After a Coup and Amid Major Protests, Myanmar Slides Deeper into Crisis

On February 1st, the Burmese military mounted a coup, deposing and detaining the civilian leadership of Myanmar.  The military, which is known as the Tatmadow, arrested the de-facto civilian leader Aung San Suu Kyi and other key members of her ruling party, the National League for Democracy.

The Tatmadow justified the coup by claiming widespread fraud in elections in November — elections, incidentally, which the National League for Democracy won in a landslide.

This coup is a major setback for Myanmar’s transition to democracy. The country was ruled by a military junta from the late 1980s until 2011. Under heavy international pressure, including from the Obama administration, the Tatmadow allowed for free elections which saw the rise of Aung San Suu Kyi’s National League for Democracy.

Now the military has once again stripped civilians from holding power. This is a big foreign policy challenge for the new Biden administration and European leaders long supportive of Myanmar’s democratic transition. China, too, is being put in a tough spot by this somewhat unexpected move from the Burmese military.

On the line to discuss this current situation in Myanmar is John Sifton, Asia Advocacy Director Human Rights Watch. We kick off discussing what we know about the motivations behind the coup, and then have a conversation about the significance of large protests against the military. We have an extended discussion about the foreign policy options available to the United States, Europe and the international community more broadly to encourage a return to civilian rule in Myanmar.

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Why Was There a Coup in Myanmar?

John Sifton [00:02:24] There were rumors that there might be a coup circulating through January, but a lot of people didn’t really think it was going to happen because the dirty little truth about this whole situation is that the Myanmar military already had immense powers and a lot of policy experience in Burma. Experts didn’t really understand why the military would seize power because they already have so much. If anything, the civilian leadership is a kind of a fig leaf for them. Before the coup, the military still controlled the security services and vast portions of the economy through its military owned companies. We’re happy to sort of see the civilian leadership get all the blame (or most of the blame) for the country’s problems while they sit in the back and do what they want to do with wars and insurgencies and killing Rohingya, the civilian government gets blamed for it.

John Sifton [00:03:28] So, it wasn’t really expected that they would do that because it wasn’t in their interest, but it did happen. I think what surprised a lot of people was to find that they actually had been quite upset about losing the elections and as they can believe, that they could engineer some kind of victory. And when confronted with the realities that they couldn’t, they decided to act.

Mark Goldberg [00:03:52] So it really it was that even though they didn’t lose much power, their overwhelming defeat in the elections was the proximate reason for the coup, you think?

John Sifton [00:04:04] It appears so, but I should caution that anybody who isn’t a member of the Tatmadaw really doesn’t really know what the Tatmadaw is about. It’s a very difficult institution to understand. I think the most intelligent person is the one who says that they don’t understand it. So it’s always very difficult to know exactly what’s going on. But it appears that they didn’t like the results of the election and believed that they had engineered a constitutional system that would ultimately allow them to lead the country, not just in deed, but in fact. But that didn’t happen, and I think it’s important to remember that the 2008 constitution that governs Burma, is a military written constitution that was passed to a bogus referendum they controlled and it had always given them immense powers. They had twenty five percent of the legislature, which gives them a de facto veto over any constitutional amendment to change the Constitution. They have immense emergency powers, which they invoked on the day of the coup. So the Constitution was already there, allowing them to do exactly what they did: invoke a fake state of emergency and take control.

Mark Goldberg [00:05:37] So we are speaking a few weeks after this coup, what has transpired on the ground in Myanmar in the days and weeks following the coup?

John Sifton [00:05:50] I think the first thing that has happened is that the people of Burma have surprised the military through this outpouring of dissent and protest. One thing is clear, which is that the military did not anticipate the level of opposition that would come out in the days and weeks after the coup. Had they known this was going to happen, they probably would have taken more prepared steps. So they were quite taken aback by what’s happened (and what’s happening) since the coup.

People in Myanmar are Rising Up in Protest

Mark Goldberg [00:06:29] And what is that? Can you describe just describe the kind of scale of the protests that we’ve seen in Burma right now so far?

John Sifton [00:06:37] Well, there’s there’s an enormous movement underway, both to street protests, but also what they call a civil disobedience movement (CDM) where people are walking out of work, (both civil servants and private sector and students) walking out of schools and work, hospitals, law firms, businesses, government ministries; and protesting. So that’s going on, it’s been going on almost every day in varying numbers. There’s been violence against protesters, people killed, shot. People have been hurt with rubber bullets, non-lethal weapons, as well as it appears, live rounds in certain instances. At night, the Internet has been regularly shut down. During those hours, there have been arrests of civil society members, journalists and other people who are linked to the opposition. Of course, there were arrests the first day of the coup of leaders of Burma, the elite, the civilian leaders of Burma and each of its states; as well as certain key ministers, including notably (and we can come back to this) the minister of finance and the deputy head of the central bank of Myanmar. And that’s important because of the finances that the government controls.

