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BurmaNet News January 27, 1996

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------------------------ BurmaNet ------------------------
"Appropriate Information Technologies, Practical Strategies"

The BurmaNet News: January 27, 1996
Issue #331


January 24, 1996

Oil groups distance themselves from forced labor. Ted Bardacke reports..
        Burmas narrow southern peninsula, once a virtual no mans land, has
become a battlefield. The construction of a $ 1bn (pound 662m), 409 km
pipeline to transport offshore natural gas across the peninsula to
Thailand, by an international consortium led by Total of France and Unocal
of the US, has brought deaths in the jungle and denunciations in the west.
        Late March five Total workers were killed and 11 injured by ethnic
Karen rebels extracting revenge for the uncompensated expulsion of
villagers along the pipeline route. Just last month security forces guarding 
the pipeline area came under attack again resulting in a least one death.
       The systematic use of forced labor by Burmese military units
charged with protecting the pipeline and its employees, and the projects
acute strategic importance to the Burmese military junta, have made the
pipeline a target of western human rights activists initiating consumer
boycotts of companies doing business in Burma. The forced labor
surrounding the project is being trumpeted loudly by proponents of a
recently introduced US bill that would outlaw further US investment in
        By all accounts, workers on the pipeline itself are being paid, and
paid well by Burmese standards, although kickbacks by workers to the local
military officers who have some power over who gets hired have been widely
        Workers in military camps being set up to secure the pipeline area
are not so lucky.
        "Last May the township military authorities ordered us to go to
Heize island. Two hundred of us were there for two weeks, clearing
grounds, constructing a helicopter pad, building bamboo barracks and a
wooden guest house,. We were not paid .... and when we left, more workers
were forced to go to replace us.  They were not paid either," says Mr. Ohn
Thaw, a villager from Kanbauk who is now a construction worker in Bangkok
after escaping from Burma late last year.
        Previously uninhabited, the island in question is important for
both the construction and operation of the pipeline. It is located in the
shipping lane through which Total will transport material and equipment to
build the pipeline, and near from the Andaman Sea on to Burmese soil.
        Mr. Ohn Thaw and other Burmese refugees say that as well as
getting no wages, they were forced to pay for the petrol used in the boat
which took them to the island and were ordered to take their own food.
        "As soon as we got there, the military confiscated our food and
then rationed it out to us. It wasn't enough, only two tins of rice per
day; we usually eat three," says Mr. Ohn Thaw, who adds that villagers in
Kanbauk who refused to go were either fined 3,000 kyat (about a month's
wages) or arrested and sent to zones of conflict to act as porters for the
        Total and Unocal say no operation under their control uses forced
labor. Yet the security situation in the area is precarious and one Total
executive involved in the project acknowledges that unless the area is
pacified, the pipeline wont last the duration of the 30-year gas purchase
agreement signed with their Petroleum Authority of Thailand.
        Mr. John Imle, president of Unocal, said last year that if you
threaten the pipeline, there's going to be more military. If forced labor
goes hand in glove with the military, yes, there will be more forced
labor. For every threat to the pipeline there will be a reaction.
        That reaction is apparent to Mr. Ohn Thaw. Forced labor shifts in
the area around his village used to be once a year he says. Now its three
times a year and the time (spend working) is double or triple what it used
to be.
        Citing these allegations among other things, this month US
senators introduced legislation that would ban US investment in Burma-
which, depending on its legal interpretation, could force Unocal to pull
out of the project- until an elected government has taken power in Burma
and international labor standards are being adhered to.
        US campaigning groups, playing up instances of forced labor, have,
meanwhile, succeeded in several American cities in enacting selective
purchase legislation prohibiting local government purchases from companies
investing in Burma. This year they will seek to push this campaign to the
state level, which could deny Unocal millions of dollars in state
government contracts.
        These groups are also introducing shareholder resolutions aimed at
prohibiting companies from carrying out operations there.
        In some cases this pressure has been effective. In 1994 Hong Kong
-based Victoria Garment Manufacturing Company, which has four factories in
Burma, exported $32m worth of textiles to US customers such as Macys,
Eddie Bauer and Liz Claiborne. Under threat of picketing in front of
stores and disruption of annual meetings, these companies stopped buying
clothes made in Burma. Victoria Garments US exports fell to around $10m in
1995 and this year the company expects it will be forced to sack half its
3,300 workers in Burma.
        While such redundancies mainly hurt workers, disruption of the
pipeline would be disastrous for the military regime. Huge reserves of
natural gas exist in the Andaman Sea, and both Texaco and Arco are poised
to begin production if Total and Unocal can show that delivering the gas
to energy-hungry Thailand is feasible.
        Burmese officials have indicated that the hard currency they will
earn from selling the gas may eventually allow them to devalue the kyat,
the most important obstacle to permanently reviving the struggling
Burmese economy.
        On top of the revenue, some of the gas will be transported by
another pipeline to Rangoon, where it will generate electricity and be
used to produce fertilizer, things the Burmese government desperately
needs. The pipeline is a key to so many projects, says Mr. Set Maung,
economic adviser to the Burmese generals.
        Total and Unocal have been at pains publicly to distance
themselves from he Burmese junta. But as the pipeline progresses, the
relationship is deepening, as the companies recognize that the military is
the only real administrative authority in the country, according to a
Total executive.
        Signs of this collaboration turn up in the oddest places. At Ban I
Thong, where the pipeline will cross into Thailand, Burmese government
troops have taken up strategic positions on a ridge which is nominally in
Thailand. In the shirt pocket of a young private, who has tied a bunch of
bananas to his belt laden with hand grenades, is a ball-point pen sporting
the logo of Total.


