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30 Oct 07
The latest indication of that is Air Bagan, a small Myanmar airline on a U.S. government blacklist that will suspend flights to Singapore.
While opposing sanctions against Myanmar in public, Singapore’s government and its banks in particular appear to be quietly distancing themselves from the ruling junta, analysts and bankers said on Tuesday.
Officially, Singapore has not deviated from the line given by Prime Minister Lee Hsien Loong a month ago, at the height of the junta’s bloody crackdown on democracy protests, that sanctions would be unlikely to shunt Myanmar towards political reform.
But gradually, signs are emerging of institutions in the city-state pulling back from involvement with the generals, for whom Singapore is a top medical and leisure destination – and widely believed to be home to their off-shore bank accounts.
“What’s going on behind the scenes, particularly on the financial side, is de facto sanctions,” said Sean Turnell, author of the Burma Economic Watch journal at Sydney’s Macquarie University.
The latest indication of that is Air Bagan, a small Myanmar airline on a U.S. government blacklist that will suspend flights to Singapore from Nov. 5, travel agents say.
Singapore’s Today newspaper said the final blow came when Singapore banks said they would “stop dealing with” the airline, owned by Htoo Trading, with close ties to the junta’s top brass.
“That would seem to be an indication that Singapore either is lining up behind the sanctions, or that they have other financial concerns or issues with Air Bagan,” said Victor Comras, architect of U.S. economic sanctions against Yugoslavia in the 1990s.
It is financial links to the likes of Air Bagan that have made Singapore a target for Myanmar activists and members of the U.S. Senate desperate to find a lever to use on the junta, a regime that seems to thrive on isolation.
Banking sources told Reuters that the Monetary Authority of Singapore (MAS) was unlikely to ask banks to cut ties with Myanmar firms unless there were U.N. sanctions on the country.
“Without legal authority such as U.N. sanctions, it won’t be possible,” a Singapore-based banking source said.
The MAS and Singapore’s three banks, DBS Group Holdings, Oversea-Chinese Banking Corp and United Overseas Bank, declined comment.
But a second banking source said banks were taking measures on their own to restrict links with Myanmar companies on a case by case basis. “It is not a blanket ban. If a customer comes to us, we can’t turn him away,” the banker said.
Activist group Burma Campaign UK lists 10 Singapore firms on its “Dirty List” of those with involvement in Myanmar, including the three banks and conglomerate Keppel Corp.
Foreign Minister George Yeo said on Monday Singapore would act according to international agreements.
“We are an international financial centre. Whatever policy we apply to Singapore banks, we must apply to all banks operating in Singapore,” he told reporters.
The police announced last week Singapore would step up efforts to detect money laundering from Nov. 1 by requiring anyone carrying or transferring more than $20,650 in or out to submit a report to immigration authorities.
While Washington and Brussels have tightened the screw gradually, Singapore has become one of the biggest investors in the former Burma. Its three banks all have offices there and firms have poured money into hotels and tourism.
Singapore senior statesman Lee Kuan Yew told an American columnist he rued advising hotel companies to go in. “They have sunk in millions of dollars there and now their hotels are empty,” he said. He also called the generals “rather dumb”.