave away,” Mr. Pang said. The Japanese “come across as nonthreatening” and have managed to build up trust with Myanmar’s leaders, he added.
The Japanese, Mr. Pang said, “come across as nonthreatening” and have managed to build up trust with Myanmar’s leaders. Many other governments have sought to upgrade relations and business contacts with Myanmar — South Korean and Singaporean companies are active in the country — but Japan has been far more comprehensive in its approach.
Many other governments have sought to upgrade relations and business contacts with Myanmar — South Korean and Singaporean companies are very active in the country — but Japan has been far more comprehensive in its approach.
Japan’s overall strategy is to deploy the full force of what used to be called Japan Inc. Some of the country’s largest conglomerates — Mitsubishi, Marubeni and Sumitomo — are working in cooperation with the Japanese Ministry of International Trade and Industry.Japan’s overall strategy is to deploy the full force of what used to be called Japan Inc. Some of the country’s largest conglomerates — Mitsubishi, Marubeni and Sumitomo — are working in cooperation with the Japanese Ministry of International Trade and Industry.
“We haven’t had any project like this in at least 20 years,” said Masahiko Tanaka, the chief representative of Japan’s International Cooperation Agency, which will provide financing for the projects.“We haven’t had any project like this in at least 20 years,” said Masahiko Tanaka, the chief representative of Japan’s International Cooperation Agency, which will provide financing for the projects.
The Japanese government says it is willing to lend Myanmar money for the projects on terms that are near-giveaways: loans with 0.01 percent interest payable over 50 years and with no payments due for the first 10 years. The Japanese government says it is willing to lend Myanmar money for the projects on terms that are near giveaways: loans with an interest rate of well under 1 percent payable over 50 years, with no payments due for the first 10 years.
While the cheap money is no doubt attractive to the cash-strapped nation, Mr. Thein Sein appears to be counting on something else: help in winning the next election, scheduled for 2015. While the cheap money is no doubt attractive on its own, Mr. Thein Sein appears to be counting on something else: help in winning the next election, scheduled for 2015.
“They are requesting that the project be finished before 2015,” said Mr. Maruyama, the Japanese deputy chief of mission, referring to the industrial zone, which is called Thilawa and which will also include banks, schools, hospitals and other amenities of a city built from scratch. He jokingly calls the timetable “mission impossible.” Mr. Thein Sein is “requesting that the project be finished before 2015,” said Mr. Maruyama, the Japanese deputy chief of mission, referring to the industrial zone, which is called Thilawa and will also include banks, schools, hospitals and other amenities of a city built from scratch. He jokingly calls the timetable “Mission: Impossible.”
Yohei Sasakawa, the chairman of the Nippon Foundation, a Japanese charity that focuses its assistance on areas where impoverished ethnic minorities live, says the government is very aware that the population will want to see a “democracy dividend” — tangible benefits from the transition away from military rule. Yohei Sasakawa, the chairman of the Nippon Foundation, a Japanese charity that concentrates on assisting areas of Myanmar where impoverished ethnic minorities live, says the government is very aware that the population will want to see a “democracy dividend” that includes tangible benefits from the transition away from military rule. “Every single person in the country will want the fruits of democratization,” Mr. Sasakawa said.
“Every single person in the country will want the fruits of democratization,” Mr. Sasakawa said.
Mr. Thein Sein has requested that the Nippon Foundation give priority to projects that can be completed quickly, like the construction of primary schools in remote areas, Mr. Sasakawa said.Mr. Thein Sein has requested that the Nippon Foundation give priority to projects that can be completed quickly, like the construction of primary schools in remote areas, Mr. Sasakawa said.
Japan’s plans for the makeover of Yangon stretch the meaning of the word ambitious. Large parts of the city’s infrastructure were built during the British colonial days, which ended in 1948. Train cars on British-built tracks ride on rotting railway ties. Yangon sidewalks are scarred by deep and treacherous crevices. A dilapidated sewage system covers only the central area, and pipes meant to deliver clean water are a Swiss cheese of leaks. Signs of Japan’s increasing influence can be seen across Yangon, Myanmar’s biggest city. New billboards advertise Canon cameras. The Japanese airline, All Nippon Airways, will resume direct flights to Myanmar this month, 12 years after discontinuing the service.
