Myanmar: Coming in from the cold?

By Oliver Elliott, Editorial Assistant

Could it be the beginning of the end for the sanctions regime on Myanmar? Yesterday Australia became the first country to loosen sanctions with the easing of travel and financial restrictions on some of the country’s leadership. Although only a tentative first step, the move comes as part of a broader push by the West to recognise and reward the reforms being enacted by Myanmar’s government.In December, Hillary Clinton made the first visit to the country by a US Secretary of State in five decades, offering to loosen some restrictions on international financial assistance and development programmes if the current rate of reform is maintained. She also suggested that the US might be willing to consider easing sanctions, which currently include an arms embargo, travel restrictions on political leaders and ban on any American individual or organisation doing new business with the country. Just a month later, British Foreign Secretary William Hague made his own equally historic trip to offer rewards in return for further reform. A few Western businesses are already anticipating a return to Myanmar in the near future.

Substantial political and economic reforms (examined in a recent IISS Strategic Comment) followed the transfer of power from the military junta to a civilian government in March 2011. Crucially, the reforms have won the support of Aung San Suu Kyi, Myanmar’s highly respected opposition leader. Her party, the National League for Democracy, formally registered with the authorities last month after boycotting the 2010 elections because of electoral laws that prevented her from taking part. Parliamentary by-elections are expected to be held in April.

But there remain some significant hurdles for Myanmar as it seeks to come in from the cold. It faces lingering questions over its chequered human-rights record: both Hague and Clinton emphasised that the release of political prisoners and dialogue with dissident ethnic minorities are prerequisites to any relaxation of sanctions.

Clinton also demanded that Myanmar sever all ties with North Korea, from which it is suspected of having acquired information on ballistic missiles and possibly nuclear technology.

Myanmar’s potential democratisation is also seen by the West as an opportunity to draw the country out of China’s economic and political orbit. China has been Myanmar’s main military and economic backer since the introduction of Western sanctions in the 1990s and holds a great deal of influence in the country.

However, the recent decision by Myanmar’s President Thein Sein to suspend construction of a China-backed dam project was interpreted by many as a sign that the country’s leadership is keen to reduce China’s dominance.

But even if this is the case, Myanmar is unlikely to accept an increased level of Western dominance as a substitute for that of China. Clinton’s visit was noticeably overshadowed by the simultaneous visit by the prime minister of Belarus.

Myanmar has been pursuing closer ties with its neighbours, including India and other countries in Southeast Asia. Its determination to chair the Association of South East Asian Nations in 2014 (which it was ultimately awarded last November) was a major motivation for the reform process.

Nonetheless, the timing of Myanmar’s reforms comes at a very opportune moment for the US. It has been encouraging the growth of ties across Southeast Asia as a counter-balance to the rise of China. Though its economy is weak, Myanmar’s strategic position and rich resources make it a potentially valuable partner.

Ultimately, however, the West will act with caution. The pace of reform has surprised the world and inevitably aroused some suspicion as to how genuine it is. Australia has demonstrated Western willingness to back rhetoric with action, but the further relaxation of sanctions will be limited until Myanmar’s elites demonstrate that the move towards democracy is for real.

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