05/09/2013 11:42 am ET Updated Jul 09, 2013

Democratic Transition in Myanmar and Western Interests

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Gradual democratic transition has been seen in Myanmar since the 2010 general elections. Prior to the elections, the country's closest allies were governments that had business interests or groups that had established connection with the military generals. The international community was visibly divided under two separate camps -- sanctions versus engagement.

The European Union (EU) and the United States (U.S.), which imposed sanctions, were sources of funding and support for Myanmar's democratic forces. The specifics of their strategies may not have been identical, but the ultimate goal to bring about democracy was the same. The objective of sanctions was to put pressure on the military generals to abandon its authoritarian rule for a democratic regime.

Some of the conditions of the Western powers to normalize diplomatic relations were the release of political prisoners including Aung San Suu Kyi, inclusive dialogue with the National League for Democracy (NLD) and ethnic minorities to pave the way for democracy, to end violence against ethnic minorities, to adhere to the United Nations non-proliferation agreements on nuclear weapons, and to hold a free and fair 2012 by-elections.

Since most of their demands were either met or initiated, both the U.S. and EU suspended sanctions in 2012, except for arms embargo and individual sanctions to certain military leaders and their associates. As a sign of diplomatic thaw, European Commission chief José Manuel Barroso visited Myanmar and offered more than $150 million in development aid. The EU's move was followed by a historic visit of President Barack Obama, the first ever visit by a sitting U.S. president in November 2012.

It is evident from their policies and actions that both EU and U.S. have respective interests. But what are their interests and how they intend to pursue is an interesting development. Their benchmark for normalizing relations and conditions for lifting sanctions seem to have certain variation.

EU's Interest

On April 22, 2013, the EU unanimously lifted the sanctions it suspended a year ago. At its meeting in Luxembourg, the EU foreign ministers welcomed the changes that had taken place in the past year and decided to lift all sanctions except arms embargo.

Even prior to lifting sanctions, the European Commission on March 5 had announced a package of €150 million to support the country's democratic reform ahead of a national election in 2015, and also pledged more EU development money and a bilateral investment agreement.

U.S.'s Interest

In less than two weeks of EU's decision, the U.S. government on May 3, 2013 said it would lift the visa ban on officials but extend targeted sanctions for another year. The rationale behind the action was to reward democratic progress of the past year but also aims to prevent backsliding it from reform.

According to The Wall Street Journal, " Bilateral trade between Myanmar and the United States reached $190.96 million in 2012, of which Myanmar's export to the United States accounted for $16.47 million while its import stood at $174.49 million, according to Xinhua" and "[a]ccording to Myanmar official statistics, U.S. investment in Myanmar amounted to $243.56 million in 15 projects, accounting for merely 0.58 percent of the total as of February 2013 since Myanmar opened to such investment in late 1988."

According to the Office of the United States Trade Representative, two days after EU sanctions was lifted:

"Ambassador Marantis, the first American trade minister to visit the country, explored with senior government officials opportunities to rebuild production and trade capacity here through mechanisms such as a potential Trade and Investment Framework Agreement (TIFA), which would formalize bilateral dialogue on trade and investment issues, and the possible reinstatement of benefits under the Generalized System of Preferences (GSP), which allows for the duty-free entry into the United States of many goods from beneficiary countries."

Different Priorities

Evidently, the EU is convinced that changes on the ground merits the lifting of sanctions. The EU policy move is also based on the expectation that the reform process will continue. Aung San Suu Kyi's support for the removal of sanctions was an important factor in the EU's decision. Moreover, there was no opposition or disagreement within the EU for such action.

On the other hand, the U.S. believes that the reform process is inconclusive and uncertainty still remains. While rewarding the government for its democratic reforms, the U.S. government maintains the flexibility to re-impose sanctions if situation warrants.

The EU hopes to help consolidate the transition process by permanently lifting sanctions. However, the Obama Administration sees that it is premature to take such a hasty decision. Some members in the Congress also have concerns over the transition.

By retaining targeted sanctions, the U.S. government intends to have the necessary leverage to punish individuals and companies that slow or thwart the reform process. It is also aimed at sending strong signal to human rights violators and officials who propagate military ties with North Korea.

Lingering Concerns

There are some common concerns both the EU and U.S. share, including the continued incarceration of political prisoners and the issue of Rohingya Muslims. They also have concerns on the larger question of ethnic problems that are yet to be addressed. Ceasefires have been signed with most of the armed groups but political solution is yet to be discussed.

An official ceasefire has not yet been reached with the Kachins, and recently tensions began to develop between the Burmese military and the Shan and Wa armed groups.

While it is encouraging to see the continued engagement of the two Western powers in the reform process, it is also equally disheartening to see their inability to influence Myanmar's government to end conflict in ethnic territories, particularly in Rakhine state.

The reform process is likely to continue despite some uncertainties. But there are lingering concerns whether the Western interests will gear toward economic and strategic considerations rather than the consolidation of peace and democracy across the country.

How some pressing issues will be addressed remain to be seen. For example, is the central government willing to grant autonomy to the country's ethnic minorities? Is the government, still dominated by the military, willing to amend the undemocratic elements of the 2008 constitution ahead of the 2015 general elections?

If answers to these questions are negative or still doubtful, Myanmar may be heading toward an illiberal or a defective democracy with the survival of certain inherent authoritarian elements in a widely perceived democratic institutional arrangement.

There are also concerns that the wide acceptance of the Thein Sein-led quasi-civilian government by the Western powers may influence the NLD and other opposition parties to accept an illiberal democracy.

Nehginpao Kipgen is general secretary of the U.S.-based Kuki International Forum. His research focuses on the politics of South and Southeast Asia, with a concentration on Burma/Myanmar. He has written numerous academic (peer-reviewed) and nonacademic analytical articles on the politics of Burma and Asia that have been widely published internationally. His latest article titled "US-Burma Relations: Change of Politics under Bush and Obama Administrations" was published by Routledge in March 2013.