A Myanmar soldier guards an area at the Sittwe airport in Rakhine state, September 2018. Ye Aung THU / POOL / AFP
Report 325 / Asia 20+ minutes

Avoiding a Return to War in Myanmar’s Rakhine State

An unofficial ceasefire has kept Rakhine State quiet compared to much of Myanmar following the 2021 coup. But friction is building between the military and ethnic Rakhine fighters. The parties should strike a formal deal to avert a return to war.

What’s new? After an informal ceasefire in late 2020, the Arakan Army used the lull in fighting to consolidate control of much of central and northern Rakhine State. Distracted by fallout from the 2021 coup, Myanmar’s military did little to oppose it at first, but rising tensions may lead to renewed combat.

Why does it matter? Many Rakhine State residents, including some Rohingya, have welcomed the shift to Arakan Army control, but the situation remains fraught. The ceasefire is fragile and the Arakan Army has grown significantly more powerful over the past eighteen months. A return to conflict would have devastating consequences for everyone in Rakhine.

What should be done? The Myanmar military and Arakan Army should avoid provoking a new war and formalise their ceasefire instead. The Arakan Army should eschew restrictions on humanitarian aid organisations, which should better coordinate their dealings with the group. Naypyitaw and Dhaka should open dialogue with the Arakan Army on Rohingya repatriation.

Executive Summary

Rakhine State has avoided the violence that has engulfed the rest of Myanmar since the February 2021 coup. The quiet owes in part to an informal ceasefire, which ended two years of fighting between the military and the Arakan Army, a pro-Rakhine ethnic armed group, and which came into force a few months before the military seized power in Naypyitaw. The Arakan Army has spurned the growing de facto alliance between the National Unity Government (NUG)-led opposition and other ethnic armed groups, focusing on getting control of much of Rakhine State. Until recently, the military has been too distracted to try loosening the Arakan Army’s grip, but tensions have started rising. The parties could soon find themselves back in conflict. While each side has reason to be leery of a formal ceasefire, both would also have reason to welcome the breathing space it would create. Most importantly, Rakhine’s people would benefit. In parallel, the Arakan Army should rein in demands on humanitarian actors, which should coordinate their interaction with it, and Dhaka and Naypyitaw should engage the group on Rohingya repatriation.

The two-year war that engulfed Rakhine State between late 2018 and 2020 significantly eroded Naypyitaw’s control of the region. Police and many other civil servants were often reluctant to leave major towns during the conflict due to the risk of attack or abduction and they remain wary of venturing into the countryside. Many local administrators resigned during this period due to threats either from the armed group or from the Myanmar military, which suspected them of collaborating with the enemy. The Arakan Army has since either replaced them with its own administrators in the areas it controls or co-opted the new appointees that the military regime has sent since the coup. As a result, the Arakan Army now directly or indirectly controls most rural areas in the centre and north of the state, while exerting significant influence in urban areas; it has also begun expanding farther south, as well as north toward the border with Bangladesh.

Over the past year, the Arakan Army has further consolidated its control by rolling out a suite of public services through its administrative branch, the Arakan People’s Authority. These include a judicial system and police force, which operate parallel to the state’s, and some health-care services (including the provision of COVID-19 vaccines). As a result, many residents are turning to Arakan Army mechanisms, rather than those run by Naypyitaw, for basic services and to resolve disputes. The service provision strategy has deepened public support for the group and its governance, but it is not without risk: it could be a major drain on the armed group’s resources, harm its popularity if the services do not live up to expectations and attract pushback from Naypyitaw.

The impact of these developments in Rakhine State has not been limited to the ethnic Rakhine community. The rise of the Arakan Army has brought positive changes for some hitherto ostracised Rohingya. While the overall situation for the Rohingya remains dire, some communities have improved access to public services and some are enjoying greater freedom of movement because of the Arakan Army’s non-enforcement of restrictions imposed by Naypyitaw. These testimonials should be considered in context, however; although Rohingya sources Crisis Group spoke to largely praised the Arakan Army and its administration, the community as a whole remains vulnerable and its members are generally not in a position to criticise the group for fear of reprisal.

Myanmar’s military regime … made only token efforts to counter the Arakan Army’s expanding control.

Myanmar’s military regime, which calls itself the State Administration Council, is focused on subduing resistance to the coup elsewhere in Myanmar and until recently made only token efforts to counter the Arakan Army’s expanding control. Part of the reason may be that locally based government and military officials, hunkered down in large towns, have little choice but to accept the facts on the ground. As a measure of the group’s growing influence, many state-run schools, which are still nominally under Naypyitaw’s control, have started playing an Arakan Army-written Rakhine anthem instead of the national anthem. There are even examples of active collaboration, such as Naypyitaw-controlled police working with the Arakan Army to resolve crimes and administrators from the two sides holding regular informal consultations.

But cooperation is certainly not the state’s default posture. The junta has in some instances sought to scare both Rakhine and Rohingya communities away from working with Arakan Army mechanisms and institutions. Recently, it has adopted more aggressive tactics, setting up roadblocks and searching vehicles, reinforcing troops, increasing patrols and detaining people it suspects of supporting the group.

The military is still too stretched to give much attention to Rakhine State, but there is a clear risk of a return to conflict. If the Arakan Army seeks to expand its influence consistent with its ambitious political aspirations – for example, into border areas or in southern Rakhine – it risks provoking the Myanmar military, which refers to itself as the Tatmadaw, into action. Similarly, a partnership with the NUG-led opposition – something many in Myanmar would welcome – could spark a return to war. While it would be difficult for the Tatmadaw to win this fight, the collateral effects of renewed conflict could be terrible for Rakhine State’s population, which is already reeling from neglect, a poor economy, communal violence and the earlier two-year war.

Although there is no clear path toward peace and stability for Rakhine State, one step that could offer both the parties and the region an extended respite from fighting might be to formalise the informal ceasefire that has largely kept the peace for the past eighteen months. Such an arrangement would focus primarily on maintaining the peace, in particular by demarcating territory and establishing formal communication channels to help de-escalate in the event that tensions begin to build once again.

Both the government and the Arakan Army have reason to be wary of such a step in that it would give the other party a chance to gather strength and prepare for renewed confrontation down the road. But each also has reason to embrace it. The military is preoccupied with the spiralling consequences of the coup that it launched over a year ago; a formal ceasefire would be a measure of insurance that it will not face another conflict that will stretch it further. As for the Arakan Army, such an arrangement could allow it to further consolidate its authority over the territories already under its control and gain recognition from outside actors, including both humanitarian organisations and neighbouring Bangladesh. While the extended respite could give the parties the chance to fortify themselves for further clashes, it would also create the possibility of a durable, peaceful solution emerging in the future – something outside actors could encourage.

If the parties agree to solidify the current ceasefire into a formal agreement, it will also be important to improve certain other ad hoc arrangements with implications for people in Rakhine. For example, humanitarian organisations are increasingly concerned that they may soon face parallel sets of requirements to operate in Rakhine State – some imposed by Naypyitaw and others by the Arakan Army – which could create both administrative burdens and operational difficulties. The group should work to ensure that those in need are not cut off from humanitarian assistance because of paralysing new rules and humanitarian organisations should come together to present a united front should such rules become overly burdensome. Dhaka and Naypyitaw should additionally engage with the Arakan Army on the possible return of Rohingya refugees living in Bangladesh.

While a formal ceasefire would offer neither party precisely what it wants, there would be enough in it for both sides that it could conceivably work. That in turn would allow Rakhine State residents to get what they need most: a continued break from violence and the corresponding opportunity to build toward a more peaceful future, one in which Rakhine and Rohingya can live in relative safety side by side.

Brussels, 1 June 2022

I. Introduction

Since independence in 1948, the Myanmar state has never been in full control of all the territory within its borders; at times, it has controlled little more than the major cities and key infrastructure, with the rest in dispute or in the hands of various non-state armed groups. Over the decades, some of these armed groups have created state-like enclaves in the country’s borderlands within which they provide services, issue laws, maintain law and order, collect taxes and do business. The United Wa State Army, the Kachin Independence Organisation and the Karen National Union are among those with well-developed governance systems, but even the smaller of Myanmar’s twenty-plus ethnic armed groups exert control over some territory.

Rakhine State has been an outlier. There, insurgency largely failed to take root and the state was firmly entrenched. Unlike most other minorities, the ethnic Rakhine attained high-ranking positions in both the military and the civil service, alongside the majority Burmans. But the Rakhine also harboured deep grievances toward the Burmans, dating back centuries to the conquest of the Arakan kingdom of Mrauk-U in 1784 by a Burman king, Bodawpaya. They pointed to Rakhine’s deep poverty as evidence of the Burman-dominated state’s neglect of the people of Rakhine, both Buddhist and Muslim.

Their anger, though, has instead often been directed toward the Rohingya, a Muslim minority in Rakhine. In 2012, communal conflict in the state left close to 200 people dead – mostly Muslims – and almost 150,000 displaced. The communities were segregated and tensions regularly threatened to boil over into further violence. Some Rakhine were implicated in the military’s deadly campaign against the Rohingya in August-September 2017 that sent more than 700,000 Muslims fleeing to Bangladesh.

State control had dissipated in much of the centre and north, leaving a vacuum that the Arakan Army set out to fill.

