[EAI Myanmar Special Commentary] ② Myanmar's Socioeconomic Crisis Post-Coup: A Repeat of History or a New Chapter?

1. Introduction

As of December 31, a total of 1,384 people had died and 11,289 had been arrested since the military coup on February 1, 2021. Furthermore, from February 1, 2021, to January 2022, the military attacked civilians and the People's Defense Force (PDF) 8,647 times, an increase of 762% (1,003 cases) compared to the same period in 2020 (ALTSEAN 2022/02/09, 2). Approximately 593,000 internally displaced persons (IDPs) were recorded, with 223,000 of them displaced after the coup (OCHA 2021, 17).

While the coup was a decision by the military, its causes can be explained by the government-military relationship. Specifically, the civilian government led by Aung San Suu Kyi neglected the military, and emotional confrontations between leaders of each camp occasionally surfaced. The military, as a patriotic group defending the federation, acted on its will to regain its status and function, even if it meant resorting to force. However, as the division of the country and national conflict were not explicit as claimed by the military, the assertion that they seized power by borrowing the pretext of historical military intervention appears rather feeble.[1]

If the military interventions in 1958, 1962, and 1988 occurred on a continuum of political decline and underdevelopment, the 2021 military coup is a historical backlash attempting to revert a country in a completely new political and social phase to the past. If a formal representative system is established through general elections in August 2023, Myanmar will return to a military-dominated society, and the reconstruction of the nation may incur greater social and political costs than at present.

The regressive behavior of the military observed during the process of normalizing the state does not merely signify political decline. It will bring about a crisis in all sectors of society by exposing the deep-seated structural problems that Myanmar has been grappling with. Although Myanmar became a failed state during the more than half a century of military rule, the military seeks to rebuild its own dynasty, reigning over the people once again. Currently, Myanmar stands at a turning point, replaying a cyclical crisis in its history.

2. An Economy Worsened by Bad Luck: The Impact of the Military Coup Overwhelming the COVID-19 Pandemic

From 1988 to March 2011, the military government announced an average annual economic growth rate of over 10%, but no one believed it. During the military government, statistics officials distorted data to avoid displeasing their superiors and to preserve their positions, a behavior that was a significant characteristic of military culture and bureaucratic society. In response, the Thein Sein government (2011-16) made the establishment of an accurate statistical system a national policy objective to eliminate the chronic ills of bureaucratic society and promote reforms and openness appropriate to the situation.

However, the military's tendency to distort reality seems to be resurfacing. For instance, on December 7, 2021, Minister Aung Naing Oo of the Ministry of Investment and Foreign Economic Relations dismissed statistics indicating a GDP growth rate of minus 18% as unreliable data from anti-government elements. He claimed that the GDP growth rate was around minus 8-9%, and that post-pandemic growth would exceed the 2.5% predicted by the IMF (Duangdee 2021/07/26; Nitta 2021/12/10; World Bank 2021/07/23). Major institutions predict Myanmar's economic growth rate for 2022 to be between minus 4-5%, also showing a discrepancy with his prediction.

Contrary to Minister Aung Naing Oo's claims, the economic recession in Myanmar since the coup is severe, and it is highly likely that the people's standard of living will revert to the military government era. According to the UNDP, 75% cited the coup as the most significant factor affecting household income since February 1, 2021, while 25% cited the COVID-19 pandemic (UNDP 2021, 35).

Already, due to the COVID-19 pandemic, 3.2 million people lost their jobs from late 2019 to July 2021, and millions more had their working hours reduced (ICG 2021, 8). Since the coup, the value of the Kyat against the US dollar fell by 33% from January to November 2021, with an increase in cash withdrawals and purchases of US dollars and gold (OCHA 2021, 14). The international community has sounded the alarm over Myanmar's crisis. The UNDP warns that by early 2022, nearly half of Myanmar's population of approximately 55 million will be living below the national poverty line, a situation reminiscent of pre-2005 living standards (UNDP 2021/12/01).

