Since the 1988 military coup in Burma, the Thai and Burmese governments have had an up-and-down relationship of necessity. Now, with Burma becoming more open and the Thaksin Shinawatra clan reassuming power in Thailand, their mutual economic and political interests may lead to a period of increased interaction. But generations-old grudges and prejudices still remain.

The recent visits to Burma by ex-Thai Prime Minister Thaksin and his sister, current Thai Prime Minister Yingluck Shinawatra, served to highlight both the internal dynamics within Thailand and Burma and the status of the current relationship between the two countries.

Thaksin arrived in Burma first and met with both President Thein Sein and ex-junta chief Snr-Gen Than Shwe, who several Burmese officials had recently sworn was retired and no longer involved in government business.

Aung Zaw is founder and editor of the Irrawaddy magazine. He can be reached at [email protected].

Burma’s reserve of natural energy resources may currently be the biggest area of mutual interest between the neighboring countries, and the deals announced while Yingluck and her energy minister were in Burma included the grant of two Burmese oil-field concessions to Thailand.

Thailand has few domestic energy supplies and benefits greatly by having a source of natural gas sitting literally next door. As one Thai scholar recently put it, Burma is “Thailand's energy lifeline.”

Burma benefits from these circumstances by having an eager customer for its most valuable export, which also gives it leverage to cut better deals with other customers in the region, particularly China. In addition, Burma gains another willing, sanctions free investor in infrastructure development such as the Dawei deep-sea port, and Thailand is able to construct environmentally sensitive projects on Burmese soil and avoid protests and health hazards at home.

Thaksin is more astute than his Burmese counterparts at gauging a country’s future economic prospects and identifying lucrative business opportunities. He realizes that Burma is both a largely untapped market as well as a strategic source of natural resources, and knows that he needs a strong foothold in the country before sanctions are lifted and Western competitors race into the economic fray.

In this respect, Thaksin is way ahead of the game. During his first stint in power, he courted the Burmese regime by directing his government to offer loans, improve border trade and send numerous delegations to Rangoon.

These actions served both Thai national and Thaksin’s personal interests. In 2004, Shinawatra Satellite Co, a telecoms company owned by the Shinawatra family, leased a satellite service to Bagan Cybertech, a Burmese company owned by the son of Gen Khin Nyunt, the former Burmese prime minister and spy chief. Thaksin was later found guilty by a Thai court of pressuring the Thai Foreign Ministry to approve a 4 billion baht (US $128 million) loan to Burma to pay for the deal.

Following the formation of the Shin Corp-Bagan Cybertech partnership, Thaksin scratched the Burmese generals’ backs by making life difficult for Burmese dissidents and rebels operating inside Thailand.

Thai-based exiled Burmese were repeatedly harassed and at one point in 2004, US Senator John McCain sent a letter to Thaksin citing “credible, first-hand reports” that Bangkok had taken steps to curtail the activities of democracy activists in border areas. “As a friend of Thailand, I write to express my deep concern over recent actions by Thai authorities along your border with Burma,” McCain wrote.

Thaksin has also had his eyes set for quite some time on what he has called the “excellent prospects” in Burma’s tourism industry, proposing the construction of a ski resort in the snow-capped mountains of Kachin State and the development of the unspoiled beaches of Arakan State.

But despite the economic incentives for Thailand and the Shinawatras to improve relations with Burma, the second major area of mutual interest between the two countries, their shared border, has been a source of tension for generations and remains so today.

There is a long history of Burmese incursions into Thailand—first by Burmese kings looking to expand their empire (Burma’s invasion of Thailand’s former capital Ayutthaya is still taught in Thai classrooms), but more recently by Burmese ethnic minority insurgents operating in the border jungles, Burmese migrant workers looking for jobs and higher pay and Burmese refugees and exiles in search of a safe haven.

Over two million Burmese live and work in Thailand, which proves to be both a benefit and a detriment for both countries. Most believe the migrant workers are a necessary ingredient to the Thai economy because they are willing to perform menial tasks for low pay that many Thais are unwilling to take on. This has also helped reduce the number of people living in poverty inside Burma during the long period of extreme economic mismanagement by the previous Burmese regime. But many of the workers leave struggling families behind in Burma and are undocumented, exploited and still impoverished in Thailand.

In addition, tens of thousands of refugees from Burmese conflict zones have fled to the Thai side of the border and now live in refugee camps. This has led to both a strain on the Thai government and tension between the two countries. In the past, the Burmese regime accused Thailand of harboring dissidents and rebels to stage attacks on Burma, and in return the Thais accused Burma of flooding its kingdom with speed pills and heroine.

When Burma and Thai relations reached its low ebb in the early 2000s, serious border skirmishes broke out and the two countries engaged in a war of both words and rockets.

While both countries fired mortars into the other’s border towns and military encampments, the Burmese junta published several articles openly attacking prominent figures in Thailand. It added further fuel to the fire by introducing a new history textbook for fourth graders that portrays Burma’s neighbors to the east as servile and lazy, and the Thais returned the favor by routinely discriminating against and looking down on Burmese migrant workers inside Thailand.

History is history—no one can go back in time and heal all the wounds. But with a transition taking place in Burma, this may be the best time in recent memory for the two countries to improve political as well as economic relations.

One positive gesture was the reopening of the Thai-Burmese Friendship Bridge between Mae Sot, Thailand and Myawaddy, Burma during the Thai King’s birthday. The Thais are also preparing to build a hospital for migrant workers in Mae Sot, and Burmese banks can now be opened in Thailand so that Burmese migrants who are legally in the country can send money back home instead of going through illegal channels.

In addition, Yingluck’s meeting with Suu Kyi may have been short on substance, but it was still a symbolically important acknowledgement of the Burmese people’s desire for democracy. The Thai prime minister said that she backed both Burma’s democracy movement and Suu Kyi’s decision to compete in the coming by-elections.

However, Yingluck’s own government official admitted that the energy deals were her first priority on the trip, and this was evidenced by the fact that she did not take the opportunity to make any public calls for the release of political prisoners or the cessation of human rights abuses in Burma.

One final area of mutual interest between Thailand and Burma is the desire of both countries to benefit from China’s investment resources, purchasing power and billion-strong market while at the same time remaining as independent as possible from Chinese influence. Thailand has done a much better job of achieving this balance, and if the current Burmese administration wants to emerge from China’s shadow it will most likely seek to deepen cooperation with neighbors such as Thailand, as well as with the West.

In any event, it appears that self-interest will drive Thailand and Burma towards better relations for the foreseeable future, even though the leaders of both countries may remain suspicious and disrespectful of their counterparts. They say that politics makes strange bedfellows. In the case of Burma and Thailand, the quest for power and profits does the same.