January 23, 1996

        Here's an excerpt from the TOTAL booklet "The Yadana Gas Development".
It's just for PR but the activists can encounter their facts with the
genuine situation.

        The Yadana gas field was discovered in the early 1980s. Further
exploration work took place during the same decade but it was not until
1992, having secured a potential market, the TOTAL signed a Production
Sharing Contract with Myanmars national oil company, Myanmar Oil and Gas
Enterprise (MOGE). The American Company UNOCAL then joined as a partner
followed by the Thai State-owned company, the PTT Exploration and
Production Public Co.Ltd (PTTEP) and finally in late 1995, MOGE itself.
The shareholders interests in the Project are TOTAL 31.24%;  UNOCAL
28.26%;  PTTEP 25.5%;  MOGE 15.0%.

The potential of Yadana
        Initial gas in place; 5 Trillion cubic feet (140 billion cubic meters)
        Average production at Platau; 650 mmscfd (18Mm3/ day)
        total duration: 30 years
        plateau; 16 years
        overall cost of first phrase; US$ 1 billion

        200 mmscfd (200 Mm3/year) will be transported free of charge along
this line to the Tenasserim region is south Burma. The domestic pipeline,
which is responsibility of MOGE, will supply gas to a combined cycle power
plant near Yangon. Most of the revenue derived from the gas will not
initially be paid in monetary terms to the Myanmar Government but in the
provision of free gas.

        Platform installation; from June 1997 to February 1998
        offshore pipeline installation; from Aug to Dec 1997
        infrastructure and onshore pipeline; from Oct 95 to March 98
        production; 1st July 1998

The gas transportation system
        The gas Transportation System comprises a 669km long 36 export
pipeline of which the first 490km is the responsibility of TOTAL. The
remaining 260km from the border of Myanmar and Thailand to Ratchburi is
the responsibility of the Petroleum Authority of Thailand, the buyer of
the gas.
        An aerial survey was carried out in May 1994, which was followed
up by an environmental ground survey in December 1994. This latter survey
was realized by a multi-disciplinary team consisting of Francis Crome,
formerlyof the Australian Commonwealth Scientific and Industrial Research
Organization, Dr.Georges Michaloud of Montpellier University and personnel
from the international constancy Environmental Resources Management....
The route has also been carefully selected to minimize the impact on
centers of population. However, isolated houses and field can occasionally
extend beyond the village boundary. Where disturbance to local life cannot
be avoided compensation will be given, whether in monetary terms or, where
possible, provision of alternative land holding in proximity to that
already existing.

offshore facilities
                The pipeline Center will be located in the western section of the
pipeline route bear the Heize Chaung, whereas the Metering Station will be
located near the border of Thailand and Myanmar.  Both ill be permanently
staffed. The logistic facilities will consist of an airstrip and a port
from which lorries will transport materials and personnel to the work
sites. There will, therefore, be no need to use the northsouth Ye-Tavoy
railway which is not suitable for the Project requirements and, furthermore, 
will most probably not to be completed prior to installation of the pipeline.

A Major contribution to local development
        Each village has also received a presentation on what the project
involves and further ones are planned with the use of videos. A
television, video player and generator have been purchased for this
purpose and mounted on a car for easy transportation between the villages.
        For the realization of a preliminary survey and construction of a
temporary accommodation camp in early 1995, the wages paid were 300
kyat/day for skilled workers, 250 kyat/day for semi-skilled workers and
200 kyat/day for unskilled workers. There rates are above the prevailing
average wage scale. In addition to their salaries, the workers received
free accommodation, food, safety equipment and medical examination.



