Aung San Suu Kyi under fire as refugee crisis tarnishes Myanmar image

Singapore/Yangon: For decades Myanmar’s leader Aung San Suu Kyi was one of the globe’s most famous political prisoners, winning a Nobel Peace Prize and receiving tributes from world leaders and rock stars like U2’s Bono.

Now she’s under attack over her response to a fresh round of violence that has seen more than 145,000 minority Rohingya Muslims flee into neighbouring Bangladesh since last month. Myanmar’s army said more than 400 people have died in the past few weeks and most of them are “militants,” while human-rights groups say hundreds of villagers have been killed.

The crisis threatens to sap investor confidence in the fast-growing Southeast Asian nation, which saw the US and European nations drop sanctions after the military junta released Suu Kyi from house arrest in 2010. Foreign companies that rushed in are again worried about risks from human rights concerns.

Also Read: Myanmar’s Aung San Suu Kyi denounces terrorists, silent on Rohingya exodus

“It certainly impacts sentiment,” said Hal G. Bosher, chief executive officer of Yoma Bank in Myanmar’s financial capital Yangon. “The Rohingya issue is giving foreign investors pause that maybe this is not the perfect story we had hoped.”

Suu Kyi, 72, fought back on Wednesday. In a readout of a phone call with Turkey President Recep Tayyip Erdogan, she said “a huge iceberg of misinformation” is creating divisions in society to promote the interests of terrorists. She noted that Turkey also dealt with terrorism, and said Myanmar is doing its best to ensure it doesn’t spread through its western state of Rakhine.

‘Fake news’

“We know very well, more than most, what it means to be deprived of human rights and democratic protection,” she said. “So we make sure that all the people in our country are entitled to protection of their rights.”

Zaw Htay, the official spokesperson for Myanmar’s central government, said that attacks by Muslim militants aren’t getting enough attention. As many as 100 Rohingya targeted 25 locations in late August, killing a dozen security personnel.

Also Read: Rohingya Muslims have nowhere to go

“In the international community, people are spreading fake news on social media,” Zaw Htay said. “They don’t emphasize the killing, they only emphasize the clearance operation conducted by the security forces. We see this is not fair.”

The treatment of the Rohingya in Buddhist-majority Myanmar has repeatedly generated accusations of mass murder in recent years. Many of the country’s 53 million people view the 800,000 Rohingya, who are denied citizenship, as illegal migrants from what is now Bangladesh.

‘Tough position’

Suu Kyi, who became Myanmar’s de facto leader after elections in 2015, has found herself caught between a world worried about the fate of the Rohingya and local interests concerned about terrorism.

Publicly criticizing the violence in Rakhine risks hurting the popularity of her National League for Democracy and could upset Myanmar’s former military rulers who still have significant power, said David Dapice, a fellow and economist of the Myanmar Program at the Ash Center in the Harvard Kennedy School.

“She is in a tough position,” he said. “The more she condemns the excesses in Rakhine, the more she weakens her public position and the NLD.”

Also Read: Narendra Modi says India shares Myanmar’s concerns on ‘extremist violence’

United Nations Secretary-General Antonio Guterres on Tuesday warned that Myanmar faced the risk of ethnic cleansing. He demurred on a question on whether Suu Kyi should speak out more against human-rights abuses, saying the UN wants “a Myanmar where the Rohingya population will see their rights fully respected.”

At home, Suu Kyi risks losing support if she even acknowledges that Myanmar has a Rohingya population—something the junta never did.

‘Overwhelmed’

Thein Nyunt, a former NLD lawmaker, criticized Suu Kyi for not invoking a terrorism law to better protect ethnic Rakhine, the majority group in the state.

“The international community is telling us to acknowledge the Rohingya and redraw our laws,” he said. “I assume that international community is attacking us for their political aim.”

Five UN agencies are working with aid groups to help Rohingya who have fled, Robert Watkins, the resident coordinator in Bangladesh, said by email. The most urgent needs include finding space for shelter in a border area.

“We are of course overwhelmed at this moment by a quickly evolving situation,” he said.

While Rakhine currently attracts very little onshore foreign investment, mainly due to its remoteness, the perception of increased security risks will reinforce its unattractiveness for investors, said Vicky Bowman, director of the Myanmar Centre for Responsible Business in Yangon. Most affected are companies dealing with tourism and oil and gas, she said.

Still promising

Foreign investment plunged 30% last fiscal year after overseas investors pumped a record $9.5 billion into the economy in the preceding 12 months. The investment shortfall coincided with concern over the direction of the government’s economic agenda and increased attention over Rakhine.

Myanmar still has a bright economic outlook as it builds off a low base. The Asian Development Bank forecasts growth at 7.7% for 2017 and 8.0% in 2018.

Bosher at Yoma Bank, which in June announced a two-year partnership with the Netherlands’ Rabobank Groep to offer financial products targeting agriculture, said that investors in emerging markets are used to doing business in countries with ethnic strife.

“The promise of Myanmar has not been dulled by this,” Bosher said. “Everyone with a conscience is unhappy about it. But—without any moral consideration, purely from a commercial point of view—this crisis has very little bearing on the commercial opportunities of Myanmar. I’m not necessarily happy about that, but that’s the way it is.” Bloomberg