Guidance

Overseas Business Risk: Myanmar (Burma)

Updated 20 December 2024

1. Political

On 1 February 2021, Commander-in-Chief Min Aung Hlaing, the Head of Myanmar’s Armed Forces, staged a coup d’état and overthrew the democratically elected civilian government led by the National League for Democracy (NLD). State Counsellor Aung San Suu Kyi and President Win Myint remain detained alongside a wide range of political prisoners.

The opposition National Unity Government (NUG), formed by members of the former parliament, operates from outside of Myanmar and virtually. Many inside the country have taken up arms against the military regime, including Ethnic Resistance Organisations (EROs) and smaller armed groups known as People’s Defence Forces (PDFs).

A series of protests followed the coup alongside a Civil Disobedience Movement (CDM) focused on restricting the military regime’s control of vital services, particularly through peaceful strikes and a domestic boycott of military linked companies. This, alongside decisions made by the military regime, has impacted the public and private sector, bringing severe disruption to basic services such as electricity, internet access, banking, health and transportation.

Political tension and unrest are widespread since the coup and general levels of violence are high, with many leaving military-controlled areas to join resistance groups. Subsequently, protests in the main cities are few in number to avoid security forces.

Since the coup, there has been an increased use of small explosive and arson attacks against targets such as buildings controlled by the Myanmar security forces and other premises associated with the regime, such as ward administrators’ offices. In February 2024, the military regime introduced conscription which has led to human capital flight that has impacted businesses in various sectors.

Conflict is present in Myanmar, in varying degrees, across almost all states and regions. See Myanmar travel advice for more details. The general situation remains volatile and unpredictable. The Myanmar security forces are responsible for serious human rights violations across the country and a campaign of ethnic cleansing against the Rohingya in Rakhine State.

The UN Independent Fact Finding Mission has produced several reports which document the actions of the Myanmar security forces. The Assistance Association for Political Prisoners produces daily reports on the situation and statistics on the numbers killed, arrested and detained.

On 24 April 2021, the Association of Southeast Asian Nations (ASEAN) issued a 5-point consensus calling for an immediate cessation to violence, access to humanitarian aid and for mediated dialogue between all parties concerned. The UK continues to support the ASEAN Five Point Consensus including through securing a UN Security Council resolution on the situation in Myanmar in December 2022. The resolution demands an end to violence and urges immediate action by the military regime to fully implement the ASEAN Five Point Consensus and release all those arbitrarily detained.

Information on political risk, including political demonstrations, is available in the FCDO travel advice.

2. Economic

Myanmar is the 7th largest economy in ASEAN with a GDP of $68 billion in 2024. With an estimated GDP (nominal) per capita of $1,248 (down from $1,462 in 2020), it remains a lower-middle income country and the poorest in South East Asia (IMF, WEO April 2024).

The UNDP reported 49.7% of the population was in poverty in 2023 – a substantial increase from 24.8% in 2017. These GDP and poverty statistics highlight the status of a deteriorated economy after more than 3 and a half years under the State Administration Council (SAC) leadership. The decade-long economic reforms and development gains are now being reversed following the SAC’s policy changes after the February 2021 coup.

Economic growth remains very weak with a real GDP growth forecast of minus 1% in 2024 (World Bank, MEM December 2024). The economy is largely restrained by the increasing conflict, double-digit inflation and prolonged electricity shortages.

During the quasi-civilian rule period from 2011 to 2021, liberalisation on economic governance, trade and investment resulted in the opening of the economy with positive impacts and an average of 6% growth.

Since the coup, the economy has struggled with relatively low growth and a significant depreciation of Myanmar Kyat (MMK). In early September 2024, the local currency is now worth less than a quarter of its pre-coup value at the market rate. With 26.5% inflation last year, real incomes have significantly declined with implications for the poorest in society. The economy remains around 10% lower than pre-COVID levels, in sharp contrast to the experience of other larger countries in the region.