Against this backdrop, a group of young Rakhine exiles established the Arakan Army in 2009, with the support of the Kachin Independence Army, and quietly built up their forces in northern Myanmar. From 2014, they began inserting their troops into Rakhine State and spreading an ethno-nationalist ideology that shifted the blame for Rakhine’s woes back to Naypyitaw. A brutal war erupted in December 2018; when the two sides reached a surprise ceasefire in November 2020, state control had dissipated in much of the centre and north, leaving a vacuum that the Arakan Army set out to fill.

This report examines how the Arakan Army has used the February 2021 coup to cement control over much of Rakhine State and why Myanmar’s military regime has not taken decisive action to stop it. It looks at the impact this shift in control has had on the lives of both Rakhine and Rohingya residents, as well as the implications for humanitarian aid and the repatriation of Rohingya refugees in Bangladesh. It is based on research conducted between January and May 2022 and builds on Crisis Group’s years of fieldwork and analysis on conflict dynamics in Myanmar. Given the constraints on travel due to COVID-19 and the military takeover, research was conducted remotely, using pre-existing networks of contacts. Sources included Rohingya and Rakhine residents of Rakhine State, members of civil society organisations and NGOs, diplomats and aid workers, and analysts and individuals close to the key protagonists.[fn]For Crisis Group reporting on the rise of the Arakan Army, see Crisis Group Asia Briefings N°s 154, A New Dimension of Violence in Myanmar’s Rakhine State, 24 January 2019; 164, From Elections to Ceasefire in Myanmar’s Rakhine State, 23 December 2020; and Asia Report N°307, An Avoidable War: Politics and Armed Conflict in Myanmar’s Rakhine State, 9 June 2020.Hide Footnote

II. The Arakan Army: From Conflict to Control

A. A Productive Peace

After fighting erupted in Rakhine and southern Chin State in late 2018, the Arakan Army began systematically dismantling Naypyitaw’s administrative system through a campaign of violence and intimidation. Local administrators resigned en masse due to safety concerns, while township-level officials and other civil servants, including police, were often unwilling to travel outside of urban areas.[fn]Crisis Group Report, An Avoidable War, op. cit. See also, for example, “Local officials resign en masse in Myanmar’s conflict-torn Rakhine State”, The Irrawaddy, 22 June 2020.Hide Footnote  In December 2019, the group formed a wing called the Arakan People’s Authority to administer recently captured territory and began actively recruiting ethnic Rakhine with administrative experience from elsewhere in Myanmar (and even abroad).[fn]Crisis Group interview, Rakhine journalist close to the Arakan Army, September 2020. See also Crisis Group Report, An Avoidable War, op. cit.; “Arakan Army seizes ferry, unveils taxation agency, in Myanmar’s Rakhine State”, Radio Free Asia, 31 December 2019; and “Arakan Army collects taxes, polices streets in parts of Myanmar’s war-torn Rakhine State”, Radio Free Asia, 20 July 2020.Hide Footnote  But with war raging across much of the region, implementation proved challenging.

The November 2020 de facto ceasefire changed the equation.[fn]Crisis Group Report, From Elections to Ceasefire, op. cit.Hide Footnote  With the fighting on pause and the new military regime focused on subduing resistance to its rule in other parts of the country, the Arakan Army has been able to strengthen its grip upon much of the centre and north of the state.[fn]Myanmar Edges Toward State Collapse, 1 April 2021; 168, Taking Aim at the Tatmadaw: The New Armed Resistance to Myanmar’s Coup, 28 June 2021; 170, The Deadly Stalemate in Post-Coup Myanmar, 20 October 2021; and 171, Resisting the Resistance: Myanmar’s Pro-Military Pyusawhti Militias, 6 April 2022; Asia Reports N°s 314, Myanmar’s Military Struggles to Control the Virtual Battlefield, 18 May 2021 and 319, Myanmar’s Coup Shakes Up Its Ethnic Conflicts, 12 January 2022. See also Richard Horsey, “A Close-up View of Myanmar’s Leaderless Mass Protests”, Crisis Group Commentary, 26 February 2021 and Richard Horsey, “One Year On from the Myanmar Coup, Crisis Group Commentary, 25 January 2022.Hide Footnote It created new administrative boundaries and appointed political officers, senior administrators, judicial officers and police officers.[fn]The new administrative districts are known as Alpha, Victor and Nova. Within each of these, there are three township equivalents, known as Alpha-1, Alpha-2 and so on. Crisis Group interviews, various sources familiar with the situation in Rakhine State, February-March 2022.Hide Footnote  Strong support for the armed group among the majority Rakhine population made the task significantly easier, to the extent that it has received support from some of the civil servants on Naypyitaw’s payroll. The rapid and relatively successful rollout of services to rural communities has only further enhanced its legitimacy and popularity, particularly among ethnic Rakhine, even though this expansion has not been without teething problems.

The Arakan Army is also making a concerted effort to formally separate its military and political/administrative functions and to reduce the influence of military officers over administrative activities.[fn]Crisis Group interviews, Rakhine researcher and Rakhine journalist, February 2022.Hide Footnote  This attempt to transform itself from an army into a state-like entity, and the group’s growing role in the everyday lives of ordinary people in Rakhine State, is reflected in the local vernacular. Residents in Rakhine now generally use the name of the group’s political wing, the United League of Arakan (ULA) – which oversees the Arakan People’s Authority – rather than the Arakan Army, the armed wing, when referring to the group’s non-military activities. Within only a couple of years, the group’s governance apparatus has begun to resemble those of much more established ethnic armed groups that have long governed sizeable territory, such as the Karen National Union in south-eastern Myanmar and the Kachin Independence Organisation in northern Myanmar.

The [Arakan Army] now has de facto authority over somewhere from 50 to 75 per cent of the territory of Rakhine State.

Given the speed with which its administrative expansion has unfolded and the lack of territorial demarcation, it is difficult to pinpoint how much territory the Arakan Army actually controls. But it appears the insurgent group now has de facto authority over somewhere from 50 to 75 per cent of the territory of Rakhine State. Generally speaking, Naypyitaw still controls cities and most of southern Rakhine, particularly Gwa, Thandwe, Taungup and Munaung townships. In the north, rural areas of Mrauk-U, Kyauktaw, Rathedaung, Buthidaung and Ponnagyun townships are either under total Arakan Army control, with no remaining state structures, or under its sway in effect, with state structures co-opted to serve its agenda. The strategically important border areas in Maungdaw Township, as well as parts of central and southern Rakhine, such as Kyaukpyu, Taungup and Ann townships, are more contested, with competing power structures.[fn]Crisis Group interviews, various sources familiar with the situation in Rakhine State, January-March 2022.Hide Footnote

Notably, the group has not taken a strong position against the February 2021 military coup. Its leadership has actively discouraged anti-regime protests and civil disobedience, urging the public to focus on the goal of Rakhine autonomy while paying less attention to political developments elsewhere in the country.[fn]"AA chief does not want Myanmar’s strikes and protests in Rakhine State”, The Irrawaddy, 12 April 2021.Hide Footnote  Unlike some other ethnic armed groups, it has also not cooperated with the parallel National Unity Government (NUG) formed by lawmakers ousted by the coup, despite public invitations from the latter to join the struggle against the regime.[fn]See Crisis Group Report, Myanmar’s Coup Shakes Up Its Ethnic Conflicts, op. cit.; and “အမျိုးသားညီညွတ်ရေးအစိုးရ NUG ယာယီသမ္မတနှင့်ဇနီးတို့ အိမ်ထောင်သက် နှစ် ၄၀ ပြည့် မင်္ဂလာအထိမ်းအမှတ် AA က မင်္ဂလာဆုတောင်းသဝဏ်လွှာပို့ [Arakan Army sends congratulatory message to National Unity Government acting president and wife on 40th wedding anniversary]”, Khit Thit Media, 12 December 2021.Hide Footnote  The Arakan Army has also insisted that it is has no contact with the anti-coup militias (many of which are known as People’s Defence Forces) that have emerged in opposition to the regime.[fn]“Rebel yell: Arakan Army leader speaks to Asia Times”, Asia Times, 18 January 2022.Hide Footnote  As tensions with the military have increased in recent months, however, it has held informal talks with the NUG and publicly acknowledged training some anti-coup resistance forces.[fn]Crisis Group interview, source close to the Arakan Army, March 2022. When the Arakan Army marked its thirteenth anniversary on 10 April 2022, it published congratulatory statements from five resistance groups in which they thanked the Army for its training and support. Most of these groups are based in the mountain ranges on the edge of Rakhine State; the Arakan Army appears to be using them to create a buffer zone between its forces and the rest of the country, particularly Magway Region and Chin State.Hide Footnote

B. Acting Like a State

The Arakan Army’s state-building aspirations in Rakhine State long predate the November 2020 de facto ceasefire. Leader Twan Mrat Naing has described the group’s political goal as a “confederate” status for Rakhine State under which the territory would enjoy almost complete autonomy. Appealing to memories of Rakhine’s status as an independent kingdom, Twan Mrat Naing describes the Arakan Army’s revolutionary struggle as the “Way of Rakhita” and its goal as the “Arakan Dream”.[fn]The “Way of Rakhita” refers to the method – revolutionary struggle – of achieving the “Arakan Dream” of an independent or autonomous state. “Arakan” is the historical name for “Rakhine”, a term Myanmar’s military regime adopted in 1989. For a more detailed discussion, see Crisis Group Report, An Avoidable War, op. cit.; and Kyaw Lynn, “The Arakan Army, Myanmar military coup and politics of Arakan”, Transnational Institute, 10 June 2021.Hide Footnote  More recently, he has articulated phases of revolutionary struggle, including a state-building phase, and spoken of the need to anchor the movement in strong institutions rather than simply in ethno-nationalist ideology and its leaders’ popularity.[fn]“ရက္ခိုင်အမျိုးသားအဖွဲချုပ် ULA ဥက္ကဌ ရက္ခိုင့်တပ်တော်တပ်မှူးချုပ် ဗိုလ်ချုပ်ထွန်းမြတ်နိုင်နန့် အင်တာ [Interview with ULA chairman and AA commander-in-chief Twan Mrat Naing]”, Arrakha Media, 15 August 2021.Hide Footnote  He has also warned that the group will push for independence if “our rightful political status … is not accommodated within this union”.[fn]“Rebel yell”, op. cit.Hide Footnote

The Arakan Army’s first priority was to establish an administrative system for the areas it controls.

