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Democracy in decline and its fate after the crisis: Economic waves and democratic procedures

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An economist and historian specializing in economic crises from ancient times to the epochs of commercial and modern industrial capitalism. Head of the Institute of a New Society, Lecturer at the Plekhanov Russian University of Economics. In early 2008, he gave a surprisingly accurate analysis of the current crisis, a long-term painful fracture, a major crisis transforming the world economy and the life of society. The forecast of changes caused by the crisis continues to be realised, confirming the theory of cyclicality of big crises. Koltashov headed the drafting of numerous analytical reports. In his book The Crisis of the Global Economy (2009), he spoke about the logic of the first wave of global instability, warning that the crisis will return. In 2013, at the beginning of the second wave of the crisis, the author returned to Russia after six years of analysing the economic catastrophe in Greece. In the same period, he began to study the connection between major crises and the great modernisation revolutions of the era of capitalism. Thus, for the first time, an economic and socio-political analysis of such phases as the restoration and glorious revolution was carried out.

In the 21st century one could observe the rise of democracy. In the 20th century for a long time it also seemed that democracy was developing steadily moving from the formal to the real. However, the big crisis of 1973-1982 led to a historic turn in its fate. Everything turned out to be more complicated than previously thought.

A brief pedigree of democracy

The emergence of democracy was associated with the development of the Greek polis economy. This happened after the “dark ages” that followed the great economic crisis of the 12th century BC. The old economic system collapsed whereas the new system had not formed yet.  It took several centuries of decline and degradation for it to occur. Another great crisis in the 3rd century dealt a severe blow to the municipalities of the Roman Empire with their democratic practices stemming from earlier city states. In history the great and big economic crises (they appeared after the great crisis of the 14th century) had a huge impact on social structures and relations, which are usually associated with the concept of “democracy”. The era after World War II is no exception. From that time to the present, democracy as a form of power and organisation of social structures has undergone enormous changes.

The concept of “democracy” is used widely, but is very controversial. It would be much more accurate to speak in most cases about the republican form of state, party and other structures, public consciousness and relations. But the word “democracy” always remains in fashion in politics, even if it is not created by the social “lower strata”, but the “elite” of nations or even the nomenclature of parties. The rejection of its widespread use will cause misunderstanding, although it would be right to treat it with extreme care. Finally, the anarchist extreme is also harmful: the belief that genuine modern government could exist in modern and even earlier socio-economic realities, not burdened by either bureaucracy, professional politicians, or oligarchs (the USA, for example, is an oligarchic republic) nor by faith in leaders and missions.

Democracy in the 21st century, no matter how contradictory this concept is, will eventually bloom. However, its current state and immediate prospects can be estimated only after analysing all the changes that have befallen it. And one should start with the crisis of democracy itself, the way the world knew it in the 20th century. It was in crisis when citizens of the former USSR saw it in its US-European liberal format.

The way 20th century democracy worked

In 1989-1994 alternative elections of heads of state and assembly of deputies, freedom of speech and press seemed the universal rules of democracy to many people in Eastern Europe. They were seen as Western standards, characteristic of a free, open, and pluralistic society. Western Europe and North America themselves seemed standards of freedom, where states flourished in democracy. Have not peoples fought here for broad public freedoms since the 18th century? Did not this struggle have results so attractive to residents of the Eastern bloc countries?

In fact, in the West, as they say in Eastern Europe, a necrosis of what is commonly called representative bourgeois democracy was taking place. No one formally abolished freedoms, like no one abolished many political freedoms in the USSR, but democracy became more and more liberal, even neoliberal, almost one-party, but most importantly, increasingly pushing the “bottom” away from decision-making. This is not to say that the “lower strata” did not cut themselves off from participating in governance, supporting neoconservative professional politicians. But most of all, they were cut off by processes in the economy. They reduced industry and the concentration of workers. But was this the only thing? Did only the dispersal of workers weaken their structure?

