Aftershocks of Myanmar’s Coup: Policy Options
In responding to the Monday coup in Myanmar, which has clearly put the military in power for an indefinite period of time, the United States and many other outside actors do not have a wide range of tools to respond. To be sure, the Biden administration, European states, Canada, Australia, and some other democracies have condemned the coup and called for the generals to accept the November election result and put Myanmar back on the path of (shaky) democracy. But regional powers, including China, Japan, and Thailand have either refused to denounce the coup, calling it Myanmar’s internal affair, or have been very slow to voice any denunciation.
Japan, for instance, has been slow to criticize, because it views Myanmar as a vital strategic partner and a place where Japan is directly in competition for influence with China. Thailand, run essentially by a military-installed government and in the midst of cracking down on its own critics and democratic politicians, is not going to say or do anything about the Myanmar military, which also has had a close relationship with some senior Thai military leaders. The Philippines, once a regional leader in promoting democracy, is now run by Rodrigo Duterte. And Indonesia, which styled itself as playing a significant role in pushing the Myanmar military toward embracing civilian rule, released a moderate statement just pushing all parties in Myanmar to move toward some peaceful outcome. None of these regional neighbors is going to apply much, if any, pressure on the Myanmar generals to step away from what looks like a path toward indefinite military rule.
Meanwhile, the United States, Australia, Canada, and the European Union still have limited strategic and economic links with Myanmar, compared to regional countries like China, India, Japan, Singapore, and Thailand. Overall, U.S. influence is limited, but that does not mean the United States and partners should do nothing. Some argue that, because Europe, the United States, and other partners have limited options, because they are dealing with their own massive domestic problems, and because Myanmar could respond by turning closer to China, leading democracies should respond modestly to the coup. But China is going to pursue its policies in Myanmar regardless or what measures are taken by the United States and other democracies, and U.S. policy should not be determined by how China is going to respond in Myanmar.
In addition, Myanmar’s usually xenophobic military leaders and other elites do not really want to move even closer to China; one of the factors that initially spurred the move toward civilian rule and shaky quasi-democracy was the army’s concern that the country was becoming so isolated and highly dependent on China. The military has come to rely on China, but the army maintains a still-prickly relationship with Beijing, and does not want to be isolated again and totally dependent on Beijing.
Given limited options, the United States and its partners could pursue several approaches. For one, the United States and partners should apply sanctions on Myanmar’s major military holding companies, Myanmar Economic Holdings Ltd and Myanmar Economic Corporation. These are sizable conglomerates in Myanmar that contribute massively to the armed forces’ coffers, and hitting them would impose a fairly severe economic pinch on the armed forces. The United States and partners also should use rhetorical pressure to push all major multinationals not to do business with Myanmar Economic Holdings Ltd and Myanmar Economic Corporation; reports from Amnesty International and others in recent years have shown several multinationals working with these two military conglomerates. The U.S. government should be able to develop and push forward a proposal sanctioning the two major military companies quickly and have it circulated to partners this week.
The Biden administration also should go well beyond the targeted sanctions applied in 2019 on a handful of top military leaders, using the Office of Foreign Assets Control (OFAC) to greatly expand the targeted sanctions to a broader level of top commanders, regional commanders, and senior leaders of the military’s holding companies, for a start. This targeting should include behind-the-scenes pressure on U.S. partners in Asia, principally Singapore, to also cut off access to Singapore’s financial institutions for anyone on the list of those faced with targeted sanctions. The White House also should call an immediate, emergency session of the UN Security Council regarding the coup, and also consider imposing other measures to limit the military’s earning power, like restoring the JADE Act.