The Arakan People’s Authority is the embodiment of these aspirations. The body has a range of functions, but the Arakan Army’s first priority was to establish an administrative system for the areas it controls. The group moved quickly to fill the void left by the mass resignation of civil servants in 2019-2020, appointing its own administrators, who sit in offices under the ULA flag and often have little or no contact with the military regime. These local administrators head committees comprising community leaders who carry out a range of functions, including tax collection, dispute resolution and criminal investigations, and answer to higher-ranking administrators and political officers.[fn]Crisis Group interviews, various sources familiar with the situation in Rakhine State, January-March 2022.Hide Footnote

In many areas, though, the Arakan Army has instead co-opted incumbent administrators appointed since the coup by the General Administration Department under Myanmar’s Ministry of Home Affairs. Although they still nominally serve Naypyitaw, these administrators are in effect under the Arakan People’s Authority’s control, seeking its guidance in local decision-making and reporting back after meetings with their township superiors.[fn]Ibid.Hide Footnote  Because one of these local administrators’ responsibilities is to recommend how public funding should be allocated and oversee how it is spent, working through them allows the Arakan Army access to state funds to develop its newly gained territory, and thus reduce its own expenses. Similarly, these administrators have enabled local farmers in insurgent-held areas to obtain state agricultural loans.[fn]Crisis Group interview, researcher focused on Rakhine State, January 2022.Hide Footnote

The enlargement of the Arakan Army’s administrative footprint has enabled it to expand and formalise tax collection. Previously, the group collected taxes in an ad hoc manner, but since early 2021 it has nominally established fixed rates for both households and businesses. Households are expected to pay a flat tax, which is usually 3,000 kyat a month (about $1.50). Businesses, meanwhile, are supposed to pay between 2 and 5 per cent of their “total investment” on an annual basis; this term appears to refer to their capitalisation, but the precise means of calculating the amount are unclear and in practice it is usually just a negotiated sum. Sources indicate that, for now at least, households are generally willing to pay; some business owners are more reluctant, but fear of arrest means they usually hand over the money as well.[fn]A resident of Mrauk-U Township related that the Arakan Army detained a relative for refusing to pay a 5 per cent tax on their business, but later released him after he agreed to pay 3 per cent. Crisis Group interview, January 2022.Hide Footnote

While they are paying taxes, residents are also benefiting from new services, particularly improved law and order. With its administrative network in place, the Arakan Army has made judicial services and law enforcement a primary focus. The group was already fulfilling these roles to some extent prior to the November 2020 ceasefire by occasionally acting on complaints from the public to apprehend (and punish) alleged criminals.[fn]Crisis Group Report, An Avoidable War, op. cit.Hide Footnote  Over the past year, however, it has established both a judiciary and police force that are separate from its armed wing, falling under the Arakan People’s Authority. Disputes that cannot be resolved by village administration committees are referred to newly created ULA courts.[fn]Crisis Group interviews, Rakhine residents and journalist, January-March 2022.Hide Footnote

The judicial system, in particular, has seen high uptake among Rakhine State residents, who have long been frustrated at the corruption, partiality and inefficiency in the Naypyitaw-controlled judiciary. Cases that would have taken a year or more to resolve through the state system, and incurred significant expenses in bribes and fees, can now be resolved in as little as a month, at minimal expense.[fn]Crisis Group interviews, Rakhine State based researcher and political analyst, January 2022.Hide Footnote  Sources Crisis Group spoke to estimated that in areas where the Arakan Army system operates, over three fourths of criminal and non-criminal disputes are resolved through these mechanisms.[fn]Crisis Group interviews, residents of Mrauk-U, Sittwe and Ramree townships, January 2022.Hide Footnote  Many judicial officials have actually resigned to join the Arakan People’s Authority, providing it with some trained judges. As one civil society leader in Ramree Township noted:

The Arakan People’s Authority oversees around 90 per cent of criminal and non-criminal cases here – even some that happen in downtown Ramree. Only people related to the military or civil service use the junta courts.[fn]Crisis Group interview, resident of Ramree township, January 2022.Hide Footnote

C. Strategic Rollout

Because state structures still exist in most parts of Rakhine State, the Arakan Army has been able to pick which services it will offer and which it will leave to Naypyitaw. It has chosen in a strategic manner, allocating its resources for maximum effectiveness. Replacing or co-opting the state administrative apparatus is not only an important symbol of Arakan Army control, but also a means of depriving Naypyitaw of a physical presence on the ground and access to intelligence.[fn]For a detailed examination of the General Administration Department, see “Administering the State in Myanmar: An Overview of the General Administration Department, The Asia Foundation, March 2015.Hide Footnote  Tax collection flows from administrative control, providing the group with an important source of funding and boosting its legitimacy when it uses the money for effective service delivery in a kind of “virtuous circle”. Complaints about police and judicial corruption, and the general breakdown of law enforcement in many areas due to the 2019-2020 conflict, had created an obvious vacuum for the armed group to fill.

In contrast, the Arakan Army has let Naypyitaw continue to provide most health and education services in areas it controls. Both require significant financial and human resources, and providing them would likely be well beyond the armed group’s capacity. Nevertheless, its influence – and that of Rakhine nationalism more broadly – permeates the classroom. Over the past two years, the Rakhine national anthem, written by the Arakan Army, has replaced the Myanmar national anthem in government-run schools in many areas.[fn]Crisis Group interviews, various sources in Rakhine State, January-March 2022. See also “Some schools opt for Arakha national anthem over its Myanmar counterpart”, Development Media Group, 20 January 2022.Hide Footnote  The armed group does not appear to have forced the anthem change, but it has obviously inspired the switch with its Rakhine nationalist ideology. “We started singing it [the Rakhine anthem] at our school because we wanted students to know our identity”, said a teacher.[fn]Crisis Group interview, ethnic Rakhine state schoolteacher from Buthidaung Township, January 2022.Hide Footnote  In some places, though not as many, the ULA flag has also replaced the national flag.

The Arakan Army’s administrative and governance structures are far from unique in Myanmar. For decades, ethnic armed groups in the country’s borderlands have run their own schools, courts and administrative systems in territories under their control.[fn]See Crisis Group Asia Report N°52, Myanmar Backgrounder: Ethnic Minority Politics, 7 May 2003. See also Aung Naing Oo, “A cold war in Myanmar and the dangers of a protracted ceasefire”, Frontier Myanmar, 1 February 2019.Hide Footnote  These services have been important for building acceptance of these insurgent movements, creating what some have described as a “social contract” between their leaders and the population.[fn]For a detailed examination of this issue and how it has affected the Kachin and Karen insurgencies in recent decades, see David Brenner, Rebel Politics: A Political Sociology of Armed Struggle in Myanmar’s Borderlands (Ithaca, 2019). See also the work of Kim Jolliffe, including “Ethnic Conflict and Social Services in Myanmar’s Contested Regions”, The Asia Foundation, 2014.Hide Footnote  Although it has not yet seriously started to take on responsibility for health and education, the Arakan Army is thus following a well-worn path, and interviews with Rakhine State residents suggest that the group is indeed benefiting in terms of enhanced acceptance and stronger buy-in to its vision for Rakhine State. Significantly, this support is not limited to the majority Rakhine Buddhists, but can also be found to some degree among the state’s Rohingya Muslim population as well (see Section IV for more).[fn]Crisis Group interviews, Rakhine State residents, January-February 2022.Hide Footnote

D. The Risk of Overreach

The rapid expansion of the Arakan People’s Authority has inevitably created challenges for what was, until less than two years ago, an exclusively military organisation. Lack of human resources has been a chronic problem, with the group heavily relying on civil servants who have quit the state system or who are still working for Naypyitaw. Many policies and structures are still not formalised or uniformly enforced, as reflected in the differing tax rates from locality to locality. Unlike other ethnic armed groups, the Arakan Army has not yet developed its own laws or school curriculum. The judicial system also remains relatively informal, with disputes still often resolved through mediation. The high caseload and the pressure to deliver results means that the courts emphasise speed rather than procedure.[fn]Crisis Group interviews, various sources with knowledge of Rakhine State, January-March 2022.Hide Footnote

