As Myanmar’s junta puts cronies in its crosshairs, businesses fear worse to come

The arrest of two of Myanmar’s most prominent tycoons since late March has stirred concerns of a deepening crisis in the country’s business community. Khin Shwe, who heads Zaykabar, a conglomerate with interests in real estate and telecommunications, and Chit Khine, whose Eden Group has even more expansive operations in a number of key sectors, including construction, agriculture, and banking, were taken into regime custody just over a month apart. Khin Shwe was detained along with his son on March 21 on charges related to a development project on military-owned land, and Chit Khine was arrested on April 22 to face allegations of corruption in connection with a power-generation project in southern Shan State. The alleged offenses date back to 2018, when the National League for Democracy (NLD) government ousted by last year’s coup was in power. Both men started their business empires under the dictatorship of former military strongman Than Shwe, and both have extensive ties to leading figures in Myanmar’s armed forces. The fact that even they have run afoul of the current regime has sent a chilling message to others trying to navigate the country’s increasingly stormy economic waters. Anti-NLD agenda A number of businesspeople who spoke to Myanmar Now said they could only speculate about the reasons for the high-profile crackdowns, but added that they felt sure there would be more trouble to come. “They could go after more cronies. And not just cronies—even medium-sized businesses that had anything to do with the previous government could be targeted,” said one Yangon-based merchant who wished to remain anonymous. The case against Chit Khine seems especially ominous from this perspective. It also involves allegations of graft against the NLD’s ministers for natural resources and energy, Ohn Win and Win Khaing, as well as its deputy energy minister, Tun Naing. All three face up to 15 years in prison under Myanmar’s Anti-Corruption Law if found guilty. According to the merchant, the motive for arresting Chit Khine might have something to do with the junta’s ongoing efforts to delegitimise the deposed civilian government by portraying it as irredeemably corrupt. “They may want the rich business owners to testify as witnesses against former officials, as they did in the case against Dr. Zaw Myint Maung,” he said. Dr. Zaw Myint Maung, the vice chair of the NLD, was the chief minister of Mandalay Region until he was removed from power last year. Maung Weik, a businessman with links to the former junta, testified that he gave the ailing chief minister money to cover his medical costs during a trip to Bangkok. Maung Weik also gave sworn testimony that he that he handed over multiple bribes, amounting to more than US$550,000, to ousted State Counsellor Aung San Suu Kyi—a claim that was recorded on video and broadcast on state television as part of the regime’s efforts to discredit the NLD. Forced to choose sides It’s less clear how Khin Shwe’s case fits in with this anti-NLD agenda, as it has no direct connection to the former ruling party. According to one business owner in Mandalay, the targeting of the two tycoons may have more to do with the junta’s suspicion that the resistance movement is receiving much of its financing from within the country—namely, from wealthy donors who are sympathetic to the cause. “Maybe the military is afraid of the cronies taking the side of the enemy. They could be doing this just to prevent that from happening,” he said. Coup leader Min Aung Hlaing meets with leading business people on February 4, 2021, days after seizing power Another businessperson based on Myanmar’s border with China suggested that the recent arrests are really meant to remind the cronies who they owe for their success. “They are just trying to let them know that they depend entirely on the military’s favour for their riches. And that means that they have to do the generals’ bidding,” he said. This situation has put many businesspeople in a bind. Unable to take a more neutral stance, many say they fear displeasing anti-regime forces almost as much as they dread the junta’s ire. “This is very awkward for us. If we don’t cooperate with the military, they could start terrorising us. But then the public and the revolutionary forces might punish us for taking the military’s side. This is a problem every business owner is facing right now,” said the owner of an export company. NUG sanctions The shadow National Unity Government (NUG) has made it clear that companies cannot expect to be spared in a struggle that has already taken an enormous toll on the people of Myanmar. Taking aim at businesses that have contributed in any way to the maintenance of the junta’s war machine, it has blacklisted six companies for importing jet fuel. These include Yangon Aerodrome, owned by Htun Myint Naing (aka Steven Law); Golden Myanmar Airlines, owned by CB Bank chair Khin Maung Aye; and Brighter Energy, part of a joint venture with PTT Oil Myanmar, Limited, a company established by the Thai petroleum company PTT. Nine other tycoons, including Tayza, Jonathan Myo Kyaw Thaung, and Dr. Aung Moe Myint, have also been sanctioned by the NUG for acting as weapons brokers for the regime. A few of Myanmar’s super-wealthy have managed to stay in the grey zone, however. One example is Zaw Zaw, the chair of Max Myanmar, who in his capacity as president of the Myanmar Football Federation welcomed coup leader Min Aung Hlaing when he visited Yangon last December. It remains unclear what relationship he has with the regime, but so far, he has managed not to seriously displease the NUG.

As Myanmar’s junta puts cronies in its crosshairs, businesses fear worse to come

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