Thailand is now the preferred banking location of the Myanmar junta, according to UN experts, while military attacks increase

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CNN
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International banks are playing a key role in enabling Myanmar’s military junta to carry out its systematic and deadly attack on its own population, according to a new United Nations-backed report.

Thai banks have become the main source of Myanmar’s military’s purchase of weapons and military equipment – including parts for attack helicopters – used to finance the three-year civil war that has ravaged the country and left more than 5,000 civilians dead, Tom Andrews, the UN Special Rapporteur on human rights in Myanmar, said in a new report. Wednesday.

Since the coup in February 2021, the military has been waging an increasingly fierce war against ethnic armed groups and popular resistance forces across Myanmar, suffering significant territorial and troop losses in recent months.

As the junta grapples with widespread public opposition and an economic crisis that has led to a rapid rise in poverty, it has stepped up airstrikes and attacks on civilians and civilian infrastructure, displacing more than three million people.

Andrews said the junta had “quintupled” its deadly air strikes on civilian targets in the past six months, deepening the humanitarian crisis by trying to “intimidate” civilians into abandoning their resistance to the military.

“They do this by sourcing weapons from abroad, and that is made possible by the services they receive from these banks,” Andrews told CNN.

The military’s brutal campaign of violence has prompted Western nations to impose sweeping sanctions against the military leadership, their families and cronies, state-owned companies, banks and jet fuel suppliers.

The report, “Banking on the Death Trade: How Banks and Governments Support Myanmar’s Military Junta,” found that 16 banks in seven countries processed transactions related to military procurement last year.

The value of weapons, dual-use technologies, manufacturing equipment and raw materials secured by the junta from abroad amounted to $253 million between April 2023 and March 2024, the report said.

“By relying on financial institutions willing to do business with Myanmar’s state-owned banks, which it controls, the junta has easy access to the financial services it needs to commit systematic human rights abuses, including airstrikes against civilians,” Andrews wrote in the report.

However, the volume of weapons and military equipment purchased by the junta through foreign banks has fallen by a third since 2023, and exports from Singapore have also fallen dramatically, the report said.

“The good news is that the junta is increasingly isolated,” the report said. “The bad news is that the junta is evading sanctions and other measures by exploiting loopholes in sanctions regimes, moving financial institutions, and taking advantage of member states’ failure to fully coordinate and enforce measures.”

According to Andrews, international banks must be aware that there is a “high probability” that transactions involving Myanmar state-owned companies could be used to purchase weapons or weapons-grade material to fill the junta’s war chest.

“If you want to be sure that this does not happen, do not do business with Myanmar’s state-owned banks,” he said.

Singapore-based companies were Myanmar’s third-largest source of weapons and military equipment. But according to a government investigation, the flow of arms shipments to Myanmar from Singapore-registered companies has fallen by almost 90 percent compared to last year.

In 2022, Singapore-based banks handled more than 70 percent of the junta’s purchases through the banking system. By 2023, that share fell to less than 20 percent, the report said.

In its search for other financial institutions, the junta found neighboring Thailand.

Between 2022 and 2023, exports of weapons and related materials from Thai companies more than doubled, from $60 million to nearly $130 million last year.

“Many of SAC’s (junta’s) purchases previously made from Singapore-based companies, including parts for Mi-17 and Mi-35 helicopters used for air strikes on civilian targets, are now sourced from Thailand,” the report said.

Siam Commercial Bank is among the Thai banks that have played a “critical role” in this change, the report said. In 2022, the bank handled just over $5 million worth of military-related transactions; by 2023, that number rose to over $100 million, according to the report.

In a statement, the SCB said it provides “international transaction services” between Thailand and Myanmar, “with the primary aim of assisting Thai and international businesses in paying for consumer goods and services to Myanmar.”

The SCB statement said the bank complies with all relevant anti-money laundering laws and that an internal investigation found that its transactions with Myanmar were not related to arms trafficking.

“SCB reiterates its commitment to comply with relevant anti-money laundering and related regulations,” the statement added.

A spokesman for the Thai Foreign Ministry told CNN: “We have seen the report and are investigating it.”

“Many countries have been mentioned and these are certainly countries through which the majority of financial transactions in the region are conducted,” the spokesman said in a statement.

“Our banks and financial institutions follow banking protocols like any major financial center. Therefore, we must first clarify the facts before considering any further steps.”

Andrews told CNN he welcomed the Thai government’s decision to “investigate the facts.”

“I am confident that (the investigation) will lead to positive changes in Thailand, as it did in Singapore,” he said.

In his report, Andrews said it was “critical” that “financial institutions take their human rights obligations seriously and do not support the junta’s deadly transactions.”

In addition, sanctions against the networks that supply the junta with jet fuel and against the Myanma Economic Bank, the military’s “main bank,” “could play a critical role in turning the tide in Myanmar and saving countless lives,” the report said.