Since early 2022, criticism of the system’s shortcomings has emerged. Rakhine-based media organisations have reported claims of corruption and bias within the Arakan People’s Authority, particularly in the judicial system, and negative posts have started proliferating on social media.[fn]See, for example, “ရက္ခိုင်ပြည်သူ့အာဏာပိုင်အဖွဲ့ လက်အောက်ရှိ တရားရေးဌာနအချို့၏ အမှုဖြေရှင်းပေးမှုနှင့် တရားစီရင်မှုပိုင်းတို့၌ အမှုတချို့တွင် မကျေနပ်မှု ရှိနေ [Dissatisfaction with the handling of some cases by the Arakan People’s Authority judiciary]”, Western Media, 22 February 2021.Hide Footnote  In March 2022, the Arakan Army responded with the first of what it said would be regular monthly press conferences – an unusual move for an ethnic armed group in Myanmar – at which it acknowledged challenges in its governance system.[fn]Ahead of the press conference, the group issued five reasons for meeting journalists, one of which was to address criticism of its judiciary and to help the public “better understand the weaknesses” of its administrative system. “သတင်းစာရှင်းလင်းပွဲပြုလုပ်ရသည့် ရည်ရွယ်ချက်များ [Objectives of holding the press conference]”, ULA/AA Press Briefing Info, 5 March 2022.Hide Footnote  In particular, spokesman Khaing Thu Kha admitted that some officials had abused their powers and promised that the group would take action, before inviting those criticising the Arakan People’s Authority to join its ranks and help improve the civil service.[fn]“အုပ်ချုပ်ရေး၊ တရားစီရင်ရေးမဏ္ဍိုင်များတွင် ခေတ်ပညာတက်လူငယ်များပါဝင်ရန် ULA/AA ဖိတ်ခေါ် [ULA invites educated youth to join administration, judiciary]”, Western Media, 5 March 2022.Hide Footnote

Despite its rapid strides, the Arakan Army will face a constant battle to meet the expectations it has created among its constituents.

Despite its rapid strides, the Arakan Army will face a constant battle to meet the expectations it has created among its constituents. Particularly at a time of relative peace, it runs the risk of losing public support if its officials appear to underperform. So far, however, many Rakhine appear to be willing to overlook shortcomings; instead, they take pride in the Arakan Army’s achievements and express confidence in the group’s ability to improve the new system and, eventually, achieve its goal of autonomy or independence. A Buthidaung teacher complained, for instance, that when she was a student, she was “taught nonsense Burmese history at school”. Her students now sing the Rakhine national anthem, though for the moment she still teaches them using the same state curriculum she disparages.[fn]Crisis Group interview, Buthidaung teacher, January 2022.Hide Footnote  Nonetheless, the Arakan Army’s influence has already changed the way she does her job.

The Arakan Army’s administrative expansion could also place it under financial strain that could either hinder its activities or force it to take steps to increase its revenues. Both are fraught with risk. Present tax receipts are insufficient to support the group’s expansion, but levying higher taxes could create hardship and resentment among its supporters, particularly given high poverty levels in Rakhine State.[fn]Rakhine is Myanmar’s poorest state or region, with 78 per cent of the population below the poverty line, compared to a national average of 37.5 per cent. See “Myanmar: Ending Poverty and Boosting Shared Prosperity in a Time of Transition”, World Bank, November 2014.Hide Footnote  As for finding new sources of funding, the Arakan Army could well be tempted to venture further into illicit activities, as many armed groups in Myanmar (including the military and its allies) have done to sustain their operations. The Arakan Army has previously been accused of involvement in drug trafficking.[fn]Crisis Group Report, A New Dimension of Violence, op. cit.Hide Footnote  Deepening such involvement could harm its public image – indeed, the military has in the past used allegations of involvement in the drug trade to delegitimise the group. But Rakhine State offers only limited opportunities to pursue legitimate business opportunities or more accepted illicit activities, such as informal border crossings, or the taxing of timber or mining, as is common elsewhere in Myanmar.[fn]Crisis Group interview, source close to the State Administration Council, March 2022.Hide Footnote

Arakan Army leaders will likely be aware of the risks that accompany the current transition, given the experience of the Kachin Independence Organisation (KIO), which supported the Arakan Army’s creation and with which it maintains close ties.[fn]Crisis Group Reports, A New Dimension of Violence and An Avoidable War, both op. cit.Hide Footnote  The KIO underwent a similar transition from active guerrilla warfare to a focus on governance after signing a 1994 ceasefire with the military. In subsequent years, KIO leaders lost the support of the public and the group’s rank-and-file after engaging in business deals with military elites and regime cronies that made them and their families wealthy but brought few benefits to – and even often hurt – their Kachin constituency. They also failed to properly fund the group’s administrative functions, adding to community frustrations. Eventually, the KIO leadership that signed the ceasefire was overthrown. The new, younger generation of leaders rejected the Tatmadaw’s demands in 2009 to become a military-affiliated Border Guard Force, leading to the breakdown of the 1994 ceasefire two years later.[fn]See Crisis Group Asia Briefing N°140, A Tentative Peace in Myanmar’s Kachin Conflict, 12 June 2013, Section III. See also Brenner, op. cit., chapter 4.Hide Footnote

III. Naypyitaw’s Long Leash

The Myanmar military’s seizure of power in February 2021 has created ideal conditions for the Arakan Army’s state-building agenda.[fn]It is ironic that the military takeover would have this effect, given that the November 2020 de facto ceasefire likely emboldened Min Aung Hlaing to launch the coup because it meant the military was no longer engaged in a major conflict anywhere in Myanmar.Hide Footnote  Typically, the military would try to disrupt any attempt by an armed group to weaken state control and establish parallel administrative structures; it has done so for decades in various parts of the country where ethnic armed groups operate and has over the past year used brute force to crush similar “people’s administrations” set up by anti-coup forces.[fn]“Leading from the shadows: The successes and failures of the CRPH”, Frontier Myanmar, 20 March 2021.Hide Footnote  But more than fifteen months after the coup, the military remains locked in a potentially existential struggle elsewhere in the country with Burman and ethnic minority armed resistance forces that are increasingly coordinating on political and military affairs.[fn]Horsey, “One Year On from the Myanmar Coup”, op. cit.Hide Footnote  At a time when the regime’s forces are already stretched, it can ill afford to open another front – least of all with an opponent like the Arakan Army, which ranks among the country’s most powerful armed groups. It has thus largely refrained from confronting the Arakan Army militarily, making it much easier for the group to consolidate control.[fn]A similar phenomenon has unfolded in northern Shan State, where the military has not intervened to stop the Ta’ang National Liberation Army (TNLA) and Shan State Progress Party from seizing territory from a rival armed group, the Restoration Council of Shan State, that is considered closer to the regime. Having dislodged the third group, the TNLA is presently building an administrative system similar to that of the Arakan Army. See “Rising dragon: TNLA declares ‘victory’ in northern Shan”, Frontier Myanmar, 4 February 2022, and “Wa an early winner of Myanmar’s post-coup war”, Asia Times, 22 February 2022.Hide Footnote

The military has at times gone even further, actively seeking to maintain cordial relations with the Rakhine armed group. It has, for example, taken the Arakan Army off its list of terrorist organisations, freed scores of people arrested for alleged links to the group, invited its representatives to peace talks alongside other ethnic armed groups, welcomed its representatives to Union Day celebrations in Naypyitaw, and even cooperated in distribution of COVID-19 vaccines in rebel-controlled areas.[fn]See, for example, “China facilitates Myanmar junta and ethnic armies’ talks”, The Irrawaddy, 16 December 2021; “Why the Arakan Army attended Myanmar junta’s Union Day event”, The Irrawaddy, 16 February 2022; and “Northern Arakan targeted in vaccine push jointly undertaken by AA and military govt”, Development Media Group, 25 January 2022.Hide Footnote  On the few occasions when there have been confrontations between military and Arakan Army forces on the ground – such as the clashes that erupted in November 2021 and February 2022 in northern Maungdaw Township – local commanders from both sides moved quickly to de-escalate tensions.[fn]“Rumbles in Rakhine amid strains between Myanmar military, rebels”, Al Jazeera, 24 November 2021; “Junta troops clash with Arakan Army in western Myanmar”, The Irrawaddy, 8 February 2022; and “Military, Arakan Army confront each other near Kyauktaw”, Myanmar Now, 19 January 2022.Hide Footnote

“Rumbles in Rakhine amid strains between Myanmar military, rebels”, Al Jazeera, 24 November 2021; “Junta troops clash with Arakan Army in western Myanmar”, The Irrawaddy, 8 February 2022; and “Military, Arakan Army confront each other near Kyauktaw”, Myanmar Now, 19 January 2022.

Their alacrity reflects a shared desire to avoid a return to war, at least for now.

