【本月我們挑選的《The Diplomat》付費文章，深度分析了一個被人忽略的疑問：緬甸軍政府策動政變後，雖然以殘暴方式鎮壓一切反抗，但選舉獲勝的民選政府依然可以成立平行政府，並有自己的武裝部隊，堅持勇武抗爭。然而緬甸平行政府不像烏克蘭，沒有任何國家正式提供武備，究竟這支軍隊的軍費從何而來？】 War isn’t cheap. How has the National Unity Government funded itself – and its military efforts? / By Zachary Abuza Following the February 1, 2021 coup d’état in Myanmar that overthrew the country’s democratically elected government, a shadow parliament and government were established. After eight months of sustained civil disobedience, in September 2021, the National Unity Government (NUG) declared a defensive war, an armed insurrection against the junta. By May 2022, the NUG claimed to control 15 percent of the country, while affiliated ethnic armed organizations (EAOs) controlled approximately 30-35 percent. But war isn’t cheap, especially without any state sponsors. While several key EAOs, including the Kachin Independence Organization and the Karen National Union, provided some initial training, a limited amount of arms, and assistance, the NUG’s military campaign against the government has been self-funded. While the NUG government has received limited amounts of foreign assistance for humanitarian needs and has made appeals for international assistance for the basic governance of the regions it does control, it has received no external funding for armed operations. The NUG and its 250 affiliated People’s Defense Forces (PDFs) have used an array of funding mechanisms to support their shadow government operations as well as their armed insurrection. So how has the NUG funded itself? In short, the NUG and its parliament, the Committee Representing the Pyidaungsu Hluttaw (Union Parliament), have relied on a range of very clever and sophisticated means that take advantage of their overwhelming legitimacy among the public and their technical prowess. They’ve made funding a patriotic endeavor, and all the while have eschewed the ubiquitous production and trade of illicit narcotics, the traditional source of funding for insurgencies in Myanmar, even at a time when drugs are flooding out of the country in record amounts. The NUG has taken advantage of new technologies and put in place some of the most progressive financial systems in Southeast Asia. But the bottom line is that the NUG is trying to raise revenue as if they are the proper state they claim to be. They’ve used fundraising as an important means to create a bond between the people and the NUG, while at the same time, delegitimizing the State Administrative Council (SAC), as the junta is known. The Early Days: Funding Civil Disobedience Immediately after the February coup, a civil disobedience movement (CDM) broke out across the country. It was hoped that a sustained nationwide general strike, together with non-violent protests, would force the military to relinquish power. Although the NUG would quickly be established, the priority throughout most of 2021 was to channel funds to support the civil disobedience movement, which erupted spontaneously. The CDM’s general strikes brought the country to a standstill. Financial support was necessary to support striking civil servants, medical sector employees, and railway and port workers. Both the CDM organizers and the NUG have been able to rely on the patriotism of the population, whose views of the military have gone from fear to disgust. Support for the CDM strikers largely came from donations, both domestic and from the diaspora. Domestic contributions moved quickly, but the grassroots fundraising done by the diaspora, an estimated 200,000 in the West and over a million in India and Southeast Asia, has also been impressive. Voluntary contributions were necessary but insufficient, especially as the military increased repression and made clear that they had no intention of surrendering power. A steadier stream of resources became necessary to support what was turning into a protracted conflict. But there was another reason: The NUG leadership was well aware of the economic burden, especially in the face of the economic implosion that followed the coup. As a result of the coup, the ensuing violence, mismanagement of the COVID-19 pandemic, and the SAC’s economic malpractice, the country’s economy withered. GDP contracted by 18 percent in 2021; the kyat, at the lowest point, lost 60 percent of its value. Currency controls restricted imports, foreign investors fled en masse, inflation spiked, and over half the country fell under the poverty line. In short, the coup eviscerated 10 years of economic progress in a few short months. The ability of domestic supporters to continue to support the CDM out of their own pockets became increasingly limited. The diaspora has remained committed, but their resources are not limitless either and the SAC spent considerable time trying to shut down financial pipelines into the country. The SAC has become increasingly focused on stopping domestic donations. In a series of