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Whiffs of Change (Asiaweek 16.2.94)

/* Posted 10 Jan 1:00pm 1997 by drunoo@xxxxxxxxxxxx in igc:reg.burma */
/* -------------" Whiffs of Change (16/2/94) "----------------- */

Growing Debate Over What to Think -- and Do -- About SLORC

It was an unusual spectacle. More than 100,000 "ardent supporters" of the
new Union Solidarity and Development Association were packed into Rangoon's
Aung San Stadium. For hours under the blazing sun last month they listened
to the pious pronouncements that are repeated daily over the airwaves. But
this day's main event turned out to be an exercise in mass sloganeering.
"National convention fundamental principles: must succeed, must succeed!"
the crowd chanted. "The unity of the entire nation: must succeed, must
succeed! Perpetuation of sovereignty: must succeed, must succeed!"

The Union Solidarity and Development Association is one of the many organs
set up by the ruling military junta to preach its new gospel. The campaign
is aimed at persuading the public -- and international aid donors -- that
warm breezes of change have come to Burma. Its specific goal is to drum up
grassroots support for a new constitution promised after the State Law and
Order Restoration Council -- the junta -- brazenly annulled the 1990
elections. SLORC's many critics see the new constitution as just another
manipulative attempt to put a positive face on an evil regime.

But increasingly, the dissidents' voices are not the only ones being heard
on the situation in Burma. Recent Burmese visitors and, especially, foreign
businessmen emphasize that Burma is no longer the land that time forgot. To
begin with, Karl Marx is out, Gautama Budddha is in and strongman Ne Win's
brutal socialist revolution is over. To some onlookers, there is at least a
measure of substance behind the new slogans. Though no one would argue that
the Burmese people's trials are over, some give Rangoon credit for its
first tentative steps at opening up, at least economically. "Many people
might criticize Burma," says Thailand-based hotelier Reggie Shiu, "but the
country is moving cautiously and undeniably toward a free-market economy.
It's a positive trend."

Influenced by a new generation of officers, SLORC has been reversing some
of the ruinous policies of the now defunct Burma Socialist Program Party.
The BSPP ruled the nation with an iron fist for 26 years after Gen. Ne Win
staged his bloody coup in 1962. The military took direct control in another
round of bloodshed in 1988, savagely putting down a tumultuous series of
pro-democracy demonstrations. With the 1989 house arrest of charismatic
oppositionist Aung San Suu Kyi and the voiding of the elections her party
won, Burma was confirmed as an international pariah state: in some eyes it
replaced South Africa.

But since early 1992, reforms have been intensified, albeit on the
military's terms. A turning point was the easing out as SLORC leader of
Senior Gen. Saw Maung, a Ne Win sychophant who had turned to drink, and his
replacement by titular boss Gen. Than Shwe. For the moment the junta
kingpin remains intelligence chief Lt.-Gen Khin Nyunt, although he is seen
as having many enemies in the military. The younger Turks's hands may be
strengthened when Ne Win, 84, dies. He was in Singapore last week getting
medical treatment, although sources said his condition was not serious.

These days life is not so oppressive. Neighbourhood People's Councils
acting as BSPP spies are no longer around. Burmese don't need fourteen-day
permits for internal travel. and Former Burmese passport holders can apply
for new citizenship and "visit visas." Although this program has been
derided by many dissidents, it could one day lead to the return of some of
the thousands of highly qualified overseas Burmese. Already, Than Than Nu,
dissident daughter of Ne Win's chief rival U Nu, has visited on a new
Burmese passport.

Another new sight is young generals prostrating themselves before senior
Buddhist monks. Top military brass regularly donate large sums of money to
the pagodas. During the Socialist era the cleagy was branded "middle some"
by party ideologues, and there were many early clashes with SLORC. Although
minks are still controlled by the state, worship is more freely tolerated.
Muslims are again free to use loudspeakers from minarets to call the
faithful to prayer. And visiting foreign pastors can now address
congregations in churches.

Perhaps the most significant change has been Rangoon's attitude to foreign
investors. HOtelier Adriaan Zecha is among the businessmen who note the
transformation. The HOng Kong based Dutch-Indonesian entrepreneur first
visited RAngoon in December 1989. Within months, he had set up a 50-50
joint venture to control and renovate the three main hotels in the Burmese
capital: the Thamada, the Russian-build Inya Lake and the venerable
colonial Strand. "In every respect, from the quality of life to the ability
to operate, the difference between December 1989 and December 1993 is like
night and day." Zecha says.

His group is not alone. Brig.-Gen. David Abel, minister for antional
planning and economic development, claimed in December that more than $2
billion in foreign funds had been earmarked for investment in 1994.
Although many of those pledges related to a mammoth proposed natural gas
pipeline to Thailand, they come atop about 80 other projects worth more
than $1 billion. Government figures show that U.S. and Thai companies are
leading investors, followed by those of Singapore and Japan. Dissident
groups confirm, much to their chagrin, that dozens of corporations are
pouring money into the nation (see Chart).

