Coup puts Myanmar’s crippling military capitalism in the spotlight

Coup puts Myanmar’s crippling military capitalism in the spotlight
Protesters gather in Yangon, main, as security forces continue to crack down on demonstrations against the coup. (AFP)
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Updated 14 April 2021

Coup puts Myanmar’s crippling military capitalism in the spotlight

Coup puts Myanmar’s crippling military capitalism in the spotlight
  • Travel bans and asset freezes since February’s coup draw attention to the generals’ sway over lucrative segments of the economy
  • Western countries likely to impose further sanctions on Myanmar, but Asian neighbors may be reluctant to follow suit

BERNE, Switzerland: Myanmar’s economy has long been shaped by the Tatmadaw — the nation’s powerful armed forces — and by the shifting whims of geopolitics, which together fashion the country’s global trade relations, particularly those concerning its large infrastructure projects.

Since the Feb. 1 coup, which overthrew Aung San Suu Kyi’s National League for Democracy (NLD) government, and the violent suppression of protests which has left more than 600 dead, momentum has been building behind efforts to impose sanctions on the junta.

To date, the US and UK have placed sanctions upon Myanmar’s two big military-owned conglomerates. Several OECD countries have also issued travel bans and asset freezes on army officers involved in the coup.

Pressure is building on companies with investment in the country to sever ties with its military-owned entities. For example, pension funds are pushing South Korean steel giant POSCO to break with its army-owned Burmese joint venture partner.




Myanmar’s economy has long been shaped by the Tatmadaw, the nation’s powerful armed forces, and by the shifting whims of geopolitics. (AFP)

Meanwhile, Japan’s Kirin Beer, which had invested upwards of $1.7 billion in a joint venture with a military-owned holdings company, has split with its partner — although it plans to continue selling beer in the country.

Not all Western multinationals are on board. Total CEO Patrick Poyanne recently said the company must continue producing gas in order to maintain the country’s power grid and guarantee the safety of its workforce.

However, the oil giant said it would not pay its taxes to the military and instead intends to donate the equivalent sums to human rights organizations.

The Tatmadaw’s tentacles are wrapped so tightly around the levers of the economy, it is almost impossible for firms to do business in Myanmar without cooperating with at least one military entity.

Two organizations with direct links to the Tatmadaw hold immense sway over the economy. One is the Myanmar Economic Corporation (MEC), the other is Myanmar Economic Holdings Limited (MEHL).

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MEC is involved in manufacturing, infrastructure, steel, coal and gas. While its raison d’etre is supplying the armed forces with raw materials, it also holds the monopoly over Myanmar’s insurance industry.

MEHL, meanwhile, is involved in banking, mining, agriculture, tobacco, and food manufacturing. Its revenues flow directly back to the military, which shields MEHL from civilian oversight. The MEHL owns Myawaddy Bank and the military’s pension fund.

The military controls much of the country’s banking sector, which was left badly underdeveloped following years outside the international financial system under sanctions targeting the 1962-2011 military regime.

The NLD government had intended to issue banking licences to foreign banks by 2021 — an effort thwarted by the coup.

Combined, MEC and MEHL own more than 100 businesses. They benefited greatly from privatization efforts in the 1990s and 2000s by picking up entities at fire sale prices.

Business practices in Myanmar are opaque to say the least — considered the very definition of crony capitalism. In 2018, Transparency International’s Corruption Perception Index ranked it 130th out of 180 counties.




Thailand is an important source of foreign currency for Myanmar, sent in remittances by migrant workers employed there. (AFP)

The first NLD government (2015-20) tried to curb the power of the military by opening several sectors to competition, but refrained from going toe-to-toe with the all-powerful Tatmadaw.

The NLD did, however, succeed in transferring power over the General Administration Department (GAD) from the military-dominated Interior Ministry to the civilian government in 2018.

This was an important step in demilitarizing the governance of the country. Given the wide-ranging powers of the GAD, from land administration and service delivery to tax collection, it was evident that taking power away from the military would eventually have ramifications for the Tatmadaw’s stranglehold over the economy.

