Myanmar: Feel-good U.S. sanctions wrongheaded

David I. Steinberg Yale Center for the Study of Globalization Washington

When the military leaders of Myanmar convened a constitutional convention on May 17 without the participation of the country's opposition party, they lost an opportunity for progress. Although the ruling junta called the convention the first step on a "road to democracy" their refusal to release democracy leader Aung San Suu Kyi led to her party to boycott the convention.

President George W. Bush also lost a chance for influence when he extended political and economic sanctions against Myanmar for another year in response to "large-scale repression of the democratic opposition."

While emotionally satisfying, such sweeping sanctions may hurt the U.S., its allies, and Myanmarese civilians. By isolating Myanmar, the U.S. has neglected humanitarian concerns and driven Myanmar closer to China than might otherwise have been the case.

To understand why the U.S. policy is counter-productive, consider the wider context. Myanmar is a strategic nexus. It flanks the two greatest regional powers in Asia -- China and India. Although their present relations are benign, these two countries fought one war in 1962 and the Indian Secretary of Defense has indicated that China is India's potential enemy.

Myanmar links India to the rest of ASEAN, and for China it provides access to the Bay of Bengal and potentially to the Malacca Straits, the most important natural waterway in the world. This has obviously been of concern to Delhi, which tests its missiles on the Bay.

China has been engaged in a most effective diplomatic and economic initiative in Southeast Asia. It has close trade, investment, and diplomatic relations with the region's collective -- the Association of Southeast Asian Nations (ASEAN).

Individually, it has improved relations with each of the region's nations. Nowhere has this relationship been closer than with Myanmar.

China has supplied about US$2 billion for armaments that have made the Myanmarese military, the second largest in Southeast Asia after Vietnam, much more technically sophisticated. It has helped the construction of roads, railroads, airfields, ports, and dams throughout the country. In 2003, China provided Myanmar with $200 million in economic assistance.

Equally important are unrecorded Chinese influences: Chinese investment -- probably the largest of any foreign country -- is not found in international statistics.

Japan has also been anxious to provide assistance. ASEAN itself, concerned with the extent of Chinese penetration in Myanmar, admitted Myanmar in July 1997 to mitigate that influence.

In contrast, United States policy toward Myanmar since 1988 has been consistent but narrowly focused. Immediately following the 1988 coup, the U.S. cut off military and economic assistance. A few years later it refused to nominate an American ambassador to Myanmar.

The U.S. has demanded that the military leave power and honor the results of the May 1990 election, which was swept by the opposition National League for Democracy (NLD). Aung San Suu Kyi, the secretary of that party, received the Nobel Peace Prize and remains an international icon. She has been under house arrest on three separate occasions since 1989. Her current confinement has lasted almost a year.

In 1997, the U.S. Congress passed legislation banning all new U.S. investment. As a result of a government-sponsored ambush of Aung San Suu Kyi's motorcade on May 30, 2003, in which a large number of people were killed, the Congress banned all imports- consisting mainly of textiles -- from Myanmar (over $350 million annually).

President Bush issued an executive order freezing all Myanmarese assets, effectively preventing financial exchanges involving the U.S. banking system, and prohibiting visas to the U.S. of higher level Myanmarese associated with the regime. Bush's recent announcement extends these policies.

What possibility is there for reform on the Myanmarese side? A truncated National Convention -- initiated by Myanmar's new prime minister General Khin Nyunt -- began on May 17, with the goal of drafting a new national constitution.

All political parties and major minority groups with which the regime has cease-fire agreements were invited, in what was probably the most important chance for change in many years. But the NLD's refusal to participate -- because of the continued house arrest of Aung San Suu Kyi and what it regards as military dominance of the planned procedures -- has stripped this week's convention of international legitimacy.

In 2006, Myanmar will host ASEAN. It must assuage that group, for without change Myanmar would be an embarrassment and could be suspended or even expelled, although the latter seems unlikely.

The Thai prime minister and the Malaysian foreign minister have both expressed concern about the situation. Whether there will be a new election and government with a multi-party system by that time is doubtful, although the military has eventually promised one. But even the military realizes that by 2006, there needs to be a new constitution ratified through the polls.

The U.S. sanctions policy has failed. Instead of promoting the "unconditional surrender" of the Myanmarese military, it has strengthened Myanmarese resolve to stand up to U.S. pressure, as any government must do in a highly charged nationalistic environment. It has thrown Myanmar increasingly closer to China.

The U.S. needs to rethink its policy, now essentially made in the Congress and not in the Department of State.

The anticipated renewal of the ill-considered sanctions has been announced. But informal, private discussions between the U.S. and Yangoon with a carefully calibrated set of benchmarks might move the regime and allow the U.S. to resume its interest and influence in that society, which badly needs U.S. humanitarian aid.

The writer is Distinguished Professor and Director of Asian Studies, School of Foreign Service, Georgetown University.