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

The BurmaNet News: February 8, 1996
Issue #340

HEADLINES:
==========
US CONGRESS: FOREIGN OPERATIONS, APPROPRIATIONS (BURMA)
INDEPENDENT REPORT: THE NEW THREAT TO DEMOCRACY IN BURMA
S.H.A.N. : FORMER MTA HARDLINERS SNEAK AWAY
ASIAN AGE: BURMESE MILITARY FINDS IT DIFFICULT TO IGNORE SUU KYI
INDEPENDENT REPORT: TOTAL SIGNS FINAL EXPORT SALES
NATION: ROAD TO MANDALAY NOT QUITE READY
NATION: DRUG BOSS KHUN SA MOVED TO RANGOON
NATION: MON REBELS COOL TO JUNTA'S ECONOMIC OFFERS
BKK POST: SOLDIERS ARE THERE TO HELP
***************

US CONGRESS: FOREIGN OPERATIONS, APPROPRIATIONS (BURMA)
February 4, 1996
FreeBurma@aol.com

(Note: The following bill was reported in both U.S. House and Senate last
year. The bill is about 60 pages long, but Burma has just a couple of pages
as follows. If you would like the whole bill, go to the ftp site --
ftp://ftp.loc.gov/pub/thomas/c104/h1868.enr.txt)
-----------------------

H.R.1868

Foreign Operations, Export Financing, and Related Programs Appropriations
Act, 1996 (Enrolled Bill (Sent to President))

H.R.1868

                      One Hundred Fourth Congress of the
                United States of America
                AT THE FIRST SESSION

Begun and held at the City of Washington on Wednesday, the fourth day of
January, one thousand nine hundred and ninety-five

An Act

Making appropriations for foreign operations, export financing, and related
programs for the fiscal year ending September 30, 1996, and for other
purposes.

     Be it enacted by the Senate and House of Representatives of the
     United States of America in Congress assembled, That the
     following sums are appropriated, out of any money in the Treasury
     not otherwise appropriated, for the fiscal year ending September
     30, 1996, and for other purposes, namely:
------------------
BURMA

Of the funds appropriated by this Act to carry out the provisions of chapter
8 of part I and chapter 4 of part II of the Foreign Assistance Act of 1961,
not less than $2,380,000 shall be made available to support activities in
Burma , along the Burma -Thailand border, and for activities of Burmese
student groups and other organizations located outside Burma , for the
purposes of fostering democracy in Burma , supporting the provision of
medical supplies and other humanitarian assistance to Burmese located in
Burma or displaced Burmese along the borders, and for other purposes:
Provided, That of this amount, not less than $200,000 shall be made available
to support newspapers, publications, and other media activities promoting
democracy inside Burma : Provided further, That of this amount, not less than
$380,000 shall be made available for crop substitution activities in
cooperation with the Kachin people of Burma : Provided further, That funds
made available under this heading may be made available notwithstanding any
other provision of law: Provided further, That provision of such funds shall
be made available subject to the regular notification procedures of the
Committees on Appropriations.

------------------

LIMITATION ON FUNDS FOR BURMA

     SEC. 567. None of the funds made available in this Act may be
     used for International Narcotics Control or Crop Substitution
     Assistance for the Government of Burma .

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

INDEPENDENT REPORT: THE NEW THREAT TO DEMOCRACY IN BURMA
February 5, 1996
From: reaproy@cais.cais.com (Phil Robertson)

The New Threat to Democracy in Burma:  The Re-engagement of International
Financial Institutions with the SLORC Regime

by Philip S. Robertson Jr.
e-mail: reaproy@cais.com
phone: (301) 270-1009

I. The Imperative to Act

Unknown both to many Burma activists world-wide as well as important policy-
makers in Washington, D.C. and elsewhere, Burma is far closer to receiving
major financial assistance from the International Financial Institutions (or
IFIs, in this case the International Monetary Fund, the World Bank, and the
Asian Development Bank) than most believe.  Unless we act now there is a
significant possibility that the U.S. Government's important efforts to prevent
IFI assistance from reaching Burma may fall short.  What is at stake in this
issue is nothing less than all the gains made in bringing international economic
pressure against SLORC in order to force the regime to negotiate a transition
to democratic rule with the National League for Democracy (NLD).

