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

The BurmaNet News: April 10, 1996
Issue #379

Noted in Passing:

                I'm a businessperson who says that we have to be socially
                and ethically responsible.  [Regarding Pepsi] I do think there
                is a problem doing business with such a company. - Harvard
                Food Services director of dining services Michael Berry.
                (see FBC: HARVARD DUMPS PEPSI)

HEADLINES:
==========
THE ASIAN AGE: A PASSION FOR PEACE - BY AUNG SAN SUU KYI
FBC: HARVARD DUMPS PEPSI
HARVARD CRIMSON: DINING SERVICES DECREES 'COKE IS IT'
DAWN NEWS BULLETIN: FORCED RELOCATION IN KARENNI AREA
THE NATION: WA GUERRILLAS SURPRISED BY US CHARGES
THE NATION: SUU KYI TELLS OF WORK SUCCESS
BKK POST: BURMA PREDICTS SMALLER DEFICIT
BKK POST: POPPIES DESTROYED
BKK POST: BEER ADDS FROTH TO BURMESE WATER FESTIVAL
INFRASTRUCTURE FINANCE: TROUBLING PROJECTS
--------------------------------------------------------------------------------------

THE ASIAN AGE: A PASSION FOR PEACE - BY AUNG SAN SUU KYI
April 8, 1996
From: {NLD/LA} <chan@unv.ernet.in>

(The OP-ED Page)
-------
NOTE: As more and more Asian countries enter the ranks of affluent nations, it

will become increasingly evident whether or not those standards and values
that
are held to be a particularly Asian heritage can withstand the onslaught of
materialism. Will we become more compassionate and caring or more calculating
and egoistic? Will we develop greater vision, deeper understanding?
-------

SO much has been said about peace one, questions whether there is anything
left
to say. And yet, "peace" as a concept has never lost the freshness of its
appeal.
Particularly in Asia, expressions such a /shalom/, /salaam/ or /shanti/ bear
repetition many times over, confirming and reinforcing man's eternal desire
for
peace. All over the world, New Year is a time to  wish each other peace and
prosperity. However, there is no single Burmese world that means "peace." The
expression /nyeinchan/ is a compound of the words for "extinction" and
"coolness."

The latter word connotes ease and happiness, while the former signifies the
cessation of the fires of passion. The allusion here to the taming of one's
desires
as a precondition for the internal quest for peace id fundamental to the
teachings
of the Lord Buddha, which continue to inspire so many Asian peoples even in
our age of gross materialism.

For, without the quelling of all those instincts that contribute to human
greed,
pride and hate, what possible hope can there be for peace in human society?
The
same message lies in human heart of all the major religions of the world and
of the
ethical standards they hold in common.

The need to develop paths to peace has not decreased despite the sweeping
changes that have taken place in the balance of political and economic power
in
recent decades.

The impressive performance of some Asian countries in the economic field over
the last few decades has won wide-spread admiration. It is natural for people
to
expect that a betterment in material conditions would bring happier times.

Yet never has been the case that wealth and riches have been able to prevent
human conflict, with its attendant suffering. The peoples of Asia have long
prided standards and spiritual values that are above mere material
considerations.

As more and more Asian countries enter the ranks of affluent nations, it will
become increasingly evident whether or not those standards and values that are

held to be a particularly Asian heritage can withstand the onslaught of
materialism.

ill we become more compassionate and caring or more calculating and egoistic?
Will we develop greater vision and deeper understanding it or will our
interests
narrow down to mere profit-making? Can we use the lessons learned from
economic achievements to help improve our social and political conditions?

It has been said that a key element in the economic success of many Asian
societies is trust in the commercial sector. The has to be true of the social
and
political spheres, were justice founded on trust and public confidence bears
lasting fruit in peace and stability.

The wealth and power of nations wax and wane, subject to the principles of
commerce, the development of technology, the challenges of the new and
unexpected, and the frailties and human nature.

The life of nations is calculated not in decades but in centuries, and to
ensure
sustained progress and stability there is a need to develop institutions
processes
that allow for change without upheaval and for the peaceful solution
of conflicting interests that are bound to arise even in the best-ordered
societies.
Conflict, it can be argued, is fundamental to all forms of life.

But just as we have to accept that for most people suffering and happiness
coexist in various shifting, unequal measures, so surely it can be seen that
the
very presence of conflicts in our midst points to its antithesis in attainable
peace.

Every conflict is but the repetition of those that have occurred throughout
the long
vitas of our shared past, even if the form those conflicts have assumed has
varied constantly from time to time and place to place. Their nature and
outcome,
the mental and physical misery caused any folly, is always the same.

But the universality of conflict and suffering is matched also by the skills
of
conciliation that have had to be developed by most human societies at various
levels, form the nuclear family to the nation state.

All the means of resolving conflict that have ever been used lie before us
like an
open book, and it is up to us to make constructive use of the lessons that can
be
learned from the history of the human race.

