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How Myanmar’s Junta is evading sanctions and what the world must do

The crisis in Myanmar continues unabated, fuelled by a complex web of financial manoeuvres and international complicity. A recent United Nations report reveals how the junta is skilfully circumventing sanctions, allowing it to sustain its brutal grip on power. This development demands urgent and decisive action from the global community.

According to the UN special rapporteur on Myanmar, Tom Andrews, the junta has shifted its financial operations from the sanctioned Myanmar Foreign Trade Bank to the junta-controlled Myanmar Economic Bank since 2022. This strategic move has allowed the military to maintain access to international funds, effectively nullifying the impact of sanctions. Following restrictions in Singapore, the junta increased its reliance on financial institutions in Thailand, particularly Siam Commercial Bank. This has enabled continued procurement of arms and military supplies, crucial for the junta’s operations.

The junta’s revenue streams remain robust, with over $660 million from natural gas exports to Thailand channeled through the Myanmar Oil and Gas Enterprise (MOGE). Despite sanctions by the US and EU, Thai banks and the state-owned energy company PTT continue to facilitate these transactions. This financial support is critical for the junta, sustaining its military capabilities.

Despite international sanctions, AOAV’s research reveals the alarming persistence of international arms networks in supplying weapons to Myanmar’s military junta. This clandestine arms trade has intensified the conflict and led to severe human rights violations, devastating the civilian population. Luc Woodall Gillard’s report uncovers a complex web of international suppliers, including entities in China, Russia, and other nations with more lenient export controls. These suppliers exploit loopholes in international regulations and use intermediary countries to obscure the final destination of the shipments. Despite efforts to curb the flow of weapons to Myanmar, the military junta continues to receive a steady supply, thanks to these sophisticated networks.

The 2023 UN report on the international arms trade supporting MMF included $406 million from the Russian Federation, $267 million from China, $254 million from Singapore, $51 million from India, and $28 million from Thailand. Of the $1 billion worth of arms, $947 million is from direct military sales. The Special Advisory Council for Myanmar has identified multiple state and private-owned companies responsible for the import of arms. Chinese and Russian manufacturers emerge as primary sources of sophisticated weaponry, including aircraft, armored vehicles, and small arms. Transactions are often facilitated by shadowy intermediaries operating through a network of shell companies and offshore accounts, making it difficult to trace the origin and final use of the weapons.

The influx of foreign arms has significantly escalated the conflict in Myanmar. The military junta has utilized these weapons to suppress dissent, target ethnic minorities, and maintain its grip on power. The report documents numerous instances where advanced weaponry has been used in brutal crackdowns against civilian protests and insurgent groups, resulting in a dramatic increase in casualties and displacement. The enhanced military capabilities provided by these arms have enabled the junta to commit widespread human rights abuses with impunity. AOAV’s findings include detailed accounts of atrocities such as extrajudicial killings, torture, and the deliberate targeting of civilian infrastructure. These violations have been systematically perpetrated against ethnic minorities and political dissidents, exacerbating the humanitarian crisis in the region.

Efforts to address this issue have been hampered by the intricate nature of the arms supply chain. International sanctions, though extensive, have proven insufficient to halt the flow of weapons. The report emphasizes the need for more robust international cooperation and enforcement mechanisms to dismantle these networks. It calls for stricter export controls, enhanced tracking of arms shipments, and increased transparency in international arms trade agreements. AOAV’s investigation highlights the critical role of financial institutions in perpetuating the arms trade. Banks and financial entities, knowingly or unknowingly, facilitate transactions that fund the purchase and distribution of weapons. The report underscores the urgent need for these institutions to adhere to international laws and ethical guidelines, ensuring they do not contribute to the cycle of violence. A separate UN report identifies companies from Austria, Israel, and the United States among those supplying parts for weapon manufacturing. This underscores the need for a more robust and comprehensive approach to sanctions.

To address this issue effectively, the international community must implement a comprehensive and enforceable embargo on all financial and material support to the Myanmar military. This includes sanctioning the Myanmar Economic Bank and cutting off all financial channels used by the junta. Targeting the military’s logistics network is also crucial. This means banning not only arms sales but also the supply of aviation fuel and other critical components. Coordinated international action is essential to dismantle the military’s supply chains and limit its ability to sustain its operations.

The resilience of the people of Myanmar in the face of severe repression is commendable. However, their struggle is exacerbated by the continued flow of financial and military support to the junta. The international community has a moral obligation to stand with the people of Myanmar by taking concrete actions to cut off the junta’s lifeline.

History will judge the global response to this crisis not by the strength of our rhetoric but by the effectiveness of our actions. It is imperative that we enforce sanctions with rigor and resolve, ensuring that the junta cannot continue its campaign of repression with impunity. The time for action is now. The international community must rise to the occasion and implement measures that will bring an end to the junta’s reign and restore hope for a democratic future in Myanmar.

Iain Overton is the Executive Director of Action on Armed Violence (AOAV)