recent police actions, the government arrested students for making donations under $10, via online banking services such as KBZPay or Wave Money, for which they received seven- to 10-year sentences. The anti-terrorism law, rewritten by the junta, now has 10-year sentences for financing proscribed groups and most have been tried in military tribunals. In one recent case, seven individuals received 10-year sentences for donating the equivalent of $8 to their local PDFs. Raising Revenue Like a State Donations could not support the resistance indefinitely, and the NUG made revenue generation a top priority. Immediately following the coup, the United States government seized $1 billion in Myanmar government reserves that had been deposited in the Federal Reserve Bank of New York. Myanmar was estimated to have roughly $6 billion deposited in overseas accounts, including in Tokyo and Singapore. No other country followed the U.S. lead in freezing reserves. Even with the United States viewing the NUG as the legitimate government, the NUG has been unable to secure the frozen $1 billion. The NUG has, likewise, tried to borrow against that $1 billion, but to no avail. This has been a key talking point every time the NUG leadership has the opportunity to meet with senior U.S. government officials. As such, the NUG’s fundraising has had to be adaptive, creative, and sustained. The NUG immediately stood up a Ministry of Planning, Finance, and Investment (MPFI), which has three broad objectives: to raise funds for the NUG; to intercept, deny, and deter sources of revenue for the military regime; and to coordinate donations, both domestic and foreign. From the start, NUG Minister of Planning, Finance and Investment Tin Htun Naing was insistent that the NUG could not rely on donations alone. There was a strong sense that if the NUG was going to act like a state, then it had to raise money like a state. It is the first major substate actor in Myanmar’s violent history that has tried to support itself completely through lawful means, including the issuance of bonds, establishing a formal taxation system, the selling of assets through open tender, and lotteries. In addition, it coordinates bilateral aid and donations. By the end of June 2022, the NUG claimed to have raised $44 million. The Spring Lottery The first revenue generation program the NUG began was to raise funds through lotteries. The first online lottery was held in August 2021 and its 50,000 tickets sold out within hours, despite junta threats against those who participated. The goal of the “spring lottery” was to raise 20 billion kyat ($11 million) to support 5,800 striking civil servants. Only $8 million was raised, but in a sign of patriotism, 55 of the 78 lottery winners donated their winnings back to the NUG. The problem was that the SAC government quickly figured out what was going on and froze the accounts that were being used domestically to raise funds for the NUG. The NUG expected that if successful, lotteries could raise $11 million a month. The spring lottery had an additional benefit and one that supported the MPFI’s charge of denying sources of funding to the SAC. At the same time people were supporting the NUG’s spring lotteries, public boycotts of the SAC’s state lottery, Aung Bar Lay, increased. The junta was so short of cash that it had to reduce its 1.5 billion kyat payout ($911,000) to 500 million kyats. Overall, the SAC’s revenue from the lottery fell from $90 million in FY2020 to $48 million in FY2021. The problem with the lotteries was that the military immediately understood what was happening, and used its control over the banking system, including teams of regulators installed in all the private banks, to freeze the accounts that were being used to move the money. The spring lottery could not work without access to the formal banking sector. Sovereign Debt for an Uncertain Sovereign States routinely issue bonds for both domestic and international investors. What is much less common is for a substate actor to successfully do so. While the NUG believes it is the de jure and lawful government, in the eyes of the international community, its status is less clear. The MPFI’s Treasury Department is charged with making “arrangements for selling government bonds and treasury bills to the public.” In what may be a first, on November 22, 2021 the NUG issued a blockchain crypto-based bond via accounts that were established in Czechia, whose government has been very sympathetic to the NUG. Tin Htun Naing insisted that the bonds be zero yield, making the purchase of the bonds a clear political statement, a show of popular legitimacy, rather than a mere investment. The bonds were denominated in $100, $500, $1,000, and $5,000, with a two-year maturity. $3 million worth were sold in the first three hours, the NUG said, increasing to $6.3 million by 12 hours. On its first day, the NUG raised $9.5 