The military budget documents were shared with OCCRP by an activist group called Justice For Myanmar. The group today made public spreadsheets that contain data from the budget documents. In addition to EU firms, the documents show that the military planned to acquire equipment made by companies from the United States, Canada, and Australia, which have their own arms embargoes and sanctions in place. Justice for Myanmar is also publishing the procurement documents related to the purchase of an Airbus plane from a domestic airline, and the planned purchase of two military aircraft from Jordan.
Sanctioned, embargoed, and accused of genocide, Myanmar’s military continues with efforts to acquire equipment made by European companies, as well as Airbus planes from Jordan’s air force, leaked documents show.
The military, which ruled Myanmar as a dictatorship for nearly half a century until 2011, has long been accused of war crimes and crimes against humanity in its conflicts with an array of ethnic armed groups.
The Tatmadaw, as the military is known, hit headlines again in 2016 when troops responded to an insurgency in western Rakhine State by murdering and raping Rohingya civilians and burning their villages. The violence escalated the following year, driving more than 740,000 Rohingya Muslims, an ethnic and religious minority, into Bangladesh, where they remain today in overcrowded refugee camps.
Last year, Gambia filed a case accusing Myanmar of genocide at the International Court of Justice, while the International Criminal Court opened an investigation into the offensive in Rakhine State.
In 2018, the European Union extended a long-standing arms embargo against Myanmar in response to the violence, which the United Nations declared had “genocidal intent.” The EU also imposed sanctions on military leaders, and other countries did too.
Arms data in EU reports show that British companies exported equipment to Myanmar the year the violence broke out in Rakhine, while Spanish firms sold supplies in 2015. Those exports may have violated the terms of the arms embargo, although they are listed in such broad categories that it is impossible to know.
The leaked Myanmar military budget documents provide further information about Tatmadaw plans to acquire European-made equipment, revealing intended purchases that would likely violate sanctions.
The budget documents are proposed expenditures, and it was not possible to confirm in most cases whether the items were delivered. However, the military could have obtained the equipment secretly, as it has in the past, by using front companies or buying through intermediaries.
Separate documents show that a Myanmar company, run by a British passport-holder, is facilitating the proposed sale of two Airbus aircraft owned by the Jordanian Air Force to the Tatmadaw for US$38.6 million. Under the terms of the proposed deal, which is set to complete this year, the Myanmar company also offers training for pilots at an Airbus facility in Spain.
Jordan has no sanctions against the Tatmadaw, but EU companies or individuals risk breaking the law if they do business with Myanmar’s military.
“Any supply of equipment or support, or financial activities related to trade to the military and the paramilitary in Myanmar, is banned, full stop,” said Siemon Wezeman, an arms trade expert with the Stockholm International Peace Research Institute.
“That goes for things that go ‘bang’ — so, real weapons — as well as any other piece of equipment.”
Brigadier General Zaw Min Tun, a spokesman for the Myanmar military, did not respond to multiple requests for comment.
New Old Planes
Myanmar lived for decades under strict international sanctions, which barred Western companies from doing business there due to human rights abuses carried out by the military junta that seized power in 1962.
In 2013, in response to sweeping political and economic reforms that saw the Tatmadaw nominally cede governance, the EU lifted all restrictions except the embargo on weapons and equipment that might be used for repression.
Other countries, including the United States, Canada, and Australia, also eased sanctions around the same time. Foreign companies arrived in the country as people prepared for elections in a novel environment of free speech and unrestricted media.
But the military retained strong political influence, even after a civilian government led by Nobel Prize winner Aung San Suu Kyi was elected in 2015. The Tatmadaw continues to run key ministries, while the constitution allots one quarter of parliamentary seats to the military, and also declares it free from civilian control or oversight.
Myanmar’s civilian authorities do not seem to have been involved in the military’s efforts to acquire two Airbus CASA C295 planes from the Royal Jordanian Air Force. Payment for the two aircraft is to be completed December 30, according to a leaked proposal outlining the deal.
Sean Lee, a spokesperson for Airbus, said company records showed the planes are owned by the Royal Jordanian Air Force. A source in Jordan who was not authorized to speak publicly about the deal confirmed that the air force is selling the planes. He said the transaction was “still under implementation,” but he did not know which country was buying them.
Airbus markets the C295 as a “combat-proven” plane that operates in “hot and humid environments of the Brazilian jungle and Colombian mountains, in the dusty and very hot deserts of Algeria and Jordan, and in the extremely cold winters and icy conditions of Poland and Finland.” Primarily used for military transport, the aircraft can also deploy paratroopers or serve as a gunship, the company’s website says.
Grainy photos of the planes included in the document appear to show them bearing the insignia of the air force and the flag of Jordan. The Muslim-majority country’s queen has publicly denounced the international community’s lack of action in defending the Rohingya against “unimaginable acts of violence.”
As part of the deal, the documents say, eight pilots and four mechanics will be provided training at Airbus facilities located in Seville, Spain, or at another location.
The deal is being facilitated by a Myanmar company called Aero Sofi. One of its three directors is Sai Kham Park Hpa, a former top executive at now-defunct Air Mandalay. He holds both a Myanmar and a British passport, and lists more than a decade of experience working at London’s Heathrow airport on his CV.
