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1 May 2012, Gateway House

Sanctions on Myanmar: Have they worked?

The West is quick to claim that their sanctions against Myanmar have forced the government to implement political and economic reforms in the country. However, such bans do not usually achieve their stated purpose of forcing regimes to change their behavior.

Director, Gateway House

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The by-election which Myanmar’s opposition party National League for Democracy (NLD) swept to victory on April 1, was a tribute to the fortitude and abiding popularity of its leader, Aung San Suu Kyi. It is also reflective of the low-key but steadfast manner in which the Myanmarese government, led by former members of the military Junta, especially President Thein Sein, has taken the reform process to an important – and hopefully irreversible – juncture.

There is much to celebrate about the rapid democratization in Myanmar. In grudging recognition, numerous foreign dignitaries have visited Myanmar this year including the UN Secretary General, the U.S. Secretary of State, the U.K. Prime Minister and the Foreign Minister of Japan. Our own Prime Minister Manmohan Singh, who had received President Thein Sein in New Delhi last October is scheduled to visit in May. He will no doubt be followed by many other senior leaders from the ASEAN countries, China, Latin America and Europe. In return, Suu Kyi will make her own first foreign visits – to the U.K. which was her home for decades and where her sons live, and to Norway because her Nobel Laureate status contributed much to her global profile.

Apart from conducting an internationally-certified free and fair by-election, Naypyidaw has moved swiftly towards political reconciliation with Suu Kyi and the ethnic minorities, media openness and economic reforms. A majority of political prisoners have been released and exiles welcomed back in time for some of them to participate in the by-election. The legislature, written off as a puppet a year ago because of the dominance of the military and its Union Solidarity and Development Party legislators, has actively supported reforms through legislation and those promoted by the President. These relate to commerce, tax and labour regulation as also bills on microfinance and foreign investment.

A controlled float of the currency has begun and Naypyidaw has started to prepare its own accounts at the market rate of 800 kyat to the dollar from the earlier fiction of 6 kyat to the dollar. Restrictions on the media have been lifted and a Human Rights Commission established. Ceasefire agreements have already been concluded with 11 of 12 dissident armed groups that have long battled the state. Even constitutional changes that could re-order the sharing of power and the natural wealth of the country with the ethnic groups as envisaged by the Panglong Agreement of 1947, are no longer ruled out.

The western countries have been quick to claim that it was their sanctions against Myanmar that brought about these astonishingly swift and wide democratizations in the last one year, and they have begun the process of removal or relaxation of long-standing sanctions against Myanmar. The EU announced the suspension of sanctions for one year and Australia followed, lifting sanctions against the country and some senior military figures. Lifting U.S. sanctions will be lengthy because it requires legislative action. Nevertheless Washington announced the opening of an embassy in Nypyidaw and withdrew its earlier objections to international organizations including UN Agencies, the World Bank and IMF and the Asian Development Bank to begin extending financial and technical assistance to Myanmar. The ill-natured and bullying suspensions rather than outright removal of sanctions, are signals to the Myanmar government that it is on notice; any thwarting of the wishes of Aung San Suu Kyi could result in their re-imposition. This is also underlined by the TV grabs of press conferences with visitors including Ban Ki Moon, Hillary Clinton etc. with Suu Kyi where she is treated almost as though she were the Head of the Myanmarese government already.

This underlines one of the most important features of sanctions – that they are almost invariably imposed on developing countries by the rich, developed world to force political processes and economic rules that open the society and economy to Western entities. The only known case of developing countries ganging up to try to impose sanctions against a member of the rich, white club was that of the Arab countries against Israel in 1967 after the Six Day War. Although their boycott of Israeli products did cause some dislocation, the impact of the sanctions was overcome by Israel finding new markets for its products and sources of essential supplies for its needs in developed countries.

Another feature of sanctions is their stickiness – which means that once imposed, they are hard to lift and become a way of life. Upon their imposition, affected governments hunker down and look for ways around them, often with popular support on the issue of soverignity and national honour. Simultaneously Western imposers find it difficult to walk away from their own heated violation-of-human-rights rhetoric and the inertia of legislative and bureaucratic procedure which do not allow these processes to be junked overnight.

This has created a community of sanction ‘lifers.’ Countries like Cuba have been sanctioned for half a century, since the Cuban Missile Crisis. Most Cubans alive today know no other way of life. Similarly North Korea has continuously been under some form of western sanctions since the Armistice of 1953, never lifted since there has been no formal end to the Korean War. Even after the dissolution of the Soviet Union and the subsidies that it gave North Korea, the latter has survived. The resultant distortion of its economy is reflected in the fact that while its people suffer malnutrition – and maybe even hunger – it has developed a formidable nuclear weapons and missile capability with which it continues to threaten South Korea and the world.