Myanmar has seen increased economic mismanagement with centralised controls and a move away from the market system to one with increased restrictions, reversal to a relationship-based economy, and a decline in the rule of law.

There were also some high-level withdrawals of international firms after the coup. There remain ongoing risks of further international economic isolation from the International Labour Organisation (ILO) governing body bringing in potential measures on Myanmar under article 33 due to their non-observance of ILO conventions and from the Financial Action Task Force (FATF) bringing in countermeasures due to the country’s lack of progress on their anti-money laundering and counter-terrorist financing action plan. In 2022, FATF added Myanmar to the list of high-risk jurisdictions subject to action (also known as the blacklist).

There remain potential further economic risks if conflict and instability continue to increase. In February 2024, the military regime activated conscription resulting in negative consequences for the economy including migration-driven labour shortages and capital flight. The military regime’s economic mismanagement is likely to maintain difficulties for consumers and businesses in terms of restricted access to foreign exchange, essential commodities and energy. Unless these issues get resolved, a significant rebound in growth remains unlikely in Myanmar.

Key figures at a glance

• population: 54.5 million (IMF, 2024)
• GDP: USD 68 billion, (IMF, 2024)
• GDP per capita (nominal): $1,248 (IMF, 2024)

3. Sanctions

The UK government, alongside international partners, have imposed financial, trade, director disqualification and immigration sanctions in respect of Myanmar. The UK’s autonomous sanctions regime is established by the Myanmar (Sanctions) Regulations 2021 (“the Regulations”), which have replaced the Burma (Sanctions) (EU Exit) Regulations 2019. Further information and guidance is available regarding the UK’s sanctions regime relating to Myanmar.

Since the coup, the UK government has announced a number of designations on individuals and entities, targeting ’involved persons’, who for example are, or have been, involved in a specified activity such as undermining democracy, the rule of law or good governance in Myanmar. Designated persons can be subject to an asset freeze, director disqualification sanctions, and/or travel bans.

See full guidance on the trade, director disqualification, immigration and financial sanctions. As well as reviewing the Regulations, businesses should review the UK sanctions list which identifies entities and individuals designated under the Regulations, and details of the sanctions regimes in respect of which they have been designated.

The prohibitions and requirements imposed by UK sanctions regulations apply within the United Kingdom or its territorial sea, including Northern Ireland, and in relation to the conduct of all UK persons wherever they are in the world. This includes UK companies incorporated or established in the UK, and to branches of UK companies overseas.

As regards to financial sanctions, the Regulations impose a targeted asset freeze, ensuring a designated person’s funds and economic resources (non-monetary assets, such as property or vehicles) are not dealt with, and prohibitions ensuring that funds and economic resources are not made available, directly or indirectly, to or for the benefit of a designated person.

Furthermore, it is prohibited to participate intentionally in activities knowing that the object or effect of them is, whether directly or indirectly, to circumvent any of the financial prohibitions, or to enable or facilitate the contravention of any such prohibition.

The Regulations currently impose trade restrictions on military goods and technology, on dual-use goods and technology, and on specified goods and technology which may be used to repress the civilian population in Myanmar, or for interception or monitoring purposes.

It also imposes further trade restrictions in respect of the provision of interception and monitoring services to, or for the benefit of, the Government of Myanmar, or the provision of certain services, funds or armed personnel to, or for the benefit of, the Myanmar Armed Forces. “For military use” is defined in Chapter 3 of the UK Myanmar (Sanctions) Regulations 2021.

The trade prohibitions in the Regulations cover the export or supply and delivery of certain items to, or for use in, Myanmar, and the making available of certain items to persons connected with Myanmar or for use in Myanmar, as well as the provision of certain related ancillary services. This means that, even if the initial destination is not Myanmar, the prohibition may still apply.