Neither Sai Kham Park Hpa nor Patrick Aung, another director, responded to multiple requests for comment.
Aero Sofi is also facilitating the transfer from a Myanmar domestic airline to the Tatmadaw of an Airbus A319 that formerly flew with Finnair and was known as the “Silver Bird.”
🔗The Silver Bird
In the summer of 2008, Finnair marked its 85th anniversary with a touch of retro flair. The flag carrier and largest airline of Finland debuted an Airbus A319 painted in a throwback livery, giving the aircraft a 1950s look.
The aircraft, dubbed the Silver Bird, made its first flights complete with crew dressed in era-appropriate outfits and air hostesses carried vintage-style Finnair bags.
The plane made its last flight as the Silver Bird in 2012. But the aircraft itself, with a new paint scheme, is now being overhauled for a different set of passengers: the VIPs of Myanmar’s air force.
Documents seen by OCCRP, including work contracts, insurance statements, and equipment lists, show how the military bought the plane with the help of one of Myanmar’s best-known companies, and a historic Hong Kong business group.
The plane was sold in October 2012 to Myanmar’s Air KBZ Limited. The company is a subsidiary of the Kanbawza Group of Companies, a large Myanmar conglomerate which the U.N. flagged last year for donating $2.5 million to Tatmadaw Commander-in-Chief Min Aung Hlaing.
A contract signed last year between the Myanmar Air Force and Aero Sofi Co details how the plane would be drastically overhauled to a “VIP configuration” to “deliver a comfortable cabin that provides passengers with a high level of comfort and efficiency in order to ensure an enjoyable experience aloft.”
To accomplish this, the plane is being fitted with a new entertainment system and wireless internet, and reconfigured into three sections. The first, contains two “VIP” seats with wall-mounted tables, a second zone has 16 business class seats, while a third has 60 economy seats. The works cost just over $4.8 million.
The refurbishment is being done by HAECO Xiamen, a member of the HAECO Group, a Hong Kong-based aircraft engineering and maintenance service provider. It is owned by Swire Pacific, a Hong Kong-listed subsidiary of John Swire & Sons Limited, which is headquartered in the UK.
Swire did not respond to emails seeking comment. A spokesperson for HAECO Group said: “We are sorry to inform that we are not able to assist.”
The contract was signed on behalf of Brigadier General Soe Tin Latt, of the Air Force. A spokesman for the Myanmar military, and the managing director of Aero Sofi Co, Patrick Aung, did not respond to requests for comment.
The leaked budget documents show Myanmar’s military made the decision to buy equipment that likely contravened arms embargoes.
The items range from a printer and sewing machines, to ammunition and a “Missile Director System,” but very few manufacturers are named. In some cases, however, the documents include branded items, which allowed reporters to identify the companies that made them.
Among the items included on the budget to buy from European manufacturers is German-made secure software for mobile communications. The budget proposals also show telephone exchange systems, as well as a ground power unit (GPU) used to power airplanes when not in flight, which are both sold by French companies.
In April 2018, the EU prohibited sales of “dual use” products, which have both civilian and military applications, and imposed restrictions on the export of “equipment for monitoring communications.”
Wezeman, the arms trade expert, said the mobile phone software would likely be considered dual use, and the phone exchange system “could be if it is for military use or has military-specific features.”
He noted that direct sales of dual use items to the Tatmadaw are banned, and that companies have a duty to research other buyers to ensure they are not connected to the military.
“Companies and export licensing authorities should determine if the buyer is safe,” he said. “I assume also that a follow-up, post shipment, check is part of the process.”
The GPU turns up in a budget document dated before the prohibition on dual use items. But European companies were subject before that to a “ban on the export from the EU of any equipment that might be used for internal repression,” which Wezeman said may have covered the power unit.
The exact nature of the equipment sales recorded in the EU’s arms export reports is more difficult to determine.
Campaigners say the EU’s reporting mechanism for arms sales is far too opaque to be effective.
“The current system of reporting requirements is under continuous criticism,” said Milan Eibl, a defense sector analyst at Transparency International.
“It allows companies and governments to continue supplying violent regimes even under embargos through opaque descriptions of material, thus allowing them to prioritize profit before casualties.”
Nabila Massrali, EU Spokesperson for Foreign Affairs and Security Policy, told OCCRP that the bloc’s descriptions of sanctioned material were “extremely detailed and precise,” but implementing the embargo was up to individual member states.
Spain reported that in 2015 it sold material classified as: “Imaging or countermeasure equipment, specially designed for military use, and specially designed components and accessories.”
Britain reported six sales in 2017 falling under categories that included aircraft and related supplies, “electronic equipment, ‘spacecraft’ and components,” and “armoured or protective equipment.”
The details are so vague that it is impossible to know whether the deals violated the embargo that was in place before the EU strengthened its sanctions regime in mid-2018. Despite the broad categories, however, Wezeman said the EU reports do contain hints that some equipment was mostly likely for military use.