January 22, 1996  (abridged)

      RANGOON, Jan 22 (Reuter) - Burma's national convention, which has met
intermittently since January 1993 to draw up the guidelines of a new
constitution, is taking a short break, an official organising the meeting
said on Monday.  Although no date has been fixed for its resumption the 
official said the meeting, which was last held on Friday, is likely to start again 
early next month. No reason was given for the break. 


January 21, 1996   (news from the SLORC)

Yangon, 22 Jan- A total of 10,483 members of Mong Tai Army  (MTA) led 
by Khun Sa have entered the legal fold  since 5 January, bringing in 6,518 
assortments of heavy and small arms and ammunition.

Sixty-one members led by Deputy Commander of No 8 MTA  Brigade 
Ywet Mein turned themselves in to the Tatmadaw on 20 January at Wansin 
village in Kehsi Mahsam Township in the west of Thanlwin River in southern 
Shan State. They handed 60 assortments of arms and ammunition to the 

Tatmadawmen  led by Acting Tactical Operations Commander of Eastern
Command  Lt-Col Khin Maung Soe warmly welcomed them. Ywet Mein 
spoke on the occasion.

Tatmadawmen  attended to their requirements.  In  the afternoon, they returned 
to their homes by cars, arranged by Tatmadawmen, to be reunited with their 

Tatmadawmen also looked into the requirements of MTA men who returned to the
 legal fold from regions  in the east of Thanlwin River .

Another 94 MTA members entered the legal fold bringing together with them 
30 assortments of arms and ammunition in Lwetun region in the east of Thanlwin 
River in eastern Shan State on 20 January.     

Understanding the Government's goodwill  towards the armed groups in jungles
 and renouncing trafficking and production of narcotic drugs and cultivation of poppy,
 MTA members under the command of Khun Sa have been returning to the legal fold
  since 5 January, turning in their weapons to the Tatmadaw. (MNA)


January 22, 1996         by Toh Han Shih

	Singapore company Techmat Holdings has been quick to seize the
opportunities in the once war-torn border areas of Myanmar.
	Soon after drug lord Khun Sa surrendered his huge cache of weapons to the
Myanmar army on January 6, Techmat has disclosed plans to open at least four
duty-free shops in the border areas and expand the operations there of its
airline joint venture, Air Mandalay.
	Techmat -- through a new joint-venture trading company called Myawaddy
Trading formed in Singapore last September -- plans to open by April a
duty-free shop in Reli, a transit point on the border with Yunnan in China,
and second at Tachilek, 10 km from the Golden Triangle near the Thai-Laos
	Myawaddy Trading also plans to open duty-free shops at Mandalay Airport and
at a border airport which Air Mandalay flies to, said Techmat's group
general manager, Shaukath Ali.
	The four duty-free shops are expected to generate US$300 million (S$42.6
million) in turnover this year, Mr. Ali said.  "We are now in the final
stages of planning.  They will sell alcohol and tobacco and we may look into
perfume," he added.
	Through these shops, Myawaddy hopes to capitalize on Myanmar's lucrative
border trade.  Myanmar's border trade with Thailand and China is thought to
account for about a third of its foreign trade.
	Techmat is a private company that deals in defense trade, aerospace sales
and service, commercial trading, air and sea freight, and surveillance systems.
	It is an equal partner in Myawaddy Trading with the Union of Myanmar
Economic Holdings (UMEH), which is 60% owned by the Myanmar Ministry of
Defense and 40% by retired Myanmar military officers.
	Techmat's partners in Air Mandalay are Malaysian listed Kemayan Corp. and
state-controlled Myanmar Airways.
	Myawaddy Trading has clinched two orders from the Myanmar government
totalling about US$10 million for the export from Singapore of steel
deformed bars and steel wire rods and hopes to generate another US$40
million in trade this year, said Mr. Ali.  This would bring the combined
turnover of Myawaddy planned shops and trading projected for this year to
US$80 million.
	Myawaddy will export steel, construction materials, and commodities from
Singapore to the Myanmar government.  From Myanmar to Singapore, it plans to
send rice, agriculture products, timber and precious stones.  It also buys
steel plates, cement and wire rods from China, Russia and Turkey.
	Air Mandalay, which expects revenue this year to be US$15 million to US$20
million, is also awaiting approval to fly to seven airports in the
previously war-torn border areas of Myanmar.  In addition to its five
domestic destinations of Yangon, Mandalay, Pagan, Heho, Thandwe and the two
northern Thai towns of Chiang Mai and Chiang Rai.
	It is expanding its existing fleet of three ATR 72 planes and plans to add
one more ATR 72 plane this year and two more in 1997.  A Techmat subsidiary
is an agent for these Francoitalian planes.


January 25, 1996
Rangoon, UPI

Burma's top military leaders attended a ceremony marking the 
completion of the construction of Rangoon's newest major 
hotel project yesterday and praised the support of investors 
from Singapore.

