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President Clinton Latter To House S
- Subject: President Clinton Latter To House S
- From: RANGOONP@xxxxxxx
- Date: Wed, 10 Dec 1997 18:52:00
HEADLINE: Text of Clinton Letter on Burma
CONTACT: White House Press Office, 202-456-2100
DATELINE: WASHINGTON, Dec. 9
BODY:
Following is the text of a letter from President Clinton to the Speaker of the
House of
December 9, 1997
Dear Mr. Speaker: (Dear Mr. President:)
I hereby report to the Congress on developments concerning the national
emergency with respect to Burma that I declared in Executive Order 13047 of
May 20, 1997, pursuant to section 570 of the Foreign Operations, Export
Financing, and Related Programs Appropriations Act (the "Act") and the
International Emergency Economic Powers Act (IEEPA). This report is submitted
pursuant to section 204(c) of IEEPA, 50 U.S.C. 1703(c) and section 401(c) of
the
National Emergencies Act, 50 U.S.C. 1641(c). This report discusses only
matters
concerning the national emergency with respect to Burma that was declared in
Executive Order 13047.
On May 20, 1997, I issued Executive Order 13047 (62 FR 28301, May 22,
1997),
effective on May 21, 1997, to declare a national emergency with respect to
Burma and to prohibit new investment in Burma by United States persons,
except to the extent provided in regulations, orders, directives, or licenses
that may be issued in conformity with section 570 of the Act. The order also
prohibits any approval or other facilitation by a United States person,
wherever
located, of a transaction by a foreign person where the transaction would
constitute new investment in Burma prohibited by the order if engaged in by
a
United States person or within the United States. This action was taken in
response to the large-scale repression of the democratic opposition by the
Government of Burma since September 30, 1996. A copy of the order was
provided to the Congress on May 20, 1997.
By its terms, nothing in Executive Order 13047 is to be construed to
prohibit
the entry into, performance of, or financing of a contract to sell or purchase
goods, services, or technology, except: (1) where the entry into such contract
on or after May 21, 1997, is for the general supervision and guarantee of
another person's performance of a contract for the economic development of
resources located in Burma; or (2) where such contract provides for payment,
in whole or in part, in (i) shares of ownership, including an equity interest,
in the economic development of resources located in Burma; or (ii)
participation in royalties, earnings, or profits in the economic development
of
resources located in Burma.
The prohibitions of Executive Order 13047 apply to United States persons,
defined to include U.S. citizens and permanent resident aliens wherever they
are
located, entities organized under U.S. law (including their foreign branches),
and entities and individuals actually located in the United States. The
sanctions do not apply directly to foreign subsidiaries of U.S. firms,
although
foreign firms' activities may be affected by the restriction on United States
persons' facilitation of a foreign person's investment transactions in Burma.
The term "new investment" means any of the following activities, if such an
activity is undertaken pursuant to an agreement, or pursuant to the exercise
of
rights under such an agreement, that is entered into with the Government of
Burma, or a nongovernmental entity in Burma, on or after May 21, 1997: (a)
The entry into a contract that includes the economic development of resources
located in Burma; (b) the entry into a contract providing for the general
supervision and guarantee of another person's performance of a contract that
includes the economic development of resources located in Burma; (c) the
purchase of a share of ownership, including an equity interest, in the
economic
development of resources located in Burma; or (d) the entry into a contract
providing for the participation in royalties, earnings, or profits in the
economic development of resources located in Burma, without
Since the issuance of Executive Order 13047 on May 20, 1997, the Department
of the Treasury's Office of Foreign Assets Control (OFAC), acting under
authority delegated by the Secretary of the Treasury, has implemented
sanctions
against Burma imposed by the order. During the current 6-month period, OFAC
issued several determinations with respect to transactions provided for by
agreements and/or rights pursuant to contracts entered into by United States
persons prior to May 21, 1997. One license was granted authorizing a United
States person's disinvestment in Burma, since this transaction necessarily
facilitated a foreign person's investment in Burma.
On May 21, 1997, OFAC disseminated details of this program to the
financial,
securities, and international trade communities by both electronic and
conventional media. This included posting notices on the Internet and on 10
computer bulletin boards and 2 fax-on-demand services, and providing the
material to the U.S. Embassy in Rangoon for distribution to U.S. companies
operating in Burma.
In addition, in early July, OFAC sent notification letters to approximately
50 U.S. firms with operations in or ties to Burma informing them of the
restrictions on new investment. The letters included copies of Executive
Order
13047, provided clarification of several technical issues, and urged firms to
contact OFAC if they had specific questions on the application of the
Executive
order to their particular circumstances.
The expenses incurred by the Federal Government in the 6-month period from
May 20 through November 19, 1997, that are directly attributable to the
exercise
of powers and authorities conferred by the declaration of a national emergency
with respect to Burma are estimated at approximately $300,000, most of which
represent wage and salary costs for Federal personnel. Personnel costs were
largely centered in the Department of the Treasury (particularly in the Office
of Foreign Assets Control, the Office of the Under Secretary for Enforcement,
and the Office of the General Counsel), and the Department of State
(particularly the Bureau of Economic and Business Affairs, the Bureau of East
Asian and Pacific Affairs, the Bureau of Intelligence and Research, and the
Office of the Legal Adviser).
The situation reviewed above continues to represent an extraordinary and
unusual threat to the national security, foreign policy, and economy of the
United States. The declaration of the national emergency with respect to
Burma contained in Executive Order 13047 in response to the large-scale
repression of the democratic opposition by the Government of Burma since
September 30, 1996, reflected the belief that it is in the national security
and
foreign policy interests of the United States to seek an end to abuses of
human
rights in Burma, to support efforts to achieve democratic reform that would
promote regional peace and stability and to urge effective counternarcotics
policies.
In the past 6 months, the State Law and Order Restoration Council (SLORC)
has
shown no sign of willingness to cede its hold on absolute power. Since
refusing
to recognize the results of the free and fair 1990 elections in which the
National League for Democracy won a vast majority of both the popular vote and
the parliamentary seats, the ruling junta has continued to refuse to negotiate
with pro-democracy forces and ethnic groups for a genuine political settlement
to allow a return to the rule of law and respect for basic human rights.
Burma
has taken limited but insufficient steps to counter narcotics production and
trafficking.
The net effect of U.S. and international measures to pressure the SLORC to
end its repression and move toward democratic government has been a further
decline in investor confidence in Burma and deeper stagnation of the Burmese
economy. Observers agree that the Burmese economy appears to be further
weakening and that the government has a serious shortage of foreign exchange
reserves with which to pay for imports. While Burma's economic crisis is
largely a result of the SLORC's own heavy-handed mismanagement, the SLORC is
unlikely to find a way out of the crisis unless political developments permit
an
easing of international pressure. I shall continue to exercise the powers at
my
disposal to deal with these problems and will report periodically to the
Congress on significant developments.
Sincerely,
WILLIAM J. CLINTON
LANGUAGE: ENGLISH
LOAD-DATE: December 9, 1997