Mark Goldberg [00:08:02] Well explain that then, because what you’re describing is a series of very targeted arrests, of course, the arrest of Aung San Suu Kyi grabbed the main headlines early in this coup. But you’re saying that other officials not internationally known, have been arrested and their arrest is sort of furthering the interests of the military in one way or another?

John Sifton [00:08:25] Absolutely. It’s very important because it goes to the issue of what the international community is going to do about all of this, vis a vis sanctions or other enforcement, to bring some level of consequences to the military that will get their attention. That’s what we’re arguing right now, is that the people of Burma have risen up and taken the military off guard, surprised them, and shown the military that they miscalculated. It’s important now for the international community to also show to the military that they’ve miscalculated by imposing level sanctions (and enforcement of sanctions) that the military wasn’t expecting. They were expecting sanctions of some type. Perhaps listing of generals names on designations of the Treasury Department, specially designated persons with whom you can’t do business or seize their assets overseas. But if you go beyond that and start imposing broader economic sanctions on the military leadership and the overseas accounts (offshore accounts) that the military controls and the revenue streams from extractives. Then you start to get their attention in the same way the people of Burma have gotten their attention by pouring it into the streets and then they start to think maybe we need to backtrack. That’s where the money comes in, because, of course, it’s not just about sanctions, it’s also about the threat and anxiety and concerns about looting and stealing of assets.

Mark Goldberg [00:09:57] I see that, so if you get these civilian guardrails out of the way, the military could just plunder state resources to fund their operations.

John Sifton [00:10:05] Right. A lot of people have been talking, “Oh, we’re going to go back to sanctions. Did they work the last time around?” And those are questions that should be raised. But in discussing that, it’s important to understand that the economic situation of the country and its place in the global economy is fundamentally different than it was in the old days, when the junta controlled Burma and Aung San Suu Kyi was a political prisoner. All that is fundamentally different because the economy is more integrated into the international economy. And during the 10 year period of, quote unquote “civilian rule”, large portions of the Burmese state-owned enterprise economy were moved out of the dark (where they had been plundered in the darkness by the military) into the light of the Central Bank of Myanmar’s accounts, which could be seen by the World Bank and the IMF. So there were all these efforts to sort of bring dark money into the light. And as a result, the Central Bank of Myanmar and the Myanmar Economic Bank, and the Myanmar foreign trade bank and all these state owned banks, had brought money into the lightness and had overseas accounts in US dollar denominations and foreign currency reserves. And all that, (which was controlled by civilian leaders like the minister of finance and the governor of the central bank) well, those people were arrested on the first day of the coup. There was every reason for countries to worry that those state assets would then be plundered, which is why the Biden administration when they announced sanctions, they noted that they had already acted before the sanctions were even announced by freezing or blocking transactions out of the US of the Central Bank of Myanmar’s funds. Why would they do that? That’s civilian money! Because they had reason to believe that the Central Bank of Myanmar was no longer the Central Bank of Myanmar. It was basically the Tatmadaw with a gun to the head of whoever sends up the transaction. So they blocked it because it was considered to be a fraudulent transaction, not a bank transaction, but an attempt by the military to, take the foreign currency reserves for themselves.

What Can the United States, United Nations and other Key Players Do About the Coup in Myanmar?

Mark Goldberg [00:12:33] So that speaks to the fact that early on, it seemed that the United States and several Western countries did seem to take fairly aggressive steps in the right direction in terms of trying to impose a degree of sanctions (of targeted sanctions) on those who were responsible for the coup, for the Burmese military. Where does that effort stand now?  I mean, I know that you and Human Rights Watch have been trying to build support for these kinds of targeted sanctions. What does that look like?