Exporters should check the ultimate end-use of goods and may apply for a licence or contact the Export Control Joint Unit (ECJU) if they know or think the items may be used in Myanmar. For the provision of services, guidance is available from the Office of Trade Sanctions Implementation (OTSI).

For general guidance on export controls and trade sanctions, contact the Export Control Joint Unit: exportcontrol.help@businessandtrade.gov.uk, +44 (0)20 7215 4594.

4. Business and human rights

The UK government is clear in its opposition to the coup and is pushing for the restoration of democracy, the protection of rights and freedoms and unobstructed humanitarian access.

In association with our allies and partners, the UK government has tailored its response to the coup and sought to impose a cost on the military regime while protecting the poorest and most vulnerable. We recognise that the complete collapse of the economy, business and trade will significantly impact Myanmar’s people, including the most vulnerable, which could destabilise the wider region and cause issues for years to come. International trade and investment have a key role to play in poverty reduction, economic development and providing a variety of products for the citizens of Myanmar.

Businesses should be aware that the commercial interests of the Myanmar security forces, and associated individuals, are wide-ranging. Businesses operating in Myanmar should remain aware of developments of relevant sanctions.

If procuring natural resources from Myanmar, particularly teak, businesses should be aware of sanctions and should ensure they conduct thorough supply chain due diligence to ensure that their intended activities do not contravene sanctions prohibitions and restrictions and that they are not supporting the military or its associated businesses.

We recommend that gem importers conduct thorough supply chain due diligence to ensure that they are not supporting the military or its associated businesses, even if their supply chain seems to be outside of Myanmar. Ruby, jade and pearl exports are known to be heavily controlled and associated with the military and may enter into the UK market through other countries.

The Myanmar military regularly uses air strikes against civilian targets. There has been increased attention on the role of international companies involved in the aviation fuel supply chain in Myanmar. If dealing with any entity linked to Myanmar’s aviation sector, businesses – including those in the insurance sector – should conduct thorough supply chain diligence to ensure that commodities such as jet-fuel do not reach the military. Businesses operating in Myanmar should remain aware of targeted sanctions on individuals and entities in the aviation fuel sector.

The UK government has undertaken an extensive consultation with civil society and UK businesses trading with Myanmar and has determined the following issues are of most concern to UK businesses.

Continuing business operations in Myanmar

In line with the UK government’s objective to protect the most vulnerable and to encourage market diversification, we advise that UK businesses operating in Myanmar may continue to do so while the political, economic and societal environment allows and that businesses should comply with standards of responsible business conduct, including respecting human rights.

They will also need to ensure they are taking account of FCDO Travel Advice. The UK government is clear that UK businesses must fully comply with relevant sanctions and not enter relationships that benefit the military regime.

We also encourage all businesses operating in Myanmar to assess the impact of a potential withdrawal from the market in line with United Nations Guiding Principles on Business and Human Rights. Please refer to our guidance on due diligence.

Responding to workforce concerns and human rights violations and abuses

The UK government is seriously concerned about the increasing human rights violations being observed in Myanmar. Businesses should work closely with their suppliers and partners to ensure that the safety, security and wellbeing of their workforce is a primary concern and that employers are respectful of individual rights, including the right to protest.

We encourage businesses to retain workers undertaking lawful and peaceful protest wherever possible and to remain compliant with their terms of employment, including not to dismiss workers for taking part in peaceful protest. For more information on the human rights situation please consult the UK’s Annual Human Rights and Democracy Report.

The UK has ratified all 8 of the fundamental ILO conventions, including CO87 (Freedom of Association and Protection of the Right to Organise) and CO98 (Right to Organise and Collective Bargaining) and we expect businesses to ensure they and their suppliers and partners are compliant with these conventions.

The OECD and International Labour Organisation have issued guidelines for multinational enterprises on responsible business conduct including regarding these conventions. More information and advice on the OECD guidelines can be sought from the UK National Contact Point.

