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February 19, 2021

White House Responds To Burma Coup, Imposing Sanctions, Export Controls

 KHARON 

Samuel Rubenfeld

FRIDAY, FEBRUARY 12, 2021

U.S. threatens further action if the military does not restore democracy


Students and teachers protest against the military coup in Kayin State, Burma. (Source: Ninjastrikers)

The White House announced broad new curbs on Burma following a coup earlier this month, issuing an executive order, imposing sanctions on military companies and leaders, and other restrictions.

The U.S. actions follow several days of protests in Burma, which is also known as Myanmar, after the Feb. 1 coup that ended a decade of democracy there. The United Nations Human Rights Council on Friday adopted a resolution without a vote that “deplored the removal” of the democratically elected government and called for the military to protect the rights of people.

The executive order authorizes sanctions on anyone operating in the Burmese defense sector, as well as those undermining Burmese democracy, and Burmese military leaders, top government officials and their spouses and adult children. It also allows the government to identify other sectors of the Burmese economy for potential sanctions. 

Beyond the sanctions, the U.S. also announced controls on certain exports, blocked the military from accessing more than USD 1 billion in government assets held in the U.S. and redirected USD 42 million in assistance, the White House said Thursday in a fact sheet.

The U.S. Commerce Department announced restrictions on sensitive exports to Burma’s Ministries of Defense and Home Affairs, as well as the armed forces and security services. And USAID said it had redirected aid that would have benefited the Burmese government, saying the funding will go toward benefiting civil society.

The U.S. Treasury Department followed with sanctions on 10 current and former military officials responsible for the coup or associated with the military regime, including Commander-in-Chief Min Aung Hlaing and his deputy, Soe Win, both of whom were already designated in 2019 for human rights abuses tied to the mass killing of Rohingya and other Burmese minorities. 

They and four others sanctioned Thursday -- First Vice President and retired Lieutenant General Myint Swe; Lieutenant General Sein Win; Lieutenant General Soe Htut; and Lieutenant General Ye Aung -- were directly involved in the coup, according to the Treasury. Four military officials named to the State Administrative Council (SAC) following the coup were also designated.

Three companies, Myanmar Ruby Enterprise; Myanmar Imperial Jade Co., LTD.; and Cancri (Gems and Jewellery) Co., Ltd., were sanctioned because they are wholly owned subsidiaries of a large conglomerate in Burma, the Treasury said. 

“If there is more violence against peaceful protestors, the Burmese military will find that today’s sanctions are just the first,” said Treasury Secretary Janet Yellen.

Though not named by the Treasury, corporate records reviewed by Kharon show the conglomerate to be Myanma Economic Holdings Public Company Limited (MEHL), a large company founded by the Tatmadaw, Burma’s armed forces. An August 2019 U.N. Human Rights Council report had listed the three firms as “alleged” MEHL subsidiaries. 

MEHL was sanctioned in 2007 by the Canadian government under a prior name, the Union of Burma Economic Holding Ltd. Though Canada eased most of its sanctions on Burma in 2012, it maintained the listing of the company and dozens of other individuals and entities.

A high-level Burmese defense official pegged MEHL’s value at USD 119.4 million in 2017, according to the U.N. report, which said the estimate was “difficult to verify.” The revenue generated by the conglomerate “strengthens the Tatmadaw’s autonomy from elected civilian oversight” and provides financial support for their operations, the U.N. report said.

The firm was as of last year owned by nearly 400,000 current or retired military personnel and about 1,800 institutional shareholders, Amnesty International reported in September, citing a leaked January 2020 filing with the Myanmar Directorate of Investment and Company Administration (DICA). A second document seen by Amnesty International detailed dividend payments received by shareholders between 1990 and 2011.

MEHL has an array of holdings and foreign partners, and it operates in a wide range of industries, including agriculture, construction, gems, finance, manufacturing, mining and tourism, according to a 2019 U.N. fact-finding mission and media reporting.

Several international partners began distancing themselves from Burmese military companies in the wake of the coup, however. 

Japanese brewer Kirin announced it would sever ties with MEHL, saying “we have no option” given the circumstances. Lim Kaling, a prominent Singaporean businessman, said in a statement cited in multiple media reports that he would exit his stake in an investment firm that co-owns a tobacco company with MEHL, saying recent events had caused him “grave concern” and that he was “exploring options for the responsible disposal.” And Hong Kong-based company HAECO Xiamen canceled a deal to upgrade a commercial airliner to a VIP jet for generals following its exposure by the Organized Crime and Corruption Reporting Project.

The Burmese military on Feb. 1 had declared a one-year state of emergency and detained key members of the civilian government, including Aung San Suu Kyi and President Win Myint, citing alleged fraud tied to a November parliamentary election. A day later, the Biden administration declared the act a coup, setting the stage for the new restrictions. 

Police have responded violently to the protests, including by shooting a young woman in the back of the head. The military has disrupted Internet access and blocked social media networks such as Facebook; the company responded by announcing it would reduce the distribution of Burmese military content, treating their profiles and pages as misinformation.















An electronics shop handwrites an advertisement for a portable radio during the Internet shutdown. (Source: Han Sann)

The United Nations Security Council should consider “all of the options” it has used in situations involving human rights violations, including sanctions, arms embargoes and travel bans, said Tom Andrews, the U.N. special rapporteur on the human rights situation in Myanmar, in a statement to the U.N. Human Rights Council. “Member states themselves, of course, have the ability to act and are beginning to do so,” he said, urging countries to act on their own. 

The executive order announced Thursday authorizes sanctions against the spouses and adult children of designated Burmese military leaders and officials; family members of senior Burmese military leaders appear to play roles in the country’s economy. Justice for Myanmar, a group of “covert activists” calling for an end to Burmese military business, released a spreadsheet on Thursday containing identifying information on the SAC members and members of their immediate family, as well as 17 of their businesses and 23 of their associates. 

Last summer, Justice for Myanmar reported on a construction contract awarded by the Ministry of Border Affairs to a company run by the three sons of Soe Htut, a general sanctioned Thursday for his direct role in the coup. The ministry was already under military control before the coup, according to the group. The children also operated two other companies involved in a long list of activities, including mining, oil and gas extraction; construction; logging; manufacturing; wholesale and retail trade, among others, the group said at the time.

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