Major General Khin Nyunt, the most powerful officer in the 
country's ruling junta, was among the dignitaries attending 
the "topping off ceremony" for the 450-room Rangoon Sedona 
Hotel, built by the Straits Steamship Land Company of 
Singapore. The international business hotel is scheduled to 
formally open to guests at the middle of this year.

In addition to military intelligence chief Khin Nyunt and 
Singapore's Minister for Trade and Industry Yeo Cheow Tong, 
the ceremony was attended by Burmese Transport Minister 
Lieutenant General Thein Win, National Planning and Economic 
Development Minister Brigadier General David Abel and Hotels 
and Tourism Minister Lieutenant General Kyaw Ba.

Minister Kyaw Ba said the Sedona project was one of the 
first eight hotels for which contracts were signed with 
foreign companies in 1993. He described the Straits 
Steamship Land Company as a "sincere good partner who put 
its faith in us at a time when not many outsiders had 
confidence to invest in our country."

He said the company's faith was further demonstrated last 
year when its representatives signed a contract for another 
Sedona hotel to be built in the northern Burmese city of 
Mandalay with an investment of $3.5 million.

The Burmese government has signed contracts for 34 hotel 
projects with a total investment of more than $1 billion, he 
said. Investment from Singapore "take first place, 
indicating the good ties between our two countries," he added. (BP)


January 24, 1996

      RANGOON, Burma (Reuter) - Singapore has agreed in high-level talks here
to broaden economic cooperation with Burma and help the isolated country to
develop human resources, rice and poultry, a Singapore official said Wednesday. 

    ``The new initiatives that we launched today will build upon the progress
achieved so far, and provide additional impetus to our bilateral econommic
cooperation,'' Singapore's Minister for Trade and Industry, Yeo Cheow Tong,
said at the end of the talks late Tuesday. 

    The human resources training project would focus on staff for Burma's
tourism industry and on training personnel for the promotion of exports, the
embassy official said. 

    The second project would develop and increase production of Burma's
indigenous varieties of fragrant rice and enable Singapore companies to
invest in Burma's rice and milling industries. 

    The third project is aimed at improving Burma's poultry breeds and will
help investment in large-scale poultry breeding and production. 

    Singapore is a leading investor in Burma with interests worth $583.7
million in 36 projects, according to Burmese government figures. 
Total foreign investment in Burma up to the end of last year was worth $2.7 billion. 


January 25, 1996    by Henny Sender

LIKE other emerging economies of Asia, Burma lacks a lot of 
things that investors like. The list includes long-term 
political stability, a freely convertible currency and 
capital markets - the country doesn't have a stock exchange.

Yet these apparent drawbacks don't seem to add up to 
insurmountable obstacles to Kerry Securities, which 15 
months ago raised $28 million for the only direct investment 
fund for the country. Templeton may not have made a single 
investment in Vietnam despite having a fund named after that 
country, but Kerry has already committed all the money 
raised to Burma. Now, the firm is considering a rights issue 
which would double the size of the Myanmar Fund, which is 
listed in Ireland.

The fund is run by Irrawaddy Advisors, which is 51% 
controlled by Kerry, one of the corporate vehicles of  Malaysian 
magnate Robert Kuok; the balance is held by the Ho family, an 
offshore Burmese clan which now resides in Bangkok.

Kerry loves Burma indeed, compared to direct investors in 
China and Vietnam, Kerry fund manager Richard Neville makes 
emerging market investment sound easy - and safe. For one 
thing, Burma has a legal infrastructure with common, 
corporate and trustee laws all based on the British model. 
Accounting isn't a foreign concept either.

One of the advantages from Kerry's point of view is that the 
fund is practically the only game in town. White there is a 
lot of foreign capital rushing into the rest of Asia, little 
has found its way into Burma. For political reasons, there 
is no multilateral aid; no competition from the World bank 
or the Asian Development bank.

Domestic capital is scarce as well; total paid-in capital of 
the private banks ads up to just $2.7 million. Nor can 
Rangoon bank on a rich Burmese diaspora. Beijing can court 
55 million Overseas Chinese, many fabulously well-heeled, 
while Hanoi hopes to attract capital from a million 
Vietnamese who live abroad. But there are only about 55,000 
Burmese offshore. "I'm the big kid on the block here," says 
Neville. "I can always get a place at the table."

Still, when Kerry launched its fund and embarked on an 
aggressive marketing campaign, there were lots of questions. 
"It was difficult to see how they did their valuations," 
says one Hong Kong fund manager who considered investing. 
"How does Kuok decide what is his and what is yours?"

