In the small Chinese border village of Yinjing, located on China’s south-eastern edge, a modest tourist sign once proudly declared, “One village, two countries.” It symbolized the close and peaceful relationship that China had built with its neighbor Myanmar. Historically, the two nations were separated by nothing more than bamboo fences, ditches, and dirt ridges.
Today, the border tells a very different story.
The BBC recently visited the area, where a tall, metallic fence now stands, topped with barbed wire and monitored by surveillance cameras. This formidable barrier cuts through the county of Ruili in China’s Yunnan province, severing rice fields and dividing streets that once seamlessly connected the two countries. What began as a pandemic lockdown measure has since evolved into a solidified security perimeter, spurred by the escalating civil war in Myanmar.
Myanmar’s crisis erupted after a military coup in 2021, resulting in a protracted civil conflict that has engulfed the country, particularly in Shan State along China’s border. This ongoing war has not only cost thousands of lives but has also compromised China’s ambitious plans to develop a vital trade corridor through Myanmar. For Beijing, which has invested heavily in Myanmar’s infrastructure, the conflict represents a growing security and economic liability.
China’s Costly Investment and Fragile Peace
China’s multi-million-dollar trade project aimed to connect its landlocked south-eastern provinces to the Indian Ocean via Myanmar. At the heart of this strategy lies the China-Myanmar Economic Corridor (CMEC), a crucial route stretching over 1,700 kilometers that links Yunnan province to Myanmar’s deep-sea port of Kyaukphyu on the Bay of Bengal. This corridor is essential for Chinese exports and energy imports, and it would allow China to bypass the congested and contested Strait of Malacca.
But as Myanmar’s civil war intensifies, the viability of the CMEC has come into question. Rebel forces have seized control of key border crossings and trade zones, severely disrupting commerce and construction. Even a ceasefire that China brokered earlier this year has failed, forcing Beijing to adopt a more aggressive stance, including military exercises along the border.
Foreign Minister Wang Yi’s recent visit to Myanmar’s capital Nay Pyi Taw underscores China’s growing concern. He reportedly delivered a stern warning to Myanmar’s military ruler, Min Aung Hlaing, regarding the security implications of the ongoing conflict. Despite China’s efforts to maintain a balancing act, its influence is waning in the face of escalating violence.
The Security Fallout: China’s Border at Risk
Shan State, Myanmar’s largest and most resource-rich region, has long been a battleground for ethnic militias who oppose the central government. It is also one of the world’s largest producers of opium and methamphetamines. Despite these security challenges, Chinese investments managed to thrive in the region until the military coup and ensuing civil war disrupted economic activity.
Now, Ruili—a once-thriving Chinese trade hub—has been transformed into a fortified border city. Loudspeakers along the border warn people not to approach the fence, underscoring the heightened tensions. The border is not only a commercial checkpoint but also a frontline in China’s efforts to contain the chaos next door.
Despite these warnings, daily life continues on both sides of the fence. Tourists still flock to the border for a glimpse of Myanmar, oblivious to the dire security situation. Yet for many, like Li Mianzhen, a 60-year-old food vendor who sells Myanmar goods, the situation is tragic. She recalls a time when cross-border trade flourished. Now, she laments, “Burmese people live like dogs.”
Li’s frustration is shared by thousands who depend on cross-border commerce to survive. Desperate Myanmar nationals risk crossing the border for paltry wages in China, earning as little as 10 yuan—a mere dollar—just to feed their families. The war has crippled Myanmar’s economy, and China has been forced to crack down on illegal migration to prevent instability from spilling over into Yunnan province.
Beijing’s Strategic Dilemma
Beijing’s delicate balancing act in Myanmar is increasingly unsustainable. Despite wielding influence over both the military junta and the rebel groups, China finds itself at a crossroads. The collapse of the January ceasefire has allowed rebel forces to make significant territorial gains, including the capture of key towns along the China-Myanmar trade route.
One such town is Lashio, the largest in Shan State and a vital junction in the CMEC. Rebel victories in Lashio have dealt a humiliating blow to Myanmar’s military regime, prompting fears in Beijing that the war could drag on indefinitely. The fall of Lashio is particularly concerning for China because it directly threatens the security of its investments along the border.
Richard Horsey, an advisor to the International Crisis Group, notes, “The fall of Lashio is one of the most humiliating defeats in Myanmar’s military history.” The rebels’ advances have raised alarm bells in Beijing, as Muse—the crucial trade hub connecting Myanmar and China—remains one of the junta’s last strongholds in the north.
China faces a security conundrum. If the war continues to escalate, its multi-billion-dollar infrastructure projects will remain stalled, jeopardizing years of strategic planning and investment. However, if Myanmar’s military regime collapses entirely, China could be left grappling with an even more chaotic and ungovernable neighbor.
Border Insecurity and Economic Fallout
As Myanmar’s civil war grinds on, the repercussions are already being felt in Ruili. The once-bustling city now stands as a shell of its former self. Shuttered shops and abandoned factories are stark reminders of the region’s reliance on cross-border trade with Myanmar. Local businesses have been hit hard by both the pandemic and the ongoing conflict, with trade grinding to a near halt.
China has tightened its restrictions on hiring Myanmar nationals, fearing that the influx of refugees and illegal workers could destabilize Yunnan. Hundreds of Myanmar nationals have already been deported for working illegally in Chinese factories. Factory owners, like one who spoke anonymously to the BBC, say their businesses are collapsing due to the loss of cheap labor from across the border.
Despite these challenges, workers like Zin Aung, a 31-year-old from Myanmar, have managed to find refuge in Chinese industrial zones. Working 12-hour shifts assembling electronics, clothing, and vehicle parts, these workers are caught between two worlds. For them, China offers a temporary sanctuary from the war, but their future remains uncertain.
“We are taking refuge here,” Zin Aung says. “The situation in Myanmar is not good, so we are staying. But I don’t know what will happen next.”
A Fragile Future for China and Myanmar
For China, the stakes are high. Its investments in Myanmar are not just about economics; they are a cornerstone of Beijing’s broader geopolitical strategy. The CMEC is a crucial part of President Xi Jinping’s Belt and Road Initiative, and its success is vital for China’s long-term plans to assert influence over Southeast Asia.
But the security risks are mounting. Rebel forces continue to make gains, while Myanmar’s military regime flounders. Beijing is at an impasse, unsure of whether to double down on its support for the junta or explore alternative options for securing its investments.
The war in Myanmar may not have an immediate solution, but one thing is clear: China’s southern border will remain a hotbed of instability for the foreseeable future. For the millions of Chinese and Myanmar nationals living along the frontier, peace feels like a distant dream, and security a fleeting promise.