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Burma Issues report on German invol

Subject: Burma Issues report on German involvement in Burma

Burma Issues
PO Box 1076, Silom Post Office
Bangkok 10504 Thailand

phone: 662 234 6674

Burma Issues (formerly Burma Rights Movement for Action,          
B.U.R.M.A.) is a Bangkok-based non-governmental organization that
monitors events in Burma with a focus on human rights, ethnic
minorities and the ongoing civil war.

                      THE GERMAN CONNECTION

S'Aung Lwin, Bochum Germany


     This document hopes to shine some light on the issue of German
involvement and investment in Burma, and the close ties that have
developed historically between German business interests, the
German government, and the oppressive military junta which has
ruled  in Burma since 1962.  More specifically, this paper will
highlight the special relationship that one particular German firm,
Fritz Werner Industry, has had with the Burmese regime since the
early 1950's, and continuing up to the present.  On a broader
level, the research presented here will attempt to demonstrate the
important role that German trade relations, developmental aid, and
political ties have had in sustaining the Burmese military elite in
power, and, thus, indirectly contributed to the oppression and pain
inflicted upon the Burmese people by their own government.

     Very few observers from the outside world had noticed the 
strong ties between the Federal Republic of Germany (FRG) and  the 
Socialist Republic of the Union of Burma  until his excellency Dr.
Richard von Weizsacker, the acting president of the FRG,  visited
Burma in February of 1986.  
     At that time the German president, his wife, and their 
entourage  were welcomed  at Rangoon Airport by the Vice-President
of Burma, and the Vice Chairman of the  Council of State, U Aye Ko,
and his wife, Daw  Mi  Mi  Lay.  The  Burmese government, keen to
show their hospitality towards the German president, ordered
students, workers, and people from all walks of life, to line up 
all along the president's route from the airport to the State Guest
House, to welcome the excellency and his accompanying entourage. 
Many in the crowd, after waiting under the hot February sun all
morning, fainted as a result of the debilitating heat, and had to
be taken to the hospital for medical attention.  
     A banquet in honor of the German president, hosted by the
Vice-Chairman U Aye Ko and his wife, was held February 5th, 1986 in
the Banquet Hall on the Pyithu Hluttaw Premises in Rangoon.  During
this celebratory occasion,  Weizsacker  praised  the  Burmese
socialist  regime  for  its "unique" policy towards Germany, and
thanked  the Burmese for its launching of a joint economic
enterprise, in the fall of 1984, involving the  participation of a
German firm with  long-established links  in  Burma.(Working
People's Daily, 5 Feb., 1986) 
     This was Burma's first joint  venture  with  a foreign country
since its self-imposed isolation from the West after the coup of
1962.  Although Weizsacker did not reveal the name of the German
firm, it was,in fact, Fritz Werner Industry Ausrustungen-GmbH, FRG
(FWAR), a company of notorious reputation among the Burmese
people.1   The German president later visited  projects being
implemented under the auspices of this ground-breaking economic
cooperation agreement between  the two  countries.  One of the
stops on his excellency's itinerary was the beach at Ngapali, a
popular tourist resort on the Araken coast.  The German president
attracted much attention from the Burmese people while there, as a
result of a highly symbolic "PR" event, in which he was seen riding
an elephant.   In the cultural and historic tradition of Burma the
ancient monarchs rode elephants as a symbol of their power and
divine royal authority.   Through the eyes of the Burmese people,
therefore, this unusual display by the German excellency signified
culturally that the Burmese military war lords were honoring this
foreign "king" in hopes of receiving continuing and increased aid
and investment from Germany. 
     This seemingly isolated incident of the German president's
visit to Burma in 1986 is, in fact, an important, if largely
symbolic, manifestation of the close German economic ties that the
Burmese oligarchy has profited from historically, and continues to
cash in on up to the present date.
     However, before delving further into these economic
connections, let us take a look at the recent intense political
turbulence within Burma, which serves as the context from which all
contemporary Burmese issues must be examined.

     In 1988 a student-led nationwide uprising emerged in Burma, 
leading  to the  fall  of  the Burma Socialist  Program 
Party(BSPP),  the same ruling party which was praised by the German
president Weizsacker just two years previous during his "historic 
State visit". A reactionary, military "coup" in September 1988,
declaring a new era of restored "law and order", followed on the
heels of this spontaneous, grass-roots movement for democracy. It
is estimated that at least  8,000 people were brutally massacred by
this "State Law and Order Restoration Committee"(SLORC), the "new"
manifestation of the same governing military thugs who had run
Burma since 1962.  Among the many victims of this crackdown were
grade school, high school, and university students, workers, 
farmers, Buddhist monks, and people from all groups within the
ethnically diverse Burmese national landscape.
     To escape execution  or  imprisonment,  thousands  of
students, teachers, peasants and workers fled to the jungle areas
along  Burma's  borders  where they could take  refuge among some
of the semi-autonomous ethnic  minorities within Burma, many of
whom are fighting the central government in Rangoon.  It is now
estimated that  at  least  338,000 refugees live  along the
Sino-Burma, Thai-Burma  and  Indo-Burma borders. 