It has been argued that war itself is a legitimate means of attaining peace.
The
problems of using evil means in pursuit of a just end will doubtless continue
to
exercise thinking people for generations to come.

The answer to that problem may never be settled to everyone's satisfaction,
but
everyone can surely agree on the absolute need to identify and uproot the
seeds
of strife before they grow to gather pace and momentum beyond all control.

I believe we can, at the present time some cautions comfort from what appears
to be a reduction in the immediate threat of wars caused by invasion. It would

seem, for the moment at least, that  a sense of restraint and rationality has
been
brought to the territorial ambition of nation states, though to be complacent
about the situation can only invite future trouble.

If, however, we can detect a lessening of human misery resulting from foreign
interventions, the same is decidedly not true when we consider the pervasive
suffering caused political, social, and economic injustice and, most
noticeably,
by ethnic hatred.

The last is usually the result of grievances caused by a sense of injustice or

prejustices fostered by lack of human understanding.

T attempt to eliminate, disguise or conceal by repression the expressions of
human grievance caused by injustice _ in fact to try to impose peace by the
exercise of authoritarian power alone  _ reminds me of the Buddhist nation of
"conventional peace" (/sammuti shanti/), which is traditionally contrasted
with
"momentary peace" (/tatanga shanti/) and "total peace" (/accanta/ shanti/).

Buddhists are taught to cultivate the transient form of peace through constant

mental awareness as means to attaining that all-embracing peace that is
synonymous with the goal of /nirvana/.

But peace of the "conventional" variety has been described as "imaginary peace

without practice; for instance, the peaceful life one can attain due to the
saving
of a powerful being, which is nothing but a misconception."

It follows that the peace )or, perhaps more accurately, quiescence), resulting
from
artificial coercion or intervention is nothing more than a dangerous illusion
and
has to be recognised as such. The truth of this has been amply borne out in
recent history.

We have seen how long-festering grievances and animosities burst into open
conflagration when authoritarian forms of rule collapse along with the means
whereby those urgent problems were hidden from view.

System which sweep aside fundamental problems of social and political
injustice
in the vain hope that such problems, if ignored long enough will vanish,
cannot
achieve long-term stability.

The nation that peace without practice can only be of an imaginary order
points
to the essentially active nature of any process aimed at achieve genuine
peace.

The skill of arbitration, mediation, negotiation and compromise will acquire
ever-increasing importance as the world continues to shrink - in a movement
that
is already bringing its manifold culture and political diversities into closer
and
closer contact. The potential for both conflict and harmony on this planet,
now
seems greater than ever before, as the speed of change accelerates beyond
anything comparable in human history.

The time is fast coming to an end, if it has not done so already, when
conflict
and peace in Asia can be separated from the turmoils and harmonies of Africa,
the Americas, Australia or Europe.

Those who would be peacemaker s have develop transparent sincerity, a have
understanding of differing points of view, and an ability to compromise, which

includes a willingness to give prejudices and privileges that obstruct the
path to
conciliation.

Our success in the great task of generating peace on this earth will depend
finally
on our ability to recognise our common humanity and our shared goals, which
transcend and rise far above the culture and political divisions of all
nations and
continents of the west and east.

Peace is too important to be left to chance, to be allowed to deteriorate into
the
imaginary form that results from lack of positive endeavour. We need to
strengthen and develop regional and international institutions that work
actively
for peace, specialising in the resolution of conflicts and in the promotion of

harmony both within and between nations.

The last decades of the 20th century have been an era of impressive economic
achievement for parts of Asia. But our continent is still rife with social and

political injustice as well a ethnic and communal strife.

Should we not resolve to work toward removing injustices, putting an end to
strife, and making the 21st century an era not of Asian prosperity but of
Asian
peace that may spread to all peoples of the world?

_________________________________
Burmese Leader Aung San Suu Kyi won the Nobel Peace Price in 1991
By arrangement with New York Times
_________________________________

*************************************************************

FBC: HARVARD DUMPS PEPSI: CONCERN OVER CONNECTION TO
FORCED LABOR
April 8, 1996
FOR IMMEDIATE RELEASE   Cambridge, MA

Cambridge:  Harvard University dining service has scuttled a $1 million
contract with Pepsi after Harvard students raised concerns over Pepsi's
activities in military-run Burma.

Harvard is not the only top university where contracts with PepsiCo are
under fire:  Stanford University Burma democracy activists have more than 2000
student backers for an effort to keep Pepsi-owned Taco Bell off their
campus.  Dozens of high school and college campuses across the US are
involved in similar efforts.

"I'm a businessperson who says that we have to be socially and ethically
responsible" says Harvard Food Services director of dining services
Michael Berry.  Regarding Pepsi he says "I do think there is a problem
doing business with such a company."

As recently as Feb. 22, a Pepsi memo sneered at the Harvard students,
noting that a Harvard demonstration against Pepsi "involved a mere 25
students."  "This shows the power of the information we provided on
Pepsi," says Harvard senior Adam Richards.

