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Notes on US Sanctions Against SLORC

N O T E S   O N   U.S.   S A N C T I O N S
A G A I N S T   B U R M A 'S   R E G I M E

    Edith T. Mirante, Project Maje
    September 1995

The idea that "unilateral sanctions by the United States won't work"
is wrong:

    **  The US has consistently been among Burma's SLORC regime's top 
        five foreign investors during the last few years. Removal of 
        that huge income source would mortally wound the SL0RC, which 
        depends on infusions of overseas hard currency to stay armed and 
        in power.
    **  One particular project, the Tenasserim gas pipeline, is the 
        SLORC's largest current and potential income-generating scheme; 
        the US oil company Unocal, is a major partner in the pipeline. 
        Other US oil/gas companies -- Texaco and Arco -- are also huge 
        investors, having paid millions of dollars to the SLORC.
        Sanctions would end their relationship with the regime. If the 
        US companies withdrew, it would probably not be worthwhile for 
        other oil companies (such as France's Total, Britain's Premier, 
        and Japan's Nippon) to continue their Burmese gas investments 
        without them. The profit margin is low on such gas sales, and 
        the risk is extremely high, so companies try to spread the risk 
        around a partnership. US money has been a crucial component of 
        such partnerships.
    **  The SLORC has hopes of a lot of  "pie in the sky" investment 
        projects, including new cities and the "year of tourism", but 
        little has come of them. SLORC remains deeply in dept, with low 
        currency reserves and high inflation. They are, however, 
        convinced that they will get a steady income if the gas pipeline 
        is built -- this helps make them reluctant to cede any power to 
        Ms. Aung San Suu Kyi's elected government. The thought that the 
        oil company money could be removed by US sanctions is extremely 
        frightening to SLORC, sources with Rangoon contacts report.
    **  As well as its investments, the US is a significant importer of 
        some Burmese goods  such as teakwood (from endangered forests) 
        and jumbo shrimp (from overfished seacoast). The SLORC makes 
        money from such sales, and has waged war on ethnic minorities 
        for access to these natural resources.  Removing the US as a 
        market for these goods would both help stop the ravaging of 
        Burma's environment, and take income away from the SLORC.

The idea that "sanctions might hurt the common people" in Burma is 

    ** Income from US investments has been going directly to the SLORC 
       (oil/gas companies) for the most part, and otherwise to various 
       cronies of the military regime (Pepsico bottling plant, and 
       garment manufacturing). Withdrawal of the US investments would 
       take money away from Burma's military, and hamper its ability to 
       buy weapons.
    ** US investment  since 1989 have served to build a richer SLORC, 
       with an immense and well armed Burma Army. Thc country is open to 
       business-people and tourists, but slavery and other human rights 
       abuse occurs on a massive scale, often right out in the open.  In 
       pouring money into the regime's coffers, US companies have been 
       complicitous in the continued existence of the regime  Worse, US 
       investment in the Tenasserim gas pipeline scheme has led to 
       large-scale human rights abuse in SLORC's security campaign for 
       the pipeline region. Sanctions would put a stop to such 
       collaboration with the regime.
    ** As foreign investments have increased in Burma, the military 
       elite and its cronies have gotten richer and richer, while the 
       average people have gotten poorer and poorer, and victimized by 
       inflation. A false free-market economy exists -- in reality, the 
       economy is as controlled by the military as it was when it was 
       called "socialism". US investments perpetuate this system, and 
       benefits do not trickle down to the vast majority of people in 
       Burma. US projects have employed few people in Burma, and those 
       employees usually must have the approval of the regime. Garment 
       companies have withdrawn, citing the inevitability of SLORC 
       involvement in Burma ventures.
   **  As consumer goods are largely imported to Burma through 
       neighbors, on an informal basis, the cancellation of US imports 
       to Burma through sanctions would have little effect on US 
       companies or on Burmese consumers.  The most high-profile US 
       consumer prodoct in Burma is Pepsi-Cola  and its removal would 
       certainly not cause any hardships for the average Burmese.   Most 
       people in Burma are living in a subsistence agricultural economy, 
       and are not now using the American imports such as cell-phones; 
       sanctions would not hurt them. There are rice shortages in Burma, 
       but the SLORC is exporting rice for prestige purposes; a US ban 
       on trade in Burmese agricultural products would help keep food 
       inside Burma, where it is needed, rather than having it traded 
       for goods Like Pepsi syrup and bottles overseas.

Edith T. Mirante is author of Burmese Looking Glass: A Human Rights
Adventure (Atlantic Month1y press), and director of Project Maje, an 
independent information project on Burma's human rights and 
environmental issues, which she founded in 1986. She has traveled 
extensively in Burma's frontier regions.