     The pivotal factors leading up to the uprising were numerous. 
On an economic level, people  were angry  and hurt that their proud
and resource-rich country,  once the  wealthiest nation in the
region, was now ranked as one of the ten poorest countries in the
world by the UN. Perseverance, struggle, and hard work on their
part did not seem to have resulted in any upgrading of the nation's
development, nor any improvement in their own personal financial
     People were also angered by the  military  junta's  sudden
demonetization  of some of the major Burmese currency notes (which
are produced by the "Warzi Currency Printing Industry", which,
incidentally, was  built through German technological and financial
assistance). Outrageously, no compensation was given to Burmese who
held these currencies in  their  hands, effectively wiping out many
people's essential savings.  This tactic  was designed to cripple
those hoarding cash for the purpose of dealing in illegal border
trade and smuggling. In reality, it most devastated those who could
least afford it - the poor - whose already minimal earnings, which
had at least sustained their hand-to-mouth existence, were now
suddenly  useless  paper.
     The iron-fisted, one-party rule of the long-time dictator Ne
Win,  and the lack  of truly free elections, decent education, or
democratic  participation in the running of the country, also added
to the people's growing mood of discontent. On a very personal
level, almost everyone had relatives or close friends in prison,
and fear of arrest was the daily diet of the people, as unjust
political imprisonment, harassment, torture, and killings had
become commonplace.  
     Some of Burma's ethnic minority groups(the Karen, Chin, Shan
etc.) had been fighting for their survival against the central
Burman government since as far back as the late 1940's, and student
protest of the Ne Win regime had emerged even in his first year in
power, 1962, resurfacing periodically since that time. So, as you
can see, there had been a long history of struggle against the
government from various sectors of Burmese society leading up to
this massive uprising in 1988.  
     At this point, let us turn our attention back to the more
specific question of how German economic involvement in Burma
relates to the desperate situation of oppression, suffering, and
injustice in Burma outlined above.

     It doesn't require too much analysis to begin to make the
connections between German economic involvement in Burma, and the
daily injustices suffered by the Burmese common people.  For
example, many of the estimated 8,000 peaceful demonstrators who
were viciously mowed down during the bloody showdown between the
military junta and the student-led movement in 1988, were killed by
the 22nd Light Infantry Army unit who, coincidentally, were armed
with G-3 and G-4 assault rifles produced and provided by Fritz
Werner Arms Industry, which, at that time, was owned by the German
     The dubious role played by  the  German government  in  arms 
production and supply of the  Burmese  military junta before and
since the now notorious 1988 massacre,  is certainly an important
issue to focus on for those working for democracy and human rights
in Burma, as well as the international community in general
     An exploratory German parliamentary inquiry in 1989 concerning 
the link  between the German  government and the Fritz Werner
company  yielded an evasive and rather  impolite  answer. (Minor
Parliamentary Inquiry, 15.2.89).  
     In March of 1990 Germany's major opposition  party,  the 
Social  Democrats(SPD), filed  another inquiry, this time extending
their questions beyond the specific issue of Fritz Werner's
involvement in Burma, to the broader question of the German
government's relationship to the  Burmese military junta in
general.- (Minor Parliamentary Inquiry, 7.3.1990).  Up to this
point, however, the German government has yet to supply any
concrete reply to the Bundestag with reference to this inquiry into
their dealings with the Burmese junta, particularly in regard to
weapons trading.  
     Although the German government halted its official aid
disbursements to Burma in 1988 - in the turbulent wake of the
political crisis there and the accompanying international outcry
against the Burmese government - German companies, in particular
Fritz Werner, continue to privately work with the Burmese military
junta, and new Burmese-German joint ventures have been signed.(see
Appendix on Burma-Fritz Werner joint venture of 1990)  
     As a result of this on-going German involvement it now becomes
necessary for people concerned about Burma's future to seriously
evaluate if these  joint ventures truly benefit the people of
Burma, or only contribute to continuing oppression and injustice. 
In order to do this, it may be helpful to make a closer examination
of the oft-mentioned Fritz Werner Industry, and the nature of its
long history of involvement in Burma.

