Chinese Lessons for the Golden Triangle’s Gold Rush

Global Risk Insights

The United States has shifted its policy toward Myanmar over the past two years, taking a number of steps to ease existing sanctions in an effort to promote democracy and economic reform. These reforms, including a new foreign investment law and an easing of rules for incorporating foreign companies, have drawn increased interest in Myanmar as an investment opportunity from the United States and other countries. China’s role in the changing Myanmar policy has not gone unnoticed, with Xi Liping of the Chinese Academy of Social Sciences stating, “There is no doubt that many inside the Chinese establishment interpret (the change in U.S.-Myanmar policy) as part of a larger U.S. strategy on China.” However, while China’s strategic role in the U.S.-Myanmar relationship has received much attention, there has been limited analysis of the impact of China on Myanmar’s growing economic importance.

China has enjoyed a dominant economic partnership…

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Bangladesh – A nation on the brink?

This is a guest post written by Andrew Wojtanik, Georgetown School of Foreign Service graduate (’12) and presently a researcher at a U.S. university-affiliated think tank. He frequently blogs for “Notes on the Periphery,” which can be found here.

While many observers this week focused on Syria or Boston, a building collapse on Wednesday took the lives of more than 377 garment workers in faraway Dhaka, capital of Bangladesh. Sadly, it is not the first time this country has seen horrible industrial accidents: a fire at a garment factory in December killed 112, and another in January took seven more lives.

But this week’s industrial accident, the deadliest in Bangladeshi history (and worst in South Asia since Bhopal in 1984), comes at a particularly unnerving time for this hyper-densely populated, Muslim-majority nation. While the main culprits are the factory owners (who evaded government permits and oversaw shoddy construction), the public response has already turned political—with the opposition Bangladesh Nationalist Party (BNP), led by ex-Prime Minister Khaleda Zia, calling for nation-wide strikes in response.

The timing could not be worse. Unfortunately, the building collapse, while tragic, comes at a time when Bangladesh faces far greater short- and long-term dangers. While the nation has largely been spared widespread violence (unlike its South Asian neighbors) since independence from Pakistan in 1971 (and local and international development efforts have helped pull the country out of poverty), two worrying trends threaten to unravel the country’s progress.

Deep-seated rivals

The first problem, quite simply, is politics. The Economist frames the issue quite nicely in a May 2012 piece as such:

“The Punch-and-Judy show of Bangladeshi politics, in which the ruling party—run by the daughter of a former president—bashes the opposition—run by the widow of a former president—before swapping places with it, has been running for decades.”

Bangladesh followers will know the rivalry at hand: Sheikh Hasina’s Awami League (AL) party, swept into power in a landslide victory in 2009, against Khaleda Zia’s BNP, which has ruled for 14 years of modern Bangladesh’s 42-year history (most recently from 2001-2006). Conducted by both the AL and BNP, politically-motivated disappearances, kidnappings, and murders have cast a shadow over Bangladesh’s “democratic” political system for decades. But with national elections forthcoming in January 2014 (at the latest), the intimidation today may be at its worst.

This issue stems in part from Sheikh Hasina’s paranoia. Though the AL remains largely popular, history is on Zia’s side—as no party has ever won consecutive terms in Bangladesh’s history (albeit three military coups have skewed some results). The latest wave of political intimidation (most recently, Hasina’s government arrested prominent opposition journalist Mahmadur Rahman) has heightened tensions to point that the BNP may choose not to participate in elections at all. And as Egypt, Iraq, or the Palestinian Territories have shown, election boycotts mostly do not end well.

On top of the bitter rivalry, corruption in the country is ubiquitous—even Zia herself faces potentially crippling corruption allegations. Consequently, the citizenry has become increasingly jaded, with the military (did I mention the three successful coups?) following in kind. As a recent International Crisis Group report puts it: “Three and a half years ago there was palpable hope for change. It has now been emphatically crushed.”

Self-inflicted wound: Islamic resurgence

Nevertheless, peace and security in Bangladesh can persist despite corruption and the AL-BNP cage match. But another factor, namely Sheikh Hasina’s vow to prosecute a series of Islamic party leaders in an International Crimes Tribunal (or ICT; run by the domestic government, despite its name), has already had tumultuous ramifications—namely, Bangladesh’s worst violence since the nation’s founding.