The concepts of “liberalism” and “democracy” have a weak connection. Democracy emerges as the power of a large number of people, while liberalism was largely an elitist trend of supporters of political freedoms, which should not be used by the “lower strata”. Therefore, it was not the power of the liberals that gave the world universal suffrage. It is known that Otto von Bismarck used universal (male) suffrage against liberals. Previously, Napoleon III had done this in France. However, the growth of industry gave rise to the development of trade unions and parties of the Social Democratic type, and later of the Communists. They made up the structures that ensured the flourishing of democracy in the West, that is in North America and Western Europe. With their help, the “lower strata” received not only the universal right to elect and be elected, but also the opportunity to have their own deputies. At least, as was the case in the United States, workers’ organizations participated through their superiors in transactions with non-worker’s parties and candidates.

Some called these deals beneficial to the working class and they actually improved its material and political position. Others called them rotten opportunism, and the masses perceived them as less and less interesting maximalists. This reformism in old industrial countries was based on the will of the working people themselves and not on deception on the part of left-wing leaders, which was remarkably shown in the book “Marxism and the Polyphony of Minds” by Andrei Koryakovtsev and Sergei Viskunov[1]. However, everything has its limits.

The crisis of 1973-1982 and a neoliberal turn

The “world revolution” of 1968 should probably be considered as the peak of the onset of democracy and social reforms. Then, students, not yet subordinated to the logic of capital by virtue of their student status, as Herbert Marcuse noted, rose to the struggle.

Many professors in the USA, Great Britain, France or the Federal Republic of Germany remembered the amazing wave of political activity of those who previously spent more time at their desks. Students demanded and sought participation in the management of universities, freedom of assembly in them and other rights. However, it would be a mistake to see in this a culmination of the struggle of employees. They often did not know what to do with the radicalism of the young. This is remarkably reflected in the film directed by Elio Petri “The working class goes to heaven” (1972): the working people solved economic problems, while the young maximalists demanded much more from them. For some time, the two streams merged and this led to an increase in wages in France and other countries. Of particular importance here was the struggle against right-wing dictatorships in Portugal, Spain and Greece. The success of these revolutions was part of the general upswing of the end of the era of economic growth of the 1950-1979s, when much seemed possible.

Finally, society was satisfied with what was achieved and the “revolutionaries” got tired. How fatigue accumulated in them is perfectly shown in the modern film “Something is in the Air” (2012). They were disappointed in the workers. Notes of this disappointment are heard in John Lennon’s sad song “Hero of the working class”. It is not difficult to see it in the transition of the hero of the Paris barricades of 1968 the anarchist Daniel Cohn-Bendit to the ranks of adequately systemic environmental parties in France and Germany. Now in the cohorts of “green” there are many critics of the neoliberalism of the 2000s. The most striking figure here is Canadian journalist Naomi Klein, the author of the book “Shock Doctrine” that denounces neoliberalism. Though, this was later… In the 1980s many parents were happy to see their “wised up” children in the ranks of office staff, among buyers of new cars, homes and aspiring to a corporate career. Hippie’s long hair was cut, and the recent criticism of parents for their commitment to the “consumer society” was forgotten.

The turnaround did not happen overnight. In the years 1973-1982 the world experienced an acute economic crisis. In the book “Capitalism of crises and revolutions how formation epochs alternate, new long waves are born, restorations die and neomercantilism advances” I dwell on its essence in great detail[2]. My colleagues from the Department of Political Economy and the History of Economic Science of the Plekhanov Russian University of Economics repeatedly pointed out in analytical reports that: the current crisis is very similar to that crisis. It was also emphasised in the report “Donald Trump and the Economic Situation”, where in 2016 it was shown how difficult it is to overcome such a crisis[3]. But the crisis of 1973-1982 according to the apt expression of the French historian Fernand Braudel was similar to a flood, and did not resemble the hurricane crisis of 1929-1933[4]. This was due to the fact that the state struggled against the manifestations, but not the causes of the economic crisis.

Almost a decade of economic crisis was enough to launch serious changes. The time had come for financial globalisation, the transfer of industry to the Third World countries and the growth of financialisation of Western economies. There industry contracted and the service sector expanded.

How the crises decide instead of us

People often look at democracy as a product of their own activity. In this sense, its development is perceived as the result of smart agitation and the rational organisation of collective interaction, and weakening as the result of incorrect actions. But history has laws and these laws are primarily economic laws. One of these laws concerns the change of long waves by Nikolay Kondratiev. These waves of development last for 20–25 years and are replaced by particularly severe, major crises. Such crises appeared after the great crisis of the 14th century. However, their regularity can be traced from the 1770s, when under the influence of the great crisis, an industrial revolution took place in England.