"What you have is America's 'best and brightest' challenging PepsiCo based
on the facts" says senior analyst Simon Billenness of Franklin Research and
Development.  "Students are at the heart of Pepsi's target market.  Pepsi
is extremely vulnerable."

Pepsi entered Burma shortly after military authorities quashed an
overwhelming  (82%) May, 1990 election victory by the NLD party of Nobel
Peace Prize winner Aung San Suu Kyi.  NLD spokespeople have repeatedly
called for Pepsi to cease operating in Burma.  Pepsi's Burmese partner is
also chairman of a joint venture with the military called JV3.  In Burma,
"the army controls all major businesses.  Not even a small scale merchant
can survive without solid army connections"  says the authoritative Far
Eastern Economic Review.

To repatriate its profits from Burma, Pepsi engages in "counter trade" by
purchasing agricultural goods for export.  Recent reports by the United
Nations and human rights groups note that forced labor has become pervasive in
Burma's agriculture sector.  The Burmese army has a practice of confiscating
farmland and using the evicted farmers as forced labor.

Despite several enquiries, PepsiCo has not disclosed the parties from
which the company buys farm products or provided any evidence that
PepsiCo is trying to avoid buying from farms that use forced labor.
Despite rising concern over its presence in Burma, Pepsi's lawyers each
year work diligently to keep such issues off of the shareholder ballot at
its annual meetings.

Pepsi's revenues in Burma, $14 million in 1995, are dwarfed by US sales of
over $10 billion.

Other US companies, including Coca-Cola, Levi Strauss, Eddie Bauer, Liz
Claiborne, Amoco and Columbia Sportswear, shun Burma.  UNOCAL, Texaco and
ARCO remain, and along with Pepsi are the targets of consumer and shareholder
activism.

F R E E   B U R M A  C O A L I T I O N
For More Info Contact:  Adam Richards (617) 493-8283 or Marco Simons (617)
493-2267 at Harvard FBC
Michael Berry at Harvard Food Svcs. (617) 495-4812, Elaine Franklin at
Pepsi  (914) 253-3122

For information on the national Burma campaign, contact Simon Billenness,
Senior Analyst at Franklin Research and Development Corp. (617) 423-6655,
x225, or Dr.  Thaung Htun of the National Coalition Government of the
Union of Burma at (212) 338-0048.

*******************************************************

HARVARD CRIMSON: DINING SERVICES DECREES 'COKE IS IT'
Decision Garners Student Support   (abridged)
April 8, 1996
From: Marco Simons <msimons@husc.harvard.edu> of the harvard
burma action group

By Chana R. Schoenberger

        The verdict is in.
        Harvard Dining Services (HDS) will once again serve Coca-Cola,
reversing a decision made earlier this year to contract with Pepsi,
Michael P. Berry, outgoing Director of HDS, told the Crimson last night.
        Coke's victory comes after months of campus controversy
concerning Pepsi's questionable human rights record and the significant
student preference for Coke products.
        Reached in Anaheim, California, where he will be working at
Disneyland, Berry said that the Coke contract is still conditional on an
improved service record. The company's history of inferior customer
service prompted the original move to Pepsi.
        The current situation, with Pepsi in Annenberg Hall and HDS
restaurants and Coke in the dining halls, will remain until the end of
the year.  Then, assuming Coke has performed service tasks
satisfactorily, all the facilities will be turned over to Coke during the
summer, according to the director.
        "If Coke stays up to par in terms of service they will get all
the business," Berry said.
        According to Berry, the decision was made in spite of the fact
that Pepsi was a better deal because of student preference for Coke and
concern over Pepsi's alleged human rights violations in Burma.
        "I'd rather not be embroiled in a political issue," he said.
        The director added, though, that if Coke did not bring its
service up to appropriate levels it would be let go "in a minute."
        Student leaders were elated over the change, with some taking
partial credit for it.
        Robert M. Hyman '98-'97, president of the Undergraduate Council,
anticipated the change and chalked up the switch to the council's
campaign against Pepsi.
        "We invited Mike Berry to our last meeting and lobbied on this
issue," Hyman said. "He was obviously receptive to our comments."
        According to its president, the council adopted a "two-pronged
approach" for the anti-Pepsi campagin. The council attacked Pepsi's human
rights record in Burma and emphasized students' overwhelming preference
for Coke.
        "I think this victory shows what can be achieved by an organized,
activist student government," Hyman said.

*****************************************

DAWN NEWS BULLETIN: FORCED RELOCATION IN KARENNI AREA
April 9, 1996
From: Caroline Lurie <caroline@ksc.net.th>

About 2500 Karenni refugees from Karenni refugee camps 1 and 2,
most of themwomen and children, were forcibly relocated to a new site
which is just one hour's walk from the Slorc outpost in Karenni area.

