Episode # 371: Flattery Will Get You Everywhere
“I remain confident in the longer term, completely, actually, that this regime is losing,” says Sean Turnell, the Australian economist and former advisor to Myanmar’s civilian government.
This is Turnell’s fourth time on the podcast. In his first appearance, he unpacked the long shadow of cronyism, currency collapse, and rent-seeking that has stunted national growth and fueled the coup; the second time, he recounted the experiences behind his arrest, imprisonment, and release, interwoven with reflections on Aung San Suu Kyi, and economic reform; most recently, he explored post-coup economic innovation, revolutionary funding mechanisms, and the tug-of-war over currency control between the military regime and the resistance. Today, Turnell discusses the recent U.S. decision to lift sanctions on several suspected cronies connected to the Myanmar junta; this episode launches an emergency series from Insight Myanmar that will address this recent turn of events and their implications. Despite the widespread concern, controversy and confusion surrounding the move, Turnell offers a nuanced, cautiously optimistic perspective grounded in his deep understanding of Myanmar’s economy, U.S. sanctions policy, and the bureaucratic realities of Washington.
Turnell begins by clarifying the scope of the recent announcement. Contrary to the more pessimistic interpretations, he believes that the move does not represent a broad policy shift. “This is very, very targeted to a few individuals and a few enterprises,” he says, emphasizing that it does not signal, at least for now, that the military itself or its main financial organs are being rehabilitated. Instead, he views it as a narrow administrative adjustment—albeit one that could become counterproductive if it emboldens the junta or encourages additional lobbying by its cronies.
He also strongly rejects a narrative around this move that has quickly gained traction: the claim that the sanctions were lifted because Min Aung Hlaing wrote a flattering letter to President Trump. The timing, in Turnell’s opinion, was coincidental; he explains that the real drivers of this move were expensive, highly specialized lobbying campaigns in Washington. Lobbying efforts, he says, are less about outright bribery than about hiring skilled advocates who argue one’s case within the U.S. Treasury’s Office of Foreign Assets Control (OFAC). He explains that lobbying operates more like an administrative appeal than a political payoff, and notes that this recent lobbying success was in fact an anomaly, because most such efforts fail. Indeed, to Turnell, its unlikely success actually underscores just how unlikely any broader wave of sanctions relief truly is. “There’s usually a lot of evidence as to why somebody should be on the [sanctions] list,” he says, adding that such evidence is not easily overturned. That said, he does admit that this particular situation raises troubling questions about transparency and influence.
To sketch out the background context of U.S. sanctions, Turnell describes how they are created, managed, and lifted. OFAC handles the technical work of sanctioning individuals and entities. While executive orders and congressional legislation set the legal framework, the actual decisions are administrative, with little public or judicial oversight. “You could lift an awful lot of sanctions just simply through executive orders,” he cautions. This procedural vulnerability means that, under a Trump presidency, political pressure could in theory be applied to soften sanctions—though Turnell believes that experienced career officials and congressional allies of Myanmar’s democracy movement would resist any sweeping changes.
Providing further background context, Turnell notes that historically, Myanmar’s elites have often tried to evade restrictions by shifting assets or renaming entities, in addition to the significant sums they spend on lobbying for their removal. These efforts in themselves suggest to Turnell that past sanctions must have certainly been painful. The effectiveness of sanctions has not only been financial but psychological as well, constraining the regime’s access to global financial systems and limiting its ability to fund arms purchases.
This relates to the shadowy world of Myanmar’s military-linked conglomerates, in particular MEC (Myanmar Economic Corporation Limited) and MEHL (Myanma Economic Holdings Public Company Limited). While these entities remain sanctioned for now, Turnell explains that their complex structures—riddled with subsidiaries and shell companies—require constant vigilance. That said, he believes that the most dangerous channels of military financing remain under tight U.S. restriction.
Throughout the conversation, Turnell reiterates that this new development should not be read as a wider rollback or even the complete end of sanctions on the Myanmar military. He describes the current sanctions landscape as powerful and largely effective, particularly the U.S. measures against state-owned banks like the Myanmar Foreign Trade Bank and the Myanmar Investment and Commercial Bank. These actions, he says, have choked off the junta’s capacity to conduct foreign exchange transactions, crippling its ability to pay for arms and sustain its war machine.
Moreover, Turnell points to pending congressional initiatives that would expand the scope of sanctions enforcement to target additional financial institutions, including the Myanmar Economic Bank and possibly even the central bank itself—and he hopes for stricter sanctions on jet fuel supplies as well. The key challenge, he warns, is not political will but administrative capacity. He points to big reductions in staff by the present administration, noting that the State Department, USAID, and other agencies have been hollowed out, which could slow the pace of future sanctions actions and increase the risk of political interference from above.
Regarding fears about U.S. tariffs on Myanmar, he views them as largely symbolic. “The trade between Myanmar and the US is infinitesimal,” he says. Far more damaging to Myanmar’s economy are the junta’s own self-destructive policies, especially its obsessive control over foreign exchange. “Min Aung Hlaing is already the biggest ‘sanctioner’ on Myanmar,” Turnell argues, noting how the junta chief has created an environment in which exporters face crippling restrictions that disincentivize trade altogether.
Throughout the interview, Turnell returns to a key distinction: the difference between the symbolic and practical effects of last week’s announcement. Symbolically, he concedes, it has been damaging; they have generated confusion, emboldened the regime’s cronies, and created an opening for narratives about U.S. retreat. But practically, it has not weakened the core of the sanctions regime or the financial choke points that matter most. His bottom line is clear: we should be alert, but not alarmed.
Taking a broader view, Turnell sees several dangers on the horizon, particularly the junta’s planned sham election. However meaningless the results would be, he fears it could give some governments and opportunistic investors a “fig leaf” to normalize relations with the regime. Preventing that, he insists, will require relentless advocacy from pro-democracy actors. “We’ve just got to be constantly out there beating that drum,” he urges, warning that global attention spans are short and Myanmar risks being “forgotten” amid other crises in Ukraine, the Middle East, and U.S. domestic politics.
Looking forward, Turnell emphasizes that the pro-democracy movement must not only defend existing sanctions but also push for new ones—while simultaneously fighting attempts by other countries to normalize relations with the junta after its staged election. He believes that advocacy remains an exhausting but essential task, and given the plethora of issues that compete for attention, persistence is the only way to prevent the regime’s international backers from exploiting global indifference.
In sum, Turnell says that while he does not dismiss the dangers of sanctions erosion because of this recent development, or the challenge of present geopolitical environment, he views the fundamentals of U.S. policy as remaining intact. For him, the key challenge is not a dramatic pro-junta shift in Washington, but the slow grind of political fatigue and bureaucratic attrition. He urges listeners to see the recent sanctions relief not as a turning point, but as a reminder of the need for constant, informed pressure on policymakers—both in the U.S. and around the world. He says simply, “We’ve just got to keep going!”