Iran is another lifer, under sanctions since the siege of the American Embassy in Tehran in 1979 and now being strangled by more sanctions that seek to force the rest of the world to stop purchasing Iran’s oil and gas. There is no doubt that the Iranian people are hurting; but the regime remains unrepentant, despite open avowals of regime change by the U.S. Even as negotiations over Iran’s nuclear programme resumed, the Iranian foreign minister stated that if western sanctions against Iran were lifted, all disputes with the west could also be resolved quickly. Clearly, the west has learnt nothing from pushing Myanmar into the arms of China – a colossal strategic misstep – and it has so far ignored the Iranian overture.

Zimbabwe has been sanctioned since 2002 because of the undoubted brutality of the Mugabe government but initially to protect the interests of barely 5000 white farmers sitting on some 70% of arable land. Despite the suffering imposed on the people for the last decade, and forcing an ill-advised coalition government with his principle challenger Morgan Tsvangarai, Mugabe remins in power and there has even been an economic resurgence in Zimbabwe.

These prolonged time frames for sanctions prove the old Greek saying  that “while the strong do what they can and the weak suffer what the they must” In fact such bans do not usually achieve their stated purpose of forcing regimes to change their behavior even as they distort economies and cause much suffering to ordinary people.

Less spoken about these days is that India itself  first began to be sanctioned by Canada, the U.S. and west Europeans after the nuclear test of 1974. Numerous technology-denial regimes such as the Australia group which controls exports of biological and chemical agents, Wassenar Agreement which bans dual use technologies, Missile Technology Control Regime etc., were devised with India as the principal target. Ironically, the U.S. and the U.K. were disappointed at the award of the French Raffaele as the choice of our fighter jet; yet they continue to deny many advanced technologies to us under the rubric of “dual use” technology.

The questions that arise are: Is long-sanctioned Cuba, with its world class education and health systems, worse off than its Caribbean neighbours like Panama with their lopsided dependence on rich American tourists? Could Mugabe have been dislodged by following some other course of action as sought by South Africa? Are the Iranians better off after decades of isolation which has completely distorted their first world oil revenue fueled level of economic development? Could not the current imbroglio with Iran have been resolved by confronting Israel’s security issues more honestly? Could we argue that India persevered in developing nuclear and space technologies and scientific competencies under sanctions, which it may otherwise have purchased from developed countries?

Things change with economic might. Some restrictions on the sale of weapons and dual use technologies on China remain, but most other sanctions introduced after the Tiananmen Square incident in 1989 have fallen by the wayside as that country’s economic profile has grown rapidly. Does this mean that sanctions against big countries and economies are shrugged off more easily?

In the case of Myanmar which has been under military rule since 1962, incremental sanctions have been imposed starting from trade and investment bans to travel and confiscation of assets held abroad by military leaders and finally – and reluctantly – to barring western oil companies from exploiting Myanmar’s substantial fossil fuels. Did the crushing of the Myanmarese economy and denial of financial and technical multilateral assistance, result in the democratization we are celebrating today? Unlikely – especially considering that China alone has invested more than $20 billion in that country’s infrastructure and fossil fuel sector in the last couple of years. ASEAN accepted Myanmar as a full member in 1997 and sought constuctive engagement, including through stepped up trade and investment. The fossil, forest and precious stones resources of Myanmar have served to benefit corrupt Thai generals enormously but not the Myanmarese people.

India, after initially extending support to Suu Kyi, sought to engage the military regime to address insurgencies in the Northeast, seek fossil fuels in its vicinity and build a bridge to its ASEAN neighbours. It was also responding to misgivings within the Myanmarese elites to being overwhelmed politically and economically by China. Has this entrenchment of Chinese influence on Myanmar benefitted the sanctioning countries in their strategic and commercial objectives? Can lifting sanctions be more productive than their imposition?

Almost certainly so. A well-researched, balanced April 2012 report by the respected International Crisis Group concludes that the impetus for reforms in Myanmar  has been internal, not the result of sanctions imposed externally. It also states that lifting the sanctions piecemeal could actually harm the Myanmar democratization project by exposing the reformers to criticism and a pushback from their opponents in parliament and the armed forces.

Unfortunately the Secretary General of the United Nations in his address to the Parliament in Naypidow on April 30, ungenerously termed the reforms “fragile” – in line with the view of western governments. What the UN really needs to do is to assist Myanmar in capacity building to absorb foreign aid and advice. Myanmar also needs to ensure that it does not hop out of the Chinese wok into the resource curse as the world begins to exploit its wealth of natural resources.

Here, India can play a role, notwithstanding the paralysis in New Delhi. Even as it does in Africa, India can accelerate its academic and human resource development programmes especially in the area of information, communications and technology. It has experience to share in agriculture and institution- building, particularly the machinery of elections. And it can help incubate non-governmental organizations, a critical and necessary national asset for liberalizing Myanmar which will otherwise be overwhelmed by wealthy western NGO seeking to further the adoption of their world view. Such moves can lift the fortunes of the ordinary Myanmarese – and put the trauma of decades of sanctions behind them.

Neelam Deo is India’s former ambassador to Denmark and Ivory Coast, and served in Washington and New York. She is the director and co-founder of Gateway House: Indian Council on Global Relations. 

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