Lift­ing US sanc­tions: right or wrong?

The Myanmar Times - - Front Page - LEE MORGENBESSER news­room@mm­times.com

TWO weeks ago the Obama ad­min­is­tra­tion de­clared that it will drop all re­main­ing eco­nomic sanc­tions im­posed on Myan­mar. Since 1997, when the sanc­tions were es­tab­lished as a re­sponse to the gross hu­man rights abuses be­ing com­mit­ted by the coun­try’s rul­ing junta, they have pre­vented any tan­gi­ble trade between the two coun­tries.

Dur­ing his meet­ing with Daw Aung San Suu Kyi, who was vis­it­ing Washington for the first time as Myan­mar’s de facto leader, Pres­i­dent Barack Obama sought to re­ward the progress the South­east Asian na­tion had made to­ward democ­racy. “The United States is now pre­pared to lift sanc­tions that we have im­posed on Burma for quite some time,” he said. “It is the right thing to do in or­der to en­sure that the peo­ple of Burma see re­wards from a new way of do­ing busi­ness and a new gov­ern­ment.”

But is lift­ing the sanc­tions the right thing to do?

The lat­est round of changes to the sanc­tions, which the Obama ad­min­is­tra­tion be­gan eas­ing in May 2012, will ter­mi­nate the Na­tional Emer­gen­cies Act. It de­fines Myan­mar as an “ex­tra­or­di­nary threat to the na­tional se­cu­rity and for­eign pol­icy of the United States”. This law forms the ba­sis of most re­main­ing sanc­tions.

By ter­mi­nat­ing the state of emer­gency as it ap­plies to Myan­mar, the trade ban im­posed on 104 in­di­vid­u­als and com­pa­nies cited on the Trea­sury De­part­ment’s Spe­cially Des­ig­nated Nationals list will cease to ex­ist. Im­por­tantly, re­stric­tions de­signed to block trade with North Korea and cur­tail the traf­fick­ing of drugs and gems will re­main in place.

Given that the sanc­tions tar­geted those in­di­vid­u­als and com­pa­nies con­sid­ered to be the most re­spon­si­ble for pre­vi­ous hu­man rights abuses as well as those most threat­en­ing to the fu­ture peace and sta­bil­ity of Myan­mar, lift­ing them is un­sur­pris­ingly con­tentious. So was this de­ci­sion the right thing to do?

The case for The most touted ben­e­fit for Myan­mar is the an­tic­i­pated in­crease in eco­nomic de­vel­op­ment and pref­er­en­tial trade with the United States. Mil­i­tary-backed con­glom­er­ates will cer­tainly ben­e­fit from this new ar­range­ment, but so will count­less small and medium-sized en­ter­prises. A more im­me­di­ate task now is to im­prove qual­ity stan­dards, pro­duc­tion fa­cil­i­ties and lo­gis­tics chains in Myan­mar. The lift­ing of the sanc­tions pro­vides fur­ther mo­ti­va­tion to make this hap­pen.

A re­lated ben­e­fit is that any growth in em­ploy­ment will aid the po­si­tion of Myan­mar’s young demo­cratic gov­ern­ment. Given the frag­ile state of party pol­i­tics in Myan­mar, whereby the only vi­able al­ter­na­tive to the Na­tional League for Democ­racy is the mil­i­tary-backed Union Sol­i­dar­ity and De­vel­op­ment Party, pol­icy changes that for­tify the pub­lic stand­ing of the rul­ing party should be en­cour­aged. The wind­fall that is ex­pected to fol­low the re­moval of sanc­tions will thus be cred­ited to Daw Aung San Suu Kyi’s gov­ern­ment.

Myan­mar will also be­come less eco­nom­i­cally de­pen­dent on China, whose in­vest­ment is not con­di­tional on re­spect for civil lib­er­ties and po­lit­i­cal rights. Since the late 1980s, China and the United States have in­vested ap­prox­i­mately US$18 bil­lion and $248 mil­lion, re­spec­tively. This im­bal­ance ac­tu­ally en­cour­aged mil­i­tary of­fi­cials and busi­ness cronies to prof­i­teer from China’s in­vest­ment. The open­ing of the Amer­i­can mar­ket of­fers not only new op­por­tu­ni­ties for pri­vate and pub­lic com­pa­nies but also sup­port from a coun­try that nor­ma­tively ap­proves of democ­racy in Myan­mar.

