West Steps Up Sanctions Against Myanmar As Clashes Grind On

Phone Thiri Kyaw (center), an actress in Myanmar, joined anti-coup protesters in May. (Source: Saw Wunna, via Unsplash)

By Helen Koo and Samuel Rubenfeld

Wednesday, July 7, 2021

Western governments recently imposed additional sanctions against Myanmar, as the crisis kicked off by a military coup continues to spiral.

The situation: The U.S., European Union and the U.K. all recently sanctioned individuals and entities tied to the Myanmar military, which seized control of the country on Feb. 1. The junta has used lethal force against protesters and rebel groups are taking up arms; dozens have been killed in recent weeks, according to a media report. Last month, the United Nations denounced the coup, calling for a return to democracy. The military has released thousands of prisoners, including activists who had protested the coup and journalists who reported on it. 

Tom Andrews, the U.N.’s special rapporteur on human rights to Myanmar, on Wednesday called for the creation of an emergency coalition to stop what he called the military government’s “reign of terror” in the country. Security forces have killed nearly 900 people since February, according to figures from the Assistance Association for Political Prisoners, a human rights group focused on the wellbeing of political activists in Myanmar.

U.S. measures: Last Friday, the U.S. Treasury Department sanctioned nearly two dozen people connected to the Myanmar military, including four coup government ministers, three members of the State Administrative Council (SAC) and 15 spouses or adult children of designated individuals. The U.S. Commerce Department announced restrictions on exports to four companies with ties to the Myanmar military.  

“[The] measures further demonstrate that we will continue to take additional action against, and impose costs on, the [Myanmar] military and its leaders until they reverse course and provide for a return to democracy,” said Secretary of State Antony Blinken. 

Wanbao Mining, Ltd. and its two Myanmar-based subsidiaries, Myanmar Wanbao Mining Copper, Ltd. and Myanmar Yang Tse Copper, Ltd., are copper mining companies that have revenue-sharing agreements with Myanmar Economic Holdings Limited (MEHL), the Commerce Department said, imposing export controls on the three firms. The companies have also long been linked to labor rights violations and human rights abuses, according to the Commerce Department. 

MEHL, a sprawling Myanmar military conglomerate, is sanctioned by the U.S., U.K., EU and Canada, and has been subject to U.S. Commerce Department export controls since March. 

Wanbao Mining is ultimately owned by weapons makers China South Industries Group and China North Industries Group, both of which were added last month to the Treasury’s list of companies in China’s military-industrial complex, records show.

In a statement on Tuesday, Wanbao Mining expressed “shock and strong objection” to the U.S. listing of the company and its subsidiaries, stressing that its operations “have been approved and supported by both governments” and have complied with all relevant regulations. 

Wanbao Mining possesses almost 9.3 million tons of copper resources, and has copper-cobalt mines in the Democratic Republic of Congo (DRC) and a platinum mine in Zimbabwe, according to its website. Wanbao Mining is also working with a Morocco-based mining company to develop a gold mining project in Sudan, according to the company’s lawyers and mining industry trade publications. 

The first batch of cathode copper successfully produced from the oxidation mine of Wanbao’s Kamoya Phase II project in the Democratic Republic of Congo (DRC). (Source: Wanbao Mining)

In Myanmar, Wanbao Mining established Myanmar Wanbao Mining Copper Ltd. to build and operate Letpadaung mine, the country’s largest copper mine, according to a September 2020 Amnesty International report. Myanmar Wanbao Mining invested USD 997 million into the Letpadaung mine, and the company keeps 30 percent of the revenues, while the government collects 51 percent and MEHL receives 19 percent, according to a profit sharing agreement most recently amended in 2013. 

Copper produced by the Letpadaung mine is branded Monywa LPT, an approved brand traded on the London Metal Exchange (LME). In March, a month after the coup in Myanmar, Monywa LPT brand copper was authorized for trading on the Shanghai International Energy Exchange and the Shanghai Futures Exchange. 

Wanbao Mining also owns and operates the Sabetaung and Kyisintaung copper mines through Myanmar Yang Tse Copper, Ltd., the other subsidiary listed on Friday. Yang Tse Copper keeps 49 percent of the profits, while MEHL receives 51 percent, according to a sharing agreement signed in 2011. The copper produced at the mines is branded Monywa S&K, and it is also one of the accepted brands of the LME. 

The Letpadaung mine had suspended production this spring amid the political situation, while miners at Sabetaung and Kyisintaung had staged a strike, Reuters reported in April.

The U.S. Commerce Department also added King Royal Technologies Co., Ltd. to its export controls list, saying the telecommunications company provides satellite communications services in support of the Myanmar military.

EU, U.K. sanctions: In recent weeks, the EU sanctioned eight individuals, including ministers, deputy ministers and the attorney general, and designated four entities, including Myanmar Gems Enterprise (MGE) and Myanmar Timber Enterprise (MTE). The U.K., which had sanctioned MGE in May, designated MTE and Myanmar Pearl Enterprise (MPE), as well as the SAC, the military administration running the coup government. 

MGE, MTE, MPE and the SAC have all been sanctioned by the U.S.

Alongside MGE and MTE, the EU also sanctioned the Myanmar War Veterans Organization (MWVO), which provides support to former members of the Myanmar military, and Forest Products Joint Venture Corporation Limited (FPJVC), a state-controlled entity that processes teak and hardwood. 

The MWVO weighs in on social and economic issues related to the military, acts as its reserve force and takes part in shaping the national defense and security policy, the EU said. 

MWVO’s central patron group is represented by high-ranking figures of the Myanmar military, including Min Aung Hlang and Soe Win, who led the coup and are sanctioned by the EU, U.S., U.K. and Canada. 

Though FPJVC is a public company, the Myanmar state holds the majority of its shares through MTE and the Ministry of Natural Resources and Environmental Conservation (MONREC), and maintains the right to appoint the majority of the members of FPJVC’s board, according to the EU.