US eases trade curbs on Myanmar for six months

WASHINGTON • The United States is temporarily easing trade restrictions on Myanmar by allowing all shipments to go through Myanmar's ports and airports for six months, in an effort to boost the South-east Asian country's opposition party after its landmark election win last month, US officials said.

The policy change, coming after Ms Aung San Suu Kyi's National League for Democracy won a landslide victory in Myanmar's first nationwide free elections in 25 years, applies even to ports and airports controlled by entities on the US sanctions blacklist, the officials said on Monday.

To bolster Myanmar's transition to democracy after decades of military rule, US officials began lifting sanctions against the country after a civilian government was formed in 2011. But officials acknowledged that remaining US sanctions against those with ties to Myanmar's military have had the unintended consequence of halting dozens of shipments.

Reuters reported last month that major US banks, such as Citigroup and Bank of America, were shying away from backing Myanmar trade after discovering that the Asia World port - one of the country's most important shipping terminals - is controlled by a businessman on America's sanctions blacklist.

Exporters use trade finance from banks to ensure they get paid after shipments arrive, and the banks' withdrawal has led to a sharp decline in US shipments into Myanmar. "It was beginning to escalate," said a senior US official.

"Not only US banks but also third-country exporters and third-country financial institutions were beginning to hold up trade going into and out of Burma," the official said, using another name for the country.

Officials cautioned that while the policy shift allows financing of shipments through blacklisted trade hubs, banks are still barred from doing business directly with banned firms.

Years after the US began to lift its near-total ban on trade with Myanmar, more than 100 people and companies remain on the US blacklist, creating a minefield for Western businesses seeking to profit from the new openings.

REUTERS

A version of this article appeared in the print edition of The Straits Times on December 09, 2015, with the headline 'US eases trade curbs on Myanmar for six months'. Print Edition | Subscribe