(Commentary) – The recent political developments in Myanmar [Burma] have prompted a renewed debate on the sanctions imposed exclusively by Western countries. Even Aung San Suu Kyi has adopted a more flexible position and the key opposition parties that won seats in the elections have called for the lifting of the measures. The NLD itself has called for discussions with the US, EU, Canada and Australia on how and when the sanctions might be modified ‘in the interests of democracy, human rights and a healthy economic environment’ (see ‘Sanctions on Burma: A Review’, NLD, 8 February, 2011).
The ‘sanctions’ are a patchwork of measures, implemented at different times by various Western countries, with divergent objectives and diverse impacts. Taken as a whole, I have long believed that sanctions are highly counterproductive. There is an urgent need for a complete overhaul of these measures because 20 years of sanctions have failed to achieve their objectives in Myanmar, as even political leaders in the US and Europe have recognized. Beyond being ineffective, they have had clearly counterproductive effects, which is why a fundamental rethinking of the sanctions regime is urgently required.
I am of course aware that sanctions are not primarily responsible for the poor state, but sanctions have certainly reinforced the negative effects of the government’s poor policymaking. It is also clear that Western sanctions have impacted negatively several labour intensive sectors including the garment, tourism, seafood processing and wood product industries, causing significant job losses and resultant hardship. In addition to the direct impact of sanctions on existing commercial activities, the opportunity costs must also be factored in. Any analysis must consider not only the jobs lost, but also those never created as a result of sanctions and boycotts.
Sanctions have also affected the population in other ways. Twenty-two years after the suspension of development assistance, overall levels of aid to Myanmar remain extremely low compared with other developing countries. The country receives less than US$ 6 per capita, compared with US$ 62 per capita for Laos, US$ 52 for Cambodia and US$ 42 for Vietnam. In my view, there is no objective reason why the people of Myanmar should be denied such assistance given the overwhelming needs. Such chronically low levels of aid are scandalous, and have contributed to considerable and unnecessary loss of human life.
Perhaps more damaging in the long run is the impact that sanctions have on technical capacity. Any government in Myanmar, whether authoritarian or democratic, will rely on the same civil service to implement its policy agenda. By blocking technical assistance from the international financial institutions and capacity-building efforts more generally, sanctions are a major impediment to improving the economic conditions for the Myanmar people. Denied access to capital markets, technology, information, best practice corporate models, and models of good governance and environmental stewardship, Myanmar’s economy will fall farther behind those of other Asean members. In a situation where Myanmar’s economic development is already lagging far behind other Asean countries, a sanctions policy that further damages its prospects for growth could have negative impacts for decades to come.
There are very few Western lawmakers and politicians who believe that sanctions are effective. The support for sanctions –genuine and often passionate–stems from other considerations: the desire to support Aung San Suu Kyi and the wish to take a moral stance against the abuses of the government. But there are many others whose support for sanctions is based more on domestic political considerations and the reluctance to draw fire from powerful domestic Myanmar lobby groups. These exile and activist lobby groups have expended enormous energy lobbying for sanctions, and undermining or vilifying those who take a different view. In the absence of any real progress in Myanmar, sanctions have instead been pursued as an end in themselves; in many quarters the strength of the sanctions regime has been taken as a proxy indicator of ‘progress’ or ‘success’. But given that almost everyone agrees that sanctions have been a dismal failure, this is nonsensical; the enormous effort and resources expended on this issue would be much better spent elsewhere.
Concerning your criticism (see story – ‘NLD disturbed by Austrian embassy’s defense firm in Burma’ ) concerning the Austrian economic fact finding mission I would like to draw your attention to the fact that Aung San Suu Kyi herself acknowledged in her audio message to the World Economic Forum in Davos in January 2011 the need for innovation and diversification of the economy if Myanmar is to catch up with the rest of the world. She encouraged investment, but called on foreign investors to ‘put a premium on respect for the law, on environmental and social factors, on the rights of workers, on job creation and on the promotion of technological skills’. This reiterated the points made in a January 4 statement setting out the NLD’s economic policies. But such calls for renewed and responsible investment are incompatible with continued economic sanctions: it is Western companies that are most likely to meet such corporate social responsibility standards, but these are the very companies that are prohibited or dissuaded from investing in Myanmar by sanctions and boycott campaigns. The absence of Western companies will continue to be exploited by businesses in the region, which have enthusiastically filled the gap created by sanctions, but which cannot offer the same quality of resource flows and knowledge transfer as the West.
I would also like to recall that all of the major national and ethnic parliamentary opposition parties–including the four largest opposition parties (Shan Nationalities Democratic Party, Rakhine Nationalities Democratic Party, All Mon Regions Democracy Party and National Democratic Force)– have called for sanctions to be lifted. Asean has also made a specific call for the removal of sanctions. So overall internationally, calls for lifting the sanctions have been growing.
I am of course aware that the main argument that has been put forward internationally against lifting sanctions is that this would somehow ‘reward’ the regime when it has not taken sufficiently convincing steps to warrant this, or would send the ‘wrong political signal’. But these are not sound reasons for maintaining the status quo.
If, as is widely recognized, sanctions have not been effective, then changing such a policy can hardly be a reward for the regime. A failed–and indeed counterproductive–policy is also not the way to send a strong political signal; rather, it sends the signal that the West is not really interested in pursuing its stated goals in Myanmar and that the real focus is on domestic political considerations and exile Burmese lobby groups.
International policies are failing Myanmar and its people. Chronically low levels of aid, a lack of vital technical assistance and capacity building, and a stubborn insistence by some within the West to cling to failed policies of sanctions and isolation have only served to exacerbate the negative impacts of poor governance.
As Myanmar enters a new political phase there is a critical window of opportunity to encourage greater openness and reform. Unfortunately, this opportunity is likely to be squandered. A small number of influential countries place a higher priority on appearing ‘tough’ on the Myanmar issue, rather than on being effective–satisfying unrepresentative domestic lobby groups at the expense of developing sound policies.
I am convinced that continuing the same old approach will only reinforce longstanding suspicions among the country’s leaders about the intentions of the West. On the ground, much is changing, but and if the Western sanctions are not gradually lifted the result will be continued deadlock, which will be to the detriment of the Myanmar people. Now is the moment for a new approach.
Bert Morsbach is a foreign investor operating in Burma.
