MoeMaKa, June 21 2023
The United States sanctioned 2 state-owned banks controlled by the military council; Rakhine and Chin states are still restricted in emergency aid after cyclone Mocha hit
The U.S. Department of the Treasury recently announced that the two state-owned banks of the Myanmar military council, the Myanma Foreign Trade Bank (MFTB) and the Myanma Investment and Commercial Bank (MICB), have been added to the United States sanctions list. This action has sanctioned 2 commercial banks under the Myanmar military council government that communicate with foreign countries. Before this, Inwa Bank, which is owned by the military, was sanctioned after the military coup.
Regarding the reason for sanctioning these 2 state-owned banks, the United States stated that these 2 banks handled the military council’s foreign arms procurement payments. From which countries the weapons were purchased and what routes were taken were not specified in detail.
These 2 banks are under the Ministry of Planning and Finance (MOPF) of the military council, and accounts are opened by local UN agencies, some international NGOs, and some private companies as organizations, or as individual accounts for the employees of these organizations.
In addition, in 2022, the military council issued a statement ordering those working as sailors and workers abroad to use these 2 banks to remit money back to their families. A news article also reported that the military council said that the central bank will handle the bank account issues of private import and export companies and family remittances following the sanctions.
After the Office of Foreign Assets Control (OFAC) of the US Department of the Treasury imposed sanctions, it is still unknown in detail how many bank accounts opened in the sanctioned banks will be able to process payments and transactions in foreign currency dollars through other correspondent banks, which procedures can be done, and which procedures cannot be done.
It is expected that private companies in Myanmar will find other ways and do procedures for payment transactions related to their businesses, and it may have more or less impact on the military council’s arms procurement issues.
On the other hand, there are already large private banks such as Kanbawza, CB, Irrawaddy, and UAB that can communicate with foreign private banks, so it is possible that we will not experience any major difficulties like during the previous SPDC junta regime before 2010.
Regarding the current sanctions, the spokesperson of the military council told some news media that there is no direct communication with the United States, so there will be no harm. But actually, banks’ operations, payments, and inter-bank payment accounting have to work in accordance with the rules and regulations approved by the United States financial system, and so there may be more or less impacts. The United States has repeatedly put pressure on the military council, and on the other hand, it has announced since the military coup that it will not help the armed revolutionary forces fighting to overthrow the military council with financial funds or weapons that can be used in the military. In the past 2 years, the US has implemented individual and economic sanctions that will put pressure on the coup junta.
This year’s US National Defense Authorization Act (NDAA) adopted the Burma Act to provide non-lethal assistance to the NUG, CRPH, NUCC, and EAO organizations. However, it is estimated that the assistance is still being provided through organizations according to policies, and procedures and has not yet reached the beneficiaries.
Another piece of news for today is that the UNOCHA announced on June 19 that the United Nations is not yet allowed to freely help Cyclone Mocha affected victims in need of humanitarian assistance.
Even more than a month after the storm hit, the military council still imposed restrictions on the importation of materials needed for aid supplies, and the UN organization announced that only limited aid is being provided.
In Rakhine state, which was the worst affected by the storm, families are still living in houses without roofs and without access to clean drinking water. They are also in need of emergency assistance regarding their health problems amidst the lack of shelter due to the storm and the difficulties in accessing water and food. They are now dependent on aid for their survival as livelihood tools such as agriculture and water industry equipment were destroyed in the storm.
For the military council to use the storm as an advantage for political mobilization and political exploitation, and to restrict an international aid organization like the United Nations after seeing it from a political point of view, is an act that will leave a black mark in history.
