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China polishes Myanmar relations as West closes in

The perfect place to see the close economic ties between China and Myanmar is at the vibrant jade market in the Chinese border town of Ruili.

Myanmar traders such as 47-year-old Soe Paing sell raw jade - one of the Southeast Asian country's many natural resources - in the most important trading hub between the two longtime allies. His family has been in the jade trade for generations.

"Chinese people didn't just start to like jade. They have always liked jade and used it for thousands of years," he said while examining various pieces of raw jade in his shop-office. "Our business depends mainly on China though since other countries are not as fond of jade as the Chinese."

What's happening in Ruili is part of a bigger geopolitical game between China and the West.

Because of major changes in the country also known as Burma, the West is fighting hard to lure the once isolated nation onto its team. However, Beijing, Myanmar's largest trading partner, is trying to use its economic clout to draw its neighbor under its influence.

The gate between the Myanmar border town of Muse and the Chinese town of Ruili.
Thierry Falise | LightRocket | Getty Images
The gate between the Myanmar border town of Muse and the Chinese town of Ruili.

Ruili is home to a special economic zone organized by the Chinese government. In the zone, Burmese workers and merchants are permitted to do business in China. The city is the main crossing point along the 2000 kilometer-long border where China ships goods overland to Myanmar - everything from food, fertilizer, electronics, and construction materials.

The citizens of Ruili boast that the jade market is the largest in China, with $50 million worth of jade sold every year. The stones are processed into jewelry, then bought and sold by the Chinese.

Trader Soe Paing said he moved here in 1994 to sell jade mined in his hometown.

"When we first came to China, our work was very tough. China wasn't fully open and we had to sell in secret. The Chinese custom officers and police would arrest us when they saw us," he explained. "They stopped around 1996, 1997. At that time, they opened a jade market in Ruili and asked us to go there."

Today, he sells about $800 worth of jade a day.

Jade trader, Soe Paing.
CNBC
Jade trader, Soe Paing.

The economic ties between the two countries goes beyond buying and selling.

Across town, Chinese businessman Zhou Huaxue runs a furniture factory employing one thousand people. Four out of five are Burmese.

"The government authorities encourage us to hire more Myanmar workers," factory owner Zhou said. "We are doing this very well."

He said the cost of labor in China had been high in recent years. A basic salary for a Chinese worker costs him $500 a month, while a Burmese worker will work for a third of that amount.

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His company, Deguan Henglong Furniture, sells into China, generating more than $16 million a year.

"I want the relationship between the two countries to be stable. When things are stable, it's easier for our business, " Zhou said. "We have always had positive cooperation with our Burmese partners. We trust one another."

China is trying to build up that trust. Local authorities are sponsoring free Chinese language lessons for Burmese workers. In one class, 120 students learn the basics for two hours every night from Monday to Friday.

"I'm taking the lessons very seriously," one Burmese student said. "And I'm very grateful for this chance."

Additional reporting by CNBC's Haze Fan