The development of the economy of capitalism is wave-like and can also be called cyclical. The Great Crisis of 1973-1982 is on a par with the crisis of 2008–2020, to which the analytical report “The Crisis of the Global Economy and Russia” was devoted. The report was written under the guidance of the author and reflected his understanding of processes in the world economy[5]. This report was released in early June 2008. It contained a predictive analysis of events, which were subsequently confirmed in many ways, and most importantly confirmed the correctness of the concept of big crises, an area of my research. Such crises existed before. Their full range is: 1770-1783, 1810-1820, 1847-1850, 1873-1879, 1899-1904, 1929-1933, 1948-1949, 1973-1982 and 2008-2020. In Figure 1. their place in the development process can be seen.

Figure. 1 Large economic crises before and after the industrial turn of 1770-1783.

Rallies, demonstrations, strikes, occupation of campuses and slogans at lectures in the name of democracy everywhere and always all this remained in the past by the end of the crisis-era of the 1970s. The turn was painful, difficult and most importantly (it always happens) there have been such shifts in the global economy, and then in technology that weakened the old industrial regions of the West. The removal of industry to peripheral countries, the growth of office facilities in the old centres of capitalism meant a change in the sphere of social relations and ideas.

Neoliberal withering of democracy

Immanuel Wallerstein could write volumes about the “1968 revolution,” but big business was the real winner. But its victory was dictated not so much by a clash with the “lower strata” as by failures during the years of the crisis of 1973-1982, which showed the need for fundamental changes in economic policy. Keynesianism has used up its historical resource.

With changes and for the sake of change neoliberal forces came to power, demanding the market to be unchained to complete freedom and the role of the state in regulation to be reduced. The main idea was simple: let the central banks rule with the help of monetary instruments. From the point of view of democracy, this means abandoning an extremely important sphere out of public control. Later, the United States will impose on countries the independence of central banks from the authorities, and Naomi Klein in the book “The Doctrine of Shock” will devote many pages to uncovering the negative consequences of such changes[6].

If central banks are independent or almost independent of the government, they are very little dependent on society. But did this mean that Western democracy shrank like the shagreen skin from Honore de Balzac’s work only due to this? In the 1980-1990s the importance of trade unions declined and the importance of left-wing parties simply collapsed. Being very serious during the crisis of the 1970s, with the collapse of the USSR they turn into parties on the political sidelines or adopt neoliberal programmes. From that moment on, all influential forces can be divided into open liberals and those masquerading as socialists, social democrats and even communists. The Green are a special type of disguise, a very effective one. The masses lose confidence in parties and the parties often lose their mass origins. They do not lose touch with their clientele, they even develop it, but they cease to be agents of the “lower strata” in the political system. The party nomenclature is adjusted to the time politically and the “lower strata” economically.

All this undermines the foundation of the very bourgeois democracy in which the propertied classes were forced to take into account the demands of the masses, since these masses had strong agents. The masses themselves were their strength. With the decline in the industrial organisation of the “lower strata,” their role in public life also deminishes. Now they are required to vote in the elections, the procedural instance of procedural liberal democracy, having even lost the indirect and largely formal power of the “demos”. But this “demos” seems to betray its former self. It follows neoliberal ideas and forces, turning away from radical left or national-conservative preachers.

When procedures prevail

Without taking into account the fact that the majority of citizens of industrialised countries followed neoliberals, such as Margaret Thatcher in the UK and Ronald Reagan in the USA, it is impossible to understand the causes of the crisis of Western democracy and its basic structures. Of course, one can believe the version that the “lower strata” were insidiously deceived, blindly followed the masters of hypnotic phrases and therefore lost faith in their own strength, the strength of their structures and in the chance of democracy. However, the truth seems different: the working class abandoned democracy and the basic working structures following the temptation to leave its class.

In those days, it was about turning people into owners of state and municipal housing (privatisation), creating small business, corporate careers, or just working in an office, which was very different from working in a factory. The temptation included the ability to dress in business style, dine in cafes and restaurants, and generally increase consumption. Many were not concerned about democracy. They did not turn against it, but its transformation into procedural democracy was not stopped.