Company                      Country           Project        Cost($m)
Sea Exploring & Mining       Thailand          Tin Dredging       93
BHP                          Australia         Cement Plant       80
Shell                        UK/Holland        Oil & Gas          80

Miriam Marshall ASSoc.       U.S.              Fisheries          74
Daewoo                       South Korea       Hotel              60
Mimatsu Construction         Japan             Hotel              60

BHP                          Australia         Oil, Bitumen       50
Idemitsu                     Japan             Oil & Gas          40
Yukong                       South Korea       Oil & Gas          39

Songserm International       Thailand          Brewery            35
O.N.K. Mining & Constr.      Thailand          Plywood Factory    24
Daewoo                       South Korea       Copper MIne        20

Premier                      Britain           Oil & Gas          19
Emerald                      Hongkong          Hotel              15
SoongThai Const.& Trading    Thailand          Tin Dredging       13

Strand Hotels International  Hongkong          Hotel              13
Suk-Uah-Anant                Thailand          ChiangRai to       13
                                               KengTong Road

B & F Enterprises            Thailand          Timber             10
Union Farm Engnieering       Thailand          Hotel              10
Vitavas International        Thailand          Hotel              10

The most active investors in ASEAN outside Thailand are the Singaporeans.
Straits Steamship Land, a subsidiary of Singapore's government-linked
Keppel Corp., recently broke ground for a new hotel project. Cigarette
manufacturers Singapura United Tobacco and more recently Rothmans have
forged deals for cigarette factories. Singapore arms manufacturers,
including Chartered Industries, have done business in Burma since the late
1980s. And Myanmar Airways International, which handles flight from
Singapore, Bangkok and HongKong, is a joint venture involving Burma's
flag-carrier, Singapore interests and Brunei royal family. Says MAI's
Singaporean managing director, Wong Fong Fui: "In Burma, the prospects are

Entrepreneurs admit doing business there isn't all roses. First among the
difficulties is the local currency. The kyat, which hasn't faced a market
correction in 30 years, is ludicrously overvalued at 6.1 to the dollar. The
black-market rate is twenty times that. Other ocmplaints include woefully
inadequate infrastructure and a lack of government understanding of what it
takes to attract big foreign investment. Only certain sectors -- such as
resources and tourism -- are open for foreign involvement. "Comparing with
Vietnam and China, Burma still has long way to go in giving private players
incentives to do business," says a Rangoon-based diplomat. "The nature of
the economic reforms is very ad hoc with no overall policy to integrate

To Rangoon's critics, foreign investment only serves to prop up SLORC at a
time when they believe it is most vulnerable to outside pressure. They see
the new constitution as a desperate measure by the junta to guarantee its
iron grip on power. Ne Win's health is another destabilizing factor. Even
SLORC's biggest success is seen by some as a sign of weakness. It has
negotiated ceasefires with ten ethnic insurgent groups, including the
powerful Kachin INdependence Organization. this has reduced the border area
rebellions to three main groups -- the Karen, Mon and Karenni -- who are
now themselves reluctantly talking with SLORC. But this merely shows that
the junta is vulnerable, argues Canada-based dissident Harn Yawnghwe, "If
Slorc had been able to gain international recognition and foreign aid, it
would not have bowed to pressure from Japan, China and Thailand to
negotiate with the ethnic groups." He adds: "SLORC will only concede enough
to ensure its own survival."

Dissidents also say that the money coming in benefits only the privileged
military class or its cronies. When the oil sector was opened, for
instance, many firms were told to arrange deals through a consultancy owned
by a son-in-law of Ne Win. Two Ne Win sons-in-law are said to be involved
in the Myanmar Airways International deal. Nor is there much sign yet to a
trickle-down effect. "You'd be surprised how normal village life is in
Burma." says an exchange student after a rcent visit. "Only after several
weeks do yo begin appreciating the dire economic straits people are in and
how frsutrated they are at not being able to talk back to the government."

Exile groups have vowed to stymie further efforts by SLORC to increase
foreign investment. U.S. activists want to block financing of the pipeline
project, which will require support from the Washington-based World Bank.
"The Burmesse people will not accept an imposed government under any
circumstances, nor will they accept an economy beneficial only to an elite
few." says Tyn Myint-U, fellow at Harvard UNIversity's Center for
International Affairs.

SLORC has been countering the outspoken dissident groups with a public
relations campaign of its own. Khin Nyunt visited Singapore last May at the
invitation of Deputy Premier Birg. Gen Lee Hsein Loong. IN August, a major
Singapre trade mission went to Burma. In September Burmese Trade Minister
Tun Kyi arrived in the city-state calling for the two to "interlink the
capital, technology, experience and efficiency of Singaporeans with the
abundant natural resources of Myanmar." A high powered Burmese delegation
also visited Indonesia, whose system entrenching the military in government
is seen as a model in Rangoon.

Though ASEAN has subscribed to a policy of "consturctive engagement" with
Burma, it is not embraced equally by all six members. Last year, sources
say, Singapore had pushed for Burma to be invited to the annual ASEAN
foreign ministers meeting. But others, notably the Philippines, were
lukewarm to the idea. Vietnam, Laos and Cambodia were invited. Teh same
discussion is now brewing in preparation for this year's meeting in Bangkok
in July. Burma-ASEAN relations, says Tin Maung Maung Than of Singapore's
Institute of Southeast Asian Studies, are "still mainly bilateral ties
within the ASEAN community."

Is constructive engagement the best way to reach the SLORC regime? "Yes,
more channels of dialogue become open to ASEAN," says Malaysian academic
K.S. Nathan. "You'll find that the attitude produces a change if they are
not treated like an outcast." But others, like Harvard's Tyn Myint-U,
question the trade-offs involved in promoting economic development as a
means of creating change. "This process of democratization lasting a
generation or two omits an important factor: the people constantly live in
fear of arrest, torture and arbitrary execution."

Businessman Zecha feels Rangoon has been unfairly singled out. "The cast of
characters is different, but the same situation pertains in Burma as in
Vietnam and as in China." He says embargoes and sanctions only impose
greater hardship on the populaiton at large. "I have had absolutely no
qualms about doing business there and more and more invesotrs are coming to
the same conclusion." MAI's Wong acknowledges the criticism of Burma's
leadership. "The stigma is still there. But it has been the Western press
that have done them in. They have pre-judged them." Says Wong: "Give the
Burmese a chance to prove themselves." Ironically, for Burmese dissidents
the world over that remains a highly contentious point of view.