Burma-China border clashes impact on crucial trade
Burma's largest border trading point, Shan State's Muse Township, has ground to a near halt due to increased conflict on the border, which we highlighted earlier this week. The Shan State government’s minister, U Soe Nyunt Lwin, says business has “almost stopped” and trucks remain stranded inside the zone. Seafood, cantaloupes, watermelons, beans, pulses, rice and other produce industries are expected to suffer if the conflict continues. According to the Ministry of Commerce, Muse's 105th-mile trade zone accounts for at least $5bn worth of trade annually with $3bn reported between April and mid-November 2016.

Business Shan State Clashes Disrupt China Border Trade

A closed entrance to the Muse 105-mile trade zone / Zaw Zaw / The Irrawaddy

Burma’s largest border trading point in Shan State’s Muse Township—the 105th mile trade zone—has fallen silent amid armed conflict between Burma Army and ethnic armed groups that began on Sunday, leaving traders lamenting the loss of business.

Attacks on security posts in Muse and Kutkai townships by an alliance of four ethnic armed groups have left at least nine dead, 30 injured, and thousands displaced.

Trucks have been stuck in their paths on the well-trodden trade route from Mandalay to China through the Muse border point.

“Big trucks are not traveling to Muse from Mandalay right now, but some small vehicles have been transporting crops [vegetables] that need to be sent while they are fresh,” U Chon, vice chairman of the Commodity Exchange Center Mandalay said.

Beans, pulses, rice, and seasonal crops carried from Mandalay to Muse on 22-wheeled trucks have been delayed by damaged bridges and military checkpoints.

“Some big trucks couldn’t return to Mandalay and remain stuck. No trucks have left Mandalay,” he said. “We are concerned for our commodities, it’s dizzying,” he said.

The Muse 105th mile trade zone trades at least US$5 billion per year and recorded US$3 billion in trade between April and mid-November 2016, according to the Ministry of Commerce.

The Shan State government’s minister for economic development U Soe Nyunt Lwin said the trading point is not officially closed but that business has “almost stopped” and 50 large trucks remain stranded inside the zone.

“This is causing big damage to our economy as the trade zone is the biggest trading point in this country,” he said.

Traders of seafood, cantaloupes, watermelons, and other vegetables in particular will suffer if clashes continue, said U Naing Lin Htet, secretary of the Pegu Division charter of the Burma Watermelon and Melon Growers and Exporters Association.

Watermelons and cantaloupes have been in high demand from China this year and sold for between 2,500 to 3,000 yuan (US$363-435) per tonne.

Fresh fish and eel exporters have also suffered from transportation delays, according to U Taing Kyaw, chairman of Mandalay Division Eel Producers and Exporters Association.

The prices of mung bean, sesame and peanuts in Mandalay wholesale markets declined due to an influx of produce unable to be exported, said U Maung Htay, information officer of the Mandalay Beans and Pulses and Sesame Commodity Exchange.

“Most of the transportation service providers in Mandalay are holding a wait-and-see attitude,” said chairman U Myo Swe of the Mandalay Region Long-Distance Commodity Transportation Service Providers Association.

The China-Burma trading point in Muse’s 105th mile trade zone had the biggest trade volume in 2015-2016 fiscal year, with US$5.3 billion of total US$7.1 billion nationwide. Myawaddy on the Thai border, and Chin Shwe Haw on the China border followed respectively out of 15 total border trading points in the country.

Additional reporting by Myat Pyae Phyo in Mandalay.