What’s new? A new administration has assumed office in Myanmar following stage-managed elections, with coup leader Min Aung Hlaing becoming president. Despite the civilian façade, the military retains control. With China’s backing, the regime’s diplomatic and battlefield prospects have improved, but lack of legitimacy and economic shocks mean the crisis will persist.
Why does it matter? Myanmar’s instability increasingly has transnational repercussions, with political and economic turmoil driving the expansion of organised crime – including scam centres, narcotics production, illicit financial flows and human trafficking – as well as risky cross-border labour migration. At the same time, indispensable Chinese support is drawing Naypyitaw further into Beijing’s orbit.
What should be done? Foreign governments should make Myanmar a higher priority and calibrate any engagement with Naypyitaw, while retaining existing sanctions. Important elements include negotiating humanitarian access and expanding livelihoods programs – including through non-state channels – as well as assisting civil society, tackling transnational crime and addressing downstream risks in critical mineral supply chains.
A nominally civilian administration has taken power in Naypyitaw following tightly controlled elections, consolidating military rule within the framework of the 2008 constitution while leaving the underlying drivers of conflict unchanged. Aided by an unpopular conscription drive and stronger Chinese support, the authorities have halted their battlefield losses and reduced their diplomatic isolation. But the country’s political divides remain intact, and the fallout of the Middle East conflict is causing severe economic strain. Myanmar’s instability is increasingly spilling across borders – manifest in scam centres with victims worldwide, narcotics production, illicit financial flows and human trafficking. All the while, Naypyitaw is growing closer to Beijing. Given the transnational implications, foreign states and bodies should make Myanmar a higher priority. They should tread carefully in engaging the regime, with the aim of strengthening humanitarian, livelihood and civil society support. Foreign governments should also better coordinate efforts to fight transnational crime and manage related financial risks.
Five years after the February 2021 coup that ousted the elected government of Aung San Suu Kyi, power rests with an administration that is civilian in form but not in substance. Coup leader Min Aung Hlaing’s move from commander-in-chief to president underscores that the elections brought about not a political transition or a reduction in conflict, but rather a consolidation of abusive military rule. The electoral outcome was scripted, with the main opposition parties excluded and people in large parts of the country unable – and, in many cases, unwilling – to cast their ballots. While the polls have provided the military with a procedural basis for its continued grip on power, they have not conferred any new legitimacy upon the leadership or created conditions for ending the country’s devastating civil war. The deep gulf between the military and society persists, particularly among younger generations, and the grievances that fuelled resistance to the coup are unlikely to dissipate.
For Min Aung Hlaing, this outcome should have marked a triumph following a turbulent post-coup period in which the military faced serious battlefield setbacks and regime insiders began to openly question his leadership. With Chinese backing, he was able to keep his footing and carry out his plan to assume the presidency, installing loyalists in key positions with little sign of internal resistance. But instead of success, the current moment is one of further jeopardy. The new administration faces a spiralling economic crisis as a result of war in the Middle East, exposing the harm wrought by the coup and its aftermath, which has left the economy highly vulnerable to external shocks. Naypyitaw will be particularly nervous at the prospect of economic hardship morphing into popular unrest, as happened in 1988 and 2007. The authorities will seek to maintain access to essential goods in urban areas at tolerable prices, but their ability to do so is limited, and the burden is falling on a population already under heavy strain.
On the battlefield, the front lines have stabilised, but the conflict has not abated.
On the battlefield, the front lines have stabilised, but the conflict has not abated. After losing ground in 2023-2024, the military has regained a measure of momentum, aided by conscription, improved drone capabilities and, critically, Chinese support. Beijing-brokered ceasefires with major armed groups in the north have eased pressure on the military, allowing redeployment to other theatres, which has led to territorial gains. These advances reverse some of the military’s earlier losses but fall well short of a return to its pre-coup levels of territorial control. The military continues to struggle against its most capable opponents, particularly the Arakan Army and the Kachin Independence Organisation, both of which are battle-hardened and well-financed.
Prospects for a countrywide peace process are bleak. While the authorities may pursue tactical ceasefire deals with leading armed groups, these are unlikely to develop into durable settlements. Broader political dialogue is even less likely, given the apparent absence of appetite for concessions within the military leadership. At the same time, opposition forces – particularly the National Unity Government created by lawmakers who were ousted in the 2021 coup – have yet to demonstrate the cohesion or vision required to convert political grievance and economic distress into sustained pressure for change.
Against this backdrop, and amid turmoil elsewhere in the world, Myanmar is slipping further down the international agenda. Western countries have rightly kept targeted sanctions on the military leadership and its business interests in place, but they have little in the way of a broader diplomatic strategy. Foreign capitals should not lose sight of Myanmar’s plight, which increasingly has transnational implications – including the expansion of organised crime, the rise of illicit financial flows and human trafficking linked to scam centres, increased cross-border migration and associated exploitation, and risks to critical mineral supply chains. A more effective international approach will require focusing on a set of realistic objectives: ensuring that any interaction with Naypyitaw is calibrated and issue-specific, so as not to confer unwarranted legitimacy on the administration; boosting funding for humanitarian and livelihood programs and civil society support; enhancing cooperation to counter transnational crime; addressing risks linked to critical mineral supply chains; and coordinating policies more closely, including pragmatic engagement with China where possible.
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