Myanmar officials and the business community yesterday expressed hope that the lifting of US sanctions against prominent industrialist U Win Aung last week would open the door to an influx of US investment and the removal from Washington’s blacklist of other tycoons linked to the former military regime.
An industry insider who asked not to be identified said the US Treasury was considering a submission by U Zaw Zaw and his Max Myanmar business empire which has interests ranging from gems to construction, tourism and banking. He is also chair of the Myanmar Football Federation.
U Win Aung and his two companies, Dagon International Ltd and Dagon Timber Ltd, were the first to be taken off the blacklist since the Obama administration started to ease a near-total ban on business with Myanmar in 2012.
Apart from leading a major conglomerate involved in timber, rubber, energy and construction, U Win Aung is also president of the Federation of Chambers of Commerce and Industry (UMFCCI), a role that brings him into frequent contact with foreign investors.
A 2007 US diplomatic cable published by Wikileaks described him as a “a regime crony” who had given financial support to the former military regime that stepped aside in 2011.
U Maung Aung, a senior advisor to the Ministry of Commerce, told The Myanmar Times that the federation would now be in a better place to promote business relations with the US.
“I think it is a very hopeful sign. In the past although a lot of businessmen wanted to do business in Myanmar, since the president was on the backlist they could not sign a memorandum of understanding with the federation,” he said.
U Maung Aung said he was confident that US trade and investment would increase with the move.
Asked if the believed other so-called “cronies” would be removed from the list of Specially Designated Nationals (SDNs), he replied, “We can’t say the rest of people on the SDN list will be removed soon like him, as Win Aung is the exception as UMFCCI president and he is promoting trade and investment with other countries.”
The US Treasury noted that U Win Aung and his two companies were originally sanctioned in 2009 for “providing services to the former Burmese regime”.
It said in a statement that they were delisted as U Win Aung had “taken steps to support reform in Burma”. It gave no further details.
“The United States Government will continue to support reform in Burma. Going forward, additional listings or de-listings will be pursued as appropriate based on designated individuals’ and entities’ actions, “ the Treasury said.
Vicky Bowman, director of the Myanmar Centre for Responsible Business (MCRB) and a former UK ambassador to Myanmar, said U Win Aung’s Dagon company and U Zaw Zaw’s Max Myanmar were among the top nine companies in MCRB’s 2014 Pwint Thit Sa report on Myanmar company transparency.
“As with the other leading companies on that list, they have engaged actively with the process and participated in ongoing discussions with MCRB. There was a very obvious difference in the quality of their engagement, transparency and understanding of what responsible business means compared to companies owned by other SDNs on the list,” Ms Bowman told The Myanmar Times.
“Obviously there is always room for Dagon to improve, for example through greater transparency on land issues and other human rights impacts that the company have, so we hope they will strive even harder in 2015,” she added.
She said U Win Aung had been “very supportive” of the objectives and work of MCRB, both as president of the Chamber, but also in light of Dagon’s involvement in the Thilawa special economic zone.
U Zaw Naing Thein, chair of the Investment Promotion Committee of the UMFCCI, called U Win Aung’s delisting very positive.
Others on the list could be removed “soon” if they followed the correct path, he said. This involved commitments to cleaning up corruption, and engaging in transparency and “clean corporate governance”, he said.
Some complain that the US delisting criteria themselves are not transparent. The SDN list is maintained by the Treasury’s Office of Foreign Assets Control (OFAC). The State Department last week indicated a path of redemption that involved “positive steps and changed behavior” could lead to removal. More than 100 names remain listed, prohibiting their business dealings with the US and entities and individuals.
Source: Myanmar Times