The Independent Investigative Mechanism for Myanmar (IIMM) is collecting evidence of the most serious international crimes and violations of international law committed in Myanmar since 2011, this includes violations since 1 February 2021. We encourage businesses to report any observed human rights violations or abuses to the IIMM.

Remaining compliant with sanctions for the transit of goods

Businesses should work with logistics partners to undertake all practical efforts to minimise exposure to military owned supply chains and ports. Some information on subsidiaries and affiliate companies of Myanmar Economic Holdings Ltd (MEHL) and Myanmar Economic Cooperation (MEC) can be found in the 2019 United Nations report detailing the economic interests of the Myanmar military. However, this is not an exhaustive list and it is up to businesses to conduct their own due diligence.

Making funds or economic resources available to, or for the benefit of, a designated person (directly or indirectly), without a licence or valid exception, is prohibited under financial sanctions legislation.

The Office of Financial Sanctions Implementation (OFSI) has published financial sanctions guidance including specific FAQ guidance for importers and exporters. Any suspected breaches of financial sanctions should be reported to OFSI.

Paying taxes and other fees

Businesses should remain compliant with the laws of Myanmar unless these violate relevant sanctions, international law or are illegal under the UK Bribery Act (see Section 5) or other UK laws. In all cases we recommend businesses seek independent legal advice.

Selling goods and services via third parties

Businesses with supply chain links to Myanmar face reputational, economic and legal risks and should ensure that third parties are aware of their own legal obligations and international frameworks such as OECD guidelines. Businesses trading in goods or services outlined in Chapter 1 of UK sanctions guidance should consider seeking legal advice noting that even if the immediate destination is not Myanmar, the prohibition may still apply.

In general businesses should consider the reputational and legal risks of goods or services being linked to, or utilised by, the Myanmar security forces and work to limit supplies through third party distributors accordingly.

Conducting safety critical maintenance on equipment linked to Myanmar security forces

Businesses seeking to trade with sanctioned entities or individuals (for example, “designated persons”) should be aware of the technical assistance provisions contained in the UK sanctions guidance and should consider Chapter 3 regarding authorisation and licencing for a sanctioned activity.

Applications for trade sanctions licences can be made through SPIRE. Enquiries for applications for certain items and services that are not processed on SPIRE can be made to tradesanctions@businessandtrade.gov.uk.

Financial sanctions are distinct from trade sanctions and Chapter 6 of the OFSI general guidance deals specifically with exceptions and licensing. The guidance covers the most common exceptions relating to financial sanctions as set out in legislation.

A licence is written permission from the relevant licensing authority permitting an act that would otherwise be prohibited under sanctions regulations. A sanctions licence does not compel any party to undertake any transaction.

Further information on OFSI licencing, as well as compliance and enforcement and the OFSI consolidated list of financial sanctions targets, can be found at www.gov.uk/ofsi. Completed licence application forms and queries can be submitted to ofsi@hmtreasury.gov.uk. OFSI prioritises urgent and humanitarian cases, for example, cases that involve a risk of harm or threat to life. In all cases OFSI recommends applicants seek independent legal advice.

Remaining compliant with sanctions if facilities are built on land owned by sanctioned entities and individuals

OFSI will consider licensing activities that fall within the licensing grounds set out in the legislation. These licences, however, cannot be issued retrospectively so if an entity has carried out an act that required a licence, without having obtained one beforehand, they may have breached financial sanctions and should consult Chapters 5 and 7 of OFSI’s general guidance immediately.

You should consider whether a designated person owns or controls (directly or indirectly) any relevant land that relates to the payment of ground rent.

UK businesses should conduct thorough due diligence on land ownership before entering into a contract to avoid providing financial support to the Myanmar security forces or their associated businesses.

Remaining compliant with sanctions imposed by other nations such as the United States or European Union

If you have queries about sanctions imposed by the US, Canada, EU, or other states, you should consult relevant national guidance and legislation. You may also wish to take legal advice, as appropriate.