The 537 households are living under a cloud of fear after being
forced to move from their camps to the new location by the local Thai
authorities on 19 March 1996.

About 12 Thai border police equipped with M16 and HK arrived at
Char Le camp (Refugee Camp 2) in the morning of  March 19.  They
demanded the refugees pack all their belongings and ordered them into
waiting trucks.  The soldiers threatened if the refugees did not obey their
orders, they would burn down the camp and kill the camp leaders.

 " We did not dare to disobey their order. They were so tough --just like
Slorc
soldiers in Burma!  We just had to follow their demands even though we
did not knowwhere we would be going." said Pha Daw, a Karenni refugee
from the camp.  Another refugee said, "The Thai soldiers shouted at us and
called us 'stray dogs'. I feel bad because I understand Thai. They used really
bad
words in Thai, shouting their orders at us to obey and be forcibly relocated."

After negotiations with the camp leaders, the deadline extension of four days
was agreed upon, but about 40 refugees were loaded into the trucks immediately

anyway. The next day, the same soldiers arrived in the morning and  took the
refugees away in 4 trucks.  Some refugees fled at night because they were in
great fear for their safety.

Aye Maung , a ward leader of the Char le refugee camp, said Thai security
officials came to the camp and ordered them out. "They ordered us not to try
to
escape from the camp, to pack and get ready to leave. The next morning they
trucked us from the camp and dropped us at the new place."

The new site is just dense forest. Upon their arrival, the refugees had to
build
rough temporary shelters of plastic sheets and bamboo.  A single mountain
range, which marks the border, is the only barrier between the refugees and
SLORC forces.

"I am very scared to live here because it is so close to the Slorc troops.
They
can come and kill us at any time," said  Naw Esther in her crude bamboo hut.
In an interview with Aike Ku, a 30-year-old Karenni from Shardaw township,
he expressed the great fear for his safety; if he were sent back to Burma he
would surely be arrested by Burmese troops. He had been conscripted for
forced labor at military bases and for porterage several times when in Burma.

In 1987, he was arrested and charged with supporting KNPP forces in 1987.
During his interrogation, he had been beaten and tortured. He was released
only after his village headmaster bailed him out with some amount of money.
As soon as he was released he fled to the Karenni refugee camp.  He first
came to the Nang Aung Karenni refugee in 1988 and six months ago he
moved to Cher Le camp.  "Most of the refugees in this camp are in the same
situation as me. We all would be in great danger if we were sent back to Burma

and rearrested by the Burmese troops." said Aike Ku.

Most of the refugees fled to Thailand several years ago due to the wide
range of human rights abuses by the Slorc troops in their native territory.
Some of them fled recently because of the latest round of fighting between
Slorc and Karenni forces.

No reason for the forcible relocation by the Thai authorities was clear, but a

KNPP commander, General Aung Myat, said he believed the refugees were
driven out of their old camp in response to demands by Burmese authorities.
"The Burmese soldiers accused Thailand of sheltering guerrillas in the old
camp
and they threaten to fire at it with artillery if the Thai authorities did not
allow
them to search it." Their old camps were about seven kilometer (four miles)
inside
Thailand while the new  location is just on the Thai side of the frontier.

A Thai border security official said all of the estimated 6,000 Karenni
refugees
in a string of camps inside Thailand would be relocated to the border line.
ABSDF family member camp in the Karenni area also faced the similar fate of
relocation. ABSDF camp members were evacuated into Thailand to escape an
intensive attack by the Burmese army.  They were immediately forced to move
to the same place as the Karenni refugees.

*********************************************************

THE NATION: WA GUERRILLAS SURPRISED BY US CHARGES
April 9, 1996
Yindee Lertcharoenchok

BURMA'S ethnic Wa guerrillas have expressed surprise that
Washington has, for the first time, named three of  their
leaders as among the "top [Burmese drug] traffickers" in its
1995 International Narcotics Control Strategy Report.

Senior officials of the United Wa State Army (UWSA) said
yesterday that they did not understand why acting leader Pao
Yu-chiang, senior commander Li Tzu-ju, and Southern Command
leader Wei Hsueh-kang, whom they claimed were innocent of
any trading in drugs, were included in the American report
which was released on March 1.

They could not confirm whether the three top leaders, who
reside at the UWSA headquarters of Panghsang on the Sino-
Burmese border in the Shan Plateau, were aware or had been
informed about being accused  of being "top traffickers."

"I don't quite understand why they [Washington] did so
[named the three Wa leaders] and how the names came about.
'I feel very uncomfortable about this,' said a Wa official.

In the report, the US State Department strongly criticized
Burma as still being the world's largest producer of opium  and heroin.

It said the drug trade in Burma's northeastern Shan State
where the UWSA, the Chinese Kokang and opium warlord Khun Sa
have been competing against one another for the lion's share
of the opium and heroin market, continues virtually unchecked.

