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Report details military links of major Myanmar telecom firm

REPORT-2-Myanmar-22-12-2020 (1)

Among those engaged in tracing the knotted web of economic ties surrounding the crouched spider of Myanmar’s military, few organizations are currently publishing as much interesting source material as the advocacy group Justice for Myanmar (JFM).

Blessed with a knack for obtaining leaked internal documents and other primary sources, the Myanmar-based organization has done much to pull back the veil on the army’s tentacular reach in an era of nominally civilian rule.

This week, JFM released its latest report, examining the threads connecting the Tatmadaw, as Myanmar’s military is known locally, to the country’s newest mobile operator Mytel, and hence to a global network of international firms that it accuses of “fueling state corruption and abetting the international crimes of the military.”

The 160-page report describes how since its establishment in June 2018, Mytel has rapidly grown into the nation’s second-largest telecom operator, with more than 10 million subscribers and quarterly profits reported to be in the vicinity of $25 million.

Unlike other notorious military-linked entities, Mytel was established under the civilian government led by State Counselor Aung San Suu Kyi, and the Myanmar public holds a 28 percent share in the firm. According to JFM, these shares are managed through Star High Co. Ltd., a privately registered company that is a subsidiary of the Myanmar Economic Corporation, one of two secretive military conglomerates with interests in most sectors of the Myanmar economy.

In a press release accompanying the new report, JFM describes Mytel as “a product of Myanmar’s corrupt democratic transition, managed by the Myanmar military to safeguard its power, privilege, and impunity.”

The report claims that the construction and operation of Mytel has allowed the military to upgrade and expand its telecommunications infrastructure, while providing “cover for the military to access an extensive international network of suppliers.”

It also states that the firm is a major revenue generator for the Tatmadaw. This “has expanded its grip on the state, its infrastructure and the people of Myanmar,” entrenching in the process the central economic position that it has continued to occupy since the end of direct military rule in 2011.

Moreover, Mytel’s largest shareholder is a firm owned by Vietnam’s Ministry of National Defense. The Military Industry and Telecoms Group – known as Viettel for short – holds a 49 percent stake in the company. (In addition to Star High’s 28 percent, the remaining 23 percent is owned by Myanmar National Telecom Holdings, a holding company of 11 public firms.)

Through a locally based subsidiary, Viettel builds and maintains Mytel towers in military bases in Myanmar, including in outlying regions of the country where there are active conflicts between the central state and ethnic minority groups. According to JFM, Viettel also operates and maintains fiber optic routes belonging to Myanmar army’s Directorate of Signals.

In addition to representing an obvious national security risk, Viettel also functions as Mytel’s contact point with a host of foreign companies. These include leading international banking and finance corporations like HSBC, Standard Chartered, Japan’s MUFG, and the Malaysian firm Maybank. The Myanmar military has access to technology from Viettel’s international supply network, which includes major businesses such as Japan’s NEC, Finland’s Nokia, and the American firms CommScope and Oracle.

Many of these firms have dealt with Viettel (and, hence, Mytel) during a period in which the Tatmadaw has been accused of committing war crimes, genocide, and crimes against humanity with its treatment of the Rohingya Muslims of western Myanmar. Since 2017, it has driven more than 740,000 people across the border into Bangladesh, burning villages and shooting civilians, while most of those who remain languish in squalid international displacement camps.

Through loans and the supply of tech and services to Mytel and Viettel, JFM has accused these international firms of “supporting crimes against humanity and war crimes committed by the Myanmar military.”

Once again, the report illustrates the murky nature of Myanmar’s business environment after a half-century of direct military rule, and the difficulties faced by foreign firms hungry for a slice of Southeast Asia’s last frontier market.