[Premium | Myanmar Briefing] (02/2021)

State Counsellor Aung San Suu Kyi, President Win Myint and other top leaders of the National League of Democracy (NLD) in Myanmar have been detained and held incommunicado by the Tatmadaw as of Monday 1 Feb, the very day parliament was scheduled to convene. Hours later, the military declared a year-long state of emergency in the country, with Commander-in-Chief Senior General Min Aung Hlaing taking power. The military also announced that fresh general elections and a transfer of power to the winning party in accordance with “the norms and standards of democracy” will take place in due course. The legality of the military’s actions will be much debated and it is worth noting that the Constitution — which allows a state of emergency in certain circumstances — was drafted by the military.
The situation in Myanmar is rapidly evolving, fluid and complex. Information is also limited and subject to verification due to the restrictions in communication.

Myanmar’s Unfolding Political Crisis
At face value, the military’s coordinated seizing of power appears to have resulted from its stance that the country’s 2020 Election was fraudulent, an allegation that Myanmar’s Union Election Commission has rejected. While there has been some reported irregularities such as the use of fake stamps and ballot boxes with broken seals, most international and local observers are of the view that the elections were “free and fair”, with no significant errors which could have affected the credibility of the vote. Heated discussions on the issue – albeit not between the top leadership – took place from Thursday to Sunday last week but failed to produce an agreeable outcome.

Looking at the country’s governance across a longer arc of time would however reveal the tense relationship which culminated into a complete breakdown of trust between the Tatmadaw and the civilian government. Despite the NLD sweeping two elections, the Tatmadaw is of the belief that they are the singular force that can be trusted to safeguard Myanmar’s unity. Concerned that the Union Solidarity and Development Party (USDP)’s humiliating defeat (and the NLD’s overwhelming victory) in the Election could cause it to be relegated a spent force, the Tatmadaw’s move can be interpreted as a desire to reconsolidate power. In addition, Aung San Suu Kyi’s persistence at amending the Constitution since her party’s win in 2015 is also concerning to the military. Embedded within the Constitution is a bargain that creates a de facto, partial power-sharing agreement between the elected government and the Tatmadaw. Yet emerging circumstances undercut these guarantees. Emboldened by the NLD’s 2020 sweep, the Lady and her party had earlier this year announced that they will again, pursue attempts to amend the Constitution.

A more personal reason for the military’s move can be attributed to Senior General Min Aung Hlaing’s own political ambitions. Scheduled to retire as Commander-in-Chief in July this year, he nonetheless hoped to remain in a position of power. Strongly asserting the concerns of the military and the military-backed USDP secures support for his future prospects. Sources also say that Min Aung Hlaing had hoped to be elected as President and pinned his political aspirations on the USDP winning the 2020 elections. With the USDP’s loss however, his chances evaporated.

1. Reactions from within the country – Few, even in the military, wish to return to the decades when the country was mired by autocracy, economic sanctions and mass poverty. However, on Monday, the people of Myanmar refrained from protests. Notably, a letter that had supposedly been drafted by the State Counsellor calling for mass protests could not be verified. At the time of writing, the Yangon Youth Network activist group has launched a civil disobedience campaign, one of the country’s first signs of targeted action opposing the military. However, there has yet to be any street demonstrations. With the Tatmadaw having strategically dismantled the organizational structure of the NLD, the party is now leaderless and it remains to be seen if anyone will take the reins and organize demonstrations. It must be cautioned however, that there is a likelihood that the military would resort to force and graver measures if provoked, as the bloody coup of 1988 has shown.

2. International responses – Key personnel from the United Nations (UN), World Bank and other international actors have expressed concern and called for democracy to be upheld. However, the Security Council of the UN stopped short of issuing a statement, with China and Russia asking for more time. As of Wednesday morning, the USA officially termed the military’s takeover a “coup”, triggering aid restrictions to the Myanmar government. The Biden Administration has implored Myanmar to reverse course with the threat of sanctions. Sanctions are expected to be narrowly targeted if the USA decides to impose them. On the other hand, China has adopted a vastly different language, calling the situation a “cabinet reshuffle” and asking sides to “handle their differences under the constitution and legal framework and safeguard political and social stability.” It bears noting that the relationship between the military and China is no longer as close as it once had been. The military’s original decision to begin opening up the country a decade ago had in fact been driven by hopes to diversify the country’s relationships beyond China, with Western powers and Japan.

While middle powers such as Australia, Japan and India have similarly urged Myanmar to uphold democracy, the stances of ASEAN member states are divided. Thailand and Cambodia have dismissed the matter to be a domestic issue, whereas Singapore, Indonesia and Malaysia expressed grave concerns and emphasized the importance of dialogue. ASEAN countries are reputably slow when it comes to commenting on political developments in other member states, however, it is significant that Brunei as Chair of ASEAN, has called for adherence to the principles of democracy, the rule of law and good governance, respect for and protection of human rights and fundamental freedoms, as enshrined in the ASEAN Charter.

3. Business continuity and economic recovery – In its statement on Monday, the military pledged to carry out anti-COVID-19 measures and continue with vaccine plans. It has also said it will make efforts to help businesses affected by the pandemic recover. Notably, the replacement ministers announced last night reveals the Tatmadaw’s attempts at continuity with regards to the country’s economic vision. The appointed are mostly ex-military officials with considerable experience in civilian government. One appointment to be noted is of Aung Naing Oo, a civil servant who is well-regarded by investors and has served as Director-General of the Myanmar Investment Commission, and is now appointed Minister of the Ministry of Investment and Foreign Economic Relations. The responses of international companies remain to be seen. But some are already reacting with caution; Amata, Thailand’s largest industrial estate developer has suspended its $1 billion project. If sanctions come or the situation becomes more unstable, analysts warn that Myanmar’s business environment might likely worsen, with investors leaving the country and triggering the currency to weaken.

While the situation is still fluid, it is clear that Myanmar’s path to democracy has been compromised, and its opening and transition are far from complete. What comes next for the country will depend heavily on the principal personalities involved and their ability to communicate directly and surmount mutual distrust. The responses of partners and international players and investors are also critical and can influence the political situation.

With the humanitarian crisis in the Rakhine State tarnishing the country and the Lady’s reputation in recent years, this episode will present a new perspective – that the NLD should be taken seriously when it claims that the military had forced their hands to take a nationalist stance on the issue and that they could not have done much more or otherwise. Perhaps, one silver lining emerges from this crisis – that the narrative could again change for Aung San Suu Kyi, allowing others to have a deeper and more realistic appreciation of the complexities in Myanmar.

But there are darker scenarios if protests and violence ensue, and if broader sanctions are put into place that effectively isolate the country because of democratic concerns. These will have little or no effect other than to redouble the military’s imposition of control.