It is amusing, but the Western working class surrendered its democratic and highly conditional dictatorship to bourgeois political management almost as quickly as the working class in Soviet Russia in 1918-1919 in a deal with party nomenclature exchanged its democratic dictatorship for new opportunities. They also included vertical mobility for some: opportunities to go up the social ladder. As a result, in the West the model of liberal democracy was established, a procedural democracy and much more formal than the form that preceded it. And if the electorate could choose parties or candidates at will, they would still get the same result, since ideologically the elections had almost no alternative. And the liberal spirit of this “democracy” was most expressed in this.

 From our partner International Affairs

[1] Koruakovtsev A. Viskunov S. Marxism i poliphonia razumov – Ekaterinburg, «Kabinetnyi uchenyi», 2016 – p. 663.

[2] Koltashov V.G. (2019). Kapitalizm krizisov i revolutsii: kak smenyautsja formatsionnye epohi, rozdautsja dlinnye volny, umiraut restavratsii i nastupaet neomercantilizm, M.: “RuScience”.

[3] Report of the Department of Political Economy and the History of Economic Science of the Plekhanov Russian University of Economics “Donald Trump i ekonomisteskaya situatsiya: strategiya kandidatov v presidenty i Vroraya volna krizisa v SSHA”  // Institute for globalisation and social movements. – URL: http://igso.ru/trump_situation/ (publication date: 28.10.2016; reference date: 27.08.2018).

[4] Braudel F. Materialnaya tsivilizatsiya, ekonomica i kapitalizm XV-XVIII . Vol. III. Vremya mira — М.: «Progress», 1992. — p. 76-77.

[5] Report of the Institute for globalisation and social movements. (IGSO) «Krizis globalnoy economiki i Rossiya» // Institute for globalisation and social movements.. – URL: http://igso.ru/world_crisis_and_russia/  (publication date: 09.06.2008; reference date: 28.01.2020).

[6] Klein Naomi.  Shock Doctrine: The Rise of Disaster Capitalism  – M.: «Dobraya kniga», 2009, p. 890.

An economist and historian specializing in economic crises from ancient times to the epochs of commercial and modern industrial capitalism, Head of the “Institute of a New Society”, Professor for the Plekhanov Russian University of Economics

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Sustainable Agriculture in Modern Society

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Now everybody is seeing the world is changing fast in this 21st century and many industries and modern buildings are also developing all over the world. But the land areas for farming are becoming narrower and narrower. Moreover, the global population is increasing rapidly and the earth becomes a crowded planet. But the younger people who are interested in agriculture are becoming less and less. There might be some young people who even think that they get foods from grocery stores because the younger generation are used to buy many kinds of ready-made foods such as fruits and vegetables easily from supermarkets. Recently, in the developed countries, the average age of many farmers is over 50 years old and the numbers of young farmers are decreasing. The shortage of young farmers can become a crisis in the future of the developed world.

In modern days, most young adults cannot see the difficult lives of farmers beyond the curtain. The farmers have to pass their whole life through a tough living in farming and sell their products at very low profit to many profiteering companies because they don’t have much choices. It is a sad story for farmers but truly happening in these modern days.

Today I would like to point out that we should not forget the role of agriculture which is very fundamental and essential for building a nation. Farming is an age-old profession that supported the settlement of human beings for thousands of years to survive on this planet. Agriculture is very important for the development of a nation because it provides the trading and employment, supply the foods and textiles and that can lead to the rise in gross domestic product (GDP) of a nation. Agriculture plays a crucial role in economy of a developing nation where majority of population is in rural areas and agriculture is the main source of job in many underdeveloped areas. Many families in developing countries live depending on farming for their livelihood. So, it can be even said that developing agriculture is an important step to reduce poverty and hunger in many developing countries. Agriculture support nutrients rich foods that are essential requirements for our healthy life because nutrients rich foods provide energy for our body, essential nutrients for our vital organs such as brain and heart etc, and enhance our immune system. So, agriculture is necessary for a flourishing and joyful life of human being.