     A diplomat familiar with Burmese politics has noted that,
"Fritz  Werner has a unique relationship with the Burmese  ruling
elite  that has been cultivated over the years. There is a  great
deal  of  mutual trust between the company and the Burmese
government, whose military-minded leaders look for such
characteristics as  reliability and discretion from a business
     The Fritz Werner company struck up this now historic
partnership with the Burmese government, referred to in the quote
above, in 1953, shortly after Burma obtained independence  from
Great Britain in January 1948. This was a time of considerable
political disorder in Burma. Ethnic separatist movements seeking a
just autonomy were already emerging within the fragile,
newly-formed Union of Burma, creating an immediate demand for
weapons within the central Burman government.  Fritz Werner
Company, which was wholly owned by the West German
government(falling under the jurisdiction of the  West German
Ministry of Economy), quickly stepped forward to meet that demand. 
Presently, Fritz Werner is the fifth largest exporter of arms in
the world.3
     Since this original contact in 1953, the Commander-in-chief of
the Burmese Armed forces and long-time dictator, Ne Win, has
cultivated friendly relations with the Fritz Werner family, both
diplomatically and personally. Fritz Werner technical advisors
posted in Rangoon have had continuous access to the dictator, even
following his "retirement" in 1988, a rare privilege not extended
to the representatives of other foreign firms.  Ne Win has even
been so generous as to build a grand, Burmese-style house for the
Fritz  Werner family in Geisenheim, Germany.  The fact that Fritz
Werner was owned  by the  West  German  government itself has
created a close personal relationship between the two governments,
making Burma "the friendliest nation toward West Germany in Asia".4
     Fritz  Werner's secretive Burmese operations,  which have
often been shrouded under a veil of mystery, got into full swing in
1957.  In this year they established  their first weapons factory,
on  the  outskirts of Rangoon, and launched into full-scale
production of G.2 (Gun 2), G.3 (Gun 3), and G.4 (Gun  4) rifles,
7.62 mm. and 9 mm. small arms  ammunition, and  a range of
explosives including Claymore mines and mortar shells up to 81 mm
in size. (Dawn, Vol.1 No.23 Dec 1989, p 10)  This start-up was
achieved with the assistance of  the West  Germany  Arms  company 
Heckler and Koch.  The  factory was  supervised  by  German
engineers  from  the German Technical Corporation  Agency (GTZ).  
     The Burmese military has often used these German-produced
weapons to oppress the Burmese people and various ethnic minority
groups, especially following the military's seizure of power under
Gen. Ne Win in 1962. For example, on the 7th of July, 1962, just
three  days  after Ne Win's ruling Burmese  Socialist Program Party
(BSPP) was formed, the  students of  Rangoon  University,  under
the leadership  of  the influential Rangoon University Students
Union (RUSU),  organized a peaceful demonstration  inside the
Rangoon University Campus. Ne  Win and his close military
associates sent troops equipped  with  G-3  automatic rifles into
the university campus with  orders  to fire into the  crowds of
thousands of students, who were peacefully demonstrating.  Over 100
students  were killed and many more injured.  The next morning  Ne
Win ordered  the  destruction of the RUSU building,  which  was a
treasured  historical  monument of the Burmese independence
movement against the British.  The building  was  blasted  to
pieces by heavy explosives, and every trace of it removed.More
recently, during the 1988 student uprising, over eight thousand
people were killed  by more of these same German-produced weapons. 
     Not only did the Fritz Werner Co. produce the vast majority 
of armaments required by the Burmese military, they also served as
a conduit for all importation of raw materials, machine parts and 
chemicals used in explosives production.  Most of this destructive
inflow of weapons material came from the countries of Belgium,
Sweden, and Singapore, as well as smaller amounts originating in 
England,  Pakistan and Israel.5  In order to sustain their export
sales in a declining  world  arms market, all of these nations seem 
willing  to turn a blind eye to the horrible consequences of their
trade in death.

     The cozy relationship between the West Germans and the Burmese
military was something of a closely kept secret until 1988, when
the democracy uprising and surrounding political crisis blew the
lid off the Burmese situation, and drew the attention of the whole
world.  Due to the international pressure brought upon the West
German government by the horror of the September 1988 coup, it
suddenly became one  of the outspoken critics of the Burmese
regime, as if they hadn't known before how many Burmese had died in
the past at the hands of the government - hands that were holding
West German weapons.  The German government suspended development
co-operation activities with  Burma, including negotiations
regarding Burmese debt cancellation(W.G. Cabinet June 1988). 
     The West German government also claimed that all export
authorization of arms to Burma had ceased. Despite assertions made
by the West Germans that the Fritz Werner Co. was no longer 
participating in  the  production of weapons and explosives  (124th 
Parliament Session,  15th of Feb. 1989), and that technical
co-operation  had been  reduced  to a minimum, the fact remains
that, to date, the manufacture  of  explosives  and  weapons 
continues, and three German employees of the GTZ remain in the
country, disguising their true field of expertise.6
     Despite the hasty withdrawal of German economic support from
Burma after the 1988 crackdown, it didn't take long before the
Fritz Werner company found an opportunity for renewed investment,
in partnership with their old friend Ne Win, and his SLORC
associates. But, before continuing the Fritz Werner-Burmese saga,
let us first set the economic context of Burma in the 1980's, as a
backdrop into which these renewed German business ties occurred. 