The fund does piggyback both on Kuok's and the ho family's 
activities in Burma. One of its biggest holdings is a piece 
of the Kuok-controlled Traders Hotel, now being built on a 
choice site in downtown Rangoon. Since Kuok acquired his 
long-term leasehold right two years ago, property values may 
have doubled.

No wonder that some investors say the worst thing about the 
fund is the fact that it is only allowed to invest 50% of 
its funds with Kuok.

And, enviably in the eyes of those familiar with China, the 
fund doesn't have any ventures in which the government is 
the partner (through that may change if and when it takes a 
stake in potential infrastructure deals). (FEER)


Khun Sa surrenders, but on his own terms
January 25, 1996

By Bertil Lintner in Bangkok

UNTIL recently, Burmese government helicopters that dared to 
fly over Golden triangle warlord Khun Sa's Homong base would 
have been targets for everything from small-arms fire to 
SAM-7 missiles. But early this month, the rugged hills that 
ring Homong were witness to the unusual sight of government 
choppers flying unscathed through rebel airspace.

What happened next was even more remarkable. As the 
helicopters landed in Homong, they were greeted by thousands 
of guerrillas standing at attention, their weapons at their 
feet. Since then, helicopters have been landing in the town 
almost daily. Meanwhile, government troops have secured 
areas along the Thai-Burmese border that have been under the 
rebels' control for decades.

The official Burmese media portrayed the event behind the 
spectacle at Homong - the surrender of Khun Sa's 10,000 
strong Mong Tai army - as a major victory for Rangoon. "When 
Khun  Sa realized that his military position was hopeless, 
he agreed to surrender to government authorities and abandon 
the narcotics trade," state radio announced.

Khun Sa claimed until recently that he was fighting for the 
independence of the ethnic Shan people of Burma. Indeed, 
Mong Tai, as in Mong Tai Army, means Shan state. But his 
name is more closely linked to the drug trade. Long reputed 
to be the biggest opium and heroin producer in the Golden 
Triangle, where the borders of Burma, Thailand and Laos 
meet, Khun Sa was indicted by a federal grand jury in the 
United States in 1989. Washington has since demanded that he 
be extradited to the US to stand trial.

Burmese television claimed on January 14 that 5,026 of Khun 
Sa's soldiers had surrendered since the peace agreement was 
sealed at a ceremony in Homong nine days earlier. 
Independent sources estimated that the rebels have turned 
over a third of their arsenal.

But most foreign analysts aren't convinced that Khun Sa has 
been truly neutralized. If anything, the deal between the 
warlord and the Burmese army has widened the already serious 
rift between Rangoon and Washington: "Relations were bad 
before," a US official says, "but now they've reached rock-

This official states bluntly that Khun Sa must have struck a 
deal with Rangoon. "WE still don't know the exact terms of 
the agreement between Khun Sa and the Burmese military," he 
says. "But it's obvious that he's getting something 
substantial in return for agreeing to all this."

Winston Lord, the US assistant secretary of state for East 
Asia and the Pacific, stated at a press conference in 
Bangkok on January 13 that Burma "can't expect relations 
with Washington to improve unless Khun Sa is extradited to 
stand trial in the US."

Shan sources talk about a 10-point agreement that includes 
an amnesty for the drug lord and promises that he won't be 
extradited to the US. He would also be allowed to retain a 
smaller militia of up to 3,000 men, to be supplied by 
Rangoon and be given the right to control certain areas of 
Burma's Shan state.

The Shan sources also dismiss speculation that the Burmese 
authorities plan to stage a show trial of the drug lord to 
appease the international community. Says one: "Khun Sa 
still doesn't trust the government. He believes that the 
moment he steps into a Burmese jail, they'll never let him 
out again. He knows too much, he has bribed too many 
officials during his years in the drug trade.

Khun Sa's unspoken threat to reveal such information is his 
guarantee that the Burmese won't double-cross him, say these 
sources. Indeed, he probably feels more threatened by his 
own men than the Burmese. Immediately before the surrender 
was announced, an entire battalion of government troops was 
deployed to guard him at Homong. The drug lord must fear 
that guerrilla who disagreed with the peace accord will try 
to kill him.

His security has been strengthened for other reasons as 
well. "We have reports suggesting that Burmese forces beefed 
up their protection of Khun Sa after we announced a $2 
million award for information leading to his capture," says 
the US government official.

Khun Sa is still at Homong. But given the Burmese 
government's ongoing drive to secure its borders, he 
probably won't stay there long. Indeed, it is likely that 
the territory which he will be allotted under the peace 
agreement will be else where, perhaps in central or northern 
Shan state.

If Khun Sa secures a new stronghold in that area, his 
militia would also serve as a counterweight to the influence 
of the rebel Wa and Kokang forces. These offshoots of the 
former Communist Party of Burma control the territory east 
of the Salween river opposite Loi Maw and Tang-yan and 
consider Khun Sa their arch-enemy.

