The junta-controlled Central Bank of Myanmar (CBM) has strongly objected to a report by the UN special rapporteur on human rights in Myanmar alleging that state-owned and private banks in the country as well as international banks are helping the junta commit human rights violations against Myanmar civilians.
A statement by the CBM published in a junta newspaper on Saturday was also signed by the Myanmar Banks Association, as well the country’s private and state-owned banks.
“The UN report severely harms the interests of Myanmar civilians and the relationship between Myanmar and other countries,” the statement reads.
The CBM was responding to a report released on Wednesday last week by Tom Andrews, UN special rapporteur on the situation of human rights in Myanmar. Andrews said that while international efforts to isolate the junta appear to have dented its ability to buy military equipment, it still imported $253 million worth of weapons, dual-use technologies, manufacturing equipment and other materials in the 12 months to March.
Andrews said the regime has used the yet-to-be-sanctioned Myanma Economic Bank to make transactions through five Thai banks since sanctions were placed on state-owned Myanma Foreign Trade Bank and Myanma Investment and Commercial Bank by Washington in June 2023.
Exports of weapons and related materials to Myanmar from Thailand-registered entities more than doubled, from about $60 million in fiscal year 2022 to almost $130 million in the year ending March 2024, according to the report, “Banking on the Death Trade: How Banks and Governments Enable the Military Junta in Myanmar.”
Siam Commercial Bank, one of the Thai banks cited in the report, responded that it had conducted an investigation and found no irregularities in transactions with Myanmar. “These transactions are not connected to the arms trade as reported in the news. The bank performs due diligence to verify accuracy and reports these transactions to relevant authorities before processing,” it said.
The CBM said local and international banks that engage in transactions with Myanmar have undergone comprehensive due diligence measures for all business relationships and transactions.
“The financial transactions are only for the import of essential goods and basic necessities for Myanmar civilians, such as medicines and medical supplies, agricultural and livestock supplies, fertilizer, edible oil and fuels,” it said.
Myanmar’s largest business lobby, the Union of Myanmar Federation of Chambers of Commerce and Industry, also rejected the claims in Andrews’ report, saying in a statement that the UN report “harms the country’s economic resources and will negatively affect employees and their families who rely on domestic businesses”.
Over 20 organizations from religious, art, literary and media organizations with ties to the regime also issued statements welcoming the CBM statement.
Defense has accounted for the largest portion of the regime’s spending since the 2021 coup. Last fiscal year, the regime announced a national budget of 20 trillion kyats (US$6.15 billion), of which defense spending accounted for over 5.6 trillion kyats, an increase of nearly 2 trillion kyats over FY2020, the last budget before the coup.
The regime has not made public its budget for the current FY2024-25. Observers believe the defense budget will not be smaller than last year’s, as the regime has become more reliant on air power and begun training thousands of new conscripts.
Russia, Belarus and two of Myanmar’s neighbors—China and India—are major suppliers of weapons to the military regime.
Junta spokesman Major General Zaw Min Tun recently told the BBC that although everyone is talking about how the regime is acquiring weapons, no one has ever shed light on how Myanmar’s ethnic armed organizations can afford to buy weapons.