In the 2020 election, the NLD government ran on a ticket of increased transparency and the transfer of power away from central authorities and the military — a move that would have been felt in the generals’ wallets.

Although boosting competition and transparency would no doubt have liberalized the economy and attracted foreign investment, it would also have threatened Myanmar’s long-established power structures.




Pressure is building to sanction the junta, left, with most of the country’s industries tied to the military. (AFP)

Fortunately for the generals, the Tatmadaw has powerful external friends. Myanmar is geopolitically important to many countries, who will cooperate with whoever holds power. These countries do not care who holds power; they just want to advance their political and economic interests.

Myanmar is strategically important to China, offering the rising superpower a land-bridge to the Bay of Bengal and an anchor country for its Belt and Road Initiative.

Until 2011, the Chinese government had a good working relationship with the junta, and had also come to an arrangement of sorts with the NLD government.

During his visit to Myanmar last year, Chinese President Xi Jinping revived the China-Myanmar Economic Corridor (CMEC) with no fewer than 33 memoranda of understanding.

The oil and gas pipeline linking China with the Bay of Bengal, the development of the deep-water port of Kyaukphyu, and the railroad linking Yunnan province to the Indian Ocean are all integral facettes of CMEC.

It is said to include projects worth $21 billion, in which the MEC and MEHL will no doubt hold substantial stakes. The NLD government, however, had concerns over China’s rising influence and Myanmar’s ballooning debts related to the CMEC.




Police arrested Myanmar Now journalist Kay Zon Nwe in Yangon on Feb. 27, 2021, amid demonstrations against the military coup. (AFP)

India, meanwhile, sees Myanmar as an important bulwark against its rival, China. As such, the Indian firm Adani is involved in the construction of the port at Yangon. Delhi feels increasingly encircled by China’s Belt and Road Initiative.

The Association of Southeast Asian Nations (ASEAN) is Myanmar’s largest trading partner, accounting for 24 percent of its business, followed by China with 14 percent and the EU with 10 percent.

Fellow ASEAN member Thailand is Myanmar’s fourth-largest trading partner and an important source of foreign currency, sent in remittances by the millions of migrant workers employed there.

The excellent transportation infrastructure connecting Thailand’s northern city of Chiang Rai to the Burmese border highlights the importance of trade (both legal and illicit) between the two countries. Furthermore, both countries are now run by military regimes whose generals have social, economic, and political ties.




General Min Aung Hlaing sits at the helm of a junta whose tentacles are spread tightly around the levers of the Myanmar economy.  (AFP/ Myawaddy TV via AFPTV)

Lastly, Russia has a long-standing relationship with the Burmese military. In 2007, Moscow entered into an agreement with Naypyitaw to establish a nuclear research center and the two countries signed a defense cooperation agreement in 2016.

Russia also supplies the Tatmadaw with weapons. It was conspicuously the only country to send a ministerial-level delegate, Deputy Defence Minister Alexandr Fomin, to attend Myanmar’s armed forces’ day on March 27.

Although Western countries are likely to press ahead with sanctions on Myanmar, its Asian neighbors may be more reluctant to follow suit for myriad reasons, ranging from geopolitical considerations to neighborly and profitable business ties. Some ASEAN countries may also want to avoid being seen interfering in the internal affairs of a neighbor.

The Tatmadaw may therefore get away with overthrowing the NLD government and can go on accumulating wealth and economic clout. Likewise, many foreign entities will be willing to engage with the junta at a business level, both because it is profitable and as it is perceived to be in their own governments’ geopolitical interests.

• Cornelia Meyer is a Ph.D.-level economist with 30 years of experience in investment banking and industry. She is chairperson and CEO of business consultancy Meyer Resources.

