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Subject: FT-Japan renews hopes for profitable relations 

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The Financial Times-Wednesday December 15 1999
BURMA: Japan renews hopes for profitable relations=20
Tokyo may decide to revive links that go as far back as the second world =
war. William Barnes reports


A bruised Japanese soldier in the popular post-war novel, The Harp of =
Burma, argued that the Burmese "possess something marvellous that we =
can't even begin to understand".

Burma has held a peculiar fascination for many Japanese since the =
Greater East Asian war when its anti-colonial heroes fought the British =
side-by-side with their Japanese "liberators".

That sentimental undertow may help explain why Japan is urging Burma's =
military regime to ease its iron grip on the country sufficiently to =
permit Japan to start helping it. Keizo Obuchi last month became the =
first Japanese premier in 15 years to meet his Burmese counterpart when =
he talked to General Than Shwe at the summit of the Association of =
South-East Asian Nations in Manila.

Mr Obuchi told Gen Than Shwe that Japan was ready to support the regime =
if it carried out "serious" economic reforms. His senior foreign policy =
adviser, Ryutaro Hashimoto, followed this up with a four-day tour of =
Burma to "size up its economic needs". A 48-member delegation from the =
powerful business organisation, the Keidanren, has also just visited the =
country. Why should Japan be quickening its engagement with a widely =
reviled military regime when - according to a recent World Bank report - =
"lacklustre economic performance. . . could have devastating =
consequences for poverty, human development and social cohesion in =
Myanmar [Burma]"?

One Japan-based analyst argues that Japan's niggling worries over =
security should never be underestimated: "Economic survivalism remains =
at the core of Japanese perceptions of themselves and the outside world, =
especially Asia," the analyst said. A feeling that Burma's potential is =
too rich to ignore is reinforced by a concern that if Japan or others do =
not move in, China will.

Japan has made Burmese friends under western noses before. The vanguard =
of the anti-colonial movement trained in wartime Japan. The "thirty =
comrades" included Aung San, father of Aung San Suu Kyi, current =
opposition leader, and also Ne Win, the future dictator

If the relationship turned sour before hostilities ended, friendships =
created during the war helped ensure Japanese aid provided a prop for an =
often isolated economy from the mid-1950s to 1988.

Tokyo eventually rebelled against the Ne Win regime's eccentric =
management with an unprecedented warning in early 1988 that the =
bilateral relationship would be in danger if fundamental economic =
reforms were not introduced. The blunt threat encouraged a newly-formed =
junta to announce the opening up of the economy in late 1988, though by =
then the massacre of anti-military protesters had already caused aid to =
be cut off.

The big Japanese trading houses are eager to see a resumption of =
large-scale overseas development assistance to provide them with =
lucrative, risk-free procurement contracts; they are too wary of =
political instability, corruption and infrastructure problems to risk =
doing much on their own.

The Keidanren, and a Japan-Myanmar Association of big corporations, is =
strongly supported by pro-business members of the ruling Liberal =
Democratic party who are moving closer to Burma's powerful military =
intelligence establishment.

One influential LDP leader, Kabun Muto, established a "Parliamentarians' =
Group to Support the Myanmar Government" in 1988.

Earlier this year another powerful LDP figure, Koichi Kato, inspected, =
with intelligence chief Lt Gen Khin Nyunt, a crop-substitution project =
(for growing buckwheat rather than opium poppies) in Kokang State.

Aung San Suu Kyi, the Burmese opposition leader, has her own links with =
Japan, especially through her father, whose life she researched in Kyoto =
University in the mid-1980s. However, Ms Suu Kyi's visibility in Japan =
has declined sharply this year. This is important in a country where =
personal relations count for more than abstract ideas such as democracy, =
at least with the political and business elite.

Japan lifted its 1988 freeze on humanitarian aid in 1995 after Ms Suu =
Kyi was released from house arrest. It resurrected a pre-1988 aid =
project in March last year by lending $22.1m (=A313.6m) for the repair =
of the dangerously rundown Rangoon airport.

Any moves to resume new aid lending must first overcome the Ministry of =
Finance's own reservations about extending more credit to a country that =
is not, in effect, servicing its existing debt to Japan.

Trickier still is the row provoked by breaking ranks with the west on =
sanctions. Japanese policymakers may resent US and European moralising, =
but the potential rewards in Burma are not worth risking a rupture with =
trade partners.

Both Mr Obuchi and Mr Hashimoto made appeals for more democracy and =
reconciliation, but critics of the regime fear that in its eagerness =
Japan will encourage it to make just token gestures.

"The leaders of Myanmar should retire from the military, stop wearing =
uniforms and should form a political party," argued the president of The =
Nippon Foundation, Yohei Sasakawa, who accompanied Mr Hashimoto to =
Burma. "Every nation has its own pace in terms of democracy and moves =
towards a market economy."