     In the 1950's, Burma ranked second in Asia economically,
trailing only the resurgent Japanese in wealth and prosperity. 
Sadly, by the 1980's,  Gen. Ne Win's economic policy, heralded as
the "Burmese Way to Socialism", but more widely perceived as
straight-forward military  mismanagement and ineptitude, had mired
the country in a desperate state of poverty and depression.  This
degraded condition reached a symbolic low point with Burma's
addition to the tattered ranks of the UN's "Least Developed
Country"(LDC) status.  
     In an attempt to remedy this disastrous state of affairs, the
Burmese government(now called SLORC) once again turned to their old
friends, the Fritz Werner company, to form up a joint venture with
the Burmese Ministry of Industry in 1990.(see Appendix-Fritz
Werner/Burma joint venture)  The venture focused on implementing
import-substitution schemes involving the glass and tire
manufacturing industries, and developing technology for production
of basic tools like bench drills and lathes. 
     The limited success of this joint venture was made  possible
thanks, in large part, to an old loan of US$500 million that the
West German government had been disbursing to Burma since the
1960's.7  This infusion of cash included a US$65 million supplement
that West Germany had given Burma as recently as 1987, which was
divided between US$15 million in technical grant, and US$50 
million  for  "capital goods imports".8  Even with this money, many 
of the joint  venture projects were closed down for want of spare
parts and  raw materials, which leads one to question whether the
foreign  exchange actually ended up in the projects they were
designated for(or was it perhaps transferred to the military for
defense purposes?).

     As one diplomat commented about the whole affair,"the Fritz
Werner  company stands by itself [in Burma], and their joint
venture is just something that has grown out of a very  personal
relationship between them and the powers who are Gen. Ne Win, Phyo
Wai Win, Ne Win's son, and U Maung Cho."9  This quote highlights
the close personal nature of the Fritz Werner-Ne Win business team.
     For a time, Phyo Wai Win and his wife and son lived  together
at Ne Win's house in Munich, Germany. At  present, however, Phyo is
working  with  Schlumberger Oil Company(which also invests in
Burma) in the  Hague, Netherlands, and is living together with his 
German girlfriend "Barbara". 
     The former Minister of Industry, U Maung Cho, is also  known
to have long-standing personal ties with the Fritz  Werner Company.
Maung Cho was educated as an armaments engineer, first in England,
where he spent four years, and later in the Federal Republic of 
Germany,  where  he spent another three  years, and ended up
marrying a German wife,Ingeborg.  While in Germany Maung Cho
received on-the-job training from Fritz Werner.10  With Ingeborg he
has a daughter "Petra".  
     "It  was lucky for the Germans he didn't marry an English 
girl", quipped one seasoned Burma watcher. "Diplomatic relations
between the  two countries have just emerged out of this thing", 
said this diplomat, in reference to Maung Cho's personal
connections in Germany.  (Germany-Burma, dpa 21 Feb. 1984) 
     These kinds of personal relationships with Fritz Werner have
helped preserve Gen. Ne Win's  Socialist government in power,
despite the various insurgencies and unrest broiling over in his
country. The connections have also helped to line the  pockets of
a small  group of German businessman. Among the individual Germans
most benefiting from this cozy relationship are Joachim  Frist of
Fritz Werner Company, Fritz Schlemmer, a  pharmaceutical salesman, 
and  Siegfried  Otto,  the  chairman  of the Giesecke  and Devrient 
group  of companies.11 
     With Fritz Werner Industry serving as an outstanding specific
example of German business involvement in Burma, let us next
broaden our scope to include an examination of Burmese\German trade
dynamics in general, and its interconnectedness to issues of peace
and justice for ordinary Burmese people. 