Both the hill-tribe Was and the ethnic Chinese from Kokang 
have had ceasefire agreements with the government since 
1989. But the truces have been shaky, and could now be 
broken altogether following the Rangoon-Khun Sa deal.

Whatever the changes in his military fortunes, Khun Sa's 
business affairs are expected to continue running smoothly. 
His daughter operates from Hong Kong ad one of his sons, Sam 
Hong, also known as Paisal Changtrakul, appears to be 
assuming a more important role in his organization.

Khun Sa may now try and set up a new base for business at 
Tachilek, a government-held border town opposite Mae Sai in 
northern Thailand. The town is  a notorious transfer point 
for drugs. Shan sources say that Khun Sa has already bought 
a three-storey building in Tachilek from which he could 
covertly continue his activities. (FEER)


January 24, 1996
by Yindee Lertcharoenchok

Slorc accuses elderly group of being influenced by West       

THE Burmese junta has tried to intimidate a group of 23 political
and military contemporaries of Ne Win who jointly signed a letter
dated Nov. 24 calling for a dialogue between the military rulers
and pro-democracy leader Aung San Suu Kyi.

Two days after the letter was sent out, the elderly group was
summoned for a meeting with four Burmese government officials _
Lt Col Tin Hlaing, Deputy Minister for Home Affairs; Col Kyaw
Win, deputy director of the Burmese military intelligence; U Soe
Win, chief director for the People's Police Force; and Col Ba
Hein from the Criminal Investigation Department.

At the meeting, Tin Hlaing repeatedly accused the group of having
been influenced by the West, especially the United States, and
told them that the ruling State Law and Order Restoration Council
(Slorc) would not tolerate "stooges" meddling in state affairs.

A Western observer in Rangoon said that there was some
speculation in the Burmese capital that the summons was inspired
by former Burmese strongman Gen Ne Win who "was shocked to learn
that his veteran friends" had come up with the dialogue proposal.

The observer said Ne Win was also concerned that Slorc leaders
had not been providing him with full briefings on the country's
overall political picture.

The political and military veterans subjected to the official
reprimand included Bohmu Aung, who along with Ne Win,
formed the Japanese-trained "30 Comrades" group that later fought
the war of liberation against the Japanese invaders.

The others included Thakin Chit Maung and Thakin Lwin, both of
whom were elected MPs during the U Nu government, and U Tha Ban,
who was a central committee member of Ne Win's Burma Socialist
Programme Party.

The observer said since the incident, Ne Win had come out of
self-imposed semi-retirement and started holding meetings "on the
fourth Saturday of the month with a small group of six to seven
of his contemporaries".

The first meeting took place on Dec 30 and the next was scheduled
for Jan 27, he said, adding that Ne Win was still in good health
but with a "little hearing problem."

During the meeting with the four Slorc officials, the veterans
were told that their demands in the letter were identical to
those of the US, according to a transcript of the meeting
released by the All Burma Student's Democratic Front (ABSDF).

Tin Hlaing said the Slorc knew that many other embassies, apart
from the American diplomatic mission, "are interfering in our
affairs", making daily visits to Suu Kyi and "giving her
instructions". "Her husband [Oxford don Dr Michael Aris] is also
instigating the situation from abroad," he added.

Tin Hlaing accused Suu Kyi's National League for Democracy
of using the old veterans, and stated that the Slorc wanted the
elderly "to remain neutral" and let the state provide whatever
they needed.

"All of you are old. We would like you to live peacefully.
We are ready to take care of you on social and humanitarian
grounds. We believe that the NLD is using you. We want you to
stay out if the political situation becomes more violent. We want
you to remain neutral," he said.

Bohmu Aung has since rejected the accusation that members of
the group were "anybody's stooges" and said they sent the letter
with "sincere belief and goodwill" and that they were "just doing
what should be done for the restoration of peace and prosperity
of the country because we want to see these things happen before
we pass away."


January 25, 1996

AFTER surprising practically everyone by surrendering his 
3,000 strong Mong Tai Army (MTA) to Rangoon on January 7, 
drug warlord Khun Sa now appears to have dropped from sight.

There are conflicting reports as to his whereabouts.

One report says he left his stronghold at Ban Hua Muang, 
opposite Mae Hong Son, and accompanied Eastern Forces 
Commander Maj Gen Tin Htut to Rangoon on the same day.

But Thai intelligence officers in Mae Hong Son believe he is 
still at his home in Muang Mai, six kilometres south of Ban 
Hua Muang.