The Arakan Army’s task has been made much easier by the composition of the civil service in Rakhine State, where the vast majority of civil servants are local, including in some of the highest positions of the state’s bureaucracy.[fn]Crisis Group interviews, various Rakhine-based sources, January 2022.Hide Footnote  In most other ethnic minority states, by contrast, ethnic Burmans deployed from the country’s Bamar heartland make up a much higher proportion of the civil service.[fn]Ibid.Hide Footnote  Due to ethnic solidarity, many civil servants in Rakhine have thus been willing to cooperate with, if not actively support, the Arakan Army. A teacher observed: “I don’t think the Arakan Army needs to take over the running of schools – because over 90 per cent of teachers in Rakhine State are ethnic Rakhine, they are basically under the Arakan Army’s influence already”.[fn]Crisis Group interview, state schoolteacher, January 2022.Hide Footnote

Even those unsympathetic to the Arakan Army cause are … willing to cooperate with the group’s governance structures.

Since the fighting ended in November 2020, some civil servants have resigned to join the Arakan People’s Authority, including members of the judiciary, as mentioned above, but also police officers and administrators. Many others work for the group while continuing to nominally serve Naypyitaw. Even those unsympathetic to the Arakan Army’s cause are in many cases willing to cooperate with the group’s governance structures. “On the ground, many [regime-employed] officials cooperate with the ULA political and governance system. Only those from the military side and high-ranking civil servants resist”, said one Rakhine-based political analyst.[fn]Crisis Group interview, Rakhine-based political analyst, January 2022.Hide Footnote  Several interviewees also noted that it was common for state-employed civil servants to pay taxes to the Arakan Army.[fn]Crisis Group interviews, various Rakhine-based sources, January 2022.Hide Footnote

The military regime has not given the Arakan Army an entirely free hand, however. Particularly since late 2021, it has increased troop deployments in some strategically important areas of the state – notably in Maungdaw Township on the border with Bangladesh and Kyauktaw township, which is the main gateway to Paletwa in neighbouring Chin State. It has also pressured Rakhine and Rohingya community leaders to avoid interacting with the Arakan Army and Arakan People’s Authority (see section V below) and set up new checkpoints in several townships in an apparent effort to prevent the insurgents from moving forces around the state.[fn]See, for example, “Military tightens security checks on travellers in some Arakan townships”, Development Media Group, 4 January 2022.Hide Footnote  It has also detained young Rakhine suspected of training with the Arakan Army, as well as others thought to be providing support. [fn]See “Dozens arrested at northern Maungdaw security checkpoint”, Development Media Group, 31 January 2022; and “Regime troops’ visits to Arakan State villages are increasingly common, and unsettling, for locals”, Development Media Group, 9 May 2022.Hide Footnote  The Arakan Army does not seem deterred by these measures, as underscored by Twan Mrat Naing’s expletive-filled May 2022 tweet warning the local military commander not to go “too far”.[fn]See tweet by Twan Mrat Naing, @TwanMrat, Arakan Army leader, 5:25am, 6 May 2021.Hide Footnote  All this evidence points to rising tensions in Rakhine State in recent months and raises the risk of a return to war (see Section VI.A below).

IV. The Rohingya: Caught in the Middle

The rise of the Arakan Army has also had an impact on the fate of Rakhine state’s Rohingya Muslim population, now estimated at approximately 620,000 after over 700,000 fled to Bangladesh in 2016-2017.[fn]“Humanitarian Response Plan Myanmar”, UN Office for the Coordination of Humanitarian Affairs, January 2022.Hide Footnote  On paper, central government regulations ban Rohingya from travelling freely outside the township in which they reside and significantly limit their access to public services, including education and health care. But given that most Rohingya live in the state’s north, a significant number are now in areas largely under Arakan Army control, particularly in Buthidaung and Kyauktaw townships. Many also live in contested areas where the group exerts significant influence but not outright control, such as northern Maungdaw and Pauktaw townships. Rohingya Crisis Group spoke to report mixed outcomes from the erosion of state control: many consider it an improvement, particularly in terms of freedom of movement and access to Arakan People’s Authority services, but it has also come at a cost, as it has resulted in threats and new restrictions from the military.

Even prior to the Arakan Army asserting control in Rakhine State, its rise opened the way for an amelioration in relations with the Rakhine Buddhist majority. In 2012, communal conflict between Rakhine and Rohingya had resulted in around 200 deaths and 140,000 people – mostly Rohingya – being displaced, leaving the state’s Buddhists and Muslims deeply divided, often to the point of segregation.[fn]Crisis Group Asia Report N°261, Myanmar: The Politics of Rakhine State, 22 October 2014, Section III.B.Hide Footnote  Since then, neither local Rakhine politicians nor Naypyitaw appeared to have the political will to mend the damage done to communal relations. Rakhine civilians were implicated in attacks on Rohingya during the military’s 2017 campaign of targeted violence. The International Court of Justice is presently hearing claims that this campaign violated Myanmar’s obligations under the Genocide Convention.[fn]Notably, the National League for Democracy government failed to follow key recommendations made by the Kofi Annan-led Advisory Commission on Rakhine State. On the ICJ case, see Richard Horsey, “Myanmar at the International Court of Justice”, Crisis Group Commentary, 10 December 2019. On Rakhine militias, see Crisis Group Report, Resisting the Resistance, op. cit.Hide Footnote

The Arakan Army leadership has, by contrast, sought to build more positive relations with the Rohingya in recent years. In particular, its leadership has reframed the Rakhine struggle as a fight with the Burmans, Myanmar’s largest ethnic group, and explicitly said the state’s Rohingya population should not be seen as the enemy. Arakan Army figures have also articulated a “nation-building” agenda that includes the creation of a more tolerant, inclusive “Arakan” identity that encompasses all groups living in the state, including Muslims.[fn]“Interview with ULA chairman and AA commander-in-chief Twan Mrat Naing”, op. cit.Hide Footnote  Although they have stopped short of officially endorsing the term “Rohingya”, which is highly contested in Myanmar, the top leader, Twan Mrat Naing, has used it in interviews.[fn]See “‘We recognise the human rights and citizen rights of the Rohingyas’”, Prothom Alo English, 3 January 2022.Hide Footnote

The outbreak of war between the Arakan Army and military in late 2018 reinforced a narrative that cast Burmans as the enemy, and Rakhine anger at the Rohingya almost immediately shifted to civilian and military leaders in Naypyitaw. Numerous sources noted that relations between Rohingya and Rakhine have improved since then, although interactions are still often limited to economic activities.[fn]Crisis Group interviews, various sources based in Rakhine State, January-March 2022.Hide Footnote

The Arakan Army has not always appeared so sympathetic to the Rohingya.

The Arakan Army has not always appeared so sympathetic to the Rohingya. After the Arakan Rohingya Salvation Army (ARSA) attacked police outposts in October 2016, the Arakan Army described the group as “savage Bengali Muslim terrorists”; Bengali is considered offensive by many Rohingya, as it implies they are immigrants from Bangladesh.[fn]ULA/AA press release, 20 October 2016, as cited in David Scott Mathieson, “The Arakan Army in Myanmar: Deadly Conflict Rises in Rakhine State”, U.S. Institute of Peace, November 2020.Hide Footnote  The following year, Twan Mrat Naing used the derogatory term kalar when he described the Rohingya “problem” as a “political trap” for the Rakhine.[fn]“AA chief urges Arakanese not to fall into army trap in Rakhine”, The Irrawaddy, 11 December 2017. The word kalar was originally used to describe all foreigners who had come to Myanmar (then Burma) by sea, but in modern times it is used primarily to denote South Asians, particularly Muslims, and is widely considered racist. For a further discussion of the etymology, see Matt Schissler, Matthew J. Walton and Phyu Phyu Thi, “Reconciling Contradictions: Buddhist-Muslim Violence, Narrative Making and Memory in Myanmar”, Journal of Contemporary Asia, vol. 47, no. 3 (2017). In 2020, activists launched a campaign, “Don’t call me kalar”, to highlight its racist connotations. See “Challenging entrenched racism in Myanmar: Don’t call me ‘kalar’”, Progressive Voice, 18 June 2020.Hide Footnote  But by August 2020, Twan Mrat Naing was tweeting “Happy Eid Mubarak to you all!”, a holiday greeting to Muslims that would have been unimaginable a few years earlier.[fn]Tweet by Twan Mrat Naing, @TwanMrat, Arakan Army leader, 5:54pm, 2 August 2020.Hide Footnote  Similarly, the group issued condolences following the death of Wakar Uddin, a prominent Rohingya leader based in the U.S. in April 2022.[fn]“Letter of Condolences”, United League of Arakan, 1 May 2022.Hide Footnote

This seemingly pragmatic evolution reflects the different stages of the Arakan Army’s struggle. In earlier phases, the group pitched a more exclusionary Rakhine ethno-nationalism to the Rakhine people as it sought to build support for its cause. After fighting with the military erupted in December 2018, it became increasingly concerned about its international image, and sought to present itself as more tolerant of the Rohingya than the Myanmar state and the Tatmadaw. During the conflict, it also made sense to have cordial, if not positive, relations with the Rohingya.[fn]For a closer examination of the Arakan Army’s position on the Rohingya, see Mathieson, op. cit., p. 16.Hide Footnote  Fighting a guerrilla war, the rebels depended on their capacity to conceal their forces and to survive on support from residents of the areas where they were operating. It therefore helped not to have the Rohingya as an enemy.