Here is the context: in an effort to fulfill Hasina’s campaign promise, 12 men—including 10 prominent members of Islamic party Jamaat-e-Islami—currently stand trial for a variety of war crimes related to conduct during the 1971 war of independence, which took the lives of some 3 million Bangladeshis in all (Jamaat-e-Islami allegedly opposed Bangla autonomy and consequently fought alongside the West Pakistan force). While a majority of citizens support the tribunal, Jamaat-e-Islami and its BNP allies deride it as a tool to score political points and extinguish opposition to Hasina’s rule. A recent scandal implicating ICT judges of collusion with prosecutors has not helped dispel this view.

The tribunal’s consequences so far have been bleak. With three of ten Jamaat-e-Islami convictions down, neither the tribunal’s public proponents nor opponents are satisfied.

On one hand, Jamaat-e-Islami member Abdul Quader Mollah was convicted this February—but only sentenced to life in prison, sparing him the death penalty. The response, largely from AL supporters, was swift: hundreds of thousands Bangladeshis gathered in Shahbag (a district in Dhaka) to protest the decision, demanding that Mollah hang. After 13 days of demonstrations likened by many to a “Bangladesh Spring,” the national parliament voted to allow an appeal. But the chorus of critics continues: protestors will virtually stand for nothing less than 10 death sentences, and for some, a permanent ban on Jamaat-e-Islami.

On the other hand, two other Jamaat-e-Islami leaders—Abul Kalam Azad and Delwar Hossein Sayedee—have been sentenced to death for crimes against humanity. Particularly after the latter decision, Jamaat supporters in Dhaka and elsewhere took to the streets. Violent clashes plagued pockets of the country in the weeks after the February 28 decision—with Jamaat supporters (most of whom were not alive in 1971) burning Hindu temples to the ground and hurling everything from sticks to crude explosives at police. The death toll so far is thought to have exceeded 100. According to the Economist: “Jamaat has been behaving more like an insurgency than a political party”—a worrying sign of things to come.

At the same time, another Islamic organization—Hefajat-e-Islam—has rapidly gained support, holding massive rallies in Dhaka as a sort of tit-for-tat response to the Shahbag movement. Hefajat members demand, among other things, anti-blasphemy laws and mandatory Islamic education. And they give the government until May 5 to accept their implausible ultimatum. The growth of Hefajat, many worry, may amount to the “Talibanization” of Bangladesh—a radical idea almost certain to precipitate greater unrest.

Bangladesh has endured a handful of Islamic extremist groups in the past (see here). But the Islamic movement emerging now is of a different kind. The Deobandi tradition behind a multitude of Pakistani terrorist groups is present in Bangladesh, but its reach and popularity do not run as deep. Rather, we might expect Hefajat-e-Islam and Jamaat to continue to work within the political system, though they may condone fringe elements that seek occasional bloodshed on the side.

Looking ahead

So far, that violence does not appear systematic or well-organized. But with seven more trials to come—including those of long-time Jamaat head Ghulam Azam and current leader Motiur Rahman Nizami—that could change. Or if the Hasina government moves to ban Jamaat, pushing the group underground is likely only to invite greater discontent.

The ICT is an enormous project that ironically, by seeking justice for crimes committed in 1971, reopened the wounds of the same 1971 war. The havoc it has wrought—mixed in with deep-seated corruption, negligence (i.e., the factory collapse/fires), and a bitter political rivalry—threatens to turn long-peaceful Bangladesh into a tinderbox for violence. As the conflict in Syria shows, a country can go from relative peace and security to chaos and instability at almost the flip of a switch.

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Myanmar Foreign Investment Law Should Inspire U.S. Policy Note: The linked post is part of two op-eds addressing investment in Myanmar. This piece, by Mike Madoff, encourages investment in Myanmar and US policy change. My companion piece, previously posted on this blog, cautions potential investors in Myanmar, emphasizing the political risks.

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From Benghazi to Boston: Sentiment and Strategy in the Unfinished War on Terror

As of this past week terrorism is an issue ranked highly in the public consciousness. April 15th’s bombing of the Boston Marathon has reminded many Americans of the horrors of 9/11, as well as the pain experienced by citizens of states such as Syria and Afghanistan on an all too frequent basis. While this incident is a true tragedy, much remains unclear. How does the bombing fit within our framework for understanding, and responding to terrorism?