Twitter: @MeyerResources


Prison ‘exacerbated’ risk London Bridge terrorist posed to public: Inquest

Usman Khan (L), 28, killed Saskia Jones, and Jack Merritt, in a knife attack in central London in 2019, just 11 months after he was released early from jail. (AP/Reuters/File Photos)
Usman Khan (L), 28, killed Saskia Jones, and Jack Merritt, in a knife attack in central London in 2019, just 11 months after he was released early from jail. (AP/Reuters/File Photos)
Updated 07 May 2021

Prison ‘exacerbated’ risk London Bridge terrorist posed to public: Inquest

Usman Khan (L), 28, killed Saskia Jones, and Jack Merritt, in a knife attack in central London in 2019, just 11 months after he was released early from jail. (AP/Reuters/File Photos)
  • Usman Khan, 28, killed 2 people in deadly knife attack in central London
  • 2019 attack among number of incidents that pushed UK to introduce stricter counter-terrorism measures in jails

LONDON: A psychologist warned that prison had made a terrorist more dangerous to the public than when he was first jailed, an inquest heard.

Usman Khan, 28, killed Saskia Jones, and Jack Merritt, in a knife attack in central London in 2019, just 11 months after he was released early from jail.

Khan had been imprisoned since 2010 for planning to bomb the London Stock Exchange and had associated with terrorists and radicalized other inmates while behind bars, the court investigating the deaths of Jones, 23, and Merritt, 25, was told.

Security officials believed Khan was a senior figure in an extremist gang while in jail. He had also been found in possession of terrorism and Daesh-related materials in his cell.

Ieva Cechaviciute, a psychologist who assessed Khan’s risk to the public while he was still in jail, said she had been “very worried” about his release.

The court was shown a report, produced by Cechaviciute, that warned seven months before his release that he continued to pose a threat to the public.

“Khan has made little progress while in prison, he doesn’t understand his own risk and being in prison has made him a greater risk than before by elevating his profile. He still refuses to accept responsibility for his crime,” minutes from a meeting said.

Imprisonment, Cechaviciute said, had “exacerbated” the risk that Khan posed, because of his violent and extremist behavior, as well as the “company he was keeping.”

“He didn’t have any convictions for violence, but he was becoming quite aggressive and there were assaults committed by him or him organizing them (inside jail). I saw that in addition to the offence he committed before, he could be violent himself,” she added.

Records showed that Khan had complied with deradicalization programs, and other staff have previously told the court that he appeared to have reformed while in jail and posed little threat to the public.

Cechaviciute and other psychologists had previously warned that his participation in these programs could have been “superficial.”

She told the court: “He was saying the right things, but it did not necessarily represent his behavior … it was quite clear to me that he has not disengaged with extremist ideology.

“It was strong in his head and the best we could hope for was him to desist from offending rather than disengaging from the ideology.”

Khan’s engagements with deradicalization programs, she added, were not “necessarily an indication of reduction in risk,” because he could be “trying to create a positive image of himself.”

Her report rated Khan as a medium risk for terrorist engagement, intent, and capability while inside prison — but predicted that it would rise to “high” when he was released.

Khan’s role in the deadly London Bridge terror attack caused controversy in the UK because of his recent release from prison after completing deradicalization programs.

Since the attack, the British government has introduced stricter counter-terrorism measures for known offenders.

The new Counterterrorism and Sentencing Act “completely ends the prospect of early release for anyone convicted of a serious terror offence” as well as significantly increases the amount of monitoring recently released terrorists are subjected to.

The inquest into the 2019 attack continues.


Greece to reopen beaches, museums after long lockdown

Greece to reopen beaches, museums after long lockdown
Updated 07 May 2021

Greece to reopen beaches, museums after long lockdown

Greece to reopen beaches, museums after long lockdown
  • Museums are to reopen on May 14, a day before Greece officially launches its travel season
  • Government began in early April to relax lockdown restrictions originally imposed in November

ATHENS: Greece will reopen private beaches on Saturday and museums next week, health officials said Friday as the tourism-dependent country gears up for a May 15 travel restart.
Museums are to reopen on May 14 — a day before Greece officially launches its travel season — followed by reduced-capacity outdoor cinemas on May 21 and theaters on May 28.
The government began in early April to relax lockdown restrictions originally imposed in November by reopening most retail shops except malls.
This was followed by high schools reopening a week later, and by outdoor restaurants and cafes on May 3.
However, tourism operators do not expect major travel arrivals before July.
Last month quarantine restrictions were lifted for vaccinated or tested travelers from the EU and a small number of other countries including Britain and the United States.
The third wave of the pandemic hit Greece hard with the majority of the country’s more than 10,000 virus deaths occurring over the last few months.
The country has recorded over 350,000 cases of coronavirus in a population of 10.8 million.
Over 3.4 million vaccinations have been carried out, and over a million people have received their second dose.