John Sifton [00:13:07] Yeah, so the Biden administration has taken the first step [00:13:10]and that’s sanctions like a separate list of financial crimes enforcement FinCen and the terrorist financing [7.9s] and combating corruption efforts that the Treasury handles. And that’s going to get the Burmese authorities attention because it’s going to tie up assets that they wanted to take for themselves. And assets are one thing. You can’t seize assets held in the local currency in Burma in their banks, but you can stop transactions in US dollars and euros if you invoke sanctions in the EU and US. Same for Australian dollars and Canadian dollars; they also have these types of sanctions. But it’s very important people understand it’s not just about seizing assets, it’s about blocking transactions in the future. Because the government controls extractive industries which have ongoing revenue streams that would accrue to the military. You can block those revenue streams accruing to the military if you use your sanctions regimes, but also your financial criminal laws, anti-corruption laws and anti-money laundering laws. If you use them robustly and vigorously, you can really tack that money, tie it up, and that really will get their attention. Because that’s the only hope we have right now, is that they come to the conclusion that they’ve miscalculated. They’ve already seen they’ve miscalculated with the people of Burma, so let’s show them that they miscalculated with the international community as well. I would say that other countries can do beyond that, but that’s that’s a first step.

Mark Goldberg [00:14:50] Well, I wanted to ask you how China figures into this. I mean right now at the Security Council, you’ve seen limited action. You’ve not seen sort of robust (like Security Council resolution) condemning the coup. You’ve seen, I think, a presidential statement or a press statement. What is China’s position right now on the coup in their backyard?

John Sifton [00:15:18] On the one hand, we know for a fact that China would never allow for a robust resolution of the Security Council. But the fact that they allowed consensus for a statement in the Security Council, the fact that they allowed a special session in the U.N. Human Rights Council in Geneva, speaks volumes about the level to which they are not happy or they’re frustrated with what has happened and may even have been as surprised as we are (or perhaps somewhat surprised). So where do we go from here? I mean, it would be good if the United States, the United Kingdom, France; as permanent members were to really push China and Russia to explain why they won’t allow a strong resolution. But we’re under no illusion that that’s a long shot, and the best we can hope for probably is continuing debate. There will be a U.N. General Assembly meeting, there already has been a General Assembly action as well. And that should happen, and that’s good. But I think we have to not be naive enough to understand that the real pressure is going to be brought down, it’s going to be brought multilaterally by concerned countries. The United States is going to act; the EU should follow suit (although they need a push to be more robust because they’re being a little weak right now). Canada has acted, Australia, New Zealand. The next step is to get key economies that are integrated into Burma’s economy, like Japan and South Korea, to flex their economic muscle over banks and businesses that do business, and tie up the money going to the military. There are a lot of legitimate business interests with ordinary civilian enterprises in Burma. We’re not talking about that. We’re talking about telling your companies that do business with the Tatmadaw, that they have to either cut off those ties (or where that would have an impact on the people of Burma) direct revenue streams and hold them up so that they don’t go to the military. Take gas for instance. Huge revenues coming in from natural gas reserves (natural gas being pumped offshore). If you cut that off, if you told those companies had to pull out and disrupted the supply chain, that would have huge consequences for the people of Burma. Cut off gas being delivered in kind to Burma; the electricity would go out because that’s how it’s produced. So instead of that, we recommend to the companies that are pumping the gas and controlling the accounts that get the money, to direct the revenues that are supposed to go to the military into escrow, and to hold them for now because that will really get their attention.

Mark Goldberg [00:18:12] But I guess you’re not concerned that should Western countries and Japan, South Korea, and allied countries, continue this sort of escalatory campaign of sanctions, targeted financial crimes, and law enforcement, that the Burmese military might not just sort of turn to China? And China, which kind of welcomed them with open arms into their broader sphere of influence. You’re saying that that China (Beijing) is also sort of perturbed right now by the actions of the Burmese military to the point where they also might be willing to exert some pressure to restore civilian leadership?

John Sifton [00:18:52] I think the first thing is the Tatmadaw doesn’t want to be a vassal state of China. That’s one of the key reasons they let Aung San Suu Kyi out of prison over a decade ago. They wanted to diversify their economy; they saw that the economy was just destroying the country and by extension, them as an institution. So I think what they were hoping for was that the coup would be a blip and then ultimately, all the Japanese companies and South Korean companies and European companies, they’ll do business. And the economy would just stumble along, but if you show them that that’s the case, they can’t turn to China. I mean, they can, but the economic terms of the loans and the companies that would do business with them if there were broad sanctions (regime imposed) on the military, would be far less and worse than what they get with with doing business with the rest of Asia and Europe and the US. So, they’ll do it if they have to, but that’s not what they want. They want to be integrated into the global economy.

Facebook Bans Myanmar Military

Mark Goldberg [00:20:06] I’m interested in learning your understanding of the significance of this move by Facebook to ban pages or accounts of members of the military. It seems like (for those of us who have been following Facebook’s role in Myanmar for a while) Facebook was credibly accused by UN special rapporteur as years ago of helping to foment a situation in which genocide could be conducted against a religious minority. Now, Facebook is banning certain accounts. How significant is that move, do you think?