In her 2012 piece “Our leaders are wrong, the War on Terror is not over”, K.T. McFarland muses, “Today is the 11th anniversary of the September 11 terror attacks. Bin Ladin is dead. Al Qaeda hasn’t had a successful attack on Americans for years. President Obama has declared the War on Terror over. So why do most Americans have a nagging sense that it’s not over?” With this simple statement, McFarland aptly frames the War on Terror as a war of emotion. This sentiment is turned into rationale by her conclusion: “The War on Terror was not a war of our choosing, and it’s not a war on our timetable. But it’s a war we must win nonetheless.”

Why should the United States engage in war—including definition-broadening wars like the War on Terror—risking its blood and treasure? The foundational answer is when it most benefits the interests of United States’ citizens. In a world of government by and for the people, the interests of the people are the guiding compass. This answer, when utilized to define an “end”, must fully take into account the costs as well as the benefits; even if the benefits outweigh the costs, a country must assess whether the war is the ideal way to achieve the maximum utility. What, then, does the War on Terror accomplish, or aim to accomplish? Is it a war of interests properly weighed against blood and treasure?

 Per analysts such as Audrey Kurth Cronin, it is difficult to tell whether U.S. counterterrorism is achieving its intended effects, much less explain how it fits within a viable American grand strategy of ends. As she notes in U.S. Grand Strategy and Counterterrorism, “Objectives do not seem to matter to ordinary Americans… Terrorism is an emotion-triggering business.” Cronin advises, “The central objective of U.S. counterterrorism should be to return the (terrorist) threat to the level of tactics, avoiding the dysfunctional action/reaction dynamic of terrorism, hastening the group toward its demise, even a we maintain focus on larger state interests and a balanced longer-term grand strategy that identifies American interests, the threats to those interests, and the means available to be deployed. A well-crafted counterterrorism strategy can only be an integral part of a grand strategy for a great power.”

Counter terrorism can be a useful tool, but it must be utilized within a strategic framework. Following the Boston bombing, is right for Americans to feel rage at insult, and pain at suffering. The United States must pursue the interests of its citizens aggressively, particularly when their security is threatened. This does not excuse, however, a war against terrorism not fought with a cool head. It is time, then, for the United States to disassociate itself from a “War on Terror” driven by emotion and the emerging risk of reactionaryism. Too often in the past have let our counterterrorism efforts been perceived as a demagogically proclaimed and largely solitary war against “Islamo-fascism.” As we respond to the Boston bombing, we would do well to heed the wise words of former National Security Advisor Zbigniew Brzezinski, “Even in the face of future terrorist attacks, the likelihood of which cannot be denied, let us show some sense. Let us be true to our traditions.”

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Risky Business: Great Power or Greater Responsibility in Myanmar’s Gold Rush?

(Note: Michael Madoff and I challenged each other to write dueling op-eds addressing investment in Myanmar. This op-ed cautions potential investors in Myanmar, emphasizing the political risks of physical insecurity, reputational damage, and investment-driven instability. Its companion piece and foil encourages investment in Myanmar.)

In the past year Myanmar has moved to the center of the frontier markets’ map for investors keen on a “first mover advantage”. However, increasingly lost amidst the hype is the recognition that with “first mover advantage” comes “first mover risk.”

Following Myanmar’s elections last spring, the United States took a number of steps to ease existing sanctions against Myanmar in an effort to promote democracy and economic reform. Liberalization and reform—and the surrounding hype—have subsequently encouraged the view that Myanmar presents a great opportunity for investment. The country’s natural resource wealth, large and young population, and strategic position between the fast-growing economies of China and India draw investors to Myanmar. Stoking their ardor is a new foreign investment law and an easing of rules for incorporating foreign companies.

Myanmar may have embarked on significant economic reforms in 2012 to make it a more investor-friendly place, but it has entered 2013 ranked as an “extreme risk” for foreign companies doing business in the country. According to a report by risk consulting firm Maplecroft, it shares the world’s worst top-10 slots with Somalia, Congo, Sudan, Afghanistan, Iraq, Libya, Central African Republic, Syria and Yemen. Issues including an antiquated financial system, poor infrastructure, unskilled labor force, lack of hard data, and a government bureaucracy that is ranked bottom by Transparency International put early investors at significant risk. The risks to investment in Myanmar’s potentially fractious political climate and dangerously fragile economy go beyond these structural challenges to less-cited political risks, including physical insecurity, reputational damage, and investment-driven instability.