Clearly one of the worst human rights abusers in the world, the State Law and
Order Restoration Council (SLORC) regime has massacred thousands of people
in the streets, annulled a free and fair election in 1990 and imprisoned many of
the victorious candidates, and been repeatedly condemned by the United
Nations General Assembly and the International Labor Organization (ILO).
This regime, which refuses to conduct negotiations with the democratic
opposistion lead by 1991 Nobel Prize Laureate Aung San Suu Kyi, does not
deserve financial assistance from the IFIs because it will further strengthen
SLORC's illegitimate control of the country.
   
Fortunately, it is not too late to bring pressure to bear to stop the IFIs from
providing the SLORC with the financial support it seeks if we begin now, work
on multiple fronts to lobby the G-7 governments and the U.S. Congress, and
understand from the outset that this will be a difficult fight.  We must move
quickly to lay the groundwork to make economic and political arguments that
Burma should not be assisted at this time because once the SLORC decides to
devalue (or "float") the kyat at market or near-market rates, the countdown to
IFI involvement in Burma begins in earnest.  The IFIs offer SLORC the
solution to economic inflation (running at 30-50%), the key economic problem
that undermines their attempts to legitimize their rule.  At the moment,
inflation results from SLORC's budget deficits (high military expenditures a
big part of that) and its inability to secure external financing for its
approximately $5.5. billion external debt.  All SLORC can do at the moment is
force the Central Bank of Myanmar to cover the debt by printing more money
(and by cutting social programs, like education and health) which further
destabilizes its rule.  Symbolically, IFI support would lend to the appearance
of stability in Burma and further encourage foreign investment which Aung
San Suu Kyi and the NLD have clearly said should not take place at this time.

Everyone who reads this should seek to obtain the following reports so that
they are conversant with some of the basic economic issues involved.  These
reports are in the public domain, so they should be obtainable:  World Bank
report No. 14062-BA, "Myanmar Policies for Sustaining Economic Reform",
Country Operations Division, Country Department I (East Asia and Pacific
Region), October 16, 1995; and International Monetary Fund "Myanmar Recent
Economic Developments", prepared by J.R. Dodsworth, Michael Braulke,
Ulhas Gunjal and Paul Heytens (Central Asia Department), October 11, 1995.

I imagine (thought I haven't looked) that the World Bank and IMF both have
web pages were inquiries could be made.

In this paper, I will first outline the role that each of these
organizations (and
the Paris Club) play. I will then concisely explain actions have been taken by
the IFIs in Burma since the release of Aung San Suu Kyi in July 1995 and why I
believe the U.S. alone cannot stop them.  Finally I will then what they want to
do (if we allow them) in Burma.  I will then offer several strategies that we,
the international activists for a free and democratic Burma, should pursue
immediately to keep the IFIs out of Burma, thereby maintaining economic
pressure on the SLORC.

II.  Who the IFIs Are: A Primer

International Monetary Fund (IMF):  Based in Washington, D.C., the IMF
provides technical advice for governments seeking to reform economic policies
and non-project financial assistance when governments undertake these
reforms.  Since this money is not tied to projects, governments can essentially
use IMF funds they receive they way that they like -- in essence, a pay off for
undertaking a reform.  Think of it as giving SLORC a multi-million dollar cash
payment for finally getting around to fixing the economy that they and their
military brethren have been mismanaging since 1962 and you get the picture.
Approval of projects must be made by the IMF Board of Directors, which is
comprised of representatives of the governments which contribute operating
funds to the IMF and dominated by the G-7 nations.  Weight of votes is
assigned based on amount of contribution to the IMF that the government
makes -- i.e. the U.S. has 18% of the votes because that is how much they
contribute -- but decisions are, by tradition, made by consensus.  IMF staff
are bound by the organization's charter to not consider "political issues" when
proposing projects, but to only examine "economic issues".  The Board of
Directors are not IMF staff (rather they are employees of their respective
governments) so they are not bound by this restriction.