The report blamed the Burmese junta for lacking the
"resources, the ability or the will to take serious action
against ethnic drug trafficking groups with whom they have
negotiated a number of ceasefire.

'Groups known to be involved in the heroin trade, such as
the UWSA and the Kokang militia, remain heavily armed and
enjoyed complete autonomy in their base areas,' it said.

Although the ruling Burmese State Law and Order Restoration
Council (Slorc) "claims that these groups have committed
themselves to drug control as part of their ceasefire
agreements, the Burmese government has been either unwilling
or unable to get these groups to reduce heroin trafficking
and opium cultivation.'

Apart from the three Wa leaders, the report also identified
U Sai Lin, aka Lin Ming-shing of the Eastern Shan State
Army; Yang Mao-liang, Peng Chia-sheng, and Liu Go-shi of the
Myanmar National Democratic Alliance Army (Kokang Chinese);
and U Mahtu Naw of the Kachin Defence Army as among other
top traffickers.

It said Slorc's ceasefire agreements with "these drug
armies" has prevented the implementation of any meaningful
drug enforcement operations in areas which are under the
control of ethnic armies.

"As a result, these regions have become drug trafficking
havens, where heroin is produced and trafficked without
risk.  Leaders of these drug armies have benefited immensely
from their good relationship with the Rangoon regime; their
businesses - legitimate and illegitimate - have prospered,'
it added.  The UWSA officials claimed that their leaders'
names must have been used by mistake as they "have never
been involved" in the drug trade. (TN)

***************

THE NATION: SUU KYI TELLS OF WORK SUCCESS
April 9, 1996

RANGOON - Aung San Suu Kyi says shed other leaders of
Burma's democratic opposition have made "reasonable progress" in
their political work since her release from house arrest eight months ago.

Addressing some 5,000 supporters on Sunday night in front of
the lake-side house that, was her private prison for nearly six years, Suu
Kyi said 1995 marked an important turning point for her country.

"I was released in July, some eight months ago," she said.
'(Former army general) U Tin U and (former colonel) U Kyi
Maung were released earlier, and we have made reasonable
progress in our political work though the progress achieved
w far short of our expectations."

One unmistakable fact we discovered in, 1995 the strong
morale of Our people, she added "All of us should be proud of it".

Suu Kyi, 51, who won the 1991 Nobel Peace Prize while under
arrest, aid the ruling military junta has worked hard to prevent her
party, the National League for Democracy (NLD), from organizing.
She described the junta's treatment of the NLD a "unfair and unjust."

"I am saying this not pick a quarrel with the authorities,"
she said. "But then if you don't stand up and speak out
against injustice you will be encouraging that injustice."

************************************************

BKK POST: BURMA PREDICTS SMALLER DEFICIT
April 9,1996

Burma's state budget was set at 163.9 billion kyats (US$27.3
billion at the official exchange rate) for spending in the
fiscal year to March 31, 1997.

The budget, which includes earnings and expenditure on state
enterprises, forecast receipts of 133.9 billion kyat to
produce a budget deficit of 30 billion kyat, compared the
1995-1996 deficit of 65.3 billion.

The military budget was equivalent to 32.7 percent of
spending by all government institutions except state
enterprises, and was set at 52.9 billion kyat, or 23.75
percent of the gross domestic product target for the year of
72.7 billion kyat. Education was allocated 7.6 billion
kyats, agriculture 6.5 billion kyats, construction 4.1
billion kyats  and health just over 2.2 billion kyats. (BP)

*******************************************

BKK POST: POPPIES DESTROYED
April 9,1996

Burmese authorities destroyed 25 hectares of poppy fields in
Kutkai township of Shan State, between March 14 and 21. The
Shan State is Southeast Asia's largest opium-growing and
heroin-producing region. (BP)

************************************************

BKK POST: BEER ADDS FROTH TO BURMESE WATER FESTIVAL
Foreign brew sales likely to soar despite high cost
April 9,1996
Report: Nussara Sawatsawang, Rangoon

Burma's traditional water festival this week will be more
like a beer party for many in the country. Downing of  imported
beer is expected to increase dramatically in the capital, Rangoon.

No official figure is available, but a foreign trader speculated the
amount consumed could be at least 10 times more than usual
because locals will be celebrating with alcoholic drinks. Also, the
government was unlikely to impose any restrictions, he said.

Burma's traditional water festival or Thingyan, which
coincides with the Buddhist New Year, will be celebrated
from April 12-15. Like their neighbours in several Southeast
Asian countries, Burmese will be performing traditional acts
of blessing and happily throwing water at each other.

Despite a recent warning from Rangoon's commander, Brig-Gen
Khin Maung Than, against using dirty water, wearing unsuitable
clothes and drunkenness, Rangoon-based businessmen are confident
there will be no serious impact on their lucrative business.