Continued religious and ethnic violence in Myanmar calls into question aggressive investment in the short term. According to Maplecroft, the booming tourism industry faces the most vulnerability, with the negative impact quickly spreading to the retail and infrastructure sectors. While the important oil and gas industry is unlikely to be directly disrupted by the present level of sectarian trouble, the Ministry of Energy’s plans to hold international auctions for up to 20 offshore exploration licenses has been delayed since last September; of note is the fact that many of these sea blocks are adjacent to the coastal Arakan region where many of Myanmar’s Muslims live. Religious and ethnic violence could cause problems for supporting logistical work such as transport, and further widespread cold create hazards to personnel operating in the vicinity that would be an additional disincentive for commercial development.

Doing business in Myanmar, still ripe with corruption and ethically questionable partners, could serve as an investment-undermining reputational risk for Western companies. It is considered unwise to operate in Myanmar without a local partner as the nation does not have a strong rule of law.  Unfortunately for potential investors, it is difficult to find Burmese business partners that do not have junta connections. Take, for example, the country’s gas stations, potentially a great investment in a frontier market where many people are poised to grow rich enough to buy mopeds and eventually even cars. 247 state-owned stations that were privatized in 2010 were sold at low prices to a military-owned trading company and other firms with close ties to the junta. Ultimately, working with the military and former junta officials could raise the risk of a boycott at home or—at the extreme—a U.S. Foreign Corrupt Practices Act investigation.

Even if an investor is able to look past the risks of insecurity or secure an uncorrupt partnership, they will still face the risk of investment driven instability. While the lure of rapid growth can be hard for investors to resist, it should be noted that waves of foreign direct investment chasing high returns have overwhelmed fragile, newly opened economies in the past. Often times these countries experience wild swings in exchange rates, monetary supply, and inflation derived from lack of fiscal discipline and strong monetary controls. A lack of standards increases the likelihood of creating financial bubbles as banks race to lend, with a raft of questionable real estate projects (e.g. Thailand in the late 1990s) following. According to Brian P. Klein, former Director of Southeast Asia Affairs at the Office of the U.S. Trade Representative, the sudden inflow of foreign direct investment may recede just as quickly at the first sign of instability.

It would unfair to not recognize that Myanmar could, certainly, provide great returns on its risky business. Myanmar has come a long way for such a short time in reforming politically and economically, and the government appears to be trying to address key issues that would deter foreign investors such as transparency. It is also actively opening up sectors that have for a long time been closed to any form of foreign investment. However, even if Myanmar manages to stay on its current path of economic and political change, the obstacles and challenges it faces will take a considerable amount of time and effort to overcome. It would be wise for investors to approach Myanmar’s investment risks—potential physical insecurity, reputational damage, and investment-driven instability—with active caution.

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U.S. Interests in the China-Myanmar Relationship

In this companion piece to “U.S. Policy for Myanmar’s 2015 Election”, Power, Peace, and the Pacific analyzes China-Myanmar relations. Given the strategic relevance of both China and Myanmar, it is important that the United States shape the China-Myanmar relationship to the advantage of U.S. interests. Ultimately, this memo recommends a hedging policy focused on promoting Myanmar’s neutrality toward both China and the United States.

Policy Issue

Myanmar, located at the crossroads of East, South and Southeast Asia and between the world’s two most populated countries, is of clear geostrategic significance. The rise of China has only made Myanmar more vital. China and Myanmar have a longstanding relationship, with the PRC having recognized and assisted the pariah state while the United States was leading the world away from Myanmar. Given the strategic relevance of these actors, it is important that the United States shape the China-Myanmar relationship to the advantage of U.S. interests.

Chinese Interests and Challenges in Myanmar

China has three principal strategic interests in Myanmar: energy procurement and security, access to the Indian Ocean, and security of border trade. China has pursued the transportation of crude oil and natural gas via pipeline and the building of hydroelectric power plants in the border area. For the landlocked Yunnan Province on the China-Myanmar border, securing access to the Indian Ocean through Myanmar as a land bridge is important for the acquisition of trade routes as well as security. Myanmar is Yunnan’s biggest trading partner, and China-Myanmar trade is also a Myanmar’s logistical artery. China’s exports to Myanmar were +39% year-on-year in 2011, while China’s imports from Myanmar were +75% year-on-year in 2011.

