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By Thomas Crampton 
International Herald Tribune

$1 Billion Is Possible If Generals Will Talk With the Opposition

Rangoon - The United Nations and World Bank have entered into     
secret negotiations with Burmese government and opposition
leaders to offer the ruling military regime $1 billion in
financial and humanitarian aid in exchange for opening a
dialogue with the opposition., according to sources involved in 
the negotiations.

Initiated only weeks ago, the plan has been introduced at a time
of bitterly polarized and deeply entrenched political stalemate
in Burma.

But government officials, opposition leaders and Rangoon-based
diplomats said the attempt at dollar diplomacy offered "the best
glimmer of hope  yet" for breaking the deadlock between the
opposition led by Daw Aung San Suu Kyi and the ruling generals.

The plan calls for step-by-step compromises from both the
government and the opposition, with progress rewarded by
increasing amounts of financial assistance and humanitarian aid.

"A lot of sticks have been used and they remain in place- but now
we are also offering the government some carrots," said a
Rangoon-based diplomat who is involved in the negotiations. "With
the reaction we have received so far from all sides it is not
impossible to outline a win-win scenario".

Both the government and opposition have agreed to pursue the idea
in further meetings with a United Nations envoy that are
scheduled to take place in Burma within the next eight weeks,
sources in the government and the opposition said.

This is the first United Nations attempt to include international
financial instructions directly in political negotiations, and it
comes amid rising criticism that past peace efforts have been
undermined by a lack of such coordination among the

Presented late last month in Burma by a United Nations special
envoy, Alvaro de Soto, the plan was formulated at a secretive
meeting held weeks earlier in southern England between the world
Bank, the United Nations and five Rangoon-based ambassadors who
attended in an unofficial capacity.

Sources involved in the negotiations said they discussed the
first step for a release of funds, which was initially set at
requiring the government to release political prisoners, allow
Daw Aung San Suu kyi freedom of movement and permit her National
League for Democracy to function as a political party. In
exchange, the National League for Democracy would agree to
rescind its calls to convene Parliament, and international
funding would be opened to Burma for the first time in more than
a decade.

Funneled through the World Bank, the bulk of the funds would come
from Japan, with additional assistance expected from Australia
and Singapore, sources involved in the negotiations said.

If the plan proceeds, the United States, which has imposed a
wide range of sanctions against the country's military regime,
will then withdraw its long-standing automatic veto of any
funding of maintance for Burma from the International Monetary
Fund and World Bank, according to diplomats involved in the

One suggestion floated was for a meeting between the UN
secretary-general, Kofi Annan, and Burma's military leaders at
the summit meeting of the Association of South East Asian Nations
next month in Hanoi.

"If the process gets under way, the World Bank will just be the
thin end of the wedge," a Rangoon based diplomat said.

"The private sector will gain confidence and the donor countries,
which are looking for just about any sign of change, will jump in
to help the development of the country."

But not even a blank check from the World Bank would break the
deadlock in Burma, many observers in Rangoon warned. The country
has no culture of political compromise and the military's sole
priority is to retain its total grip on power, the observers

No matter how the plan is structured, however, the ruling
generals would be forced to accept Daw Aung San Suu Kyi's strong
influence over the use of funds and her ability to stop them at
any time.

The opposition leader, who won a Nobel Peace Prize in 1991 for
her democratic struggle against the government, helped inspire
the wide range of sanctions now imposed on Burma and she alone
has the credibility to call for their loosening or removal.

Meanwhile, the government remains wary of foreign involvement in
domestic  matters and confident of the country's ability to
ignore external pressure.

"Did the United Nations ensure stability in Cambodia after
injecting billions of dollars? No," said Brigadier General Maung
Maung, minister to the office of the ruling council's chairman. "
We welcome any unconditional assistance you would like to give
us, but like Cambodia, we need to solve our problems by

One diplomat dismissed the UN initiative as an attempt by Western
governments to "whitewash the dictatorship into something
palatable for domestic consumption." 

" You simply can't cross-breed democracy and military
dictatorship," the diplomat said. "The generals may take some of
the money, but they will never cede power. You must accept this
reality and on that basis decide whether to give aid or not".

Most countries have opted against giving aid. Development
specialists estimate that Burma could easily attract more than
$500 million per year from donor countries, but international
condemnation of human rights abuses by the military government
has reduced annual multilateral foreign development assistance to
less than $20 million in recent years.

All of this assistance passes through a UN program designed to
avoid supporting the military government by sending aid directly
to a select set of small, grass-roots projects in different parts
of the country.

The UN program would very likely serve as a model for funneling
initial World Bank assistance into Burma, sources involved in the
negotiations said.