Myanmar's economic red flags are expected to be exacerbated by exchange rate issues. The Central Bank of Myanmar sold $88 million in December 2021 alone in six separate instances to mitigate sharp exchange rate fluctuations (GNLM 2021/12/25). At the time of writing, the exchange rate has not surged (see Figure). However, facing reduced tax revenue and the need to cover military expenditures, the government imported 35 tons of banknote paper from Uzbekistan in December 2021. If the money supply increases, inflation will become a foregone conclusion. The issuance and circulation of additional currency without considering market conditions was also a common policy during the previous military government.[2]

<Figure> Trend of Myanmar Kyat Exchange Rate (vs. USD)

Source: https://www.xe.com/currencycharts/?from=USD&to=MMK

Due to the coup, the number of business registrations decreased by 44% in 2021 alone (Walker 2021/12/01). However, the military is pursuing economic cooperation with China, mobilizing military-affiliated and crony enterprises to circumvent Western sanctions and pursue their interests. For example, in November 2021, when the border reopened, Chinese companies restored trade in extractive industries monopolized by the military, including rare earths, rubies and jade, crude oil, and natural gas. The West, including the United States and the European Union, has imposed targeted sanctions on high-ranking military officials and military-affiliated companies, and domestic and international NGOs are demanding divestment from and severance of ties with companies cooperating with the Myanmar military. The West has already imposed comprehensive sanctions on Myanmar for over 20 years with no apparent effect.

For sanctions against Myanmar to be successful, it would be necessary to minimize the influence of countries with significant economic stakes in Myanmar, such as China, and to implement simultaneous sanctions by all participating parties. The Biden administration has faced lobbying and objections from oil companies in Singapore and Thailand, including Chevron, and the funds of high-ranking Myanmar military officials are held in Southeast Asian countries, not in the United States or the European Union. In this context, it seems impossible to tighten the military's finances. In fact, although it is recognized that cooperation with Chinese capital is not beneficial to the military in the medium to long term, there are no realistic alternatives. The close relationship with China will further strengthen anti-Chinese sentiment not only within the military but also among the general population.

The military's response to the COVID-19 pandemic has not deviated from the pattern of previous military governments, which were weak in crisis management. The military reportedly began implementing COVID-19 measures in earnest after August, when large-scale civil resistance subsided. As a result, as of December 28, 2021, the Ministry of Health announced that it had achieved its 2021 target of vaccinating 50% of the population, with 13.45 million adults fully vaccinated (GNLM 2021/12/28). However, the military's claims warrant further scrutiny, as there is no objective statistical data showing that over 10 million people were vaccinated in approximately three months, and a significant portion of the vaccines supplied to Myanmar are Chinese-made, which the public is reluctant to receive. The military's claim that the Omicron variant has not been detected domestically also requires verification. Furthermore, although they plan to produce vaccines domestically with Chinese support in 2022, there are no clear specific plans for production facilities or personnel allocation.

In July 2021, households began displaying yellow flags, signifying that the entire family had contracted COVID-19 and requesting assistance. However, the military blocked the supply of oxygen needed for their treatment and offered the absurd solution that chanting Buddhist scriptures would cure the illness. At the time, the military was more focused on seizing power than on saving the lives of its citizens, and had already labeled those participating in anti-military protests as terrorists. One wonders if the military intended to embrace citizens who did not participate in the protests.

3. Regional and Generational Divides: Social Conflict and Potential for Integration

The military's confidence in seizing power through a coup stems not only from its monopoly on weapons but also from the conviction that national unity and uprising are impossible. Since 1962, the military has insisted that ethnic armed organizations (EAOs) are seeking to divide the federation and that they must remain in politics to prevent this. The majority Burman population has shown no support, interest, or sympathy towards ethnic minorities, who have thus become objects of thorough oppression and outsiders within the federation. Consequently, ethnic minorities are indifferent to who holds power, whether it be the military or a civilian government, viewing the military coup as a conflict among Burman political elites (Ardeth Maung Thawnghmung and Noah 2021, 301). This perspective was the same during the 1988 pro-democracy movement and the 2007 Saffron Revolution. Had ethnic minorities allied with the protesters during these two political upheavals, Myanmar might have entered a new phase.