The case against The most ob­vi­ous rea­son not to lift the sanc­tions is that those in­di­vid­u­als linked to the pre­vi­ous mil­i­tary regime would ben­e­fit from the de­ci­sion. This in­cludes prom­i­nent busi­ness cronies, known crim­i­nals and es­tab­lished hu­man rights abusers. Com­pa­nies linked to the pre­vi­ous mil­i­tary regime would also ben­e­fit, es­pe­cially the Union of Myan­mar Eco­nomic Hold­ings and the Myan­mar Eco­nomic Cor­po­ra­tion. To­gether they dom­i­nate the agro­farm­ing, air­line, bank­ing, min­er­als, tourism and trad­ing in­dus­tries. The re­moval of sanc­tions would there­fore ben­e­fit the few, not the many.

An­other prob­lem, ex­pressed by eth­nic civil so­ci­ety or­gan­i­sa­tions, is that end­ing the sanc­tions re­leases pres­sure on the mil­i­tary to abide by in­ter­na­tional hu­man rights norms amid on­go­ing con­flict. “There re­main a num­ber of press­ing is­sues threat­en­ing the sta­bil­ity of the coun­try and its most vul­ner­a­ble peo­ple,” a joint let­ter stated. “These is­sues are deeply con­cern­ing as they in­clude the sever­est of hu­man rights abuses, and progress on these dire mat­ters should be re­quired to lift fur­ther sanc­tions.” This ap­peal ev­i­dently fell on deaf ears.

Lift­ing the sanc­tions also takes away the lever­age they pro­vided the gov­ern­ment in its re­la­tion­ship with the mil­i­tary. This is the crit­i­cism made by Hu­man Rights Watch: “The sanc­tions are cru­cial for press­ing the mil­i­tary to end rights abuses and trans­fer power to a civil­ian gov­ern­ment. They shouldn’t be fully lifted un­til the demo­cratic tran­si­tion is ir­re­versible.” In other words, the sanc­tions of­fered a means to get the mil­i­tary to the ne­go­ti­at­ing ta­ble on re­form­ing the 2008 con­sti­tu­tion. With­out them, it is un­clear how to get the mil­i­tary to in­vest more fully in democrati­sa­tion.

The right thing? All that said, drop­ping the sanc­tions was the right thing to do. This is be­cause the en­tire case against do­ing so is premised on the no­tion that the sanc­tions ac­tu­ally worked.

This claim runs counter to a se­ries of dev­as­tat­ing cri­tiques of­fered by Morten Ped­er­sen (2008) and Lee Jones (2015). They reveal how those in­di­vid­u­als and com­pa­nies tar­geted by the sanc­tions had ac­tu­ally been able to cir­cum­vent the re­stric­tions and dis­place their costs. The con­se­quences of the sanc­tions were thus avoided al­to­gether and/or suf­fered by av­er­age cit­i­zens.

The fur­ther claim – that with­out the sanc­tions, the mil­i­tary would not feel pres­sured to com­ply with in­ter­na­tional hu­man rights norms – is ir­rel­e­vant. The wide­spread abuses com­mit­ted by the mil­i­tary against var­i­ous eth­nic groups eas­ily pre­date the start of sanc­tions and will con­tinue to oc­cur with the end of them.

The fi­nal claim, that the sanc­tions pro­vide the gov­ern­ment with lever­age over the mil­i­tary in the con­text of re­form­ing the con­sti­tu­tion, fails to ac­count for the real rea­son why the mil­i­tary ab­di­cated day-to-day con­trol of the gov­ern­ment. Not only does this ex­tru­sion strat­egy re­main in place, but also the sup­posed pres­sure of sanc­tions are in­con­se­quen­tial to it.

Lee Morgenbesser is a re­search fel­low at the Grif­fith Asia In­sti­tute, Grif­fith Univer­sity. This ar­ti­cle is a col­lab­o­ra­tion between The Myan­mar Times and New Man­dala, a web­site on South­east Asia’s pol­i­tics and so­ci­eties based at the ANU Co­ral Bell School of Asia Pa­cific Af­fairs.

Photo: EPA

US Pres­i­dent Barack Obama speaks dur­ing a meet­ing with Myan­mar youth and eth­nic mi­nori­ties at Yan­gon Univer­sity in the com­mer­cial cap­i­tal on Novem­ber 14, 2014.

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