"Like Thais, the Burmese love drinking alcohol for
entertainment and relaxation, and the government usually
won't impose strict rules during festivals," he said. The
domestic market has high potential. Consumers are both
locals and expatriates working in the country. Although one
can of beer costs 60-100 kyats (15-20 baht), three to five
times more than minimum wage for unskilled labour, people
make sure they can afford it. In the past, about 40
containers totaling two million cans of foreign beer were
imported monthly, observers said. According to a survey
conducted by a trading company, altogether 58 brands of beer
from all over the world used to stream into Burma through
the porous Thai-Burmese border.

But since border trade was banned following Rangoon's order
to seal three key checkpoints last year, only 10 brands
remain on the market and have to be trans.-shipped through
Bangkok and Singapore.

These are Heineken, Carlsberg, Budweiser, Foster, Tiger,
ABC, Anchor, San Miguel, Guiness Stout and Thailand's Singha
which is said to be doing well. Mandalay beer is the only
Burmese brand that has remained popular in the face of overwhelming
foreign competition, especially among middleage Burmese. Tiger
dominates, followed by Heineken, Mandalay and Budweiser.

The beer business in Burma is moving from imports to local
joint ventures producing popular brands. Singapore's Asia
Pacific Brewery, with the active support of its government
and smooth relations between the republic and Burma, has
formed a joint venture with the military-run Myanmar
Economic Holding Co to produce Tiger beer in Burma.

Under their agreement signed last April, production is
expected to start this September. The state-owned Mandalay
brand is said to have formed a venture with another
Singaporean company to upgrade its quality.

Imports could make good money, observers said. Although
import tax on specific goods such as beer, cigarettes and
liquor can be as high as 200%, traders can benefit from the
official exchange rate imposed by the government. This mean
tax is calculated at around 5.5 kyats per one US dollar, while
agents and traders can sell these products at a market price, which
uses the unofficial exchange rate of about 120 kyats per dollar.

Since Burma announced "Visit Myanmar Year" some observers
were left with the impression that private traders could
register goods essential to promote international tourism
with the Ministry of Hotel and Tourism, rather than the
Ministry of Trade, and obtain tax privileges.

However, Burma is facing an ever-widening trade deficit
stemming particularly from imports of consumer and luxury
goods, which typically account for 40 percent of all
imports, according to the latest report of the Economist
Intelligence Unit.

In the first quarter of the 1995-96 fiscal year (April-June
1995), the overall trade deficit accounted for 676.5 million
kyats, (about US$123 million at the official exchange rate),
almost double the deficit of 350.3 million kyats ($63.6 million)
recorded in the same period of 1994-95, the report said.

Rising demand for heavy machinery and other equipment to
support government-sponsored infrastructure projects and
imports of non-electrical machinery and transport equipment
were also among factors contributing to the deficit, it said.

Some businessman in Rangoon said there did not seem to be
any concrete measures to tackle the deficit, especially
controls over the influx of foreign goods into the country.

"The Burmese government seems more concerned about building
confidence in its market by allowing free flow of goods to
satisfy demand," the businessman said.

The government also receives hard currency income from this
lucrative business, including advertisements on state-run
television from which it can earn a maximum of $1,440 for a
60-second prime spot.

It charges $10 per square foot of billboard space. Temporary
bans on beer and cigarettes are imposed from time to time.
But observers said the bans stemmed from a request by those
running state beer enterprises who worried about losses,
rather than whether consumers would become addicted as
claimed by the government. (BP)

******************************************************

INFRASTRUCTURE FINANCE: TROUBLING PROJECTS
Feb/Mar 1996
From: dohrs@u.washington.edu

Myanmar's Yadana gas field raises the question:  Should companies do
business with regimes that violate basic human rights?

By Gregory Millman  (pp. 17-19)

        Myanmar's early god-kings ostentatiously poured their country's
wealth into building herds of sacred white elephants.  The military
dictators who have ruled Myanmar (formerly Burma) since 1988 continue the
ancient traditions of absolutism and spending, but have added something
more:  Myanmar's State Law and Order Restoration Committee (SLORC) has
been charged with just about every human rights violation - including
rape, torture, execution without trial, political prisoners, and slavery.
        The SLORC was born in a bloody massacre of pro-democracy
demonstrators in 1988.  It renamed Burma the Union of Myanmar - though
opponents to the regime continue to call the country Burma.  The SLORC
allowed an election in 1990, but when 80 percent of the voters cast their
ballots against the SLORC, it nullified the poll, imprisoned opposition
candidates and placed Nobel laureate Aung San Suu Kyi under house
arrest.  The SLORC's human rights record has been condemned publicly by
the US State Department, the United Nations, Amnesty International, Human
Rights Watch Asia, and the editorial page of the Wall Street Journal.
        But is the fact that a regime is tyrannical and oppressive a
reason not to do business with it?  From China to Nigeria and from Cuba
to Iran, investors are having to grapple with the morality issues as well
as the economics of various investments.  The Yadana pipeline now under
development in Myanmar by Unocal of the US and Total of France paints the
issue in the starkest colors.
        Some think that the record of Myanmar's government is so
egregious that it is immoral to do any business there - at any price.
George Soros acted decisively on this conviction in 1994, when he dumped
the shares of Peregrine Investments held by his Quantum Fund because of
Peregrine's involvement in Myanmar.  Levi Strauss and Co. pulled out of
Myanmar in 1992, saying that doing business there was impossible without
"directly supporting the military government and its pervasive violations
of human rights."  Liz Claiborne Inc., the clothing manufacturer, also
withdrew for the same reason, and RH Macy and Co., the US department
store, left because of "corruption."  In addition, the Asian Development
Bank is not extending loans to Myanmar because of human rights violations.

