Suspended Myanmar hydropower project alarms Chinese firms

Beijing will boost political diplomatic backing for its companies overseas, particularly in Asia.

This was announced by Luo Zhaohui, director-general of the Asia Department of the Foreign Ministry, after Chinese firms investing in merging markets were alartmed by the suspension of a $3.6 billion joint hydropower project in Myanmar.

By the end of 2010, 71.9 percent of China's foreign direct investment, which totaled $300 billion, was based in Asia, official figures showed.

"As the scope of these companies broadens, the risks and challenges they
face, such as shifts in political affairs, disruption by external factors and a lack of experience in operating internationally, are rising as well," said Luo, a former ambassador to Pakistan.


Myanmar President Thein Sein's sudden suspension of the Myitsone hydropower plant, a project both sides agreed upon in 2006, on Sept 30, came as a surprise to many. The country's foreign minister and vice-president paid consecutive visits to China to hold consultations in the wake of the incident.

The two countries are still in the process of properly resolving the issue, Luo said, adding that China supports reconciliation efforts by the Myanmar government and is willing to see its relations improve with Western countries.