European Union foreign ministers were
expected permanently to end sanctions against Myanmar on Monday, recognizing
the country’s transition from military dictatorship to a civilian rule that has
released thousands of political prisoners, improved freedom of expression and
made efforts to maintain peace with armed ethnic minority groups.
Though the EU planned to leave an arms
embargo in place for one more year, ending other sanctions would highlight
strengthening international support for the long-isolated Southeast Asian
nation, despite allegations from human-rights groups that authorities are
failing to stem abuses against minorities, particularly Rohingya Muslims who
have been driven from their homes by tens of thousands of extremists from the
EU ministers were expected unanimously to
endorse the removal of sanctions late Monday at a meeting in Luxembourg. The
arms embargo would be reviewed after another year. Ambassadors from EU member
states had indicated over the past week that a year-old suspension of sanctions
would be made permanent.
European leaders had warned last year that
the suspended sanctions could be reimposed at any time, and they pressed for
vigilance over the pace of change, as encouraged by opposition leader Aung San Suu Kyi.
Removal of sanctions, analysts say, should
encourage investment by European companies who have spent the past year
researching opportunities in what has been Asia’s most talked-about frontier
The U.S. has lifted the bulk of its sanctions
in stages over the past year, permitting its companies to invest and allowing
imports from Myanmar. Still, the Treasury Department forbids U.S. citizens from
business dealings with 100 or so Myanmar citizens termed as “Specially
Designated Nationals” and considered cronies of the former military
regime. Companies with operations in the U.S. risk running afoul of U.S. sanctions against
Fully removing EU sanctions would show how
quickly momentum has built toward rewarding President Thein Sein‘s nominally civilian government,
with much of the West hesitant to undermine the sweeping political and economic
reforms he has undertaken, despite the serious eruption of ethnic violence and
the failure of authorities to stem it.
On Monday, Washington, D.C.-based Human
Rights Watch alleged the government was complicit in “coordinated
attacks” on Muslim neighborhoods and villages in Rakhine state, in
southwestern Myanmar, where more than 100 ethnic Rohingya Muslims have been
killed and an estimated 125,000 displaced by mob violence over the past year.
Much of Myanmar’s Buddhist majority regards the Rohingyas as noncitizens.
Thousands of Rohingyas have fled the country in rickety boats in recent years,
with many drowning.
Human Rights Watch has labeled the violence
as a campaign of ethnic cleansing and accused the government of not doing
enough to prosecute perpetrators, giving Buddhist extremists incentive to
attack Muslims elsewhere, such in central Myanmar, where clashes in March killed at least 43 people and
displaced thousands. Myanmar’s government spokesman didn’t immediately reply to
requests for comment.
Officials from the United Nations have warned
of a possible humanitarian crisis when expected monsoon rains hit Rakhine state
in May, possibly causing widespread flooding in crowded refugee camps. Tensions
remain high in the region. Only 4% of Myanmar’s estimated 60 million people are
Muslims, but tensions have been highest in areas where they are more numerous,
such as Rakhine, where they make up about one-quarter of the population.
For European investors, practical concerns,
including infrastructural hurdles and an untested legal environment, may weigh
more strongly when choosing whether to enter Myanmar’s nascent market despite
the lifting of sanctions.
European business leaders cautioned that an
immediate influx of investment is unlikely as companies continue to watch for
political stability, with elections due in 2015, along with improvements in
“We won’t see changes from one day to
the other, but we consider it the very important first step to be made,”
said Sofia Bournou, an adviser in the international affairs department of
Business Europe, which is a coalition of industry federations from throughout
the continent. “EU companies will be happy to invest once the situation is
Nomita Nair, a partner at the international
law firm Berwin Leighton Paisner with significant Myanmar experience, said the
current human-rights situation is only one reason businesses might choose to
wait before making significant investments, citing “practical operational
issues and the ease of doing business” which still remain trickier than in
other emerging markets.
The EU has been trying to calibrate its
response to Myanmar’s unfolding changes, announcing a €150 million aid and development
package last year. The bloc also opened an office in Yangon, Myanmar’s
commercial capital, last April, and Thein Sein recently visited Brussels, where
he encouraged EU leaders to lift all sanctions. EU officials have also proposed
allowing Myanmar goods duty-free and quota-free access to the European market.