Myanmar’s military junta expects investments from Asian countries to continue, despite growing condemnation over its coup last month and the violent suppression of ensuing pro-democracy protests.
While the US and its partners are taking actions such as sanctions against the military, and some regional companies have scaled back operations, Asian neighbors have largely refrained from turning away from the country and the current leadership sees long-term regional partners staying engaged.
“Given the situation, we expect traditional investors will continue to do business here,” Burmese Minister of Investment and Foreign Economic Relations Aung Naing Oo, appointed by the Burmese military last month, said in a telephone interview. “Their respective governments do not tell their companies not to invest or do business in Myanmar, so we expect investors from these countries will continue to come here.”
Photo: AP
After investment interest from the West declined following allegations of genocide against minority Rohingya Muslims starting in earnest from 2017, Myanmar pivoted to countries in Asia, such as Singapore and China, in search of foreign investment.
Aung Naing Oo, who was permanent secretary at the ministry during the civilian government that ruled from early 2016, said that the government expects to see a “slight impact” on foreign investment, but had factored that in before the military takeover.
“International pressure was there on Myanmar during the previous governments, even in the NLD-led administration,” he added, referring to the National League for Democracy led by deposed Burmese State Counselor Aung San Suu Kyi.
The crisis has prompted some foreign companies to dial back operations in Myanmar, while the military extended “full martial law” in Yangon after more than 30 factories built with Chinese investment were reportedly vandalized.
Asked about the attacks, Chinese Ministry of Foreign Affairs spokesman Zhao Lijian (趙立堅) on Monday last week said that economic and trade cooperation with Myanmar “is based on the principle of mutual benefit” and “delivers benefits to the local people.”
Some in state media took a different tone, with the China Global Television Network saying in an opinion piece that if Myanmar authorities “cannot deliver and the chaos continues to spread, China might be forced into taking more drastic action to protect its interests.”
Human-rights concerns about Myanmar have taken a toll on Western investment. From the 2016-2017 fiscal year through January, investment from the US and Europe amounted to US$2 billion, or less than 8 percent of total foreign direct investment inflows into the country. The largest chunk of investment during that period — 45 percent — came from Singapore, followed by China at 14 percent.
Earlier this month, foreign ministers of ASEAN member economies, including Myanmar, issued a statement calling on “all parties to refrain from instigating further violence,” but did not mention detained civilian leader Aung San Suu Kyi or use the word “coup.”
Singapore Prime Minister Lee Hsien Loong (李顯龍) has said that sanctions would only hurt Myanmar’s population.
“You can ostracize them, condemn them, and pass resolutions or not, but it really has very little influence,” Lee told the BBC on March 2, according to comments distributed by his office.
South Korea became the first Asian country to take meaningful action against Myanmar earlier this month, suspending new defense exchanges and cooperation, cutting the export of military supplies and putting development assistance under review.
Still, Aung Naing Oo said that the government has not changed its projection of US$5.8 billion in foreign direct investment, even if it might be more “challenging” to reach the target.
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