World Bank (WB):  Also based in Washington, D.C., the WB gives technical
advice, non-project assistance (like IMF), specific project assistance (for a
road or other part of infrastructure, for instance), and "humanitarian" project
assistance (health, education, etc.).  Traditionally, the WB only enters a
country after the IMF has gone in (in essence, give the IMF stamp of approval
for reforms) but, as we shall see, Burma was almost an exception.  The U.S.
has 21% of the vote at the WB.

Asian Development Bank (ADB): Based in Manila in the Philippines, the ADB
is dominated by Japan and U.S. influence is much weaker (only 11% of the
vote).  Like the WB, it conducts four types of projects.  However, the ADB is
not bound like the WB and has no restraints in entering a country before the
IMF.  In fact, the ADB has already done several road projects in Burma
(started pre-1988) and is plotting ways to start new infrastructure projects.

The Paris Club:  An informal group of lenders/creditors, this organization is
lead by the French and its mission is to provide relief for "official debt",
i.e.
debts guaranteed by governments.  They only operate once a country has the
IMF's seal of approval.  Unamity of creditors is required and they operate
under rules set by the G-7 nations.

What they can do for SLORC is re-schedule (at lower interest rates, or with
long interest-free grace periods) perhaps 60% of the SLORC's $5.5 billion
external debt.  Most of that debt is held by the Japanese.  The poorer a
country, the more generous their terms tend to be -- up to and including just
cancelling debts.  Think of it this way -- debt relief for SLORC is tantamount
to a new cash infusion, because now they can borrow more and buy more.
And, as recent news reports show, they are still interested in buying things
like new Russian attack helicopters which are 'cash on the barrel head' deals.

The Japanese Government is already subverting the intent (although not
necessarily the writ) of the international community against new loans to the
SLORC.  When SLORC pays back Japanese Government funds, it goes into a
special account.  All the proceeds in this account can be used by SLORC to
purchase new commodities manufactured in Japan.  So, in essence, the
Japanese Government is not being paid back -- the balance of the loans
remains the same while SLORC gets more Japanese equipment.

III.  What the IFIs Have Been Doing in Burma

It is clear that the IFIs want to get back into Burma as quickly as
possible.  In
August 1995, within a month of Aung San Suu Kyi's release from house arrest,
both the IMF (on an annual monitoring mission) and the World Bank had come
up with concrete plans for their immediate re-involvement in the country.  At
big bureaucracies like these, plans of this kind of complexity take longer than
a month to put together -- signifying that the IMF and World Bank staff have
been plotting these approaches for awhile, even when Aung San Suu Kyi was
still in detention.  While many have said that it was the possibility of aid
from Japan that prompted SLORC to release her, a question worth asking is it
also possible that the lure of millions of dollars from the IFIs was also a factor
in SLORC's plans?  And, if this is true, did the IFIs know this beforehand?

The IMF does what is known as an "Article Four consultation" each year in
each country around the world, examining economic trends, offering advice to
the government and writing a report.  Every August, it is Burma's turn for
this service but August 1995 was different than previous years.  Eager to get
back into Burma after years when Western government pressure kept them
out, the IMF staff had prepared what essentially constituted an end-run
around the IMF Board of Directors.  What was proposed (following a formal
request from the SLORC Finance Minister, likely arranged in advance of the
mission) is what is known in IMF terms as a "staff monitoring mission".  The
mission would monitor SLORC compliance towards economic reform targets, the
most important of which is moving to a market-based exchange rate for the
kyat.  If the mission certifies that SLORC has satisfactorily met the reforms,
then within as fast as 6 to 9 months a formal IMF project (putting millions of
dollars in SLORC's pockets) could be set up.  The length of this timeline,
assuming full float of the kyat, could be a IMF project within a year and a
half.

It would have all taken place quietly and secretly, behind the closed doors of
the IMF, but it appears some people in the Clinton Administration were paying
attention and raised the issue.  (The U.S. Government's representatives to
the IFIs are all currently required by law to vote against all assistance to the
SLORC Government because Burma has been identified as a country that is not
cooperating in eliminating narcotics.)  What followed was extraordinary.  To
its credit, the U.S. Government used the full array of diplomatic weapons at
its disposal to stop the IMF staff's plan.  It held a meeting in Rangoon
with all the Ambassadors of the G-7 countries (Canada, Japan, Britain, France,
Germany, Italy and U.S.) to outline U.S. opposition to the staff monitoring
mission.  The U.S. then called a similar meeting held at the State Department
in Washington, D.C. with all the G-7 country Ambassadors based in
Washington.  Finally, the U.S. Embassy staff in each G-7 country were sent
with a diplomatic demarche to the Finance Ministry which again explained why
the U.S. was against the IMF staff's proposal.