     Historically, Germany views Burma as a country with  great
economic potential. Its excellent population to land area ratio,
and its status prior to World War Two, as the world's largest
exporter of  rice and a major exporter of petroleum, earned Burma
the distinction of being one of the wealthiest countries in South
East Asia.  Along with its huge agricultural potential  and 
promising  oil  and natural gas reserves, Burma has  significant 
deposits of  minerals in the areas of gemstones,  jade,  tin,
silver, gold and  tungsten.  Furthermore, Burma is blesses with the 
world's largest (though  rapidly  diminishing)  teak  forest and a
rich supply of  other tropical  woods.  Offshore, Burma has access
to teeming fisheries. Labor is  extremely  cheap, which is
attractive for foreign investors as well.   Burma's strategic 
location  at  the crossroads of South East Asia makes it a
potentially ideal location for the export of cheap manufactured 
goods throughout the region. 
     For  Burma,  the  Federal Republic of  Germany  is  an 
important trading  partner.  As  a supplier-country, it  accounted 
for  23 percent  of total Burmese imports in 1983, which was second 
only to  Japan; as a purchaser of Burmese goods, Germany took ninth
place in world ratings, accounting for  2.1 percent of overall
Burmese exports.12 
     Increasing German-Burmese trade is expected in the future.
Support by private  German  firms  for  Burma's  economic expansion
can be seen in the launching of a joint  enterprise in the machine
building sector in the autumn of 1984 with the Fritz Werner
Company(as well as subsequent joint ventures as recently as 1990). 
This undertaking by Fritz Werner was generally seen as
"trailblazing" for  future economic relations between Burma and the
Federal Republic of Germany. 
     Another signal of the push for smoother trade between  Germany 
and  Burma can be seen in  the holding of a seminar designed  to
promote  Burmese  exports  to the Federal  Republic  of  Germany. 
This was organized jointly  by  the German Embassy  in  Rangoon 
and  the Federal Office of Foreign Trade in Cologne.  13

     Germany has a great interest in exploiting the economic
potential of Burma's wealth of natural resources.  For example, it
has been involved in the exploration of nickel and copper deposits
in the Chin and Arakan mountains on  the western fringes of Burma.
This project was carried out by experts and advisers from the
Federal Geo-Scientific and Raw  Materials Establishment in
Hannover, Germany. This German scientific establishment was also
involved in  the evaluation of mineral prospecting  work, and
exploration for possible oil and natural gas deposits  in different
regions of Burma.14
     Germany hopes its close working relationship with Burma will
lead to further lucrative development of both copper and nickel
deposits, as well as new expansion into natural gas and
petrochemicals.  For example, Germany has  reserved  money  for 
the Martaban Offshore Natural Gas Project which is designed to
extract natural gas  from the Gulf of Martaban, and process it into 
Methanol, and then, ultimately, into  gasoline.  Germany hopes that
a successful exploration in the Gulf of Martaban will lead to the
construction of new Burmese fertilizer factories operating on
natural gas.  The Federal Geo-Scientific and Raw  Materials
Establishment in Hannover has the full support of the German
government in this endeavor. The German government has already
supplied geophysical(seismological) equipment for the oil
exploration.  The final details and contract arrangements between
the two countries have not yet been disclosed.15  
     The flip side  of  West  German economic investment in Burma
can be seen in its importation of Burmese natural resources into
Germany. The  Burmese  government is rapidly selling  off wholesale
its marketable natural resources in a desperate bid to bring in
much needed foreign  exchange.  For example, in the past eight
years, Burma's German-built "Five Star" ships (S.S.Sagaing, Magwe, 
Pegu, Mandalay etc.) have exported  a number of elephants,
thousands of tons of teak  wood, animal food, and minerals to
Germany. (Burmese sources in  Hamburg claim that arms from West
Germany have also been loaded on these Burmese Five Star Shipping
line ships.)16

     In order to sustain long-term trade operations and
exploitation in  Burma, the West German firms have sponsored
training programs for the Burmese. A list of the training
initiatives Germany has sponsored in Burma include: 
- sponsorship of young military officials to study military,
intelligence, and armaments training techniques in Germany 
-  sponsorship  of  the Sinde Vocational Training  Center  and  a
Railway Workshop in Mandalay 
-  supply  of  equipment and teaching aids to  improve  work  and
training at the Bawdwin Namtu mining and foundry plants 
-  German  assistance in the development of  an  integrated  crop
protection service 
- sending of advisers for the Paleik textile factory, also  built
with German assistance 
- setting up of a short-term pool of experts for preparation  and
execution of technical cooperation projects 
-  Assistance  in the drawing-up of a study for  the  electricity
supply in Rangoon 
-  sponsorship  of the cooperative system (sending  of  advisers,
supply of equipment, training of specialists) 
- sponsorship of the Syriam Trade Training Center, which  trains
specialists in maintenance engineering and electrical  maintenance
work for technical installations  in the industrial sector
(especially in conjunction with the Industry and Defense
-  German assistance in the further development of Burmese  radio
(supply and installation of radio transmitters, financing of  the
training of experts, etc.)
     (Work  of particular importance in this sphere is done  by 
Fritz Werner Industry, the Carl Duisburg Society, the German
Foundation for International Development, the Deutsche  Welle Voice
of Germany overseas radio service, and - in the  college and
university sector - the German  Academic  Exchange Service (DAAD)
and the Alexander-von-Humboldt Foundation.)17
     The final entry listed above, the Burmese radio development
project, presents a clear, specific example of how German economic
investment and training in Burma is used to support the military 
regime, and works against the people's struggle for democracy. 
Germany has been involved  with the supply and installation of
radio transmitters to the  Burma  Broadcasting Station (which is
heavily controlled by the military), and also in the training  of
Burmese journalists, and radio and television technicians. After
the German training these journalists and technicians have no
option but to work for the only radio and television stations in
Rangoon, which are essentially the mouth pieces of the military
government.  Although these people are trained in Germany under the
guidelines of a free press, they never write or announce the real
situation as it happens in Burma when they return. All news is
simply headlines and  propaganda produced by the military. So most
of the students trained in Germany end up coming back and serving
the dictator. As most of them are children or relatives of the
military elite, they will work only  to please  their  elders. 
This is one of the many methods used by the military to maintain
its power and oppress its own people.18

