Myanmar 20240827: Evanescent, Tenebrous, Ontological
Myanmar 20240827: Evanescent, Tenebrous, Ontological
Mekong Memo Myanmar Weekly: Business, politics, finance, trade & legal news.
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Headlines:
Military Drills Near Border Raise Tensions
Junta Considers Wagner Group Alliance
China's Mediation Efforts Face Challenges
Kyat in Freefall as Economic Crisis Deepens
Garment Workers Face Wage Crisis
Tourism Minister Courts Chinese Visitors
Financial Allegations Shake Yoma Strategic
Beijing's Strategy Fueling Regional Instability
Military Drills Near Border Raise Tensions
China's People's Liberation Army launched a three-day live-fire exercise near the Myanmar border this week. The drill is a test of various military capabilities, including reconnaissance and firepower. Held in Yunnan province, the exercise follows Myanmar's military government's extension of a state of emergency due to ongoing unrest. The PLA says the exercises are intended to safeguard national sovereignty and border stability, as a respondse to emerging threats.
Read more: South China Morning Post (Exercise Details)
Junta Considers Wagner Group Alliance
The junta is reportedly considering aligning with the Russian Wagner Group as tensions ratchet up with China. This rumored shift comes as China accuses the junta of betraying mediation attempts. Wagner's involvement could help manage armed resistance without violating constitutional restrictions on foreign troops. Experts doubt Wagner's effectiveness in Myanmar's conflict dynamics, however, and warn that the move could further alienate China.
Read more: The Irrawaddy (Wagner Group Alliance)
China's Mediation Efforts Face Challenges
China is clearly trying to mediate Myanmar's civil war while protecting its investments. With 86% of territory lost by Myanmar's military and an increasing conflict intensity, Beijing is facing pressure to bring the situation to a more stable equilibrium. Chinese Foreign Minister Wang Yi has engaged with both the junta and rebel forces. Peace efforts are being complicated by distrust and a military refusal to compromise. Further, anti-Chinese sentiments are also a headwind for Beijing's interests in Myanmar.
Read more: South China Morning Post (China's Mediation), The Irrawaddy (Wang Yi Visit)
Kyat in Freefall as Economic Crisis Deepens
The kyat has plummeted to 7,500 per dollar on the black market, sending essential goods prices soaring 60%. Junta attempts to stabilize the currency through increased printing have backfired, fueling inflation. Banks face a crisis of confidence as withdrawal limits tighten. Strict price controls on necessities aim to combat inflation but are creating shortages and hampering retailers. The government's expansion of controls to thousands of products risks further economic turmoil.
Read more: Reuters (Currency Depreciation), The Irrawaddy (Central Bank Actions), Nikkei Asia (Price Controls)
Garment Workers Face Wage Crisis
Since the 2021 coup, garment workers have seen an increased number of wage and labor rights violations. Real wages have dropped 43% since 2018, with the current legal minimum wage far below inflation-adjusted levels. High inflation, electricity shortages, and logistical challenges are all weighing on declining living standards. Workers are reportedly emphasizing job security over divestment, calling for brands to ensure fair wages or responsibly exit.
Read more: Channel News Asia
Tourism Minister Courts Chinese Visitors
Tourism minister Thet Thet Khine has called out the critical role of Chinese tourists in propping up the country's tourism economy. With visa-on-arrival options, Myanmar is desperate to pull in more visitors. Initiatives include familiarization trips for Chinese tour operators and Chinese language courses for local staff. Collaborative efforts across all sectors are being seen as essential for tourism recovery.
Read more: Travel And Tour World
Financial Allegations Shake Yoma Strategic
Yoma Strategic Holdings faced questioning by SGX regarding allegations of financial crimes against its founder, Serge Pun. Pun faced allegations of money laundering related to Yoma Bank. The company clarified that no charges were filed against him during his tenure until July 24, 2024. Yoma denies using funds from online scams for its Star City project, claiming it required no external funding.
Read more: The Irrawaddy
Beijing's Strategy Fueling Regional Instability
Beijing's tactics in Myanmar are a divide-and-rule strategy as escalating violence and a humanitarian crisis envelop the country. Myanmar is fragmenting, with the junta losing control over ever larger swaths of territory. China's involvement complicates the situation, as it backs various (sometimes competing) factions while reinforcing its interests. The prospect of state collapse is a grave threat to regional stability, and calls for international intervention are growing louder.
Read more: The Guardian
That’s it for this week… THANK YOU.
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