Japan Firm Gets U.S. Sanctions Exemption to Pay Myanmar Military Company- Japanese Official

A Japanese construction company has been allowed by the US government to pay a Myanmar military-owned company despite sanctions aimed at depriving the Myanmar military junta, which took...

A Japanese construction company has been allowed by the US government to pay a Myanmar military-owned company despite sanctions aimed at depriving the Myanmar military junta, which took power through a coup, of sources of income, according to a Japanese official on Friday. The payments are related to a bridge project in Yangon, Myanmar, funded by the Japanese government and approved prior to the coup that took place on February 1, 2021, causing chaos and violence in the Southeast Asian nation.

The US Treasury Department could not confirm if it gave a license to Yokogawa Bridge Corporation, a Japanese company, to pay Myanmar Economic Corporation (MEC) which would be the first publicly known exemption from sanctions imposed on junta-linked businesses after the coup. A Japanese foreign ministry official, speaking anonymously about talks with the private company, said that Yokogawa Bridge Corporation discussed the project with US authorities and “was able to continue the project due to the US authorities agreeing to make an exception for the sanctions in this case,” but declined to elaborate on the reason for the exception.

The Myanmar military, facing allegations of human rights abuses in its brutal crackdown against coup opposition, has been subjected to new Western sanctions, including against MEC, designated by the US Treasury Department in March 2021. Human Rights Watch (HRW) claimed to have analysed financial transactions showing that Yokogawa Bridge Corporation paid MEC around $1.3 million from July to November 2022. The advocacy group said the payments were processed through Mizuho Bank Ltd, a part of a large Japanese holding company with global operations. Yokogawa Bridge Holdings Corp, the parent company, declined to comment on individual contracts and Mizuho Bank Ltd also declined to comment.

HRW’s Teppei Kasai, Asia program officer, stated in a report published on Monday that these payments “effectively funded junta atrocities,” and called on the Japanese government to stop providing non-humanitarian development aid to the junta. Although Japan has stopped new aid to Myanmar and called for the military to end the violence since the coup, its response has been milder compared to the strict sanctions imposed by the US, EU, and others. The former Prime Minister of Japan, Shinzo Abe, had previously announced plans to provide a $239 million development loan for a 1.86-mile bridge project in 2016.

HRW’s Teppei Kasai, Asia program officer, stated in a report published on Monday that these payments “effectively funded junta atrocities,” and called on the Japanese government to stop providing non-humanitarian development aid to the junta. Although Japan has stopped new aid to Myanmar and called for the military to end the violence since the coup, its response has been milder compared to the strict sanctions imposed by the US, EU, and others. The former Prime Minister of Japan, Shinzo Abe, had previously announced plans to provide a $239 million development loan for a 1.86-mile bridge project in 2016.

A US Treasury spokesperson stated that they couldn’t confirm or deny the existence of any sanctions license or application, which are granted based on US foreign policy and national security concerns on a case-by-case basis. The spokesperson also said, “We are deeply concerned about the deteriorating human rights situation in Burma and are in close contact with Japan regarding the situation there.”

Source: Reuters

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