WHO gives emergency approval to Sinopharm, first Chinese COVID-19 vaccine

WHO gives emergency approval to Sinopharm, first Chinese COVID-19 vaccine
Updated 07 May 2021

WHO gives emergency approval to Sinopharm, first Chinese COVID-19 vaccine

WHO gives emergency approval to Sinopharm, first Chinese COVID-19 vaccine
  • Sinopharm becomes the first COVID-19 shot developed by a non-Western country to win the WHO's backing
  • First time WHO has given emergency use approval to any Chinese vaccine for any infectious disease

GENEVA: The World Health Organization (WHO) announced on Friday it had approved a COVID-19 vaccine from China’s state-owned drugmaker Sinopharm for emergency use.
The vaccine, one of two main Chinese shots that collectively have already been given to hundreds of millions of people in China and abroad, becomes the first COVID-19 shot developed by a non-Western country to win the WHO’s backing.
It is also the first time the WHO has given emergency use approval to any Chinese vaccine for any infectious disease.
A WHO emergency listing is a signal to national regulators on a product’s safety and efficacy, and would allow the shot to be included in COVAX, the global program to provide vaccines mainly for poor countries.
The WHO has previously given emergency approval to COVID-19 vaccines developed by Pfizer-BioNTech, AstraZeneca, Johnson & Johnson, and, last week, Moderna.


UN must shoulder responsibility to resolve Israel-Palestine confict, Saudi envoy says

Abdallah Al-Mouallimi told Antonio Guterres that the Israel-Palestine issue was “central to the UN agenda since its inception.” (KSA Mission to UN/File Photo)
Abdallah Al-Mouallimi told Antonio Guterres that the Israel-Palestine issue was “central to the UN agenda since its inception.” (KSA Mission to UN/File Photo)
Updated 07 May 2021

UN must shoulder responsibility to resolve Israel-Palestine confict, Saudi envoy says

Abdallah Al-Mouallimi told Antonio Guterres that the Israel-Palestine issue was “central to the UN agenda since its inception.” (KSA Mission to UN/File Photo)
  • Abdallah Al-Mouallimi also pressed Guterres on plans for finding peaceful solutions to conflicts in Syria, Yemen and Libya

NEW YORK: It is time for the United Nations to shoulder responsibility in resolving the Israeli-Palestinian conflict, Saudi Arabia’s permanent representative to the UN said on Friday.

Abdallah Al-Mouallimi, speaking at the Secretary General selection dialogue, told Antonio Guterres that the issue was “central to the UN agenda since its inception,” and urged him to continue support and funding for United National Relief and Works Agency (UNRWA).

The Saudi envoy also pressed Guterres on plans for finding peaceful solutions to conflicts in Syria, Yemen and Libya.

“What are you planning to do so that peace in Middle East moves forward?” Al-Mouallimi asked the Secretary General.

He also asked Guterres, who is standing for reappointment as Secretary-General, how the UN planned to ensure the Middle East was an area free of nuclear weapons.

The Saudi envoy praised Guterres for achieving gender parity, but questioned him on geographical parity, pointing to the fact Arabs were underrepresented in senior leadership positions.

Al-Mouallimi also pressed the Secretary-General on plans to combat desertification and lack of water resources in Middle East.

