Nobel laureate Aung San Suu Kyi and dozens of National League for Democracy (NLD) candidates have won seats in Burma’s parliament. What should one make of the elections? And what are the wider implications? On one hand, this is the first time the NLD party has taken part in the political process since 1990, when the military refused to recognize Suu Kyi's landslide victory. But many, including Suu Kyi, have complained that the elections were not genuinely free and fair and were tainted by significant procedural irregularities.

Given that Burma’s military junta still holds enormous sway over the quasi-civilian government, it’s tempting is to dismiss these parliamentary by-elections as a decoy: a cynical ploy to convince the United States and the European Union to wind back international sanctions against the country. That may be the motivation of some of the country's generals. But the undoubtedly flawed elections and Suu Kyi’s return to politics still carry enormous significance for both Burma and the geopolitics of the wider Asian region.

Burma’s Uncertain Future

Recent developments cannot be cynically dismissed as window dressing for a Western audience. Hundreds of political dissidents have been freed, including prominent leaders of the 1988 student-protest movements, monks from the 2007 protests, ethnic-minority activists and Suu Kyi herself, who was released from house arrest in November 2010. The government has promised greater freedom of the press (although progress has been predictably slow). Labor unions have been legalized. The creation of a civilian parliament followed after the 2010 national elections. Even hard-nosed visiting dignitaries such as Secretary of State Hillary Clinton have expressed cautious but genuine hope that Burma is moving in a happier direction.

The country is a long way from becoming a respectable democracy, and the future of promised reforms is still uncertain. But the best chance for genuine political reform occurs when regimes come to the self-interested realization that maintaining the status quo is more dangerous to their hold on power than managing gradual change.

President Thein Sein (himself a former military general) remains a trusted ally of longtime dictator Senior General Than Shwe (commander-in-chief of the armed forces) and other influential generals. Even so, recent events suggest that even the country’s generals realize Burma’s economy may not hold together much longer without partial reform. Despite official statistics boasting double-digit GDP growth rates over the past decade, a more realistic figure is around 3 percent per annum. Such growth should be placed alongside inflation, which was estimated by The Economist Intelligence Unit to have reached 16 percent in 2011.

With GDP per capita of around US $3,000 per annum and a military absorbing an estimated 25 percent of the government’s total budget, Burma has some of the worst health and social indicators in the world. For example, male life expectancy is around fifty-four years, compared to an average throughout Asia of over sixty-six years. Only 66 percent of rural citizens have access to safe water and sanitation, compared to an Asian average of 74 percent. Ninety-five percent of its current population of around 50 million is under the age of sixty-five.

With a large and restless young population, Burma’s leaders increasingly fear social unrest spiraling out of control. Rapid economic growth and modernization is increasingly essential to regime survival. Existing sanctions regimes ban only Western investment in the Burmese economy. Chinese, Thai, Indian and South Korean companies already have significant economic footholds in the country. But it is also clear that trade and investment with these Asian neighbors has not provided the Burmese economy with the means necessary to rapidly modernize. Burma’s economic reliance on China is increasingly viewed as a one-sided relationship by both Burmese leaders and the population.

The current regime’s attempts to convince U.S. and EU leaders to unwind sanctions suggest it views Western developmental aid, know-how and investment as essential to preventing economic collapse and political disaster. Burma’s attempts to show Washington and Brussels that it is initiating gradual political reform reveal a sense of desperation.

Moreover, a public commitment to political reform means that Yangon has cornered itself into having to acknowledge that a democratically elected government is the only legitimate form of authority. A pledge to “strengthen democracy” was also added into the Association of Southeast Nations (ASEAN) Charter in 2008—and with Burma assuming the Chair of ASEAN in 2014 and Suu Kyi’s return to the scene, the cost of returning to brutal authoritarianism will increase significantly.

Geopolitical Implications

China will view developments in Burma warily. Recently dismissed by many as Beijing’s client state, Burma’s courting of the West may signal decreasing Chinese influence in the geostrategically important Southeast Asian country. As Ding Gang, a senior editor at the Chinese state-backed newspaper Global Times acknowledges, “In the relationship between China, Myanmar and the US, a win-win situation is not always guaranteed. Sometimes the embrace of China and Myanmar means the US and Myanmar will be estranged and vice versa.”

Beijing sees the U.S. “pivot” to Asia as largely driven by a desire to counter China’s increased political, strategic and military influence. But it is not just about material capabilities.

China knows that it generally enjoys a competitive advantage against liberal democracies when it comes to influence over autocratic countries such as North Korea, Sudan, Angola, Iran, Kazakhstan, Turkmenistan and Burma. Beijing has long accused America and the West of spreading democratic “viruses” throughout the world, and even within China to weaken Beijing’s influence in autocratic countries, damage the legitimacy of the Chinese Communist Party (CCP) and morally segregate China.

Burma’s political reform adds an important dimension to the U.S.-China competitive dynamic. By compelling Burma to accept democratization as the only process for legitimate governance, the moral isolation of authoritarian China deepens in Asia. If Burma makes good on its pledges on political reform, China’s authoritarian advantage will likely be diluted. To Beijing, this is further proof that America seeks to entrench its regional and global leadership—at China’s expense—through moral as well as material and institutional means.

The holding of what appear to be flawed by-elections does not necessarily mean that the Burmese people will soon witness genuine and significant moves toward democracy. But recent events in Burma are worth watching—both for the country’s future and the region more broadly.

Dr. John Lee is the Michael Hintze Fellow and adjunct associate professor at the Centre for International Security Studies, Sydney University, and a scholar at the Hudson Institute.

Image: Prachatai