Burmese tycoon Tay Za who is targeted by US sanctions has formed a proxy airline with the name of Asia Wing and his other airline, Air Bagan, has increased flights to neighboring Thailand in 2010.
Businessmen in Rangoon said Tay Za will manage Asia Wing through an associate company, Sun Far Travel and Tour Co Ltd., a well-known travel agency in Burma, thereby avoiding the financial flow and insurance problems of his first airline, Air Bagan, which has been affected by targeted sanctions from the US and EU.
A leading private journal in Rangoon, The Weekly Eleven, reported about Asia Wing airline in this week's edition, quoting other travel agencies and airlines in the country.
“As far as I know, the airline is called Asia Wing,” an official with a domestic airline told the weekly, adding that it was uncertain whether the name was final. The journal said the airline will use newly-purchased aircraft from the European Airbus consortium.
A businessman in Rangoon who spoke on condition of anonymity said he learned from both Tay Za's Htoo Company and Sun Far that the new airline will begin running on domestic routes before extending to international routes.
“By using a proxy airline, Tay Za can buy new planes for both the proxy airline as well as Air Bagan, which is scheduled to extend its international routes,” he said.
When The Irrawaddy contacted Sun Far's Rangoon office, an official confirmed that the company will run Asia Wing, but declined to comment on the company’s relationship with Tay Za.
Information about Tay Za’s proxy airline began to leak from Rangoon’s business community in June. Rangoon businessmen said US sanctions were causing problems in transferring funds and insurance for Air Bagan and the US Treasury Department's powerful global electronic blocking had also prevented Tay Za’s from purchasing more aircraft for Air Bagan.
The US announced targeted sanctions on senior junta officials and their family members and associates like Tay Za and other businessmen following the brutal crackdown on mass demonstrations in September 2007.
The sanctions targeted other Tay Za businesses such as Myanmar Avia Export Co Ltd, Ayer Shwe Wah Co Ltd in February 2008.
“We are tightening financial sanctions against Tay Za, an arms dealer and financial henchman of Burma’s repressive junta,” said Adam J. Szubin, then director of the US Treasury Department.
After the crackdown on the September 2008 demonstration, Air Bagan faced a consumer boycott in addition to US sanctions. Both sanctions and the boycott affected Tay Za as Air Bagan was forced to suspend its international routes from Rangoon to Singapore and Bangkok in November 2007.
However, Tay Za re-launched Air Bagan’s international flights to Thailand’s northern city of Chiang Mai in January, flying twice a week.
Later the airline vowed it will extend its routes from Rangoon, flying to Bangkok and Phuket (Thailand), Siem Reap (Cambodia), Kuala Lumpur (Malaysia), Kunming (China) and Singapore in the peak season this year, according to the The Myanmar Times weekly in Rangoon.
The junta, meanwhile, praised Tay Za and other cronies hit by sanctions as most honorable persons and often highlighted them in state ceremonies and the media.
On Sept.1, The New Light of Myanmar, ran a front-page story with a picture of Tay Za alongside Prime Minister Thein Sein in a report honoring participants in government construction projects in the Cyclone Nargis-hit Irrawaddy delta.
Photos and the names of other cronies such as Zaw Zaw, of the Max Myanmar group of companies, Htay Myint of Yuzana Company and Aung Thet Mann, son of the junta No.3 Shwe Mann, who are on the US sanctions target list appeared on the newspaper's inside pages.
Tycoon Tay Za is close to junta supremo Snr-Gen Than Shwe and has been accused of doing business for the general’s family. Tay Za and other Burmese tycoons such as Zaw Zaw accompanied Than Shwe, his family members and government officials on a state visit to China in September.