US gives banking green light to Myanmar tycoons

YANGON: Two banks owned by tycoons associated with Myanmar's former military regime will start to do business with US companies and investors in the latest reward for the Southeast Asian country's rapid political transformation.

The US Treasury Department said last Friday it would issue a general licence for four of Myanmar's biggest banks: Myanma Economic Bank, Myanma Investment and Commercial Bank, Asia Green Development Bank and Ayeyarwady Bank - allowing US companies and citizens to deal with them.

The easing of sanctions on Asia Green Development Bank and Ayeyarwady Bank underlines how politically-connected capitalists of the old regime - whom the US once castigated - are re-inventing themselves and retaining a strong foothold as foreign investors race to enter the country.

It helps remove uncertainty among US companies over lingering restrictions on their dealings in Myanmar and is expected to increase the domestic reach of US credit card firms Visa and MasterCard.

The decision was announced ahead of a visit to Myanmar by 50 American executives yesterday to explore opportunities in the resource-rich nation, the latest sign of burgeoning foreign corporate interest in the country of 60 million.

Washington eased sanctions last July to allow US companies to invest in and provide financial services to Myanmar, dropping restrictions on dealing with most Myanmar banks.

Sean Turnell, an expert on Myanmar's economy at Australia's Macquarie University, said the latest move was significant because it would normalise the flow of international funds in and out of Myanmar.

But he said the inclusion of formerly blacklisted Ayeyarwady Bank and Asia Green Development Bank was a surprise given previous US assurances that they "still had their eye on the worst offenders of the past regime".

Ayeyarwady Bank is owned by Zaw Zaw, who was previously described by the US Treasury as "a regime crony" and blacklisted under targeted US sanctions four years ago.

Asia Green Development Bank is controlled by Tay Za, Myanmar's best known tycoon. He was previously sanctioned by the US Treasury as a "notorious henchman and arms dealer." Reuters