The armed group’s relationship with the Rohingya became even more important after it began administering territory in which Rohingya lived. As it has rolled out administrative structures, the group has worked to include Rohingya leaders in local administration, including on committees that resolve disputes. Rohingya administrators told Crisis Group they preferred working with these new structures to engaging with the military regime. As one noted:

Because the Arakan Army is working for all communities, we prefer their system, and we work together. We ignore the orders from the junta.[fn]Crisis Group interview, Rohingya administrator from Kyauktaw, January 2022.Hide Footnote

Although these comments reflect a degree of genuine improvement in living conditions for Rohingya in areas under Arakan Army control, such as reduced restrictions on movement, they should be understood in context. The expression of positive sentiments about the Arakan Army needs to be considered in light of the extreme repression that Naypyitaw has inflicted on the Rohingya for decades, which makes even modest betterment of the situation seem quite positive. Rohingya may also not feel comfortable openly criticising the Arakan Army, given that they are living in areas under its control. Moreover, reports are not uniformly positive. Some sources suggest that Rohingya experiences with Arakan People’s Authority structures, such as its judicial system, have been uneven, with complaints of bribes being requested in some areas.[fn]Crisis Group interviews, various sources in Rakhine State, January-March 2022.Hide Footnote

Some Rohingya may also perceive the new parallel governance structures as an extra burden, forcing them to pay taxes to the armed group while they still need to interact with state bureaucrats – and pay bribes – for example to obtain permits to travel to the state capital, Sittwe, or other military-controlled areas.[fn]Crisis Group interview, January 2022.Hide Footnote  Another complaint about the Arakan People’s Authority is the lack of inclusion of Rohingya and other ethnic minorities in its middle and upper levels.[fn]Crisis Group interviews, various sources in Rakhine State, January-March 2022.Hide Footnote

Beginning in August 2021, military officials based in Rakhine began warning Rohingya community leaders not to have any contact with the Arakan Army or the Arakan People’s Authority.[fn]Crisis Group interviews, various Rohingya sources in Rakhine State, January 2022: and local media reports.Hide Footnote  At one meeting in Kyauktaw Township, officers claimed that the Rohingya could rely on the state’s administration and judicial systems. But a Rohingya community leader present at the meeting told Crisis Group there was little choice but to use the Arakan People’s Authority, because state structures no longer exist in the area. “Officially I work for the [regime], but I haven’t seen any officials in our area for at least two years. Even since the coup, junta members have been too scared to come to our village”, he said, adding: “The Arakan Army is good for us. If we have problems, they come and solve them”.[fn]Crisis Group interview, Rohingya administrator from Kyauktaw, January 2022.Hide Footnote

Beyond repeated warnings to community leaders, the military has imposed increased restrictions on the Rohingya. In November 2021, it tightened the process of issuing travel permits for movement beyond township limits in Maungdaw and Buthidaung, where the vast majority of Rohingya live. Community members in these areas now need to get permits from local Immigration Department branches, in addition to the longstanding requirement that they obtain approval from local state administrators.[fn]Crisis Group interview, Rohingya community leader from Buthidaung, January 2022.Hide Footnote

The modest improvements some Rohingya have seen in territory controlled by the Arakan Army should not obscure the economic plight that the community faces.

Finally, the modest improvements some Rohingya have seen in territory controlled by the Arakan Army should not obscure the economic plight that the community faces throughout Rakhine State. The two-year war in Rakhine, the COVID-19 pandemic and Myanmar’s post-coup economic crisis have created further financial hardship for the Muslim minority, which was already among the most impoverished groups in Myanmar. “Since the coup, we don’t have any work – we are just trying to survive, trying not to die”, said the Rohingya community leader from Buthidaung.[fn]Crisis Group interview, Rohingya community leader from Buthidaung, January 2022.Hide Footnote

Combined with the political uncertainty the community faces, this hardship is prompting many to try to leave the state, often in the hope of reaching Malaysia, which already has a large Rohingya community. This illegal journey is expensive and risky; police regularly detain large groups of Rohingya in other parts of the country and charge them with travelling outside their home township without permission, an offence usually punished with two years’ imprisonment.[fn]Several hundred Rohingya have already been arrested in 2022 in other parts of Myanmar, nearly all of them while attempting to reach a third country (usually Malaysia). In one notable example, regime police arrested 65 Rohingya in the town of Myawaddy, on the border with Thailand, as they sought to reach Malaysia. See “65 Muslims arrested in Myawaddy for illegally travelling to Malaysia”, Narinjara, 3 March 2022.Hide Footnote  Those who try to escape by sea face a perilous voyage at the hands of human traffickers.

V. A Clouded Future

A. A Return to War?

Despite the calm in Rakhine State since the November 2020 informal ceasefire and the subsequent coup, a return to conflict remains possible, even likely. The lack of a formal ceasefire, particularly one with clearly demarcated lines to separate the forces, means that troop movements can easily result in clashes in disputed areas, as was the case with fighting in Maungdaw in late 2021 and early 2022.

The Arakan Army’s objective of confederacy, if not independence, is anathema to the military, which envisions a centralised, unitary state, and has sought to maintain control of the country’s border areas. Although the military has largely tolerated the Arakan Army’s state-building agenda since the coup, the scale of the undertaking is beginning to provoke stronger pushback from the regime, particularly as the Arakan Army seeks to expand into areas that the military deems strategic. Interviews with Rakhine and Rohingya residents and other sources in the state indicate that many believe a return to war is only a matter of time.[fn]Crisis Group interviews, various sources in Rakhine State, January-March 2022.Hide Footnote  After first seeking to downplay its administrative expansion, the Arakan Army has grown increasingly bold by attempting to expand into the Bangladesh border region, talking more publicly about its parallel administrative system and openly describing itself as a “government”.[fn]The Arakan Army has described itself as a “Rakhine transitional government” to aid workers and at the 5 March press conference Khaing Thu Kha referred to it as a pyithu asoya, or “people’s government”.Hide Footnote

A renewed outbreak of conflict could be even more devastating than the two-year war that ravaged parts of Rakhine State in 2018-2020. The Arakan Army has significantly built up its armed forces since the ceasefire, with as many as 30,000 people having now undergone training.[fn]Crisis Group interview, source close to the military regime, March 2022. See also “Rebel yell”, op. cit.Hide Footnote  Newer members lack combat experience, and possibly also arms and equipment, but the insurgency will nevertheless be an even more formidable opponent for the regime than it was during the earlier conflict, when it inflicted significant casualties on the military. The strength of popular support it enjoys will enable its fighters to remain highly mobile; they will also benefit from Rakhine communities providing intelligence and supplies, thus making a Tatmadaw victory close to impossible. Still, the humanitarian consequences of renewed fighting would likely be devastating for both Rakhine and Rohingya residents, leading to large-scale displacement.

War is not inevitable, however, at least not in the near term. All will depend on the political will of the junta and Arakan Army leadership to find a mutually acceptable near-term arrangement that moves beyond the fragile status quo. A formal ceasefire agreement that demarcates territory in Rakhine State could avert a return to conflict and create greater stability for local populations. It would preserve both parties’ current positions, allowing for the possibility of more substantive negotiations on an Arakan Army-controlled autonomous region to take place at a later date.

The regime has not only been forced to accept the fact of the Arakan Army’s presence, but ... appears to be open to an agreement that would formally recognise it.

A formal ceasefire agreement had seemed highly unlikely before the coup: Myanmar’s military leadership had demanded that the Arakan Army withdraw from Rakhine State and return to Kachin State, where the group was first established.[fn]Crisis Group Report, An Avoidable War, op. cit.Hide Footnote  The informal ceasefire, though, reflected a shift in the Tatmadaw’s position and this has only solidified amid post-coup realities. The regime has not only been forced to accept the fact of the Arakan Army’s presence, but according to several sources Crisis Group spoke to, appears to be open to an agreement that would formally recognise it.[fn]Crisis Group interviews, sources with knowledge of informal discussions between the military and the Arakan Army, January-April 2022.Hide Footnote  Although meetings between the two sides are rare, both mid-level military commanders and political intermediaries are in regular contact.[fn]Crisis Group interviews, sources close to the military regime, March and April 2022.Hide Footnote  Such a shift in approach from the military means a formal ceasefire is now possible.

To place these developments in context, late last year, junta leader Min Aung Hlaing also launched a new peace initiative and has declared 2022 a “year of peace”. His primary motive is to undermine opposition to the coup by enticing ethnic armed groups from the battlefield to the negotiating table, enabling the military to focus its forces on newly formed resistance groups, many of which are aligned with the NUG. He also hopes the initiative will distract outside actors and stave off pressure to open talks with the NUG and other resistance groups. The process lacks legitimacy and is highly unlikely to lead to a comprehensive settlement that ends Myanmar’s internal conflicts. But Min Aung Hlaing’s eagerness to cut deals and the junta’s overall weak position create an opportunity for the Arakan Army to use this initiative to negotiate an arrangement that might otherwise be unattainable.

Past experience in Myanmar suggests that the parties could reach such an agreement quickly. With the exception of the Nationwide Ceasefire Agreement, most ceasefires are light on detail – if they are written down at all – and are instead based on understandings or “gentlemen’s agreements” between military officials and armed group leaders. In some cases, these understandings have endured for decades.

Still, the two sides are likely to be some distance apart on the key terms of such an arrangement. In particular, the military may not accept the present geographic extent of Arakan Army control or meet the group’s demands on the level of autonomy it wishes to enjoy. There are also other reasons for both sides to be wary; in particular, a ceasefire without an explicit political element would enable their opponents to build up their forces and prepare for renewed confrontation down the road.