Does Commerce Civilize?
        However, several oil companies have been getting involved in
Myanmar.  Amoco has departed for so-called economic reasons, but Texaco
and Arco are actively engaged in exploration.  And Unocal and Total are
beginning to develop the Yadana gas field - about 43 miles off Myanmar's
coast in the Andaman Sea.  Production from this field is expected to
reach 650 million cubid feet per day, most of which will be shipped via a
416-mile pipeline to the Electricity Generating Authority of Thailand.
        Critics say that revenues from the Yadana project will help keep
Myanmar's junta financially secure and make it possible for the generals
to buy arms.  From this perspective, the pipeline may be regarded as a
callous collaboration between a repressive regime and companies that put
profits before people.  "Unocal and Total are partners in that and can't
escape culpability," says Simon Billenness, senior analysts at Franklin
Research and Development, which he describes as a socially responsible
investment firm.
        Oil companies view the project differently.  They describe it as
a means of opening a closed society.  "You have a choicwe between doing
nothing and doing something," says Herve Chagneux, Total's coordinator
for Myanmar and Thailand.  "We are entrepreneurs.  Our business is to
create wealth, and we feel that by doing so, we push things in the right
direction."  In other words, commerce can be a civilizing influence.

An Ethical Challenge
        The Yadana project is neither a challenge technologically nor
financially.  The $1 billion project is expected to be financed entirely
with equity.  According to Chagneux, financing will include export credit
agency (ECA) support.  However, he does not expect any participation from
ECAs in the US, UK or France; though, he says, "Japanese [support] is
clearly a possibility at this stage.  As for the rest, it is difficult to
say."  Contractors have already been invited to submit bids.
        Total owns 31.24 percent; Unocal, 28.26 percent; the Burmese
government's Myanmar Oil and Gas Enterprise (MOGE), 15 percent and
Thailand's PTT Exploration and Production Public Co., 25.5 percent.  The
Petrolium Authority of Thailand has signed a 30 year gas sales cotract.
According to Chagneux, the contract provides for the purchase of 525
cubic feet of gas per day.  As a result, the project is expected to be
highly profitable.  In fact, Lehman Brothers analyst Paul Cheng estimates
that the Yadana pipeline will boost Unocal's per share earnings by as
much as 10 percent annually.
        There are only two serious challenges.  One challenge is
presented by the Karen and Mon, two ethnic groups who have been fighting
the Burmese for centuries.  The proposed pipeline will only cross Burmese
land for 39 miles, but the route goes through Karen and Mon strongholds.
In the Spring of 1995, insurgents attacked and killed five surveyors.
The insurgents say their land is being taken for the pipeline without
their consent or any compensation.  They claim that their villages have
been razed and their people marched off to forced labor camps or
otherwise relocated.  They aren't happy, they have guns, and they know
how to use them.
        The second challenge is ethical.  Ethicists say that even among
countries charged with human rights violations, Myanmar is unique.  The
abuse of human rights is so much a part of the system that it takes very
creative approaches to do business ethically in Myanmar.  Professor Tom
Donaldson of Georgetown University, author of The Ethics of International
Business, says, "In Burma the human rights violations have been systemic,
widespread, and involve violations of the most fundamental and central
human rights accepted by both liberals and conservatives."
        Donaldson is no knee-jerk bleeding heart.  He says that his
ethical business guidelines would allow a company to do business with
almost anyone in the world.  "I call this the condition of business
principle,"  he says, "Basically, we will tolerate a fair amount of
unethical behavior from a person, firm or nation with whom we just have
business dealings, but when matters reach the point of a dramatic
threshold, most people say you just don't do business with that type of
person.  I don't think China reaches that point, but if any country might
qualify as passing that threshold, it would be Burma."
        Donaldson's view is reinforced by Richard DeGeorge, director of
the International Center for Ethics in Business at the University of
Kansas, who says, "One of the guidelines I would put out is that a
company should not knowingly cooperate with with any supplier, government
or other enterprise that engages in slavery, slave labor, or even child
labor.  Saying, 'We know they're doing it, but we're not doing it,'
doesn't let you off the hook.  If you know it's being done, you're
ethically responsible for it.  It's your responsibility to mitigate the
harm they're doing to those people.  They can't simply be ignored."
        Professor Kenneth Goodpaster, a former faculty member at the
Harvard Business School who now teaches business ethics and policy at the
University of St. Thomas in Minneapolis-St. Paul, says, "When you can
forsee in clear terms that this supplier or user of your services or
products is engaging in behavior that is, by any reasonable estimate, an
abridgment of basic human rights, there's no escaping that you have a
responsibility there."
        None of these ethicists specifically says that it is unethical
