Myanmar Sanctions to be Lifted by EU, but Arms Embargo Stays

A year ago the European Union (EU) temporarily suspended some of the sanctions placed on Myanmar. Today, the reforms that the country established had been rewarded. It was announced on Thursday that the sanctions on Myanmar would be lifted by the EU next week. However, the arms embargo stays.

Myanmar President Thein Sein visited Brussels in March. This was a first for a head of state of the country. He appealed to the EU to have the sanctions lifted, citing that Myanmar is one of the world’s poorest countries and would definitely need help from prosperous nations.

The back story

Myanmar or Burma was under military control since the 1962 coup d’etat. The country’s rulers have been accused of several human rights violations, prompting the sanctions from the international community.

The military had been foregoing its control on government for some time and the release of Aung San Suu Kyi, a human rights activist in 2011 have greatly improved Myanmar’s foreign relations. Sanctions imposed by major world powers such as the United States, the European Union and Japan have been allayed.

During the embargo, the EU froze the assets of more than 1,000 companies in Myanmar. It also named and banned nearly 500 people from going to any country in the European Union. Military-related technical assistance and investment in precious metals, timber and mining were also banned by the EU. This crippled the country’s economy since timber and precious metals are some of Myanmar’s biggest sources of revenue.

Lower investment risk

The move is seen by analysts as very favorable to the EU as well as to Myanmar. This will open new business opportunities for both parties and will lower their investment risk in the country. However, this gives the United States some pressure, since the country suspended its sanctions on Myanmar last May 2012. American companies were only allowed to do business with Myanmar through a general license but several businesses have been urging the U.S. to lift its sanctions so that their uncertainty over their investment in the Asian country will be removed.

With this development, analysts are predicting that the U.S. will be thinking carefully about their next move.