Chinese ventures crop up in northern Shan State town under Kokang administration

Since its capture by an ethnically Kokang armed group in 2023, the town of Hseni (Hsenwi), northern Shan State has drawn large numbers of Chinese business people, reportedly encouraged further by a recent, Chinese government-brokered ceasefire. Located on a major trade route crossing northern Shan State’s border with China’s Yunnan Province, the city has been under the control of the Kokang Army—also known by its official name, the Myanmar National Democratic Alliance Army (MNDAA)—since late October 2023. The MNDAA’s fighters are predominantly Kokang, a Mandarin-speaking ethnicity with a history of several centuries in northern Shan State. The armed organisation took over Hseni as part of the sweeping “Operation 1027” offensive against junta targets in northern Shan State carried out by the Brotherhood Alliance of ethnic armed groups in 2023 and 2024. According to one Hseni resident, Chinese entrepreneurs have been leasing homes, shops, farmland, and properties abandoned by civilians who fled as clashes between the MNDAA and Myanmar military made conditions in the city dangerous. “The Kokang Army has leased captured government offices to Chinese businesspeople,” the Hseni resident said. “They’ve now demolished the general administration office and fire station to build high-rise structures. Chinese people are also renting houses in the town for long-term stays, and some properties left behind by displaced residents have been taken over,” he added. According to locals living in Hseni, Chinese nationals are renting homes in the town for monthly fees between 500,000 (US $114) and 5 million (US $1,136) kyat. Some have torn down the structures they were renting, replacing them with newly constructed buildings. Many Chinese business people have also opened general stores, dry goods shops, pharmacies, and restaurants in busy areas. “They’re seeking farmland to plant sugarcane and tissue-cultured bananas, and have already made their way to the Lashio border,” a resident said. “Some are leasing, others purchasing. Even farmland left behind by displaced residents is being taken over. Yet no one dares to protest.” The Chinese entrepreneurs came to the town via border towns such as Muse, Mongko and Pang Hseng (Kyu Koke) in Muse Township, and Chin Shwe Haw, according to residents, and could be seen driving around town in vehicles with Chinese license plates on most days. “The MNDAA only knows how to fight. For economic matters, they’ve brought in people with expertise,” a Hseni resident said. “They’ve already demolished the Hseni market and are planning to construct a six-storey building in its place. A Chinese business group is behind these developments.” Hseni is around 70 miles south of the major border trade hub of Muse, the only major border town on northern Shan State’s border with China that has remained under the Myanmar junta’s control, and 70 miles west of Chin Shwe Haw, a border town in a historically Kokang region. The city is also at the intersection of routes leading to major infrastructure and investment projects developed as part of China’s international Belt and Road Initiative. It had a population around 60,000 before many residents were displaced by conflict and consists of four urban wards and more than 30 village tracts. Data collected by the junta’s General Administration Department in 2023 indicates that more than half the city’s residents are ethnically Shan, with more than 10,000 ethnically Chinese people comprising the second largest ethnic community and the Kachin population of 5,000 the third largest. With more than 40,000 acres of arable land, Hseni is commonly called northern Shan State’s “rice bowl.” Chinese nationals have reportedly been growing crops like bananas, sugarcane, and watermelons on the farmlands they have rented. Although the landowners are benefiting from rental income, the practice has raised concerns about soil degradation. A junta airstrike killed 10 civilians and caused severe damage in an airstrike that targeted the Hseni Myoma market in July of last year. The MNDAA closed the Hseni market in April of this year, removing the vendors to a new marketplace in Panglawt village around a mile outside of town despite their protests. In response to the protests, the Kokang armed group arrested four women, later releasing three and reportedly removing the fourth—an ethnically Chinese woman—to the border town of Laukkai, although her whereabouts remain unconfirmed. A Hseni resident said locals were frightened by the incident and were now unwilling to speak out against activity by the MNDAA in Hseni. “People are afraid to speak up. When the market protest occurred, the woman who led it was arrested and taken to Laukkai,” he said. “Now, Chinese nationals are coming in, renting homes, land, and even farmland. Although authorities claim that selling property is not allowed in the town, they are doing it themselves. And no one dares to raise their voice.” Myanmar Now contacted spokespersons for the MNDAA on Wednesday to request comment on the involvement of Chinese nationals in rent and land transactions in Hseni, but received no response by publication time. Hseni was captured in October 2023, shortly after the launch of Operation 1027, by an alliance of anti-junta fighters including members of the People’s Liberation Army (PLA) and Karenni Nationalities Defence Force (KNDF) as well as the MNDAA. The MNDAA and its allies had overrun all remaining junta outposts on the Hseni-Lashio road under Military Operations Command 16 by the following January, effectively gaining total control over the township. Nearly 30 civilians were killed in subsequent junta airstrikes on Hseni, including the July 2024 attack on the marketplace, with airstrikes only stopping after a Chinese government-mediated ceasefire between the MNDAA and the military that went into effect in January of this year.

Chinese ventures crop up in northern Shan State town under Kokang administration

The influx of Chinese entrepreneurs—including some leasing or buying farmland and homes left behind by the displaced—has accelerated in Hseni (Hsenwi), northern Shan State since a Chinese-brokered ceasefire halted airstrikes in the area

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