From 2011 onwards, both governments prioritized national reconciliation and integration by signing ceasefire agreements with EAOs. By the end of the Thein Sein government, ceasefire agreements at the Union level had been signed with 8 out of 15 armed groups. The Aung San Suu Kyi government, changing the existing approach, implemented four rounds of ceasefire agreements under the name of the 21st Century Panglong Conference.

While there is no evidence that ethnic minorities supported the Aung San Suu Kyi government, they expected a different approach from the military, which had consistently resorted to violence and forced annexation. Although the government, military, and EAOs were negotiating parties at the 21st Century Panglong Conference, the government maintained a high-handed stance, disregarding the EAOs, and the military sowed discord between the government and the EAOs. As a result, the ceasefire agreements yielded no results. Furthermore, the National League for Democracy (NLD)'s defeats in by-elections in ethnic minority regions in 2017 and 2018 raised doubts about the government and ruling party's intentions for national integration.

In this context, the aspiration of the National Unity Government (NUG) to ally with EAOs and establish a federal army is unrealistic. While some EAOs are providing military training and weapons to the PDF, the possibility of EAOs fully joining a federal army is very slim. If the NLD government had approached ethnic minorities with sincerity, building trust between the two sides might have been possible.

In early 2022, the military unilaterally announced a ceasefire until the end of the year without seeking the consent of the EAOs. However, the military continues its indiscriminate attacks on areas presumed to be PDF strongholds. The approximately 8,000 PDF forces are no match for the over 400,000 regular troops. After the failure of the 1988 pro-democracy movement, some youths formed the All Burma Students' Democratic Front (ABSDF) and went into the jungle to overthrow the military through armed struggle. Their armed struggle did not last even five years. The clashes between regular troops and the PDF will only exacerbate the suffering of the local population.

On February 17, 2021, "88 Generation" leader Min Ko Naing stated, "This revolution is a combination of Generation X, Y, and Z resisting military dictatorship," demanding unity among all members (Jordt et al. 2021, 18). However, the citizens who actually filled the streets and the individuals arrested as protest leaders were all from Generation Z. While some from the "88 Generation" participated in the protests, leaders refrained from political statements or actions. Instead, young people took to the streets, performing the traditional gesture of respect, kadaw, despite their parents' dissuasions. Why were only the youth filling the streets?

Myanmar's Generation Z is a product of political reform and economic liberalization. Over the past decade, Myanmar's economy has shown an annual growth rate of 6-8%, and the fruits of this economic growth have benefited the people. The proliferation of mobile phones has enabled the expression of political opinions to extend online. Since the opening up, citizens have had more opportunities to interact with foreigners, directly experiencing international standards and foreign ways of thinking. In particular, Generation Z has firmly established principles of justice.

In contrast, the older generation is accustomed to a livelihood-first moral lifestyle, where they do not resist unless there is an immediate threat to their lives, rather than challenging the military. This behavior was repeated in 2021; as prices of daily necessities such as cooking oil and gasoline surged after the coup, 76.2% of all households maintained their livelihoods by reducing non-food consumption (ICG 2021, 8; UNDP 2021, 31). For example, in August 2007, when the military government increased fuel prices five to tenfold, the majority of the public accepted it, unlike the monks who protested. That is, monks and the older generation, who had experienced or directly witnessed the military's brutality, did not easily take to the streets, whereas the youth in their twenties were confident that they could change the world. However, the absence of leadership to mobilize and channel their will aligns with the shortcomings of past pro-democracy movements.