Several challenges to China-Myanmar relations have emerged which stand to impact Chinese interests. Negative images of China have developed among the people in Myanmar, as the Chinese government supported the military government of Myanmar and Chinese companies are believed to have exploited Myanmar’s natural resources. China stands to be affected by struggles between the Myanmar Armed Forces and rebels on the border, which China formerly supported. The preliminary success of Burma’s democratic transition has raised questions about China’s own political system and long-postponed reforms. Growing intimacy between the Thein Sein administration and the U.S. government is resulting in sentiments of strategic insecurity.

The Strategic Importance of the China-Myanmar Relationship to U.S. Interests

U.S. interests, defined as security, economic growth, universal values, and international cooperation by the 2010 U.S. National Security Strategy, provide the lens through which to view the China-Myanmar relationship. Myanmar has the potential to serve as a major new market; stands as a potential partner on China’s doorstep amidst growing security concerns; serves as an opportunity for the United States to support universal liberal values; and, through increased global interest, provides an opportunity for international cooperation. The United States must promote a China-Myanmar relationship which best assures the maintenance of these interests.

Policy Options for the China-Myanmar Relationship

Contain- Limit China-Myanmar Partnership: This position asserts that the United States has the upper hand and strong potential for developing a unique relationship with Myanmar. The limiting of the China-Myanmar partnership can then be utilized to better pursue U.S. interests. The United States can leverage frustrations with China, increased investment and support of Myanmar’s emerging democracy to bring Myanmar under its political wing. The potential positive impact extends beyond Myanmar to the United States strategic position.

Caution- Defer to China-Myanmar Partnership: This position asserts that China has the upper hand and greater potential for maintaining a unique relationship with Myanmar. It could direct large amounts of investment into Myanmar via the state, leveraging Myanmar to temper its relationship with the United States. China could also utilize conflict on the China-Myanmar border to decrease security and discourage U.S. involvement and investment. The United States may avoid potential repercussions by allowing the traditional alliance.

Hedge- Promote Myanmar’s Neutrality toward China and the United States: This position asserts that while it is not in U.S. strategic interests for Myanmar to be an ally of China, per the concept of security dilemma it is also not in U.S. interests for Myanmar to antagonize China. U.S. relations with China, as well as Myanmar’s relations with the United States and China, should not be perceived as a zero-sum game. It is in part China’s zero-sum policies that have strained its relations with Myanmar, and as such the United States must not repeat China’s mistake by keeping Myanmar on a chain. Economic interconnectivity between all China, Myanmar, and the United States can moderate relations per interdependence theory.

Recommended Policy: Hedge

The “Contain” and “Caution” positions understate the continued strength and importance of the China-Myanmar economic relationship, with China remaining Myanmar’s largest trade and investment partner. In 2012 two-way trade grew 46% over the previous year, to $6.5 billion, while China’s cumulative investments in Myanmar reached $14 billion. Of the $900 million Myanmar’s government is set to borrow this year, China will provide $527 million. Given China’s continued importance, the United States has not developed the capacity to cut China-Myanmar ties. Conversely, the United States should not feel forced to defer to China as it is not likely to risk its position of relative strength through an overly aggressive response. The “Contain” and “Caution” thus positions represent overaggressive or overpassive options, and have the potential to provoke a security dilemma. Ultimately then, the United States should hedge by promoting a policy of neutrality between Myanmar and China. Although China will face increased competition, a policy of neutrality will allow all actors to pursue their economic interests while increasing the likelihood of maintaining the United States’ interests in security, international cooperation, and democratic growth. This policy of neutrality, while potentially controversial to China, can be softened through the application of trilateral U.S.-China-Myanmar consultations and the promotion of policies in Myanmar which limit the threat potential.

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U.S. Policy for Myanmar’s 2015 Election

In this memo, Power, Peace, and the Pacific takes a look at the issue of Myanmar. Specifically, it addresses the planned 2015 election, a signal of Myanmar’s democratic transition that both Myanmar and the United States must get right. To ensure the completion of a democratic transition in 2015, it is important for the Obama Administration to create the conditions for cooperation. Cooperation will not be possible without adequate reassurance of both regime and opposition.

Power, Peace, and the Pacific will follow this post up with a memo on U.S. interests in the Sino-Myanmar relationship.