Diplomatic sources in Rangoon say the Slorc will be taking 
members of the diplomatic crops to Ban Hua Muang at the end 
of March so their success over Khun Sa can be revealed to 
the world.

But if the Thai intelligence report is correct and the drug 
warlord is still at his home, will the diplomats get to meet the man 
said to have overseen the world's largest opium plantations.

Sources say Khun Sa and his MTA soldiers have already 
received Burmese citizen identification cards, which means 
in theory they can travel freely any where inside Burma.

Slorc has also named Khun Sa as chief of a volunteer force 
to support the Rangoon government. The same thing was done 
with the United Wa State Army (UWSA) and Burmese Communist 
Party (BCP) when they too gave up their armed struggle 
against Rangoon.

A new group called the Shan National Organisation has also 
been set up. Among its 11 founders is Zao Khuensai Jaiyen, 
the chief director of the Shan Herald Agency for News, a 
bimonthly Thai Yai newspaper. Zao Khuensai is really the 
personal secretary of Khun Sa and is still the MTA foreign affairs officer.

He told Inside Politics after Khun Sa's surrender: "I am now 
out of a job." Looks like he has found himself new employment.

Meanwhile, Thai narcotics officials in Chiang Rai say the 
heroin smuggled through Thailand to the US and Europe has 
shot up in price after the surrender of Khun Sa.

Grade 4 (high grade) heroin previously sold for 140,000 baht 
for 750 grammes near the border area, but now costs 180,000 baht.

However, the heroin coming from Red Wa factories is still 
priced at 110,000 baht while that from the BCP is 91,000 
baht for the same quantity. (BP)

The BKK POST: (Heroin Price Soars In Shan State)
added on January 25, 1996: 

In a another development, another border source said more 
MTA troops recently defected to Gun Yod whose Shan State 
national Army now includes almost 10,000 men. The defection, 
he said, was due to disagreement with Khun  Sa's decision to surrender.
Gun Yod, one of Khun Sa's close aides, broke away from the 
MTA early last year along with about 1,000 soldiers.

The source said about 500 troops had earlier defected from the 
supervision of Cham Juen, one of Khun Sa's sons, to Gun  Yod.
Gun Yod's forces were said to be based outside a town north 
of Shan State.

Another border source said over 800 MTA soldiers based about 
20 kilometres south of Tachilek yesterday surrendered with 
arms to the Burmese government. (BP)


January 25, 1996

RANONG -The Ranong court yesterday sentenced three fishermen 
to 25 years in prison for murdering two Burmese crewmen and 
assaulting a third aboard a Thai fishing boat off the coast last August.

The court, which delivered the verdict in the presence of  Burmese 
authorities, said Khamsai Kaenkaew, Somsuan Kerdmareng and 
Sunthorn Kaewsongduang were guilty of murdering U Tun Kyi and 
Kyaw Tun Hla, and assaulting Seng Aye Kyaw.

It said the three had confessed to the crime. Two other 
defendants were acquitted in the case.

Thai officials in Bangkok and Ranong province yesterday 
expressed hope that the long sentences given to the three 
men would help appease the Burmese junta which had 
retaliated for the killing by closing the border crossing at 
Victoria Point, or Kawthaung.

They hoped the ruling Burmese Slorc would respond to 
Thailand's action by considering reopening the Victoria 
Point crossing opposite this southern coastal province.

In Bangkok, Defence Minister Gen Chavalit Yongchaiyudh 
yesterday thanked Assistant Burmese Military Attache Col Hla 
Than for cooperation in resolving the case.

An informed Army source said Assistant Army Chief Gen 
Chettha Thanajaro would go to Rangoon soon at the invitation 
of Burmese leaders. But Chettha, he said wanted to see "some 
positive gesture" from Slorc, such as a pledge to reopen one 
or more of the three border crossing it closed early last 
year, before embarking on the visit.

"The general does not just want to go and have tea or dinner 
with the Burmese leaders. He wants to see some positive 
gesture or some signs of improvement in bilateral relations 
before he starts off on the trip," the source said.

Thai officers in Ranong said the Burmese authorities present 
at court were satisfied with the verdict and sentences 
handed down on the Thai fishermen. (TN)


ESTABLISH TIES   (abridged)
January 25, 1996
Phnom Penh, UPI

CAMBODIA'S Foreign Affairs Minister Ung Huot flew to Burma 
yesterday to re-establish diplomatic relations which were 
served between the two countries over 20 years ago.

The foreign minister's visit will be closely following by 
the arrival of Cambodia's first Prime Minister Prince 
Norodom Ranariddh in Burma Saturday, to further cement the 
move towards closer relations.

The Foreign Affairs under secretary said discussion during 
the visit would also focus on the status of Cambodian assets 
which were abandoned in Rangoon in 1975 when Khmer Rouge 
rebels seized control of Cambodia and sealed the country off 
from the outside world.