One of Britain’s sales, for example, falls under a category relating to fire from weapons: “Fire control, and related alerting and warning equipment, and related systems, test and alignment and countermeasure equipment, specially designed for military use.”
“It sounds very military and definitely should have all kinds of alarm bells ringing,” Wezeman said, although he noted that some components of systems for detecting and avoiding fire could also have civilian uses.
“It may be actually the whole system, which is being plugged onto a civilian government aircraft to protect it from being shot at with missiles.”
Bulldozers and Radios
Aside from EU firms, the budget documents cite products made by companies in other parts of the world. This includes television broadcast equipment from Canada, bulldozers from the U.S., and secure radio gear from Australia made to keep out eavesdroppers.
Australia has an arms embargo, which its foreign affairs department says makes it illegal to “directly or indirectly supply, sell or transfer arms or related matériel to Myanmar.”
In the case of the Canadian technology, the company admitted that it had sold it to Myawaddy TV, a military-owned station. Ross Video said in a press release that its technology had been used to broadcast a football tournament, and that it was “delighted to have been involved in this competition.”
Since 2007, Canada has maintained a “trade embargo on arms and related material, as well as on related technical and financial assistance” to certain individuals and entities controlled by Myanmar’s former military rulers. However, Wezeman said it was unlikely this sale was in violation as the equipment was used for civilian purposes.
By the time Ross sold the technology to Myawaddy TV, reports of Tatmadaw soldiers committing atrocities against Rohingya civilians had been published and broadcast worldwide for almost 18 months.
But Ross Video’s CEO, David Ross, told OCCRP he saw no moral problem with selling to Myanmar’s military, arguing that “10 more companies will be happy to step in and sell in our place.”
“One could argue that countries representing more than half of the world’s economy are viewed as being responsible in some way by some people for war crimes, crimes against humanity, genocide,” he added in an email.
Facebook removed the Myawaddy TV page, and others linked to the Tatmadaw, shortly after a UN report on military abuses of civilians was published. Facebook said in a statement that those behind the pages had “enabled serious human rights abuses in the country. And we want to prevent them from using our service to further inflame ethnic and religious tensions.”
The leaked budget document for 2019/2020 mentions the planned purchase of four bulldozers made by an American company.
Bulldozers have been used previously to clear Rohingya villages. Satellite imagery analyzed by Human Rights Watch in 2018 shows that dozens of villages once occupied by Rohingya who fled from Rakhine to Bangladesh have been bulldozed into the ground. The group accused Myanmar of destroying “crime scenes.”
“Bulldozing these areas threatens to erase both the memory and the legal claims of the Rohingya who lived there,” HRW Asia Director Brad Adams said in a statement.
Washington lifted most of its sanctions on Myanmar in 2016, but kept in place an arms embargo, though it would likely not cover sales of equipment like bulldozers. The U.S. Embassy in Myanmar was unable to provide clarification on the terms of the embargo, despite repeated requests.
The Tatmadaw’s broad economic influence, and the difficulty of navigating Myanmar’s bureaucracy, means foreign firms can find themselves dealing with military-linked companies even after conducting due diligence checks.
Over decades of junta rule, the military gained control of much of Myanmar’s economy, and today it owns companies that range from soap making and mining, to tourism, telecommunications and banking.
A 2019 U.N. report on the Tatmadaw’s economic interests pinpointed 120 subsidiaries of two massive military-controlled conglomerates, while the researchers said they were “certain” there were even more unidentified firms. Additionally, the U.N. pointed to Myanmar companies with close connections to the Tatmadaw.
The U.N. warned foreign firms to be vigilant in ensuring they do not assist Myanmar’s military in any way: “This report puts companies on further and effective notice of the human rights implications that arise from maintaining business connections with the Tatmadaw.”
Myanmar’s military could use any number of companies under its control or influence to purchase equipment indirectly — which appears to have been the case with a helicopter drone acquired from the Austrian firm Schiebel.
The deal became public in late 2018, after footage of navy officers operating the aircraft was broadcast on the military’s Myawaddy TV, and the U.N. later named Schiebel in its report.
Schiebel denied selling the aircraft to the Tatmadaw, telling the Austrian publication Profil that it had “delivered CAMCOPTER® S-100 for monitoring and mapping in mining and road construction to Myanmar.”
Schiebel refused to say which Myanmar company bought the drone, and the Profil reporter was unable to obtain that information in Austria.
“The hope, of course, was that there would be some investigation into this,” said Christoph Zotter, the journalist who wrote the Profil story, over the phone from Vienna. “The ministry of economy said it would look into this, but never published what it found out.”
Schiebel told the Business & Human Rights Resource Centre — which queried foreign companies named in the U.N. report — that the “Myanmar military is not one of our customers” and the sale “took place with valid export licensing, before the EU embargo was imposed.”
Other companies said their products had ended up in Tatmadaw hands via subsidiaries or resellers.
Wezeman said EU regulations require companies supplying equipment that could be considered dual use to take measures to ensure that such items do not fall into the hands of the Tatmadaw.
“If they are ordered by the military, then that should be banned,” he said.
“If they are ordered by another entity in Myanmar, then there should be a very clear understanding that they cannot be passed on to the military — that it’s not a front for the military.”