Amid Myanmar crisis, Ayalas opt to dance with the devil

"There's little chance of a return to normalcy soon."


We've been following events in Myanmar, one of the 10 members of the Association of Southeast Asian Nations, ever since the military there mounted a coup d'etat on February 1 this year and seized power from the legitimately elected National League for Democracy led by Nobel Peace Prize winner and democracy icon Aung San Suu Kyi.  

Since then, Myanmar  has been wracked by a widespread civil disobedience movement that organized peaceful street protests in various cities but were met with brutal repression by the Tatmadaw, as the military is called. The death toll has now reached more than 1,000.

The violent suppression of street protests in the urban areas and armed insurrection in Myanmar's provinces where diverse ethnic groups have already joined forces to oppose the military junta shows that the political situation there is not likely to improve soon but even escalate in the months ahead.

Is such an extremely unstable political and social environment—a powder keg, in other words—in the westernmost part of Southeast Asia a viable place for any business to thrive?

For the Ayala Corporation, the Philippines' oldest conglomerate, it still is.

It was in late 2019, or nearly two years ago, when Ayala decided to invest $237 million, or more than P12 billion, in  Myanmar's leading conglomerate, the Yoma Group.

The Yoma Group is owned by Myanmar-born tycoon Serge Pun. It is comprised of two holding companies: Singapore-listed Yoma Strategic Holdings (YSH) and Myanmar-listed First Myanmar Investment Public. In 2017, Forbes estimated Pun's net worth at $800 million (P40.8 billion).

Pun was quoted by Nikkei Asia thus: "We look forward to leveraging their expertise and experience to strengthen our existing businesses, and to explore potential new opportunities in Myanmar."

Ayala, for its part,  expressed optimism over the partnership,  as this would give them a unique opportunity to participate in Myanmar's growth story. After all, Myanmar's economic growth  then was the second-fastest in the region, clocking in at some 6 percent since 2016.

"We could not imagine a better way to do this than with the Pun family, whose solid, decades-long reputation as a business house has cemented their expertise in multiple sectors such as real estate, banking, automotive, health care, power, and tourism, among others," the report quoted Ayala chairman and chief executive officer Jaime Augusto Zobel de Ayala as saying.

"Through partnerships of this kind, we see greater potential to deploy and explore shared expertise, knowledge, and resources to grow in multiple sectors," said Ayala president and chief operating officer Fernando Zobel de Ayala.

Explaining the conglomerate's decision to hunker down instead of folding the tent in Myanmar,  Ayala managing director Eric Francia said the group is looking at its Myanmar investments "from a long-term perspective."

 "While there is obviously a concern on a lot of issues, we remain steadfast in our long-term outlook," Francia said in April this year. "We will just continue to work with our partners to make sure that our investments are prudently managed, and then we will take appropriate actions as the developments evolve."

"The situation on the ground is extremely sensitive," Ayala head of corporate strategy Paolo Borromeo said. "Obviously, projects and businesses stopped. But at this stage ... I think the most prudent thing to do is to wait and see and ensure the safety of our partners' employees."

Ayala has already established its presence in Indonesia, Vietnam, and China, as well as Australia, Europe, the United States, and Mexico.

But its investment in war-torn Myanmar could  be its most problematic at this point, as the military junta led by senior general Min Aung Hlaing appears unwilling to give an inch to critics who have been stridently pounding at the gates. They are demanding an immediate end to the military junta's iron grip on power, which is backed up by a large standing army, battle tanks and air assets.  

That the situation in Myanmar remains precarious for ordinary Burmese—as well as foreign investors—is well evidenced in recent reports by, an online news service run by local journalists working underground.

In an incident that has stunned the nation, a group of five young anti-junta activists leapt from a high-level apartment in downtown Yangon, the capital, plunging to their deaths rather than face arrest by security forces. State media later claimed that the security forces found explosives and that two men and one woman were also arrested, and accused some of the men in the group of “recent drug use.” The incident came on the heels of an increase in bombing attacks in Yangon.

In another development, just days after Brunei's second foreign minister Erywan Yusof was confirmed as the ASEAN special envoy to Myanmar, the junta walked back on its commitments to the ASEAN five-point plan to end the crisis. The plan called for a meeting by the envoy with all parties concerned, including opposition parties now forced to go underground after the coup d'etat in February.

And perhaps indicative of the lengths to which the military junta wants to hold on to power at all costs for as long as they can, they apparently tried to carry out an insidious assassination plot against Kyaw Moe Tun, Myanmar's ambassador to the United Nations who has remained loyal to the overthrown civilian government led by Aung San Suu Kyi.  The junta had fired the envoy from his job and charged him with treason. The junta had also demanded that Washington extradite him, but was refused.

The US Department of Justice statement on the incident claimed two Myanmar nationals "plotted to seriously injure or kill" Kyaw Moe Tun in New York, in collaboration with an unnamed arms dealer based in Thailand. The US ambassador to the UN, Linda Thomas-Greenfield, also issued a statement on the incident, thanking law enforcement for preventing the "horrific alleged plot."

“We unequivocally condemn this threat to Ambassador Kyaw Moe Tun, which fits a disturbing pattern of authoritarian leaders and their supporters reaching across the globe— including into the United States—to persecute and repress journalists, activists, and others who dare speak or stand against them,” she said.

 At the rate things are going in Myanmar, there's little chance of a return to normalcy soon. If foreign investors like the Ayalas have no choice but to engage in a slow but joyless dance with the devil, it's because the military junta leaves them with no choice at all—or else they will see P1.2 billion go down the drain. 

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Topics: Myanmar , Association of Southeast Asian Nations , National League for Democracy , Nobel Peace Prize , Aung San Suu Kyi
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