     All of these facts and figures point to a trade relationship
between Burma and Germany of significant proportions. But how do
trade connections tie into the broader issue of oppression and
human rights violations in Burma?
     The essential link between trade and oppression can be found
in the Burmese defense budget. In  1987  the Burmese government
stated that the  defense  budget took  50%  of  all  foreign 
exchange.  Other  observers  of  the government believe that the
percentage is much higher than this figure. Most of Burma's foreign
exchange is obtained through trade.  Since 1987 the defence budget
has risen from 1.7 billion kyats  to 2 billion kyats, while the
domestic economic situation has worsened even further.
     Starvation is now rife throughout the poor urban areas of the
major cities. One can quickly see how providing the Burmese
government with foreign exchange through trade ends up translating
into more defense spending, more military oppression, and more
economic mismanagement inside Burma, all primary causes of
suffering among the common people.
     Next, we will take a short look at the similar role that
German developmental aid has played in Burma.

     The official state visit to Burma made by the German president
in 1986, which was highlighted in the introduction, also pointed to
the potential future role that Burma may play as one of the focal
points of German developmental  aid.

     Germany has certainly been a major player in Burma's
developmental projects historically. For example, during the
1970-1988 pre-crackdown period, the Federal Republic of Germany 
was Burma's second largest donor of bilateral O.D.A (Official
Development Aid - see table 1 & 2). West German disbursements grew
impressively after 1978,  reaching a record level of 1 billion DM
during this period.     
     In 1984-1985 alone, West Germany provided Burma with DM 150 
million worth of financial aid. It was agreed to utilize these
funds for the rehabilitation of the Thayetmyo Cement Factory, the
purchase  of shunting  locomotives,  spare  parts and  equipment 
for  Burmese railways,  and for partial financing of the Kinda 
Hydro-Electric Power Station.  Commodity aid amounting to DM 10
million was also designated to be used for the purchase of urgently
required imports such as industrial inputs and spare parts. 
     Financial aid cooperation between the Federal Republic of
Germany and Burma is built upon the historic priorities of Burma's 
own  development policy. Earlier German aid assisted in the setting
up of industrial manufacturing plants such as the Syriam glass
bottle factory near Rangoon,  the  Bassein  flat glass factory, the 
Sinde  pump  and engine  factory,  the brick works in Hmawbi and
Danyigone, and the Paleik textiles factory.  This cooperation in
the industrial sector has formed the basis for a close  partnership
between Rangoon and Bonn, and encouraged a spirit of mutual trust. 
     Beyond the establishment and further development of industrial
production plants, this financial aid cooperation is focused
primarily on projects for the exploitation of Burmese raw
materials, resources, and reserves, the boosting  of agricultural 
productivity, measures designed to  expand  the transportation  
infrastructure, and vocational/educational training.  A  large 
proportion  of financial cooperation  funds  is also set  aside 
for  commodity  aid,  chiefly involving  the purchase of raw
materials, food, spare  parts  and other badly-needed civil
- ( All  data  based on statistics provided  by the  Federal
Statistical Office in Wiesbaden, Germany) 

     In  addition  to this bilateral cooperation, the Federal 
Republic  of Germany has made available to Burma annually an
approx. total of DM 50 million through multilateral channels.
Beyond the direct loans of bilateral aid, Burma receives German
money indirectly, via international  bodies  such  as the  World 
Bank,  the  Asian Development  Bank, the U.N. Development Program
(UNDP), or the International  Development Association.  Germany  is 
a  major  contributor  of  funds  to  all  of  these institutions. 
There  is also German involvement  in  the  "Burma Consortium", set
up by the World Bank to coordinate  international aid to Burma. 
     This economic aid pipeline from Germany, both bilateral and
multilateral, sustains the Burmese military regime in much the same
way an active trading partnership does. It brings in much needed
foreign exchange, supplies investment for governmentally-planned
projects which fit into the state's security needs and strategies,
provides legitimacy and good publicity, both internationally and
internally, to the unconstitutional Burmese police state, frees up
other funds for military spending (the government's #1 priority),
and usually benefits only the wealthy military elite who rake in
any profits made off of economic development investment in Burma.

