To the millions of Myanmar Buddhists who still visit it, Mandalay symbolizes, nominally at least, the Rome of this “Golden Land.” It is a royal “City of Gems.”

The city was originally founded by King Thibaw to fulfill an ancient prophecy: Ananda, a disciple of the Buddha, supposedly foretold the establishment of a religious metropolis at the foot of Mandalay Hill. Thenceforward, change was a rare visitor. As recently as a decade ago, Mandalay remained a complex of narrow, dusty streets, chaotic markets and sleepily moving traffic — the very epitome of old Asia.

That has all changed now. An influx of goods in the last several years has created pockets of wealth, transforming central Mandalay into a core of high-rise buildings, modern shops and hotels, and brand-new homes, many owned by Chinese and Yunnanese merchants or by the ethnic bosses of Mandalay’s notorious drug rackets.

The Chinese presence in central Mandalay grew dramatically during the early 1990s when the government — then known as the State Law and Order Restoration Council — forcibly relocated native Myanmarese to new satellite towns, ostensibly in the name of the City Beautification and Development Program. Over a million such Khmer Rouge-style relocations have taken place. Myanmar specialist Mya Maung has noted that “the Chinese takeover of Mandalay and northern Burma replicates the economic consequences of the British colonization of Burma, which included a massive importation of Indian and, to a lesser extent, Chinese manpower and capital.”

The difference, of course, is that a foreign imperial power imposed the first takeover, while the current one is being approved by a native, albeit unelected government. Although most of Mandalay’s Chinese residents are foreign-born, reports suggest that national registration cards are easily acquired on the black market.

The boom in “informal trade” between China, Myanmar and their respective frontier states can be seen partly as the logical reactivation of time-honored Asian styles of border commerce. Myanmar’s former black market, a vast, informal operation in which practically everyone participated at some time or other, provided just the right conditions and knowhow for this particular type of trade. Never openly condoned, but tacitly accepted nonetheless, the black market allowed the people of Myanmar, as writer Saw Myat Yin has explained, to “survive in the face of an inefficient government distribution system which rationed everything from matchboxes and spools of thread to rice and oil.” In 1987, the turnover from this parallel economy (in defiance of the then prevailing socialist economic orthodoxy) was estimated at over $1.5 billion, almost half the country’s gross domestic product.

Mandalay’s two best-known markets, the Tayoke-tarn Zay (China Town Bazaar) and the Zay Cho (Sweet Bazaar), remain barometers of the city’s prosperity, just as at the heyday of the black market. During the 26-year rule of Myanmar’s half-Myanmarese, half-Chinese dictator Gen. Ne Win, the two markets functioned as clearinghouses for black-market contraband. The bazaars have blossomed with the legalization of border trade and the lifting of internal trade barriers.

Border trade with China and other neighboring countries was formally legalized in September 1988, only a month after the military regime massacred thousands of prodemocracy demonstrators. China now has virtually free access to the north, with a steady flow of trucks loaded with Chinese goods and up-to-date weapons thundering down the old Burma Road that runs from Yunnan across Myanmar’s northeastern state to Mandalay.

Priority has in fact been given to the building of roads and bridges on routes that facilitate arms deliveries from China. The first bridge to be appropriated by those in charge of the weapons trade spans the Shweli River, linking Ruili in Yunnan with roads that carry armaments into Myanmar; locals have nicknamed it the “Gun Bridge.” Deliveries so far have included amphibious tanks, armored personnel carriers, rocket launchers, antiaircraft guns, thousands of tons of recoilless rifles, mortars, light weapons and ammunition.

Although the key to Mandalay’s present boom is unquestionably China, or more precisely, the ethnic Chinese who live in the city, times have not always been so full of promise for the Chinese in Myanmar. The main motive driving the Burmese independence movement was the desire to dismantle what Deputy Prime Minister Kyaw Nyein described in the 1950s as a social pyramid with “millions of poor, ignorant, exploited Burmese at its base, and a few outsiders, British, Indians and Chinese, at its apex.” Most of the Indian migrants, particularly the much-despised Chettiar moneylenders, fled the country in 1962, along with thousands of Chinese merchants and shopkeepers, when Ne Win took over the government and implemented policies effectively excluding foreigners and residents of foreign extraction from participating in the economy.

A second wave of Chinese left in 1967, the year of violent anti-Chinese riots in Rangoon (now known as Yangon). The majority of Chinese who stayed and watched as the government’s ill-conceived notions of socialism brought the country steadily closer to the brink of ruin, remained in their old settlements along the great rivers and near the northeast trade routes into China.

These strategic geocommercial routes, the historical and filial connections between the Chinese in Myanmar and the people of Yunnan in southwestern China, have left the Chinese well-placed to become key players in the recently expanded cross-border trade, profits from which are said to now exceed $2 billion annually. Cheap Chinese goods have been flooding into the country, and unofficial estimates place the contribution of this trade to Myanmar’s otherwise chronically stagnant economy at over 6 percent a year. Ethnic Chinese continue to buy up large chunks of Mandalay real estate; fortunes have allegedly been made in recent years as prices have soared.

For many residents of Mandalay, the new materialism signifies an erosion of this conservative city’s traditions and culture and a coarsening of interpersonal relations. They complain that their refined language — typified by such things as the custom of using polite courtesies in greetings — is succumbing to an influx of vulgar Burmese dialects and alien tongues and to an explosion of generally unseemly behavior. Not only have karaoke bars, cabarets and Bangkok-style massage parlors fueled a rise in liquor consumption among formerly abstinent Myanmar Buddhists, but their hostesses are widely believed to provide other, informal after-hours services. The number of Buddhist monks is also thought to have declined in recent years, in part because of the difficulties they face in collecting alms from the new arrivals, mostly nonpracticing Buddhists, and getting rice, new robes and other traditional charitable gifts from believers in distant, increasingly impoverished satellite towns.

The moral and cultural decay of this once grand city is evident even to the first-time observer. Not that Mandalay ever really had an entirely unblemished reputation before the arrival of unscrupulous business elements. George Orwell, in his book “Burmese Days,” described Mandalay as “a rather disagreeable town . . . said to have five main products all beginning with P, namely, pagodas, pariahs, pigs, priests and prostitutes.”

Had Orwell been alive today, he might have added a sixth P — for profiteers.

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