“Leakage control is an urgent problem,” said Masaru Matsuoka, one of the engineers sent to fix the water system. In his native city of Fukuoka, in southern Japan, 2.6 percent of tap water leaks from the system. In Yangon, the figure is more than 40 percent. Equipment has been dispatched from Japan that will help pinpoint leaks underground, Mr. Matsuoka said. Japanese investors have their work cut out for them. Large parts of the city’s infrastructure were built during the British colonial days, which ended in 1948. Train cars on British-built tracks ride over rotting railroad ties. Yangon sidewalks are scarred by deep and treacherous crevices. A dilapidated sewage system covers only the central area, and pipes meant to deliver clean water are a Swiss cheese of leaks.
Much of Yangon’s infrastructure is held together with Band-Aid fixes. At a reservoir on the edge of the city, workers have jury-rigged strips of bamboo as a filtration system to prevent fish, foliage and trash from entering the pumping station. (Japanese engineers working on the project recommend against drinking the city’s tap water.) Much of Yangon’s infrastructure is held together with Band-Aid fixes. At a water reservoir on the edge of the city, workers have jury-rigged strips of bamboo as a filtration system to prevent fish, foliage and trash from entering the pumping station.
The Japanese government is also studying plans for mass transit systems, the rehabilitation of four power plants that provide electricity to Yangon, the construction of a second bridge over the Bago River and the addition of six berths to the port near Yangon that will serve the Thilawa project.The Japanese government is also studying plans for mass transit systems, the rehabilitation of four power plants that provide electricity to Yangon, the construction of a second bridge over the Bago River and the addition of six berths to the port near Yangon that will serve the Thilawa project.
The Japanese government says it will have a better idea about the cost of the projects once feasibility studies are completed at the end of the year. But it is sure the price tag will be in the billions of dollars. It has already reached a deal that would forgive or reschedule Myanmar’s outstanding debt to Japan.The Japanese government says it will have a better idea about the cost of the projects once feasibility studies are completed at the end of the year. But it is sure the price tag will be in the billions of dollars. It has already reached a deal that would forgive or reschedule Myanmar’s outstanding debt to Japan.
While Japan’s interest in Myanmar is partly geostrategic, for some older Japanese the re-engagement by Japan also cements a longstanding — and checkered — relationship between the two countries. Aung San, the country’s independence hero (and father of Daw Aung San Suu Kyi, who is now leader of the opposition in Parliament), trained in Japan before leading efforts to oust the British from the country. While Japan’s interest in Myanmar is partly geostrategic, for some older Japanese the re-engagement by Japan also cements a longstanding — and checkered — relationship between the two countries. The Japanese occupation of the country, then known as Burma, during World War II was brutal. But Aung San, the country’s independence hero (and father of Daw Aung San Suu Kyi, who is now the leader of the opposition in Parliament), trained in Japan before leading efforts to oust the British.
By helping main figures of the Burmese independence movement, the Japanese see themselves as the having been “midwives” of Burmese independence from the British, according to Mr. Turnell. Myanmar and Japan eventually developed a kind of kinship of former foes, something akin to the United States and Vietnam today.
The subsequent Japanese occupation of Burma during World War II was brutal. But the two nations developed a kind of kinship of former foes, something akin to the United States and Vietnam today.
The sentimentality that many Japanese have toward Myanmar may be in part because of a popular 1956 film, “The Burmese Harp,” in which a Japanese soldier dons the robes of a Buddhist monk and remains behind after the war.The sentimentality that many Japanese have toward Myanmar may be in part because of a popular 1956 film, “The Burmese Harp,” in which a Japanese soldier dons the robes of a Buddhist monk and remains behind after the war.
For Mr. Sasakawa of the Nippon Foundation, re-engaging with Myanmar is personal. He remembers eating rice shipped from Burma in the lean years after the war in Japan. “We are really late in repaying our obligation,” he said. “We are passionately looking forward to paying back the kindness of Myanmar.” For Mr. Sasakawa of the Nippon Foundation, helping out in Myanmar is also personal. He remembers eating rice shipped from Burma in the lean years after World War II. “We are really late in repaying our obligation,” he said. “We are passionately looking forward to paying back the kindness of Myanmar.”