John Sifton [00:20:48] In the grand scheme of things, not very significant. They’re not going to let Aung San Suu Kyi out of prison because they had their Facebook accounts suspended. They’re going to restore democracy when they see that they’ve miscalculated both the people and world. Facebook can be part of that, but really, we got to talk in raw economic terms and the anxieties about being held accountable for their abuses. If they see they miscalculated, they may seek some kind of exit. Obviously, that’s going to be hard to navigate a roadmap for them to exit gracefully. The only way that’s going to happen is if there’s economic leverage imposed on them, and there’s a way to do that. Take the gas; the gas is so easy. The Thai government buys most of it (the pipe that goes straight to Thailand) and the Thai state-owned enterprise buys it. The revenues go into a joint venture that is controlled by the French oil company Total. Tomorrow, the Treasury Department (working with authorities and others) could just block those transactions and that flow of income, which is the largest source of the Tatmadaw’s foreign currency assets (well, legal assets, I can’t speak to the drug trade) would be cut off. You could do the same thing with the Myanmar timber enterprises and with the Myanmar mining companies. And pretty soon they’ll realize, “well, we miscalculated”. [00:22:35]And it’s not the case just because the US sanctions, they don’t have impact.  Any bank, even if it’s not a US bank, [8.5s] will do what the Treasury says because if they don’t they’re subject to fines themselves for violating the law. A bank like BNP Paribas, can face consequences if they do business with sanction regimes.

Why Financial Sanctions Against the Burmese Military Could Be Effective

Mark Goldberg [00:23:01] So that’s what you’ll be looking for in the coming days and weeks and months: the extent to which the Treasury Department takes escalatory actions and uses say, the Office of Foreign Asset Control and other financial tools, to apply pressure on the Burmese military.

John Sifton [00:23:19] That’s right. We want to be more sophisticated this time, not just names on sanctions lists, which is the sort of go to tired and old approach. That’s tired. The wired way, is enforcement. To get out there and track down where the money flows are, and go after them. Then you combine that with action at the Security Council where you’re leveraging the threat of legal liability (both for current abuses and past abuses). And, you shun this regime on the global stage and make the pariah status. They can’t be invited to multilateral military exercises. The Association of Southeast Asian Nations (ASEAN), is not going to take strong action on them in and of itself, but they could raise concerns in that context, which would be extremely embarrassing to Burma. I mean, it is the case that even ASEAN (which is a weak regional institution) back in the day, they almost considered suspending Burma when Aung San Suu Kyi was previously in prison (or under house arrest) which is pretty significant knowing how ASEAN is usually so weak.

Mark Goldberg [00:24:40] I just have one last question here. So last time that we spoke, I had you on the show to discuss the Rohingya issue. I’m curious to learn from you if you think that Aung San Suu Kyi’s acquiescence (or the international perception that she acquiesced) to the Rohingya genocide, has impacted her ability to rally international support against the coup right now,.

John Sifton [00:25:10] Amazingly it hasn’t. It’s been kind of amazing to watch how we, and other human rights groups outside the country, and many inside the country; just don’t talk about her. They’re talking about democracy, they’re talking about the junta. In the first few days of the coup, we didn’t even talk about Aung San Suu Kyi. Our releases talked about restoration of democracy and the outpouring in the streets. It’s been less about her, and more about what the military has done and how much the people of Burma don’t want them to be in control.

John Sifton [00:25:49] It’s refreshing because we have to move beyond Aung San Suu Kyi. Burma’s future is not Aung San Suu Kyi, and it’s certainly not the military: it’s the people. They are out in the streets now and they’re demanding civilian rule. Some are mentioning her, but they’re demanding democracy and that’s good. Because it was a mistake, a misplaced focus, to make Burma’s human rights and democratic aspirations get tied up in a single icon. I think we can now move beyond that and so that that’s good in a sense. But again, it’s important that the international community to do their part. The people of Burma are sabotaging their own economy. So it would be misplaced for the international community to be pandering and be anxious about the economic consequences of actions, when the people of Burma are sabotaging their own economy to protest what the military has done. I think the only way forward here is if strong pressure is brought against the military in the streets and then on the economic side and on the international UN side. So that they say, “OK, we screwed up, we got to backtrack. We have to figure out an exit strategy here”.

Mark Goldberg [00:27:11] Well, John, thank you so much for your time, this is very helpful.

John Sifton [00:27:15] Great.