million. Its overall target is to raise $1 billion through bond sales. As of the end of June 2022, the NUG had raised just over $40 million in bond sales. The issuance of the bonds was made possible by blockchain encryption and a helpful facilitating government. Buyers of the bonds made payments via international transfers to an account in Czechia, a temporary workaround for now. The bond purchase page is only in Burmese and the zero interest has allowed the NUG to skirt some Western financial oversight. The NUG posts updates on new tranches of bonds on a Facebook page. Bond sales have not just been an important way for the NUG to raise funds. They serve a critically important political function, too. The NUG cannot win the war without the support of various EAOs. The NUG has pledged that its goal is to establish the country as a federal democratic republic. And although the NUG has shown a greater commitment to this than any previous government, there are still lingering suspicions on the part of ethnic minorities and EAO leadership about this. While the NUG is dependent on the EAOs at the moment, there is a legitimate concern that they will not follow through with a federal system that devolves political and economic power if and when they regain control of the country. The issuing of bonds plays a role in building trust. There are specific bond issues that are tied to each region. For example, there are Kachin- and Karen-specific bond issues, from which the EAOs get 100 percent of the proceeds. For the first time a Bamar-majority “central government” has not only promised revenue sharing with minority regions but acted on that promise. By June 2022, the NUG had transferred $2 million to Karen groups in Kayah State. This, of course, also weens the EAOs away from the production or taxation of illicit narcotics, which does much to hamper international support for the NUG and its partners. Taxation: Creating the Bond The NUG wanted to formalize the collection of taxes to support the shadow government’s operations and provision of social services. Taxes form an essential bond between the citizenry and the state. For people to pay taxes to the NUG was a strong signal of their popular legitimacy and something that irks the SAC. The MPFI was charged with establishing a “tax system which can provide assistance when building a federal democratic nation in accordance with the consent of the people.” In September 2021, the NUG’s parliament, the Committee Representing the Pyidaungsu Hluttaw, approved the “Union Taxation Law.” The law provided for individual and corporate taxpayers both domestic and foreign to voluntarily pay tax online through a self-assessment process. By November 2021, the MFPI claimed that over $150,000 in taxes had been paid. Tin Htun Naing acknowledged that “[o]nly a very small percentage of major businesses have started paying taxes. The main taxpayers right now are the regular office staff and small businesses.” The tax rates were set by the payees themselves, and the NUG issued receipts. In short, the payment of taxes has become a political statement. Should the NUG look like it’s getting closer to achieving its political goals, corporations and individuals are likely to increase their contributions to hedge their bets. Beginning in April 2022, the SAC launched a crackdown on several high-profile tycoons, all of whom had worked closely with the military. This may have been an attempt by the junta to squeeze them, as the junta is short on cash. But the crackdown may also stem from the suspicion that so much of the NUG’s funding is coming from domestic sources. “They are just trying to let them know that they depend entirely on the military’s favor for their riches. And that means that they have to do the generals’ bidding,” one businessman told Myanmar Now in May 2022. There is no rhyme or reason for whom they are targeting; the randomness creates a level of fear and compliance. The SAC has doubled down on its prosecution of businessmen who are supporting the NUG and PDFs. In a recent raid, a prominent hotelier in Monywa was “accused of providing financial assistance to PDFs.” An example was going to be made of him as other businessmen begin to hedge their bets, and support the NUG. The bigger concern for the NUG is who and how much to tax both in territories that they control and in contested territory. The NUG claims to control 15 percent of the country’s territory, and it recently announced Phase II military operations, an offensive to expand its control. The NUG needs to impose taxation over the territory that they have full control over. But the reality is that most people are being taxed by multiple actors. The military government is taxing them, and often compelling them to pay at the barrel of a gun. At the same time, they may want to pay taxes to the NUG out of patriotism. There is also the problem that while some PDFs stil...