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Over Objections, U.S. Lifts Myanmar Investment Ban

WASHINGTON, May 17 2012 (IPS) - In a highly anticipated confirmation, the United States on Thursday announced that it would be significantly rolling back bilateral economic restrictions that have been in place on Myanmar (Burma) for a decade and a half.

The move will not affect a pre-existing arms embargo or an import ban, nor are U.S. businesses allowed to conduct business with military-linked entities or individuals. But it will allow U.S. companies to restart investment in Myanmar for the first time since 1997, following on a year of reforms by a new quasi-civilian government.

Observers, meanwhile, are warning that the necessary protections are not yet in place, though the U.S. business community “applauded” the announcement.

The sanctions were imposed 15 years ago in response to gross human- rights abuses by the then-military government. Following Thursday’s announcement, many were quick to point out that such abuses are in fact continuing apace.

“The reality is the Burmese military’s escalating assault against the Kachin ethnic minority in Northern Burma continues unabated and unnoticed,” the U.S. Campaign for Burma said in a statement following the announcement.

“Their brutal military offensive has resulted in nearly one hundred thousand refugees who are hiding in makeshift shelters.”

Those sentiments were echoed by some within the U.S. government.

“We know so little about the actual impact of political changes made by the ruling junta in the past year, and until we see more evidence of change, I am adamantly opposed to rolling back the only leverage that we possess in that country,” said the chair of the U.S. House of Representatives Foreign Affairs Committee, Ileana Ros-Lehtinen.

In recent weeks, several groups, including Human Rights Watch, have asked the U.S. not to lift the sanctions regime until specific safeguards are put in place.

On May 10, the United Nationalities Federal Council, an umbrella body of ethnic groups in Myanmar, likewise publicly requested the international community “not to suspend or lift the remaining … sanctions but to wait and see if the (Myanmar army) does not stop its … military offensives in Kachin State by June 10, 2012.”

Human rights groups are now warning that Washington is moving too quickly, offering a massive reward to a military-dependent government that has enacted reforms that have yet to reach the majority of marginalised communities in the impoverished country.

“The U.S. administration’s policy is ‘action for action’ – rewarding positive action on the part of Burma’s government,” Thelma Young, with the U.S. Campaign for Burma, told IPS. “But there are no measures in place to combat the negative actions that are still taking place. We’re worried that this new move will fuel human rights abuses in the ongoing conflict zones in Burma.”

The U.S. and other Western countries have already made several initial tweaks to longstanding policies aimed at isolating Myanmar.

While the U.S. has twice this year made minor adjustments to the sanctions regime, Thursday’s announcement is by far the most significant in the ongoing normalisation of relations.

Also on Thursday, President Barack Obama named Derek Mitchell, until recently the U.S.’s special envoy on Myanmar, as ambassador to the country, the first time in more than two decades that such a position has existed.

Due diligence

Against the backdrops of the reforms process, Washington in recent months has seen a steadily increasing drumbeat for a lifting of U.S. sanctions. This week alone, two senators with long Myanmar experience, John McCain and Jim Webb, forcefully reiterated such calls.

On Tuesday, opposition leader Aung San Suu Kyi expressed tentative backing for McCain’s suggestion that the United States suspend – rather than eliminate – all sanctions but the arms embargo. Doing so would allow for the sanctions to be reappraised, and potentially reactivated, at a later date.

The European Union has made a similar move.

Still, Suu Kyi warned that Western countries shouldn’t be too optimistic, and the method by which the U.S. government went about rolling back the restrictions seems to bear out this caution, at least in part.

On Thursday morning, President Obama went forward with an annual reauthorisation of an emergency executive order that has allowed for the imposition of sanctions, which was due to sunset soon.

However, by the afternoon, following a meeting with Myanmar Foreign Minister U Wunna Maung Lwin, who is currently in Washington, U.S. Secretary of State Hillary Clinton announced a selective waiver of that executive order.

“We will be keeping relevant laws on the books as an insurance policy, but our goal … is to move as rapidly as we can to expand business and investment opportunities,” Clinton said.

“We will keep our eyes wide open to try to ensure that anyone who abuses human rights or obstructs reforms or engages in corruption do not benefit financially from increased trade and investment with the United States, including companies owned or operated by the military.”

In addition, the secretary of state noted that the U.S. government will “expect U.S. firms to conduct due diligence to avoid any problems, including human rights abuses”.

For many observers, however, such policies, while well-meaning, add up to very little protection on the ground. U.S. investors, meanwhile, could end up doing business with noted human rights abusers, accidentally or otherwise.

“After decades of military rule, business is inextricably linked with the military in Burma,” Thelma Young warns, noting that oftentimes such linkages are well hidden.

Relying on “due diligence” by U.S. corporate interests also doesn’t engender much optimism.

“The U.S. is simply not going to be able to oversee this well enough,” she says. “While the government wants to encourage U.S. businesses to follow economic and social practices, it has no way to ensure that this actually happens.”


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