for Unocal and Total to invest in Myanmar, but they all underscore the
need for innovative approaches to insure that the project does not
benefit from the SLORC's injustice.  They add that if companies could
exert a positive influence in Myanmar, it would be ethically legitimate
to do the project.  Thus it's no surprise that Unocal, Total and other
oil companies justify their presence in Myanmar by arguing that economic
development and prosperity will eventually civilize that state.  They
point to other examples where they say economic growth has helped
facilitate an expansion of human rights in Asia - including the
Philippines, Indonesia and China.
        Though oil companies insist they are making every effort that
ethical business requires, their interest are entwined with those of the
SLORC.  One executive, who declined to be identified, even defended
Myanmar's use of forced labor as reasonable given that the country could
not borrow money to build its infrastructure.
        While Unocal and Total have not gone that far, thay have been
supportive of SLORC in some ways.  For example, John Imle, Unocal's
president, says of SLORC, "What we look for is a government that delivers
on its commitments.  This one has."  Moreover, in January 1995, he told a
group of human rights activists that opponents of the pip[eline should be
blamed for the military's atrocities in the region, "Let's be reasonable
about this.  What I'm saying is that if you threaten the pieline, there's
going to be more military.  If forced labor goes hand-in-glove with the
military, yes, there will be more forced labor."  In an interview with
INFRASTRUCTURE FINANCE, Imle clarified his point:  "The troops assigned
to provide security on our pipeline are not using forced labor," he said.
        Interestingly, Imle's partners at Total do not share his
confidence in the good conduct of Burmese troops.  "I could not guarantee
that the military is not using forced labor," says Total's Chagneux.
"All we can really guarantee is what we [ourselves] are doing, the
contracts we make, the people we employ.  What is being done nearby we do
not know."  As the operating partner, Total handles on-site activities
such as hirings and construction, and is, therefore, much closer to the
scene than Unocal.
        There is no shortage of reports from refugees who say that they
have been forced from their villages in the pipeline areas and compelled
to work as porters or as construction workers on military bases.  "We've
sent them mountains of interviews with dislocated villagers, victims of
forced labor, photographs of villages being burnt down, people being
shot, but they refuse to believe it," says Louisa Benson, US
representitive of the Karen National Union and the Democratic Alliance of
Myanmar.
        While the US State Department says that many such refugee
accounts are credible, Imle doesn't believe them.  "The people being
interviewed - a lot of them in Bangkok or in the refugee areas - may be
people who don't understand where the pipeline will be or what it is," he
says, adding, "There are people who are using this as a cause or as part
of an agenda."
        Not all oil executives question these accounts.  At another oil
company exploring in Myanmar, an executive says he's looking for ways to
provide security for his operations without relying on the Burmese army,
in order to avoid any taint of collaboration with the regime.
        But at UBS in New York, oil company analyst Mark Gilman says
frankly, "There are a lot of folks in the industry who would rather deal
with an authoritarian regime than with the chaos often associated with an
emerging democracy."  As a securities analyst, Gilman adds, how a
dictatorship treats its people is of no concern.  "Human rights remain
off the table until such issues begin to jeopardize the likely conclusion
or the bringing to fruition of projects.  When those issues begin to have
intermediate to long-term economic implications, then they become
relevant, but exclusive of that, they're not."  Gilman's view is
generally shared among analysts who cover Unocal, though no others were
willing to be quoted.  George Soros may have abandoned Myanmar because of
his personal convictions, others seem unlikely to follow his trail.

Profits and Principles
        The decision on whether and how to do business in Myanmar will be
made by individual companies, who must weigh issues of profits and
principles.  In this context, every oil executive interviewed for this
article cited as one justification for staying, that if his or her
company left, there were others eager to take its place.
        To change the trade-off facing compnies, a number of governments
are dusting off boycott measures once used against South Africa.  For
example, the Commonwealth of Massachusetts and several US cities have
introduced local legislation calling for a boycott of companies that do
business in Myanmar.  Moreover, in Washington, DC, sanctions legislation
is expected to be sponsored in Congress by Senator Tom (sic) McConnell
(R-Kentucky) and Senator Daniel Patrick Moynihan (D-New York).
        Amid the growing debate, Unocal and Total continue to insist that
it is possible to do business ethically in Myanmar, and they don't worry
that they have a vested interest in protecting an oppressive regime.
However, that view is not necessarily shared by executives at other
companies or by public officials in many countries around the world.