Policy Issue

Myanmar’s April 2012 by-elections have been hailed as the most important sign yet that Myanmar’s nascent reform process is serious, and have been followed by increased United States opening. However, successful by-elections and the emergence of the National League for Democracy in parliament do not ensure that the reform process has been consolidated or that future developments will be in line with U.S. interests. The election that will decide Myanmar’s political future will come in 2015, when 75% of the parliament will be contested in contrast to the 10% contested in 2012.

Why the 2015 Election is Important for U.S. Interests

U.S. interests, defined as security, economic growth, universal values, and international cooperation by the 2010 U.S. National Security Strategy, provide the necessity for a successful 2015 election in Myanmar. Myanmar has the potential to serve as a major new market; Myanmar stands as a potential partner on China’s doorstep amidst growing security concerns; Myanmar serves as an opportunity for the United States to support universal liberal values; and Myanmar’s reception of international interest provides an opportunity for increased international cooperation. The difficulty for the United States consists in achieving security and economic growth without sacrificing universal values and international cooperation. Only through a successful 2015 democratic transition can the ideal combination of interests be supported.

Policy Background

Myanmar’s reforms rest on the precarious positions of both opposition and the regime, and subsequently an unsuccessful 2015 election could firmly derail the progress made. The opposition’s strength is imperiled by Suu Kyi’s constitutional ineligibility for the presidency, as well as constitutional reservation of 25% of the parliament’s seat to the military. With Thein Sein expected to not stand for reelection, there will likely be a scramble for the presidency amidst hardliner concern about the future of the military, potentially leading to a regression of reforms.

Alternative Policy Options

Policy of Re-measurement

This position holds that the Obama Administration’s policy toward Myanmar lacks sufficient protections against Burmese backsliding on reforms to properly ensure a full democratic transition by 2015. The focus should be put on setting precise criteria for Myanmar’s progress and tying failure to achieve these benchmarks to re-imposition of the major U.S. sanctions. Residual sanctions will remain as a safeguard. By holding the Myanmar government to a harder line, the United States can ensure follow-through on still incomplete reforms and force constitutional changes that will allow Suu Kyi’s participation in the presidential election and ensure the removal of military’s permanent positioning in the parliament.

This position over-emphasizes the foreign policy tool box’s stick while under-emphasizing the carrot. It risks making the democracy movement appear as a greater threat and fails to recognize the fragility of gains made. Seeing the recent removal of sanctions as too much too soon, it fails to provide further incentive for the government to cooperate in the lead up to the election.

Policy of Opening

This position holds that more opening up to the government is required to ensure continued cooperation. The Obama Administration should considering removing travel and asset bans against particular individuals and organizations, prohibition on certain military-to-military activities and assistance, restrictions on investments and financial services tied to Burma’s armed forces, and the arms embargo. Aid should be utilized to promote growth and increased positive relations between the United States between the United States and Myanmar. By providing more assistance to the Myanmar government, the United States can ensure participation in further reforms amidst concerns about the future of the military amidst the democracy.

This position over-emphasizes the foreign policy tool box’s carrot while under-emphasizing the stick. It risks undermining the democracy movement by over-supporting the government. Seeing the democratic gains in line with opening as successful, it fails to provide a threat to ensure government cooperation in the lead up to the election.

Recommended Policy of Moderating Facilitation

To ensure the completion of a democratic transition in 2015, it is important for the Obama Administration to create the conditions for cooperation. Cooperation will not be possible without adequate reassurance of both regime and opposition. As the transition to democracy will be completed in the opposition’s favor, it is important that the regime is not “scared” by the democratization process, while at the same time the opposition must be empowered to act.

Policy for the Regime

The Obama Administration should not give up its strong bargaining position by decreasing residual sanctions before 2015 elections. At the same time, it must not reintroduce dropped sanctions unless there is a strong regression. From this firm posture, democratic transition can be induced through the provision of increased, targeted aid. The regime must be assured of lack of punishment as well as political survival of its members following transition.

Policy for the Opposition

The opposition should be aided by increased transitional assistance for Myanmar from USAID and international actors. The Obama Administration must work with the opposition to ensure moderate policy in transition. Independent arbiters should be utilized to assist with facilitating constitutional changes and democratic transition. Maintaining residual sanctions without wanton increase will signal U.S. caution to the regime and in this way support for the opposition.

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