Especially let’s see my home country, as data from Food and agriculture organization (FAO) of the United Nations, “The agriculture supports 37.8 % of gross domestic product of Myanmar, contributed to 25-30% of total export earnings and employs 70 % of the labour force”. Humans cannot survive without agriculture. When there is no more agriculture, it will end with starvation and collapse in economy. It will cause a serious failure in modern civilization.

Nowadays, modern farming is largely evolved into industrial agriculture where many kinds of chemical fertilizers are being used to induce massive production. Industrial agriculture is beneficial to economic development because it can cause the crops growing faster than in the traditional agriculture. The industrial agriculture can provide more enough foods for growing population in modern civilization. However, it is not sustainable because it cannot protect the benefits of the society and our green planet in the long run. Chemicals used in agriculture are destroying the soil where is left with damaged soil fertility and this area can’t be reused in the future. This is a huge affect to sustainability of our green environment.

Modern agriculture has many issues related to water scarcity, soil erosion, climate changes and etc. To be sustainable in agriculture, we must focus on solutions of these issues. The sustainable agriculture will focus on three bottom lines that is environmental, economical and social.

The sustainable agriculture involves many practices such as using the organic fertilizers in farming, growing drought resistant crops, breeding biodiversity in farms, modified irrigation systems and others. Sustainable agriculture is more suitable to practice for the future of the green earth than industrial agriculture. It is very important to promote awareness of sustainable agriculture and issues related to environmentally toxic practices in agricultures among local farmers. And I believe that it can cause many advantages for economic development if farmers can work systematically with sustainable practices in their farming and the local authority can provide farmers with more technological skills and lending some funding to practice sustainable ways in agriculture. With the willingness to participate for environmental heath at the enough profit for incomes of daily living life, I hope famers will become socially responsible persons.

And another one more point, in this digitalization era, we should certainly apply digital technologies in sustainable agriculture. By developing digital farming, it will help farmers to get easier access to source of many information related to agricultural practices. Government in developing countries should support to develop digital farming as rapidly as possible for the poor farmers to get proper profits and to work in environmentally friendly practices. Since poor countries already have enough labour force, they just need many financial aid and technology supports to grow into sustainable agriculture.

I believe that it is a responsibility for our humans that we should not forget something that had supported our existence on this earth. We should work out for development of traditional agriculture into modern agriculture with the best sustainable ways. As being a part of this society, we must help each other, we must protect the sustainability of this green earth, Biodiversity and this is also beneficial for long-term existence of our human beings on this earth. Let me end this talk by suggesting everyone to promote sustainable agriculture in your surrounding local farming.

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The Blazing Revival of Bitcoin: BITO ETF Debuts as the Second-Highest Traded Fund

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It seems like bitcoin is as resilient as a relentless pandemic: persistent and refusing to stay down. Not long ago, the crypto-giant lost more than half of its valuation in the aftermath of a brutal crackdown by China. Coupled with pessimism reflected by influencers like Elon Musk, the bitcoin plummeted from the all-time high valuation of $64,888.99 to flirt around the $30,000 mark in mere weeks. However, over the course of the last four months, the behemoth of the crypto-market gradually climbed to reclaim its supremacy. Today, weaving through national acceptance to market recognition, bitcoin could be the gateway to normalizing the elusive crypto-world in the traditional global markets: particularly the United States.

The recent bullish development is the launch of the ProShares Bitcoin Strategy ETF – the first Bitcoin-linked exchange-traded fund – on the New York Stock Exchange. Trading under the ticker BITO, the Bitcoin ETF welcomed a robust trading day: rising 4.9% to $41.94. According to the data compiled by Bloomberg, BITO’s debut marked it as the second-highest traded fund, behind BlackRock’s Carbon fund, for the first day of trading. With a turnover of almost $1 billion, the listing of BITO highlighted the demand for reliable investment in bitcoin in the US market. According to estimates on Tuesday, More than 24 million shares changed hands while BITO was one of the most-bought assets on Fidelity’s platform with more than 8,800 buy orders.