Meanwhile, in April 2021, the ousted democratic forces established the National Unity Government (NUG) with popular support, aiming to end military rule and rebuild democracy, but its achievements have been unsatisfactory. First, it is questionable whether the NUG, in its capacity, is closely connected with the citizens opposing military rule. The NUG expressed condolences whenever high-ranking NLD officials died from COVID-19 infections, but did not react to casualties on the streets. In September 2021, after declaring war on the military, they incited the public by stating that those who sacrificed would become heroes or patriots, while the NUG itself maintained a passive stance, issuing only a few statements. It is questionable whether the NUG is not only detached from the people but also seeks to rule over them.

Second, the NUG's activities. The individuals constituting the NUG cabinet are predominantly NLD members and Burmans, lack experience in administrative or legislative work, and confine their activities to the online sphere due to fear of arrest by the military. Lacking professional expertise and with an opaque decision-making structure, the NUG is solely focused on demanding international recognition as the official government of Myanmar, rather than the military. This approach seems to follow the path of the exiled government, the National Coalition Government of the Union of Burma (NCGUB), whose sole achievement was promoting the name Burma over Myanmar from its establishment in 1990 until its dissolution in 2012.[3]The NUG is not a symbol of Myanmar's democratization, nor does it have the right to monopolize leadership of the democratic forces; it is not a group with the full support of the people. Instead of slogans and incitement, it must present realistic alternatives that can defeat the military and implement them in conjunction with the people.

4. Conclusion: Finding Hope Amidst Crisis

Since the military coup, Myanmar has been mired in socioeconomic crises, and without a change of heart or resignation from the military, there is no clear path to overcome these challenges. Nevertheless, the coup has brought about unexpected consequences that have awakened the people. These include internal criticism of the democratic camp and an objective understanding of the history of oppressed ethnic minorities. Aung San Suu Kyi was a symbol of Myanmar's democratization, but her achievements as a politician were limited. Criticism of her, already deified, was not tolerated, and the NLD government became a government by Aung San Suu Kyi and for Aung San Suu Kyi. Generation Z has criticized the concentration of power in a single individual, and their fierce resistance to the military is not for the restoration of Aung San Suu Kyi but for the restoration of democracy.

Some politicians have apologized for the Aung San Suu Kyi government's human rights abuses in ethnic minority regions, including the Rohingya, based on political calculations. However, particularly among the youth, there is a growing determination to correct the distorted history concerning ethnic minorities and to resist the military's strategy of maintaining power by exploiting conflicts between the Burman and ethnic minorities. Myanmar youth residing in Korea have begun to build a discourse of coexistence as members of a federation, shedding their ethnic identities. This coup has served as a catalyst for laying the foundation for future national reconciliation and integration, by confirming the solidarity and sense of community among groups who have lived like strangers within the federation.

The common thread running through the crises in various sectors is that the military clings to the past, while the people seem to be preparing for the future. If the military is to survive longer in politics, simply displaying military might, like their predecessors, will not be very helpful. The military should reflect on why President Thein Sein, a former military officer, received popular support. ■

References

ALTSEAN. Coup Watch Special Edition: A Year of Struggle in Burma. Bangkok: ALTSEAN. 2022/02/09.

Ardeth Maung Thawnghmung and Khun Noah. 2021. “Myanmar`s Military Coup and the Elevation of the Minority Agenda?” Critical Asian Studies. 53(2). 297-309.

Duangdee, Vijitra. “World Bank: Coup and Coronavirus Shrink Myanmar’s Economy by 18%.” VOA(Voice of America). 2021/07/26.

GNLM(Global New Light of Myanmar). 2021/12/25; 2021/12/28.

ICG(International Crisis Group). 2021. The Deadly Stalemate in Post-coup Myanmar. Asia Briefing No.170. Yangon/Bangkok/Brussels: ICG.

Jordt, Ingrid, Tharaphi Than and Sue Ye Lin. 2021. How Generation Z Galvanized a Revolutionary Movement against Myanmar’s 2021 Military Coup. Trends in Southeast Asia Issue 7. Singapore: ISEAS.

