Factbox: The Myanmar military conglomerates sanctioned by U.S. and Britain

Posco Steeleon

25/03/2021 14:18

(Adds U.S., UK sanctions, POSCO and Adani investments)
    March 25 (Reuters) - The United States and Britain
sanctioned conglomerates controlled by Myanmar's military on
Thursday following its Feb. 1 coup and deadly crackdown on
demonstrators.  urn:newsml:reuters.com:*:nL1N2LN1FM urn:newsml:reuters.com:*:nL9N2JX01R
    Here is what we know about the blacklisted firms Myanmar
Economic Holdings Ltd (MEHL) and Myanmar Economic Corporation
(MEC), based on a 2019 report produced by the United Nations
Human Rights Council.
    After Reuters broke news of the U.S. sanctions earlier on
Thursday, MEHL general manager Hla Myo said in an email: "The
company is basically focusing on business and has no immediate
response for now."  urn:newsml:reuters.com:*:nL1N2LN00V
    MEC did not immediately respond to a request for comment.
    
    - MEC and MEHL are two major holding companies that own more
than 100 businesses, generating revenue for the military on a
scale that dwarfs any civilian-owned company in Myanmar. 
    - Financial information about the two companies, which are
exempt from paying income and commercial tax, is not disclosed.
The funds they generate bypass formal government channels, with
indications that billions of dollars of revenue from oil and
gas, copper and gemstone operations remain unaccounted for.
    - MEHL was the first private company established in Myanmar
following a 1988 coup that installed a new military regime after
two decades of army-led socialism. MEHL has businesses that span
jade and ruby mining, banking, food and drink sales, tourism and
transport.
    - MEC was established in 1997 and is equally diverse but
with a greater focus on raw material production, including coal
and gas, and manufacturing. Its main purpose is to supply the
military with natural resources and factory goods.
    - The companies own two of Myanmar's largest private banks,
giving the military access to the international financial
system. Myawaddy Bank, established in 1993, is owned by MEHL.
MEC owns Innwa Bank, which opened in 1997.
    - Current and former high-ranking officials in the Tatmadaw,
as the military is known locally, including Commander-in-Chief
Min Aung Hlaing, have significant control and influence over the
two holding companies and their subsidiaries.
    - MEHL and MEC own sizeable amounts of land throughout
Myanmar, including premises rented by foreign companies. They
also have joint ventures with foreign firms.  urn:newsml:reuters.com:*:nL1N2L70NV
    - Japanese drinks maker Kirin  2503.T  last month announced
it was cutting ties with MEHL, although it plans to keep selling
beer in the country.  urn:newsml:reuters.com:*:nL1N2KL0DJ 
    - An affiliate of South Korean steelmaker POSCO  005490.KS 
runs a plant in Myanmar with MEHL. A spokesman for the
affiliate, POSCO C&C  058430.KS , said on Thursday the firm did
not expect the U.S. sanctions to impact its business in Myanmar.
    - A unit of Indian firm Adani is developing a port in Yangon
through a lease deal with MEC, according to the 2019 U.N report.
An Adani spokesman declined to comment on the lease deal on
Thursday. He said the firm was watching the situation and will
engage with authorities and stakeholders on the way forward.

 (Compiled by Joe Brock and John Geddie; Editing by Martin
Petty)
 ((joe.brock@thomsonreuters.com; +6598355351; Reuters Messaging:
joe.brock.thomsonreuters@reuters.net))