The bitcoin continued to rally, cruising over the lucrative launch of BITO. The digital currency rose to $64,309.33 on Tuesday: less than 1% below the all-time high valuation. In hindsight, the recovery seems commendable. The growing acceptance, albeit, has far more consequential attributes. The cardinal benefit is apparent: evidence of gradual acceptance by regulators. “The launch of ProShares’ bitcoin ETF on the NYSE provides the validation that some investors need to consider adding BTC to their portfolio,” stated Hong Fang, CEO of Okcoin. In simpler terms, not only would the listing allow relief to the crypto loyalists (solidifying their belief in the currency), but it would also embolden investors on the sidelines who have long been deterred by regulatory uncertainty. Thus, bringing larger, more rooted institutional investors into the crypto market: along with a surge of capital.

However, the surging acceptance may be diluting the rudimentary phenomenon of bitcoin. While retail investors would continue to participate in the notorious game of speculation via trading bitcoin, the opportunity to gain indirect exposure to bitcoin could divert the risk-averse investors. It means many loyalists could retract and direct towards BITO and other imminent bitcoin-linked ETFs instead of setting up a digital custodianship. Ultimately, it boils down to Bitcoin ETFs being managed by third parties instead of the investor: relenting control to a centralized figure. Moreover, with growing scrutiny under the eye of SECP, the steps vaguely intimate a transition to harness the market instead of liberalizing it: quiet oxymoronic to the entire decentralized model of cryptocurrencies.

Nonetheless, the listing of BITO is an optimistic development that would draw skeptics to at least observe the rampant popularity of the asset class. While the options on BITO are expected to begin trading on the NYSE Arca Options and NYSE American Options exchanges on Wednesday, other futures-based Bitcoin ETFs are on the cards. The surging popularity (and reluctant acceptance) amid tightening regulation could prove a turn of an era for the US capital markets. However, as some critics have cited, BITO is not a spot-based ETF and is instead linked to futures contracts. Thus, the restrain is still present as the regulators do not want a repeat of the financial crisis. Nevertheless, bitcoin has proved its deterrence in the face of skepticism. And if the BITO launch is to be marveled at, then the regulations are bound to adapt to the revolution that is unraveling in the modern financial reality.

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Is Myanmar an ethical minefield for multinational corporations?

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Business at a crossroads

Political reforms in Myanmar started in November 2010 followed by the release of the opposition leader, Aung San Suu Kyi, and ended by the coup d’état in February 2021. Business empire run by the military generals thanks to the fruitful benefits of democratic transition during the last decade will come to an end with the return of trade and diplomatic sanctions from the western countries – United States (US) and members of European Union (EU).  US and EU align with other major international partners quickly responded and imposed sanctions over the military’s takeover and subsequent repression in Myanmar. These measures targeted not only the conglomerates of the military generals  but also the individuals who have been appointed in the authority positions and supporting the military regime.

However, the generals and their cronies own the majority of economic power both in strategic sectors ranging from telecommunication to oil & gas and in non-strategic commodity sectors such as food and beverages, construction materials, and the list goes on. It is a tall order for the investors to do business by avoiding this lucrative network of the military across the country. After the coup, it raises the most puzzling issue to investors and corporate giants in this natural resource-rich country, “Should I stay or Should I go?”

Crimes against humanity

For most of the people in the country, war crimes and atrocities committed by the military are nothing new. For instances, in 1988, student activists led a political movement and tried to bring an end to the military regime of the general Ne Win. This movement sparked a fire and grew into a nationwide uprising in a very short period but the military used lethal force and slaughtered thousands of civilian protestors including medical doctors, religious figures, student leaders, etc. A few months later, the public had no better options than being silenced under barbaric torture and lawless killings of the regime.

In 2007, there was another major protest called ‘Saffron Uprising’ against the military regime led by the Buddhist monks. It was actually the biggest pro-democracy movement since 1988 and the atmosphere of the demonstration was rather peaceful and non-violent before the military opened live ammunitions towards the crowd full of monks. Everything was in chaos for a couple of months but it ended as usual.

In 2017, the entire world witnessed one of the most tragic events in Myanmar – Again!. The reports published by the UN stated that hundreds of civilians were killed, dozens of villages were burnt down, and over 700,000 people including the majority of Rohingya were displaced to neighboring countries because of the atrocities committed by the military in the western border of the country. After four years passed, the repatriation process and the safety return of these refugees to their places of origin are yet unknown. Most importantly, there is no legal punishment for those who committed and there is no transitional justice for those who suffered in the aforementioned examples of brutalities.