Guidance regarding due diligence

Businesses are ultimately responsible for conducting due diligence regarding their engagement and operations within Myanmar and should seek legal advice to ensure compliance with relevant sanctions, law and standards, as well as undertaking appropriate risk assessments.

The UK government expects businesses to work with businesses that follow best practice on responsible business, including respecting human rights in Myanmar and to not enter or continue contracts, rent from or purchase from private sector entities that do not meet such standards.

The OECD has produced guidelines for multinational enterprises and on due diligence. The UK government also encourages businesses to implement the United Nations Guiding Principles of Business and Human Rights (UNGPs). Since the whole of Myanmar can be considered a conflict-affected and high-risk area, businesses should conduct ongoing and heightened due diligence.

Businesses should be aware that under section 54 of the Modern Slavery Act 2015, certain businesses with a turnover of £36 million or more are required to produce modern slavery statements during each financial year setting out the steps they have taken to tackle modern slavery in their supply chains and any other part of its own business.

The Department for Business and Trade (DBT) team at the British Embassy in Yangon and can assist with pointing businesses towards organisations that provide due diligence services: Trade.Yangon@fcdo.gov.uk.

5. Bribery and corruption

The Bribery Act applies to non-UK companies operating in the United Kingdom, and to UK companies working overseas.

It created 4 prime offences:

• two general offences covering the offering, promising or giving of an advantage, and requesting, agreeing to receive or accepting of an advantage
• an offence of bribing a foreign public official
• an offence of failure by a commercial organisation to prevent a bribe being paid to obtain or retain business or a business advantage (should an offence be committed, it will be a defence that the organisation has adequate procedures in place to prevent bribery)

The Act recognises that no bribery prevention regime will be capable of preventing bribery at all times. A company will have a full defence if it can show that despite a particular case of bribery it nevertheless had adequate procedures in place to prevent persons associated with it from bribing.

Companies must therefore make sure that they have strong, up-to-date and effective anti-bribery policies and systems in place to prevent bribery by persons associated with them.

6. Terrorism and security

Please see the information provided in the FCDO Travel Advice Terrorism section.

7. Intellectual property

Myanmar is a country with limited support for intellectual property (IP) rights as IP laws remain unimplemented. The UK government’s advice globally is that it is essential to register your rights as soon as possible in order to be able to defend and enforce them. IP rights are territorial in nature which means that registrations in the UK or another country’s jurisdiction are not automatically enforceable in others.

Myanmar is a member of the World Intellectual Property Organisation (WIPO). However, Myanmar is not a signatory to any conventions.

The IPO has attachés based in Singapore providing IP business support to UK companies operating across Southeast Asia.

The IPO has information on protecting your intellectual property overseas.

Further information on the local IP system can be found at the Myanmar IPO website.

8. Useful information

The UN Office of the High Commissioner for Human Rights 2023 publication on ‘Business and Human Rights in Challenging Contexts: Considerations for Remaining and Exiting’ is relevant to Myanmar.

Other information that could support companies to undertake heightened human rights due diligence when sourcing from or operating in Myanmar is available on the website of Myanmar Centre for Responsible Business (MCRB). This includes guidance on regulatory frameworks and human rights risks connected to particular issues and sectors. 

However, human rights risks for business in Myanmar are constantly evolving. Chambers of Commerce in Myanmar offer briefings on emerging issues. For the apparel sector, the MADE in Myanmar is a useful resource, including for collective action. 

MCRB also initiated the regular Pwint Thit Sa report which aims to incentivise Myanmar companies to improve their corporate governance and disclosure, thereby facilitating due diligence by potential business partners.

9. Organised crime

Please see the information provided in the FCDO Travel Advice Safety and security section.

10. Further information

The DBT team at the British Embassy in Yangon can assist with general enquiries: Trade.Yangon@fcdo.gov.uk.