Nevertheless, both sides have compelling reasons to try reaching a deal. The regime’s new peace process has so far had limited buy-in from the country’s ethnic armed groups; if the Arakan Army were to engage in ceasefire negotiations through this process, it would give the process a major boost that the military would likely welcome.[fn]The military invited all ethnic armed groups – but not the National Unity Government or its People’s Defence Forces – to a ceremony to mark Union Day on 12 February in Naypyitaw, but only ten of Myanmar’s twenty or so ethnic armies sent delegations. One of them was the Arakan Army.Hide Footnote  A ceasefire would also deprive the military’s opponents, particularly the NUG, of a potentially powerful ally, at least for now. For the insurgents, a formal ceasefire would be an opportunity to further consolidate control over their newly won territory. Moreover, any agreement that explicitly or implicitly recognises their authority would represent a major political victory, even if at first it does not deliver the level of autonomy that they seek. It would also enable other actors, such as humanitarian aid groups and Bangladesh, to more openly engage with the Arakan Army, something the armed group has been seeking.

While the coup has put a previously unattainable deal within reach, it also complicates negotiations.

But while the coup has put a previously unattainable deal within reach, it also complicates negotiations. The Arakan Army leadership has already been forced to walk a fine line between engaging the junta in pursuit of its own political agenda and avoiding the appearance that it is legitimising the regime, which remains extremely unpopular in Rakhine State and Myanmar more broadly. At the 5 March press conference, Khaing Thu Kha asserted that the Arakan Army does not recognise the junta as the legitimate government and that it was “impossible” to hold a “political dialogue” with an administration that had seized power in a coup. Any political agreement, for example on autonomy and related issues, may therefore have to wait, at least until after a planned 2023 election. But in the interim, both sides could hold negotiations on a ceasefire focused on military matters, particularly demarcation of territory.

Pending the result of such negotiations, both sides should avoid taking steps that might provoke a return to fighting. The red lines for the military are blurry, but they are likely to include any attempt by the Arakan Army to gain control of the northern border areas with Bangladesh, townships in southern Rakhine (including Ann) or urban centres in the centre and north of the state. Optics are also likely to be important for the junta, so the group should refrain from showcasing the extent of its military and administrative control, so as not to portray itself as a de facto government. The military, meanwhile, will need to accept the fact of Arakan Army control in most rural areas of the state. It should stop aggressive troop movements and its attempts to disrupt the activities of the Arakan People’s Authority through arrests and other forms of pressure on civilians.

One alternative for the Arakan Army is to increase political and military cooperation with the NUG, as some other ethnic armed groups have done since the coup. The Arakan Army has held numerous informal meetings with the NUG, which hopes to entice the pro-Rakhine group to join the anti-military resistance. Many in Myanmar see the Arakan Army as a potential game-changer in the battle with the military regime. But the NUG has been unwilling to meet the Arakan Army’s demands for autonomy, which goes beyond the federal system that the rebel administration is negotiating with ethnic armed groups and other stakeholders.[fn]Crisis Group interview, NUG sources, March 2022.Hide Footnote  There is also still deep antagonism among many Rakhine, including the Arakan Army leadership, toward the National League for Democracy (NLD) for supporting the military’s war against the Arakan Army in 2018-2020.[fn]Crisis Group Report, An Avoidable War, op. cit.Hide Footnote  By joining with the NUG, the Arakan Army risks provoking a return to war with the junta, something it still seems keen to avoid, and which would exact a heavy toll on the people of Rakhine State.

There are other potential pathways forward as well. The Arakan Army might, for example, pursue a formal ceasefire with the military while also continuing to engage the NUG, as well as other resistance forces and ethnic armed groups. The group might see strategic benefit in keeping its options open, given the uncertainty about how Myanmar’s broader conflicts will play out. If the Arakan Army tries to go this route, however, it could make the military regime less amenable to its ceasefire demands, particularly if the latter continues to publicise its talks with the NUG and support for resistance groups. Conversely, the decision to pursue negotiations within Min Aung Hlaing’s peace initiative or separate from it would likely increase the military’s willingness to meet the Arakan Army’s terms, as it will clearly prefer that the armed group join the talks, thus bolstering their credibility.

B. Implications for Aid Delivery

Rakhine State has historically been a major destination for humanitarian aid in Myanmar, due to its high overall poverty and the needs of its Rohingya population in light of discriminatory policies. But humanitarian activities have been impeded by post-2012 communal tensions, the military’s violent campaign against the Rohingya in 2016-2017, the war between the Arakan Army and the military between 2018 and 2020, and the outbreak of COVID-19.

After taking power, the military regime relaxed some restrictions, likely in an attempt to improve its international image vis-à-vis the previous NLD government.[fn]Crisis Group interview, aid agency official, March 2022. Close to 150,000 Rohingya displaced by the 2012 communal violence remain in camps, villages and other displacement sites, almost entirely dependent on international humanitarian aid. “Number of internally displaced in Myanmar doubles, to 800,000”, UN News, 11 February 2022.Hide Footnote Despite these limited improvements, however, at the time of writing, aid workers estimated that around 75 per cent of humanitarian activities in the state were still facing constraints, including insecurity, blanket bans on access to certain areas, denials or delays in approving travel authorisations, conditions or limitations on the authorisations that are issued, or demands from the authorities for detailed reports.[fn]Crisis Group interviews, humanitarian workers and aid agency officials, March 2022.Hide Footnote  Some organisations have scaled back operations or even closed entirely due to these restrictions.[fn]Crisis Group interview, aid agency official, March 2022.Hide Footnote

In general, the Arakan Army’s increased assertion of administrative control has not significantly affected humanitarian operations. Aid workers have been able to pass through rebel checkpoints by showing Naypyitaw-issued travel authorisations and the armed group has not otherwise sought to stop them from carrying out their activities.[fn]Ibid.Hide Footnote  Local civil society organisations, which are not subject to the travel authorisation system, similarly report few restrictions. “Arakan Army officials just asked us not to take too many photos while we are in their areas. They said this is for security reasons – they don’t want outsiders to get too much information about what they are doing”, said one civil society leader, whose organisation works mostly in areas under the group’s control.[fn]Crisis Group interview, civil society leader in Rakhine State, January 2022.Hide Footnote  Another civil society leader from Ramree said that, when his staff informs regime officials about their planned activities, they are usually given a long list of restrictions, whereas the Arakan Army always gives permission. “We prefer to work with the Arakan Army’s administration. … The [regime] restricts and prohibits many things”.[fn]Crisis Group interview, civil society leader in Ramree Township, January 2022.Hide Footnote

Recently, however, the Arakan Army has begun exerting greater control over aid activities within the territory it controls, particularly those implemented or funded by international organisations. Foreign aid workers report that the armed group has been contacting local implementing partners to seek information about their activities and personnel, and in some cases asking them to register with its parallel administration.[fn]Crisis Group interview, aid agency official, March 2022.Hide Footnote  The group has set up a dedicated Humanitarian and Development Coordination Office to engage with the UN and international NGOs but has not elaborated on how this office will work in practice.[fn]Ibid.Hide Footnote  The office reflects both the insurgency’s desire to be treated as a state-like entity and the significant role that humanitarian actors play in Rakhine State. The Arakan Army has claimed the plan would ease operational difficulties they are facing, but some fear that introducing such reporting requirements could further constrict the humanitarian space in Rakhine State by forcing aid agencies to report to two parallel administrations.[fn]Crisis Group interviews, humanitarian workers and aid agency officials, March 2022. Aside from adding an extra layer of bureaucracy that restricts humanitarian activities and consumes resources, a parallel system would be impractical unless travel authorisations issued by the regime and the Arakan Army were near identical. Travel authorisations are for a specific time period, for example, and the time period would need to align on both authorisations for activities to be implemented.Hide Footnote

The Arakan Army should ... tread carefully as it devises a system to interact with aid organisations.

The Arakan Army should therefore tread carefully as it devises a system to interact with aid organisations, avoiding the introduction of new rules that in practice restrict their capacity to operate, and respecting the need for these organisations to work with Naypyitaw, especially as many of them have operations in other parts of the country. In particular, it should not force them to register, pay taxes or obtain travel authorisations from a parallel system it would introduce. Unworkable rules that force aid groups to scale back support to the people of Rakhine State would harm its own interests – negatively affecting how the Arakan Army is perceived by both residents of Rakhine State, who would be deprived of aid, and by foreign governments, many of whom have provided humanitarian funding to Rakhine for years.

For their part, international organisations working in Rakhine, including UN agencies, should forge a common approach to how and in what circumstances to engage the Arakan Army. Because Rakhine has certain unique features relative to other parts of Myanmar where ethnic armed groups are also present, there is no template to borrow from; this framework will have to be developed more or less from scratch.[fn]There are key differences in both scale and timing. Although humanitarian organisations are active to some degree in other insurgent-controlled areas of Myanmar, they usually operate only through local implementing partners and on a much smaller scale than in Rakhine. Further, because most of these other insurgencies date back decades, aid agencies were generally not present prior to an armed group establishing control, as has been the case in Rakhine. A further difference is that humanitarian aid has been at times a highly divisive issue in Rakhine State, with many ethnic Rakhine feeling that the Rohingya have received preferential treatment from aid actors.Hide Footnote  In addition to bringing them together to work on this framework, such a coordinated approach will give aid organisations maximum leverage if they need to push back against a parallel system of authorisations. Engagement with the Arakan Army should not be seen as just a risk, however; it could also be an opportunity to positively influence the group’s policies and practices.