The vicious circle repeated in 2021. With the economy in free fall and the deadliest virus at doorsteps, the people are still unbowed by the oppression of the junta and continue demanding the restoration of democracy and justice. To date, Assistant Association for Political Prisoner (AAPP) reported that due to practicing the rights to expression, 1178 civilians were killed and 7355 were arrested, charged or sentenced by the military junta. Unfortunately, the numbers are still increasing.

Call for economic disengagement

In 2019, the economic interests of the military were disclosed by the report of UN Fact-Finding Mission in which Myanmar Economic Corporation (MEC) and Myanmar Economic Holding Limited (MEHL) were described as the prominent entities controlled by the military profitable through the almost-monopoly market in real estate, insurance, health care, manufacturing, extractive industry and telecommunication. It also mentioned the list of foreign businesses in partnership with the military-linked activities which includes Adani (India), Kirin Holdings (Japan), Posco Steel (South Korea), Infosys (India) and Universal Apparel (Hong Kong).

Moreover, Justice for Myanmar, a non-profit watchdog organization, revealed the specific facts and figures on how the billions of revenues has been pouring into the pockets of the high-ranked officers in the military in 2021. Myanmar Oil & Gas Enterprise (MOGE), an another military-controlled authority body, is the key player handling the financial transactions, profit sharing, and contractual agreements with the international counterparts including Total (France), Chevron (US), PTTEP (Thailand), Petronas (Malaysia), and Posco (South Korea) in natural gas projects. It is also estimated that the military will enjoy 1.5 billion USD from these energy giants in 2022.

Additionally, data shows that the corporate businesses currently operating in Myanmar has been enriching the conglomerates of the generals and their cronies as a proof to the ongoing debate among the public and scholars, “Do sanctions actually work?” Some critics stressed that sanctions alone might be difficult to pressure the junta without any collaborative actions from Moscow and Beijing, the longstanding allies of the military. Recent bilateral visits and arm deals between Nay Pyi Taw and Moscow dimmed the hope of the people in Myanmar. It is now crystal clear that the Burmese military never had an intention to use the money from multinational corporations for benefits of its citizens, but instead for buying weapons, building up military academies, and sending scholars to Russia to learn about military technology. In March 2021, the International Fact Finding Mission to Myanmar reiterated its recommendation for the complete economic disengagement as a response to the coup, “No business enterprise active in Myanmar or trading with or investing in businesses in Myanmar should enter into an economic or financial relationship with the security forces of Myanmar, in particular the Tatmadaw [the military], or any enterprise owned or controlled by them or their individual members…”

Blood money and ethical dilemma

In the previous military regime until 2009, the US, UK and other democratic champion countries imposed strict economic and diplomatic sanctions on Myanmar while maintaining ‘carrot and stick’ approach against the geopolitical dominance of China. Even so, energy giants such as Total (France) and Chevron (US), and other ‘low-profile’ companies from ASEAN succeeded in running their operations in Myanmar, let alone the nakedly abuses of its natural resources by China. Doing business in this country at the time of injustice is an ethical question to corporate businesses but most of them seems to prefer maximizing the wealth of their shareholders to the freedom of its bottom millions in poverty.

But there are also companies not hesitating to do something right by showing their willingness not to be a part of human right violations of the regime. For example, Australian mining company, Woodside, decided not to proceed further operations, and ‘get off the fence’ on Myanmar by mentioning that the possibility of complete economical disengagement has been under review. A breaking news in July, 2021  that surprised everyone was the exit of Telenor Myanmar – one of four current telecom operators in the country. The CEO of the Norwegian company announced that the business had been sold to M1 Group, a Lebanese investment firm, due to the declining sales and ongoing political situations compromising its basic principles of human rights and workplace safety.

In fact, cutting off the economic ties with the junta and introducing a unified, complete economic disengagement become a matter of necessity to end the consistent suffering of the people of Myanmar. Otherwise, no one can blame the people for presuming that international community is just taking a moral high ground without any genuine desire to support the fight for freedom and pro-democracy movement.

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