     Finally, we will explore the nature of Burmese-German
political ties over the years and contemporarily.  Presently,
diplomatic relations between Burma and Germany appear stable and
free of major problems.  In recent decades a dialogue based on
mutual trust has evolved between the two nations.  Despite the
difficulties presented by substantial differences in political/
social systems, and the intervening factor of geographical
distance, the countries share some similar affinities. Among these
is something of a common vision for profitable relations between
First and Third World nations, with the German government in Bonn
dedicated to playing a facilitating role in the development of
economic and political stability within LDC's like Burma.  
     One expression of the historic good state of relations between
Germany and Burma can be seen in the exchange of  visits  by 
prominent public  figures on each side. 
     Most prominently from the Burmese side was Gen. Ne Win's visit
to the Federal Republic of Germany in 1968, and subsequent trips in
the years 1982, 1984, 1985 and 1988, in his role as Chairman of the
Politburo of  the Burma Socialist Program Party.  The  first four
visits centered on Ne Win's desire for German weapons, while his
final trip in 1988 was focused on exploring the possibility, via
the conduit of his German lawyer, of  political asylum in Germany
or Europe, should the democracy forces overthrow his regime. 
     Furthermore, the  former Burmese prime minister, U Maung Maung
Kha, went to Germany privately in 1984, and had visited previously
in 1976 while holding the position of Burma's Mining Minister.  
     There have  also been several  visits  to  the Federal
Republic  of  Germany  by  other Burmese  parliamentarians  and 
ministers  including  the  former Foreign  Minister  Chit Hlaing
(privately in 1984),  Finance and Planning Minister (and deputy
Premier) Thura Tun Tin (1984, also in 1978, 1982 and 1983),
together with Defence Minister Thura Kyaw  Htin (1982  and 1984),
and the Industry Minister Col. Maung  Cho (who  was  trained  by
the  Fritz  Werner company while living in Germany).
     The most prominent visitors to Burma from the Federal Republic
of Germany have included the late Chancellor Ludwig Erhard (1958 
in his  capacity  as Economic Minister), former  Chancellor Kurt
Eorg Kiesinger (1967), Former Minister of State  Hildegard  Hamm
Brucher (1979), Overseas Aid Minister Jurgen Warnke (1984), State
Secretary  Dieter von Wurzen (1984), and various delegations  from
the Federal Parliament. 
     In summary, the  German-Burmese political relations which were 
initiated by the  Fritz  Werner family in 1950, and given impetus
by the late Chancellor Ludwig Erhard's visit to Rangoon in 1958 in
his  capacity as  Economics Minister, reached its climax in
February 1986 when his excellency, the  president  of the Federal
Republic of Germany,  Dr. Richard von Weizsacker,  made the
"historic visit" to Burma mentioned several times previously. 

     Following  the uprising in 1988, the European Community  and 
the United   States  began  imposing  economic  sanctions  on 
Burma, identifying  the  high incidence of human rights abuses by
the government as the primary reason. At the same time this
anti-SLORC movement was happening in the West, German business
firms were  accelerating their assistance to the Burmese military.
      Despite  the dire human rights situation in Burma,  Fritz 
Werner and  other  German  firms are not slowing  down their
investments, as their economic assistance continues to filter into
Burma. Many of these  German firms  are  involved in highly
sensitive and  complex  fields in Burma, such as weapons production
for the military.  All  assistance relating to these  sensitive
areas should  be  ceased temporarily until Burma  can  reach  a
settlement to its long civil war, and become more stable and
democratic as a nation. 
     Investments by Fritz Werner and other companies bring benefits
not to the Burmese people, but only to these companies, and to the
military leaders who use them to buy more weapons to intensify
their civil war against the people of Burma. 
     Fritz  Werner and many foreign companies now investing in 
Burma, seem to fear that democracy will be restored in  Burma and 
their investments will all be in vain. It seems that they are
worried that when peace comes to Burma at last, and the  43 years 
of civil war ends, they won't be able to make a profit as easily as
they are now.  Perhaps this is why Fritz Werner and other foreign
firms continue to prop up the Burmese military economically, and
continue to supply them with weapons which are used to kill
innocent people, even after most of the world community has cut off
aid to Burma for humanitarian reasons.
     The suffering of the Burmese people at the hands of these
military rulers has become undeniable.  The irresponsible
investments of Fritz Werner and others are indirectly encouraging
the torture,  persecution, and  killing of many ethnic nationals,
clergymen, students, and organizations which are struggling for
democracy inside Burma.  For the Burmese people, the cooperation of
Fritz Werner and other German firms  has  been extremely
discouraging. It is time for these corporations to stop considering
only how they can best exploit the  untapped  natural  resources 
of  Burma, and start listening to the cry of the Burmese people for 


