Without Sanctions, Burmese Govt Must Hold Cronies Accountable

By Aung Zaw 15 September 2016

In the near future, Burma will no longer be a pariah, as the Obama administration has announced its intent to lift economic sanctions to deepen business, trade, diplomatic ties, and several assistance programs with the Southeast Asian nation.

Many cronies who were on the US sanctions list will soon be removed, but it is as yet unclear who will remain under restrictions. This news will bring some relief as well as some uneasiness.

To put it simply, removing them from the US sanctions list doesn’t necessarily mean these cronies and criminals are clean.

Now, the onus is on the Burmese government and State Counselor Daw Aung San Suu Kyi to hold them accountable and begin a process of rehabilitation so that it matches her repeated aphorism that she will introduce rule of law in the country.

Moreover, the Burmese public, independent media and civil society groups will need to remain vigilant in monitoring how these former US-sanctioned cronies gradually reintegrate into the local and international business community; they will also need to stay informed about the foreign partners that work with them. No doubt there is huge risk involved in working with some notorious tycoons and it will require enormous due diligence on the part of those who choose to do so.

According to the US State Department’s press release, “…several restrictions remain in place. JADE Act visa ineligibilities remain in effect, including with respect to military leaders and those who provide substantial political and economic support to the Burmese military. Remaining restrictions on foreign assistance to Burma include limitations on assistance to Burma’s military.”

Indeed, Burma’s notorious drug barons, arms dealers, and businessmen associated with the military generals have all enriched themselves. Under military rule, these cronies became wealthy, but many were simply rent-seekers and did not run genuine enterprises.

It is also assumed that some generals and tycoons who were involved in arms smuggling and illicit trade will not be removed from the list. If they are in fact removed from the US sanctions list, it is the Burmese government who should launch a thorough investigation into their activities and hold them accountable in public. If they are found guilty, they should be jailed. This will show that the Burmese are taking matters into their own hands.

Still, US-sanctioned tycoons have whispered that many businessmen who should be on the US sanctions list are still at large: it is time for the elected government to do its homework.

It remains to be seen whether some figures such as Tay Za and Htun Myint Naing—also known as Steven Law—will be among those removed from the US sanctions list soon.

Tay Za (also spelled Te Za) was placed on the US sanctions list in 2007 after the regime crushed a monk-led pro-democracy uprising that year. Officially, Tay Za runs the Htoo Trading Group, but he is also known to have served as an arms broker for the former regime when it purchased military hardware from Russia. It should be noted that there are several new arms brokers in Burma that are not on the US sanctions list.

In any case, Tay Za is allegedly close to Burma’s top leaders of the former junta, including Snr-Gen Than Shwe, but he now lives in Bangkok, Thailand. The irony is that in December, National League for Democracy (NLD) lawmakers held two political trainings at Shwe San Eain Hotel in Naypyidaw—the hotel is owned by Tay Za, who has been known to generously sponsor NLD trainings. In a report published by the Center for Strategic and International Studies (CSIS) this month, it was also revealed that Tay Za is building the NLD new headquarters.

What about Htun Myint Naing? Will US remove him from the list? As the son of one of Burma’s well-known drug traffickers, Lo Hsing Han, Htun Myint Naing runs Asia World, Burma’s largest business conglomerate.

He is known to be close to former generals and as a businessman, he has strong links to the Chinese government.

Under Burma’s previous quasi-civilian administration, Htun Myint Naing’s company won a contract to build a new Rangoon airport terminal—the project is worth US$660 million.

As the company anticipated the easing of US sanctions, Asia World restructured its business to focus on infrastructure, energy and property development, and dropped out of other pursuits, such as toll road construction, coal power plants, petrol stations and mining interests.

Htay Myint, a former lawmaker and a business tycoon close to former regime, heads the company Yuzana. Over the past decade, Yuzana has been accused of confiscating 300,000 acres of land in the Hukawng Valley area of Kachin State for use as a plantation.

Farmers who owned several acres of land in the area now demanding the company return it and compensate them.

The question remains how Daw Aung San Suu Kyi and the NLD government will continue to investigate the many issues involving notorious tycoons. How much capacity and political will they need in order to make sure public confidence remains strong in the government?

According to Global Witness, drug lord Wei Hsueh Kang controls a web of jade companies. The US has reportedly put a US$2 million bounty on his head and targeted him with narcotics sanctions and indictments. It is doubtful he lives in Burma though, and is likely in China.

Indeed, there are several other criminals still at large. But no doubt they are multi-millionaires, flying private jets and enjoying expensive champagne and laughing at the news of a new era in the US-Burma relations.

The State Counselor once said, “I’m not afraid of sanctions, because I believe that sanctions were imposed for a particular reason and these reasons will be removed in time.” But the public will not like to see criminals, drug barons and arms smugglers walking free on the street, carrying on business as usual. The intention is to reward the Burmese who fought hard to achieve some degree of freedom and democracy so that ordinary citizens—rather than cronies—could enjoy more prosperity and opportunity.

Daw Aung San Suu Kyi strongly advocated for rule of law in the country during her political campaign. She has to ensure that when it comes to some notorious tycoons and criminals in the country, not everything is back to normal. If not, the public could lose faith in the government, the system, and in the rule of law itself.