More to follow…


Gandhi warns ‘explosive’ COVID wave threatens India and the world

Gandhi warns ‘explosive’ COVID wave threatens India and the world
Updated 07 May 2021

Gandhi warns ‘explosive’ COVID wave threatens India and the world

Gandhi warns ‘explosive’ COVID wave threatens India and the world
  • Gandhi implored Prime Minister Narendra Modi to prepare for new lockdown and accelerate vaccination programme
  • India reported record daily rise in coronavirus cases 414,188 Friday, bringing the total for the week to 1.57 million

BENGALURU: India’s main opposition leader Rahul Gandhi warned on Friday that unless the deadly second COVID-19 wave sweeping the country was brought under control it would devastate India and threaten the rest of the world.
In a letter, Gandhi implored Prime Minister Narendra Modi to prepare for another national lockdown, accelerate a countrywide vaccination program and scientifically track the virus and its mutations.
Gandhi said the world’s second-most populous nation had a responsibility in “a globalized and interconnected world” to stop the “explosive” growth of COVID-19 within its borders.
“India is home to one out of every six human beings on the planet. The pandemic has demonstrated that our size, genetic diversity and complexity make India fertile ground for the virus to rapidly mutate, transforming itself into a more contagious and more dangerous form,” wrote Gandhi.
“Allowing the uncontrollable spread of the virus in our country will be devastating not only for our people but also for the rest of the world.”
India’s highly infectious COVID-19 variant B.1.617 has already spread to other countries, and many nations have moved to cut or restrict movements from India.
British Prime Minister Boris said on Friday the government needed to handle very carefully the emergence of new coronavirus strains in India that have since started to spread in the United Kingdom.
Meanwhile tons of medical equipment from abroad has starting to arrive in Delhi hospitals, in what could ease the pressure on an overburdened system.
In the past week, India has reported an extra 1.5 million new infections and record daily death tolls. Since the start of the pandemic, it has reported 21.49 million cases and 234,083 deaths. It currently has 3.6 million active cases.
Modi has been widely criticized for not acting sooner to suppress the second wave, after religious festivals and political rallies drew tens of thousands of people in recent weeks and became “super spreader” events.
His government — which imposed a strict lockdown in March 2020 — has also been criticized for lifting social restrictions too soon following the first wave and for delays in the country’s vaccination program.
The government has been reluctant to impose a second lockdown for fear of the damage to the economy, though many states have announced their own restrictions.
Goa, a tourism hotspot on the west coast where up to one in two people tested in recent weeks for coronavirus have been positive, on Friday announced strict curbs from Sunday, restricting timings for grocery shops, forbidding unnecessary travel and urging citizens to cancel all gatherings.
While India is the world’s biggest vaccine maker, it is also struggling to produce and distribute enough doses to stem the wave of COVID-19.
Although the country has administered at least 157 million vaccine doses, its rate of inoculation has fallen sharply in recent days.
India vaccinated 2.3 million people on Thursday, the most this month but still far short of what is required to curb the spread of the virus.
India reported another record daily rise in coronavirus cases, 414,188, on Friday, bringing total new cases for the week to 1.57 million. Deaths from COVID-19 rose by 3,915 to 234,083.
Medical experts say the real extent of COVID-19 is likely to be far higher than official tallies.
India’s health care system is crumbling under the weight of patients, with hospitals running out of beds and medical oxygen. Morgues and crematoriums cannot handle the number of dead and makeshift funeral pyres burn in parks and car parks.
Infections are now spreading from overcrowded cities to remote rural villages that are home to nearly 70 percent of the 1.3 billion population.
Although northern and western areas of India bear the brunt of the disease, the south now seems to be turning into the new epicenter.
In the southern city of Chennai, only one in a hundred oxygen-supported beds and two in a hundred beds in intensive care units (ICUs) were vacant on Thursday, from a vacancy rate of more than 20 percent each two weeks ago, government data showed.
In India’s tech capital Bengaluru, also in the south, only 23 of the 590 beds in ICUs were vacant.
The test-positivity rate — the percentage of people tested who are found to have the disease — in the city of 12.5 million has tripled to almost 39 percent as of Wednesday, from about 13 percent two weeks ago, data showed.
Syed Tousif Masood, a volunteer with a COVID-19 resource group in Bengaluru called the Project Smile Trust, said the group’s helpline was receiving an average 5,000 requests a day for hospital beds and oxygen, compared with 50-100 such calls just one month ago.
“The experts say we have not yet hit the peak,” he said. “If this is not the peak, then I don’t know what will happen at the real peak.”