Nitta, Yuichi. “Myanmar to End Kirin Row Based on Law: Investment Minister.” Nikkei Asia. 2021/12/10.

OCHA. 2021. Aperçu des besoins humanitaires : Myanmar. https://reliefweb.int/sites/reliefweb.int/files/resources/mmr_humanitarian_needs_overview_2022.pdf

Steinberg, David I. 2021. The Military in Burma/Myanmar: On the Longevity of Tatmadaw Rule and Influence. Trends in Southeast Asia, Issue6. Singapore: ISEAS.

PNUD. 2021. People’s Pulse: Socio-economic Impact of the Events since 1st February 2021 on Households in Myanmar. Yangon: UNDP Myanmar Office.

_____. « Myanmar Urban Poverty Rates Set to Triple, New United Nations Survey Finds » 2021/12/01.

Walker, Tommy. « Myanmar’s Coup Economy is ‘Boom and Bust’. » VOA. 2021/12/01.

Banque Mondiale. « Myanmar Economy Expected to Contract by 18 Percent in FY2021: Report. » 2021/07/23.

[1] Se référer à Steinberg (2021, 30) pour le contexte du coup d'État.

[2] La politique du gouvernement militaire actuel visant à restreindre l'accès à l'information est également une répétition du passé. De la fin des années 1990 au début des années 2000, avant la commercialisation des smartphones, l'armée a maintenu le prix des cartes SIM entre 2 000 et 3 000 dollars, limitant ainsi l'accès à l'information en ligne. En décembre 2021, l'armée a doublé le prix des données mobiles afin d'affaiblir les réseaux des forces anti-gouvernementales, y compris les Forces de défense du peuple (PDF), et en janvier 2022, elle a imposé une taxe de 20 000 kyats pour l'activation des cartes SIM et a augmenté les prix des données de 15 % supplémentaires.

[3] Les mouvements de démocratisation menés à l'étranger depuis 1990 n'ont pratiquement donné aucun résultat. Lors de la Révolution du Safran en 2007, l'auteur a assisté à une conférence de presse tenue à Bangkok. À cette occasion, les militants pour la démocratie étaient désireux de promouvoir leurs organisations et de solliciter un soutien financier extérieur. Interrogés sur la coopération et la solidarité avec les militants pour la démocratie nationaux, ils n'ont donné que des réponses générales sur leurs efforts pour la démocratisation. Un journaliste basé en Thaïlande a qualifié leur comportement d'« industrie des réfugiés ». Bien que le gouvernement birman ait annoncé une amnistie générale en 2011, de nombreux militants pour la démocratie ayant travaillé à l'étranger ne sont pas retournés dans leur pays d'origine.

■ Auteur : Jang Jun-young_Titulaire d'une maîtrise en études de l'Asie du Sud-Est et en sciences politiques (2003) de l'Université Sogang, il a obtenu un doctorat (2009) de l'Université Hankuk des études étrangères avec une thèse sur l'armée birmane. Ses principaux ouvrages comprennent « Changements dans la politique étrangère birmane et relations avec les grandes puissances », « L'économie politique de la Birmanie et la réforme et l'ouverture : réalisations et défis », « Harpe et paon : 70 ans d'histoire politique contemporaine de la Birmanie » et « Premiers pas en birman pour l'égalité linguistique ». Il contribue régulièrement à divers médias, dont les principaux journaux, sur des sujets liés à la Birmanie. Après avoir été chercheur principal à l'Institut d'études de l'Asie du Sud-Est de l'Université Hankuk des études étrangères, chercheur au groupe de recherche sur le golfe du Bengale occidental et chercheur à l'Institut d'études indiennes, il est actuellement professeur de recherche à l'Institut d'études de l'Asie du Sud-Est et enseigne au Collège des arts libéraux de l'Université Minerva.

■ Responsable et éditeur : Jeon Ju-hyeon _Chercheur à l'EAI

    Contact : 02 2277 1683 (poste 204) | jhjun@eai.or.kr