February 24, 2021

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Myanmar coup tests Biden’s ability to work with allies in Asia, where China’s influence is growing – CNBC

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U.S. President Joe Biden in Washington, D.C. on Jan. 25, 2021.

Kevin Dietsch | UPI | Bloomberg via Getty Images

SINGAPORE — The latest coup in Myanmar presents an early test to U.S. President Joe Biden’s pledge to work more closely with allies in the Asian region where China’s influence is expanding.

Biden has condemned the military takeover in the Southeast Asian country as well as the detention of elected officials including de facto leader Aung San Suu Kyi. The U.S. president also threatened to impose sanctions on those responsible for the coup.

But rallying U.S. partners in Asia to join in the condemnation could prove challenging, according to analysts from think tank Center for Strategic and International Studies.

“Washington will not be alone in its pressure campaign,” the analysts said in a Monday note. They predicted that some countries including the U.K., Canada and Australia might join the U.S. in imposing sanctions on the military in Myanmar.

“But regional responses will be critical. It will be more difficult for the United States to get major investors in Myanmar, like Japan and Singapore, to follow suit,” the CSIS analysts added.

Generally, statements released by Myanmar’s regional neighbors following the coup have used more diplomatic language, compared with criticisms coming from some Western countries and international organizations such as the United Nations.

Japan and Singapore, in separate statements by their foreign ministries, expressed “grave concern” over the situation in Myanmar. Japan went further by saying that it “opposes any action” that goes against the democratic process in Myanmar.

It will be more difficult for the United States to get major investors in Myanmar, like Japan and Singapore, to follow suit.

Center for Strategic and International Studies

Meanwhile, Thailand and Cambodia reportedly said the military takeover was Myanmar’s internal matter.

Some of Myanmar neighbors have “powerful” militaries, and that would prevent them from taking a stand against the coup, said Simon Tay, chairman of think tank Singapore Institute of International Affairs.

 “Thailand, next door, is sort of a military-party backed government. They’re not going to see this as something they want to interfere with,” Tay told CNBC’s “Squawk Box Asia” on Tuesday.

Reactions from China

China, which shares a border with Myanmar, has not commented much on the latest military takeover.

A spokesman from the foreign ministry, Wang Wenbin, said on Monday that China has “noted” what happened in Myanmar and was gathering more information on the situation.

“China is a friendly neighbor of Myanmar. We hope that all parties in Myanmar will properly handle their differences under the constitutional and legal framework and maintain political and social stability,” Wang said during the ministry’s regular press briefing.

I think Xi Jinping and the Chinese administration (are) a lot more mindful about how it wields its soft power nowadays.

Steve Wilford

Control Risks

China is a major investor in Myanmar and is the Southeast Asian country’s largest trading partner. Some analysts predicted that Beijing would soon start engaging the new military regime in Myanmar.

“The largest foreign player in Myanmar’s economy, China, will be all too happy to recalibrate its engagement to recognize the new facts on the ground,” read the CSIS note. “That will likely soften the blow of any U.S. sanctions.”

But others said Chinese President Xi Jinping would be more cautious about being close to Myanmar’s military, given the international community’s broadly strong reactions to the coup.

“I think Xi Jinping and the Chinese administration (are) a lot more mindful about how it wields its soft power nowadays,” said Steve Wilford, partner and head of global risk analysis in Asia Pacific at consultancy Control Risks.

“And I think it’s going to be cautious in how it engages with whatever kind of new regime emerges from this coup,” Wilford told CNBC’s “Street Signs Asia” on Tuesday.

Biden’s options

Beyond sanctions, Biden’s options to make a difference in Myanmar are limited, analysts said.

Several Myanmar military generals have been sanctioned for their role in human rights abuses against the Rohingya minority, CSIS analysts said.

The U.S. could expand that list to include those involved in the latest coup, but that’s “unlikely to have much immediate impact on the generals, few of whom had any intention of traveling to or doing business in the United States,” the analysts added.

View of Myanmar’s parliament building in capital city Naypyidaw on February 2, 2021, one day after the military detained de facto leader Aung San Suu Kyi and others.

STR | AFP | Getty Images

American businesses have remained “relatively modest players” in the Myanmar economy, and mostly focused on serving the domestic market, said the analysts. That means their withdrawal from the country will mostly harm private citizens — not the military, they added.

Still, the unfolding crisis could be an opportunity for the U.S. to lead international condemnation of the coup and rally support for any resistance movement that arises within Myanmar.

“Regional partners like Japan have emphasized democratic values as part of their strategy to respond to a more assertive China. The Biden administration will need to reiterate that this is no time to retreat from that focus,” CSIS analysts said.

“Those states with greater economic leverage in the country should be prodded to signal that widespread violence against citizens is unacceptable and would lead Myanmar back to international isolation, undoing the economic progress of the last decade,” they added.

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