Marina said Cambodia wanted to retrieve control of houses 
and property which it had owned in Burma prior to 1975. 
Political observers said Cambodia and Burma would also 
discuss how to stem a reported thriving heroin drug trade 
from Burma through Thailand, Laos and Cambodia.

They said Cambodia was also hoping to establish a market for 
timber products in Burma.

A statement from the Cambodian Ministry of Foreign Affairs 
said the prime minister's eight-member delegation will 
include the tourism minister and high-ranking defence, 
finance, trade and agriculture officials.


information provided by M. Beer and C. Schlenker and compiled by 


Diethelm Travel, Myanmar has announced the opening of two new branch
offices in important up-country tourism centers, Mandalay and Bagan. 
Establishing a local presence in these two key destinations has been given 
top priority in view of the problems of poor communication and limited 
tourist facilities, especially accommodation, which have faced all operators 
as the volume of visitors to these attractions has grown over recent years.

Marketing and sales executives of Diethelm attending recent trade shows, 
such as ATM in Singapore, Top Resa in France, WTM in London and ATF 
in Surabaya, have reported a keen interest in Myanmar from the trade, including 
inquiries from agents and tour operators who have not previously included the 
country in their programs.

According to a Diethelm staff person in Bangkok, "Myanmar must still be 
considered an `adventure' destination, but the time is coming when no tour 
operator can claim to be covering Asia without including this country in 
their programs."


ACTACORP Holdings Bhd has an understanding with parties in Myanmar to 
embark on a mixed development project encompassing office and hotel blocks. 


QAF Ltd's former managing director Wong Fong Fui will be making
a general offer for Bousteadco at $ 2.60 a share after acquiring a 65.38 per
cent stake at the offer price, or a total of $ 57.2 million.

Mr Wong, who is founder and managing director of Myanmar Airways 
International, is also credited with privatising Myanmar's international air 
routes. Mr Wong is said to have won a contract to manage an airport
terminal in Myanmar. Mr Wong might be planning to use Bousteadco to
carry out some of these activities. 


Myanmar-Japan health expo '96 is being held in Burma under the joint 
sponsorship of the Myanmar health ministry and the Japan medical 
products international trade association (JAMPITA).  Displayed at the four-day 
expo are over 130 items of medical and dental equipment from 22 Japanese 
companies of the JAMPITA group.

The exhibits include a whole set of gynecology equipment and an obstetrics 
room, a delivery room, a dental operation room and an emergency room.  The 
governments of Myanmar and Japan exchanged notes last October on Japan's 
grant-in-aid of 16.11 million US dollars for the expansion of the Institute of 
Nursing in Myanmar.


BURMA'S Construction Ministry recently signed contracts to buy
heavy equipment from China's Yunnan Machinery Export and Import
Corp. The equipment will be used in construction and maintenance
of roads and bridges in Burma's border areas. Managing director U
Tinh Swe of the Ministry's Public Works Co signed the contract
with the Yunnan company's president Wu Wen Kuan and Yunnan deputy
governor Liu Jin.


SENIOR adviser Midori Matsuhiro of Japan's Central Union of
Agricultural Cooperatives recently held talks with Burmese
Cooperatives Minister Than Aung in Rangoon on the possible
setting up of a bank for farming cooperatives and training for
Burmese agricultural officials. The Japanese expert visited
cooperative farms in Mandalay and Pagan.


A new natural gas power station on Monday went into operation in the
township of Mingaladon, 26.4 km from Yangon.  The Hlawga Natural Gas 
Power Station, which is equipped with two turbines of 66 megawatt capacity, 
supplies power to Yangon and National Power Grid, said the New Light of
Myanmar.  Natural gas has been put into full use since the discovery
of Aphyauk natural gas field in central Myanmar in 1993 and is now supplying
electricity to Yangon and other parts of southern Myanmar.


PERCON Corp Sdn Bhd is set to conduct a study on the feasibility of
undertaking privatization of hospitals in Myanmar. It signed a memorandum of
understanding (MOU) to this effect earlier this week.  Percon Corp chairman 
Tan Sri Dr Jaffar Hussein said work on the privatization exercise will begin 
within the next six months if the study finds the project to be commercially 
viable. The study is to take three months


Mandarin Oriental Hotel Group will began work soon a $23-million 
luxury hotel in Bagan, Burma. The single-storey property will feature 
100 suites spread throughout 38 acres of landscaped gardens. The site 
will be developed with cultural and environmental sensitivities in mind. 
Several pagoda structures, which Mandarin Oriental will restore and maintain, 
occupy 10 acres of the site. The hotel is expected to open in early 1998.