C. Rohingya Repatriation

The rise of the Arakan Army in Rakhine State will inevitably affect prospects for the repatriation of Rohingya refugees, particularly over the long term. An estimated 730,000 Rohingya fled to Bangladesh in 2016-2017 due to the Myanmar military’s brutal crackdown on the community in northern Rakhine State. Bangladesh and Myanmar signed a bilateral repatriation agreement in November 2017, but no refugees have yet returned through formal channels despite two high-profile attempts by Bangladesh in November 2018 and August 2019.[fn]For a detailed examination of the issues around repatriation prior to the military coup, see Crisis Group Asia Briefing N°153, Bangladesh-Myanmar: The Danger of Force Rohingya Repatriation, 12 November 2018.Hide Footnote

Refugees have cited the failure of the Myanmar authorities to guarantee their safety in Rakhine State and the inability to get citizenship as the main reasons for refusing to return. At the time, the NLD government largely ignored these demands and instead blamed Bangladesh for bureaucratic delays that it said were holding up repatriation.[fn]“Myanmar blames Bangladesh for Rohingya repatriation failure”, The Irrawaddy, 18 November 2019.Hide Footnote  Myanmar has also said ARSA militants in the camps that house hundreds of thousands of Rohingya in southern Bangladesh have been threatening refugees into rejecting repatriation; Bangladesh has acknowledged that some refugees are using force to oppose repatriation, but until very recently it rejected the suggestion ARSA is active in the camps.[fn]See, for example, “Bangladesh’s harboring of terrorists continues to hinder Rohingya repatriation process”, The Irrawaddy, 13 October 2020. Bangladesh maintained for years that ARSA was not present in the camps and that alleged ARSA members there were actually criminals using the group’s name. After the killing of Mohib Ullah, a Rohingya political activist, in September 2021, Dhaka has acknowledged ARSA’s presence in the camps. See “Armed group behind Rohingya leader’s murder: Bangladesh police”, Al Jazeera, 16 March 2022.Hide Footnote  Despite China’s efforts to mediate between Dhaka and Naypyitaw, the repatriation process stalled entirely after large-scale fighting erupted in Rakhine state in 2019.

The coup has only made the situation more challenging. It dealt a further blow to prospects of large-scale repatriation, as many refugees will likely remain reluctant to return with the military that was directly responsible for the mass violence that drove them from the country in power.

The coup also delayed the resumption of bilateral negotiations with Bangladesh on repatriation, but it has not derailed the process entirely. Dhaka has been understandably anxious to start sending refugees back – or at least avoid the process being derailed entirely – and has ensured repatriation remains the central issue in bilateral relations. For its part, the Myanmar military has stated since shortly after the coup that it will continue repatriation efforts. Although this is almost certainly an attempt to improve its international image, it leaves the door open for further discussions.[fn]In his first major public address after the coup, Min Aung Hlaing said his administration would “continue receiving the displaced persons in Bangladesh in accord with the bilateral agreement”. Since then, the regime has blamed Bangladesh for further delays in repatriations. See “Republic of the Union of Myanmar State Administration Council Chairman Senior General Min Aung Hlaing makes speech to public”, Global New Light of Myanmar, 9 February 2021; “MOFA Press Release on ASEAN Foreign Ministers’ Meeting Retreat”, Myanmar Ministry of Foreign Affairs, 20 February 2022; and “Rohingya refugees reject return to Myanmar without assurances”, Radio Free Asia, 24 February 2022.Hide Footnote  In January 2022, Myanmar and Bangladesh resumed talks via a virtual coordination meeting and in March the Rakhine State Administration Council said it had received a list of what it referred to as 700 “Muslims” to be repatriated, though no further details have since been released by either country.[fn]See “Bangladesh, Myanmar resume talks over Rohingya verification”, The Independent, 28 January 2022; and “ဘင်္ဂလားဒေ့ရှ်မှ မူဆလင် ၇ဝဝ ကျော်ကို ပြန်လည်လက်ခံရန်ရှိဟု ရခိုင်ပြည်နယ်ကောင်စီပြော [More than 700 Muslims who fled to Bangladesh to be repatriated, says Rakhine State Administration Council]”, Narinjara, 8 March 2022.Hide Footnote

[The return of some Rohingya refugees to Rakhine State] mostly reflects the deterioration of conditions in the camps in southern Bangladesh.

Despite reservations about returning to military-controlled Myanmar without guarantees on citizenship and other issues, some Rohingya refugees may be willing to consider heading back to Rakhine State. Indeed, an unknown number – possibly in the low thousands – have already returned informally, crossing the border on their own. While their return may be partly due to the November 2020 de facto ceasefire, which brought some level of stability in Rakhine State, it mostly reflects the deterioration of conditions in the camps in southern Bangladesh, where reports of crime and violence have been steadily increasing.[fn]“Bangladesh concerned by growing crimes, unrest at Rohingya camps”, Dhaka Tribune, 2 October 2021.Hide Footnote  Dhaka has also been taking a tougher approach to the refugees, closing some schools, destroying shops in the camps.[fn]See “Bangladesh destroys 3,000 shops belonging to Rohingya Muslim refugees”, The Independent, 5 January 2022; “Bangladesh: Rohingya Refugee Schools Face Closure”, Human Rights Watch, 18 December 2021; and “Bangladesh shuts largest private school in Rohingya camps”, Agence France-Presse, 28 March 2022.Hide Footnote  It has also moved close to 28,000 Rohingya to the island settlement of Bhasan Char.[fn]The Bangladesh government has set a target of relocating 100,000 refugees to Bhasan Char.Hide Footnote  Any formal repatriation would, however, likely involve only a small number of refugees, at least at first, for the reasons noted above.[fn]“Rohingya refugees reject return to Myanmar without assurances”, op. cit.Hide Footnote

Given the extent of Arakan Army influence in Rakhine, its explicit or tacit approval will likely be required to enable any large-scale organised repatriation to proceed. In line with its efforts to appeal to the Rohingya and improve its image abroad, leader Twan Mrat Naing has insisted his group does not oppose repatriation, saying it is “only natural” that Rohingya refugees would want to return. But he has also cautioned that the situation is not yet stable enough to initiate such a process and that a “massive” number of returns could lead to “unrest”.[fn]“‘We recognize the human rights and citizen rights of the Rohingya’”, op. cit. and “Rebel yell”, op. cit.Hide Footnote  Agreeing to support repatriation will be politically fraught for the group, as it is likely to draw complaints from its harder-line Rakhine supporters, who still consider most Rohingya to be illegal immigrants. Nevertheless, it may be willing to support limited formal returns if it believes it will gain enough, principally in enhanced legitimacy and international recognition. International actors should encourage it in that direction.

The emergence of the Arakan Army as a governance actor raises important questions for Bangladesh. The Arakan Army has long sought to build relations with the Bangladesh government, but Dhaka has rebuffed the overtures, because it has a policy of eschewing engagement with insurgencies that undermine the sovereignty of neighbouring states.[fn]“‘We recognize the human rights and citizen rights of the Rohingya’”, op. cit. On 21 February 2022, the United League of Arakan also issued a “statement of solidarity”, ostensibly to mark Bangladesh Language Martyrs Day, in which it spoke of the “natural bond between the people and regions of Bangladesh and Arakan”. It issued a similar statement to mark Bangladesh Independence Day the following month.Hide Footnote  With the Arakan Army and military regime no longer fighting and the armed group in partial or full control of much of the territory the Rohingya refugees on its soil originated from, Dhaka may wish to reconsider that approach in this particular case. Should the Arakan Army and Naypyitaw arrive at a formal ceasefire, Dhaka may reconsider it sooner.

VI. Conclusion

The two-year war and the subsequent de facto ceasefire between the Arakan Army and Myanmar military has radically reshaped the balance of power in Rakhine State. Taking advantage of the February 2021 coup, the armed group has eroded state control across much of Rakhine, and in its place rolled out its own governance and service delivery structures. Although these new mechanisms have faced some criticisms, support for the Arakan Army remains strong, particularly among the ethnic Rakhine. The Rohingya have also benefited from the group’s rise to some extent, but they remain vulnerable and wary of military retaliation for cooperating with the parallel administration.

Although under strain due to the nationwide uprising against the coup, the military is unlikely to tolerate an autonomous entity in Rakhine State. It may therefore attempt to dislodge the Arakan Army at some point. Another war would be devastating for everyone in Rakhine, and the Arakan Army is so well entrenched that Naypyitaw is unlikely to be able to wrest back power anyway. To avoid further conflict, both sides should reach a ceasefire agreement that recognises the armed group’s territory and increases stability in the state. Such an agreement would not only reduce the risk of further humanitarian disaster in Rakhine, but it would also bolster the prospects of return for at least some of the hundreds of thousands of Rohingya refugees presently lingering in refugee camps across the border.

Brussels, 1 June 2022

Appendix A: Map of Myanmar

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