1 Kaing Htan, "Burma and Fritz Werner" (in Burmese), March 1986.
2 "Germany - Burma" dpa Feb. 21, 1984.
3 "Stoppt den Rustungs Export der BOKO Co-ordanitationstelle,
4 Interview with the former staff of Fritz Werner in Geisenheim,
June 2, 1992.
5 International Institute for Strategic Studies, The Military
balance 1992-1993 (London, II SS, 1992): 173 & Far Eastern Economic
Review, Dec 6, 1990: 27.
6 Judith Richter "Deutsche Geschafte in Birma" April 24, 1991.
7 Embassy of FRG, Rangoon "Press Release" 1985.
8 Embassy of FRG, Rangoon "Press Release" 1985.
9 "Germany-Burma" dpa Feb. 21, 1984.
10 "Germany-Burma" dpa Feb. 21, 1984 & interview with the former
staff of the Burmese Embassy in Bonn, June 21, 1992.
11 Dawn News Bulletin, Bangkok "Military Aid to Saw Maung" Vol. 1
No. 23, Dec. 10, 1989.
12 Embassy of FRG, Rangoon "Press Release" 1985.
13 Embassy of FRG, "Press Release", 1985.
14 Embassy of FRG, Rangoon "Press Release" 1985.
15 Embassy of FRG, Rangoon "Press Release" 1985 & Bestelle Fur
Ausfenhandles Information (BFAI) Wirtschaftsentwicklung, Myanmar
(Burma) Wirtschaftsdaten May 31, 1990.
16 Interview with Kipp, European-Burmese Association, Hamburg, June
30, 1992.
17 FRG Embassy, Rangoon "Press Release" 1985.
18 Embassy of FRG, Rangoon "Press Release" 1985 & Fritz Werner
"Referenzliste Industrieanlagenbau Stand 7/91.


Summary of Correspondence Concerning the Establishment of a
Munitions Factory by Fritz Werner in Burma.*

Letter from the German Embassy in Rangoon to the Foreign Ministry,
Bonn, of 5 July, 1958

The Burmese Secretary of State, U Tun Thaung, informed the Embassy
that the Burmese government had decided to build a munitions
factory for an amount of 20 million kyat and to hire the Berlin
company, Fritz Werner, under the condition that, apart from a first
installment of 5 million kyat, the remaining installments can be
paid back within 4 to 5 years.  That means the contract should
include the Hermes insurance (a German government body which gives
loans and guarantees to ease foreign investors' risks.)  The
Burmese Ministry of Defense urged that the factory should be
completed in 2 years.  There were other offers from Japan and the
CSSR, but the military institutions had special confidence in Fritz
Werner.  Hermes should give its approval because Fritz Werner would
not have enough capital to run the project on its own.  It would
also be important to strengthen the German position in this
important sector of the Burmese defense and to prevent that a
(communist) East European country gets the contract.

Response from the Foreign Ministry, August 1958

The Hermes Committee rejected Fritz Werner's application regarding
the delivery of a munitions factory, in spite of the Foreign
Ministry's approval.  The reason for this rejection were the
conditions of payment which - according to the application - should
be handled in installments within 7 years, beginning one year after
the delivery - and not within 4 to 5 years, as stated before. 
Terms of payments beyond 5 years would only be granted to projects
in developing countries which serve to build up a healthy economy. 
However, the decision could be modified if acceptable payment
conditions were negotiated.

Handwritten note, 7/8/1958

Mr. Maier, a board member of Fritz Werner,s left for Rangoon for
further negotiations and to contact the German Embassy.  Before
that, he got the assurance from the German Ministry of Economics
that Hermes would approve the project if a first installment of
10%, 15% on delivery, and the remaining amount in 6 half-year
installments (3 years) could be negotiated.

Letter from the German Embassy in Rangoon to the German Foreign
Ministry, 14 August 1958

On 11 August, Dr. Maier signed a contract with the (Burmese) War
Office to establish a munitions factory.  The 20 million kyat deal
was made without the involvement of the Hermes-Insurance.  The
payment for the German machines would be made step by step within
a period of 27 months.  Mr. Maier had promised to inform the
Ministry of Economics about the contract.  The War Office insisted
on the secrecy of the project.  According to Fritz Werner, the
German company Zueblin AG had a good chance to get the contract to
construct the factory buildings.

*(All correspondence translated from German and summerized)