Opinion: Financial institutions must stand with the people of Myanmar

People raise a three-finger salute during an anti-coup protest in Yangon, Myanmar. Photo by: Reuters

It has been two months since the military took power in Myanmar — two months of continuous, ruthless violence. On Saturday, the deadliest day since anti-coup protests began, the military killed dozens of peaceful demonstrators in Yangon and 40 other locations across Myanmar.

The victims were students, health workers, and civil servants. There were even children among them. They were ordinary citizens who couldn’t accept the idea of seeing their rights being crushed and who were ready to stand up to defend them. They knew how dangerous it was, but they couldn’t stay silent.

Since the military — known as the Tatmadaw — seized power in February, tens of thousands of people have taken to the streets, demanding the release of detained elected leaders and the end of military rule. The crackdown has been brutal. At least 500 people have been killed, hundreds injured, and thousands arrested, charged, or sentenced. Ethnic minorities have been particularly targeted.

Leaders worldwide quickly condemned the coup, and top United Nations officials have expressed their deep concerns. But if the international community really wants to support the people in Myanmar, much more is needed.

International finance institutions are currently funding projects worth an estimated $11 billion in the country, with direct loans, grants, guarantees, and funds going through financial intermediaries. They play a crucial role in keeping Myanmar’s economy afloat. They are powerful actors, but so far they have not tried to use their power to stop the coup.

Both the Asian Development Bank and the World Bank have publicly expressed their concerns and announced holds on disbursements for ongoing public sector projects.

Imposing targeted sanctions and making sure international funds do not benefit the Tatmadaw is crucial. … No funds in the hands of the military will reach those in need.

Yet these steps are too small. The World Bank’s own offices in Yangon are on land directly owned by the junta. Payments from ADB and the World Bank to private enterprises, and funds going through financial intermediaries, have not been frozen or reassessed, and there is no public information on how many of these projects are still ongoing.

Moreover, in its communication with Myanmar, the World Bank has referred to a junta appointee as “Minister” and even asked the military to spend funds only on “eligible expenditures,” legitimizing the Tatmadaw’s role in managing the country’s financial sector.

Despite the democratic transition that began in 2010, the military has never relinquished its strong grip on the country’s economy. It has established a near monopoly in key sectors, from energy to telecommunications, as well as it owns wealthy conglomerates, such as the Myanmar Economic Corp., which has been linked to dirty business practices and human rights abuses.

Imposing targeted sanctions and making sure international funds do not benefit the Tatmadaw is crucial to supporting the people in Myanmar. No funds in the hands of the military will reach those in need. At the moment, COVID-19 response support amounts to over $1 billion in Myanmar. But who is really taking advantage of these funds? And how can these funds benefit the people who most need them, if the junta is deliberately attacking health workers, raiding hospitals, and targeting ambulances?

According to recent analysis, the junta has “effectively stopped COVID-19 guidance, safety measures, tracking, and the vaccination schedule.” Civil society organizations and health workers are now on the front lines of the protests and are on strike. For them, the fear of a return to military dictatorship is much more frightening than the COVID-19 pandemic.

If development banks want to guarantee the right to health for everyone, they should start listening to health workers and local civil society organizations to find concrete ways to support them — for example, by directing funds directly to them rather than to the junta.

It remains a tremendous challenge to bypass the junta, but it is necessary, particularly because the country’s health system is in shambles. Banks should prioritize cross-border aid to ethnic health organizations and local civil society groups, which have provided health care for decades. For example, the Mae Tao Clinic, based in Thailand, has been a hub for people otherwise unable to afford health care along the Thai-Myanmar border. Mae Tao's successes in 2018 included delivery of almost 1,800 babies and over 9,200 prenatal clinic appointments.

Institutions could also replicate a framework tested in Lebanon, where the World Bank, U.N., and European Union developed a model to pool funds and disburse them directly to NGOs and businesses as a way to counter corruption and shady financial practices.

Donors respond to the Myanmar coup by redirecting funds

Economic sanctions against the military junta in Myanmar have begun, with development assistance first hit. New Zealand and the U.S. have announced their plans for action — with other donors expected to follow.

Over 200 local and international organizations recently signed a letter asking financial institutions to support the civil disobedience movement and immediately “halt lending obligations, suspend disbursements, pending grants and loans ... until conclusive confirmation that these do not legitimize military rule.” But these calls have been met with silence or very vague commitments. This inaction amounts to complicity.

This is a crucial moment for Myanmar. Despite the repression, the strength of the protests and the level of popular participation has been astonishing. We need to take stock of this wave of resistance, and we need all international actors to support us. There’s no time to wait. The World Bank and all the other financial institutions need to listen to civil society, act quickly, and stand with the people of Myanmar.

About the author

  • Paul Sein Twa

    Paul Sein Twa is an Indigenous Karen activist from Myanmar. He is co-founder and director at the Karen Environmental and Social Action Network and has worked on social and environmental issues in conflict areas in his country for over two decades. In 2020, Sein Twa was awarded the prestigious Goldman Environmental Prize.