July 26th, 2012 | Global Times Jade weak basis for China-Myanmar trade
Two things grab visitors’ attention in the town of Tengchong, Yunnan Province. Real estate advertising is everywhere, like in many small and medium-sized Chinese cities. But, more unusually, there are clusters of stores all over the place which deal in Myanmar jade.
A local taxi driver proudly told me: “I cannot guarantee you that the jade in Tengchong are real – but I dare say 90 percent of them are genuine.”
Tengchong has long been famous for jade traded from the neighboring nation of Myanmar. When you see the old houses in Heshun, an ancient suburb of the city, you can see the profits that Myanmar jade brought to Tengchong for centuries, and how the city helped spread the jade all over the world.
Without the commercial routes created by Tengchong businesspeople, Myanmar jade would remain buried. Almost every mine in Myanmar deals with Tengchong firms.
Myanmar is the only source of high-quality emerald and is also famous for its rubies and sapphires. Myanmar jade has become a crucial component of Tengchong economy. Through Tengchong, Myanmar jade has entered the world market.
With the booming development of the market, an increasing number of people throughout Yunnan Province are flocking to dip their feet in the market.
But how much output does Myanmar jade have? Can it continuously supply the market?
A Myanmese jade supplier told me that jade production has risen by a substantial margin in recent years. This is due to the use of advanced technology and the application of large-scale mining equipment. The Myanmar jade exports to China also increased. China has a huge market and advanced processing technology while the US and Europe cannot directly buy Myanmar jade under existing sanctions.
Myanmar jade has brought prosperity to Chinese border cities such as Tengchong, Ruili and Jinghong. But this is not a sustainable business in the long term.
In June, the Myanmar Ministry of Mines announced the closure of most of the emerald mines in some northern Myanmar regions, which led to a hot public debate.
According to industry insiders, the entrance of more Chinese in the industry, which will directly affect the jade supply, may trigger a new round of price inflation.
This is actually not a bad thing for trade and economic relations between China and Myanmar. It is time to reduce the influence of Myanmar jade in the mutual economic relationship.
Trade and economic relations between China and Myanmar should not only create enduring benefits, but also let more Myanmar people share the fruits of trade. To achieve this goal, this relationship cannot solely be supported by jade, timber, energy or other natural resources.
It shouldn’t be forgotten that this is also one of the important reasons why Myanmar has taken steps to balance the influence of China and reduce the over-dependence of its economy on its larger neighbor by launching domestic reforms and reconciling with the US.
The current situation of China-Myanmar trade also reflects common problems of economic and trade relations between China and some ASEAN countries. Similar problems also exist in bilateral trade with countries such as Laos and Cambodia.
We should make the countries surrounding China become processing bases rather than simply importing raw materials from them. This will be closely connected with whether China can really play a role in enriching its neighbors.
One friend told me recently that a number of Chinese textile enterprises have formed an investigative delegation to Myanmar. They are considering using the opportunity of Myanmar reform to move their factories there. And this can also mitigate the challenges raised by rising domestic labor prices.
It is good momentum. China cannot monopolize all the middle and low processing areas of the manufacturing industry. The southward shift of lower-end and labor-intensive manufacturing means that trade relations between China and ASEAN countries have stepped into a new stage. It’s a promising sign of China’s effective economic transition.
The author is a senior editor with People’s Daily. He’s now stationed in Bangkok.
By Ding Gang