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<DIV><FONT face=3DArial><FONT face=3DArial,Helvetica,Sans-Serif=20
size=3D2></FONT></FONT><FONT face=3DArial size=3D2><FONT=20
face=3DArial,Helvetica,Sans-Serif size=3D3><FONT size=3D2>The Financial =
Times-<FONT=20
class=3Dtf face=3DArial,Helvetica,Sans-Serif size=3D2>Wednesday December =
15=20
1999</FONT></FONT></FONT></FONT></DIV>
<DIV><FONT face=3DArial size=3D2><FONT face=3DArial,Helvetica,Sans-Serif =

size=3D3><STRONG>BURMA: Japan renews hopes for profitable =
relations</STRONG>=20
<BR></FONT><FONT color=3D#666666 face=3DArial,Helvetica,Sans-Serif =
size=3D2>Tokyo may=20
decide to revive links that go as far back as the second world war. =
William=20
Barnes reports</DIV><BR></FONT><FONT face=3DArial,Helvetica,Sans-Serif =
size=3D2>
<P>A bruised Japanese soldier in the popular post-war novel, The Harp of =
Burma,=20
argued that the Burmese "possess something marvellous that we can't even =
begin=20
to understand".<BR><BR>Burma has held a peculiar fascination for many =
Japanese=20
since the Greater East Asian war when its anti-colonial heroes fought =
the=20
British side-by-side with their Japanese "liberators".<BR><BR>That =
sentimental=20
undertow may help explain why Japan is urging Burma's military regime to =
ease=20
its iron grip on the country sufficiently to permit Japan to start =
helping it.=20
Keizo Obuchi last month became the first Japanese premier in 15 years to =
meet=20
his Burmese counterpart when he talked to General Than Shwe at the =
summit of the=20
Association of South-East Asian Nations in Manila.<BR><BR>Mr Obuchi told =
Gen=20
Than Shwe that Japan was ready to support the regime if it carried out =
"serious"=20
economic reforms. His senior foreign policy adviser, Ryutaro Hashimoto, =
followed=20
this up with a four-day tour of Burma to "size up its economic needs". A =

48-member delegation from the powerful business organisation, the =
Keidanren, has=20
also just visited the country. Why should Japan be quickening its =
engagement=20
with a widely reviled military regime when - according to a recent World =
Bank=20
report - "lacklustre economic performance. . . could have devastating=20
consequences for poverty, human development and social cohesion in =
Myanmar=20
[Burma]"?<BR><BR>One Japan-based analyst argues that Japan's niggling =
worries=20
over security should never be underestimated: "Economic survivalism =
remains at=20
the core of Japanese perceptions of themselves and the outside world, =
especially=20
Asia," the analyst said. A feeling that Burma's potential is too rich to =
ignore=20
is reinforced by a concern that if Japan or others do not move in, China =

will.<BR><BR>Japan has made Burmese friends under western noses before. =
The=20
vanguard of the anti-colonial movement trained in wartime Japan. The =
"thirty=20
comrades" included Aung San, father of Aung San Suu Kyi, current =
opposition=20
leader, and also Ne Win, the future dictator<BR><BR>If the relationship =
turned=20
sour before hostilities ended, friendships created during the war helped =
ensure=20
Japanese aid provided a prop for an often isolated economy from the =
mid-1950s to=20
1988.<BR><BR>Tokyo eventually rebelled against the Ne Win regime's =
eccentric=20
management with an unprecedented warning in early 1988 that the =
bilateral=20
relationship would be in danger if fundamental economic reforms were not =

introduced. The blunt threat encouraged a newly-formed junta to announce =
the=20
opening up of the economy in late 1988, though by then the massacre of=20
anti-military protesters had already caused aid to be cut =
off.<BR><BR>The big=20
Japanese trading houses are eager to see a resumption of large-scale =
overseas=20
development assistance to provide them with lucrative, risk-free =
procurement=20
contracts; they are too wary of political instability, corruption and=20
infrastructure problems to risk doing much on their own.<BR><BR>The =
Keidanren,=20
and a Japan-Myanmar Association of big corporations, is strongly =
supported by=20
pro-business members of the ruling Liberal Democratic party who are =
moving=20
closer to Burma's powerful military intelligence =
establishment.<BR><BR>One=20
influential LDP leader, Kabun Muto, established a "Parliamentarians' =
Group to=20
Support the Myanmar Government" in 1988.<BR><BR>Earlier this year =
another=20
powerful LDP figure, Koichi Kato, inspected, with intelligence chief Lt =
Gen Khin=20
Nyunt, a crop-substitution project (for growing buckwheat rather than =
opium=20
poppies) in Kokang State.<BR><BR>Aung San Suu Kyi, the Burmese =
opposition=20
leader, has her own links with Japan, especially through her father, =
whose life=20
she researched in Kyoto University in the mid-1980s. However, Ms Suu =
Kyi's=20
visibility in Japan has declined sharply this year. This is important in =
a=20
country where personal relations count for more than abstract ideas such =
as=20
democracy, at least with the political and business elite.<BR><BR>Japan =
lifted=20
its 1988 freeze on humanitarian aid in 1995 after Ms Suu Kyi was =
released from=20
house arrest. It resurrected a pre-1988 aid project in March last year =
by=20
lending $22.1m (=A313.6m) for the repair of the dangerously rundown =
Rangoon=20
airport.<BR><BR>Any moves to resume new aid lending must first overcome =
the=20
Ministry of Finance's own reservations about extending more credit to a =
country=20
that is not, in effect, servicing its existing debt to =
Japan.<BR><BR>Trickier=20
still is the row provoked by breaking ranks with the west on sanctions. =
Japanese=20
policymakers may resent US and European moralising, but the potential =
rewards in=20
Burma are not worth risking a rupture with trade partners.<BR><BR>Both =
Mr Obuchi=20
and Mr Hashimoto made appeals for more democracy and reconciliation, but =
critics=20
of the regime fear that in its eagerness Japan will encourage it to make =
just=20
token gestures.<BR><BR>"The leaders of Myanmar should retire from the =
military,=20
stop wearing uniforms and should form a political party," argued the =
president=20
of The Nippon Foundation, Yohei Sasakawa, who accompanied Mr Hashimoto =
to Burma.=20
"Every nation has its own pace in terms of democracy and moves towards a =
market=20
economy."</P></FONT></FONT></BODY></HTML>

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