Despite this intense inter-governmental pressure, the U.S. was unable to stop
the plan.  When the IMF Board of Directors met to consider the matter on
October 20, 1995 the U.S. was the only country which opposed the staff
monitoring mission proposal.  The issue was finessed to make it seem less
confrontational -- the Board just made a statement of non-objection to the
staff's proposal -- but the bottom line was the same:  the staff monitoring
mission was established.  While the situation may be different in the future if
the issue is a full assistance package and IMF members have to confront the
appalling human rights record of SLORC straight on, we can't assume
anything.  We need to organize opposition right now in support of the position
that all IMF Board of Directors (from whatever country) should vote against
any future requests for assistance for Burma.

Publicly the U.S. Government (or at least the State Department) presents the
impression that its opposition will be enough to prevent IFIs from re-engaging
with SLORC.  For instance, when Winston Lord, the Assistant Secretary of
State for East Asian and Pacific Affairs, went up to testify before the Senate
Appropriations Committee (Foreign Operations Subcommittee) on July 24, 1995,
he said "Of greatest impact, we will also continue to oppose lending from the
international financial institutions..."  When Kent Wiedemann, Lord's Deputy,
went to testify before the Subcommittee on Asian and Pacific at the House
International Relations Committee on September 7, 1995, the line was much the
same:  "...our influence with other countries have in practice prevented most
assistance to Burma from the IMF, the World Bank, and the Asian Development
Bank."  He continues optimistically that "...our actions and those of like-
minded countries have made clear that Burma can not fully rejoin the
international community and gain the assistance it needs to develop its economy
until fundamental challenges are made."

Well, those lines may sound good to the Congress but rather than placating
them I would argue we need to get Congressional interest stirred up so that
the Congress can work to apply additional pressure on the IFIs.  All one can
say about Lord's weapon of "greatest impact" is that it didn't work the first
time.  The U.S. went quite far out on a limb to oppose the staff monitoring
mission (not even a full project proposal) and they weren't able to win that
one.

Let's be clear here.  My purpose is not to beat up on the U.S. Government --
they are, after all, the only government in the G-7 that took a principled stand
at the IMF -- but rather get the word out that we need to help them find allies
who will make it clear to the IFIs that now is not the time to provide the
financial support to SLORC.

Approval of a formal IMF project in Burma could open the gates for hundreds
of millions of dollars in financial assistance to the SLORC regime.  The process
will remain into suspended animation until the SLORC makes a decision about
the kyat.  Either it will fully float the kyat (i.e. abolishing the fixed
official exchange rate of 6 kyat = $1.00 and following the market price) or partially
float the kyat by establishing a new fixed rate, such as 60 kyat = $1.00.  Once
that reform begins, the clock starts ticking.  It is this issue, how and when to
deal with the exchange rate reform, which is allegedly being debated within
SLORC at this time.

As for the other IFIs, they are also working on ways to re-engage with
SLORC.  The World Bank has already outlined a full Structural Adjustment
Program (SAP) for the SLORC regime to implement.  In fact, some World Bank
staff allegedly proposed that in the case of Burma, the World Bank violate its
fundamental policy of waiting for the IMF to negotiate a project which
demonstrates the seriousness of the host government to economic reform.  The
only other case where the World Bank has done this was Brazil in the 1970's,
and the results were disastrous.  Fortunately, this ill-considered proposal was
stopped and know the World Bank is back to its initial position, waiting for the
IMF to act.  Once a IMF staff-monitoring mission certifies that SLORC is
meeting reform targets, the World Bank will come on line with what could well
be projects worth hundreds of millions of dollars.

The Asian Development Bank has fewer constraints than the World Bank.
They have finished many of the "left-over" infrastructure projects that the
ADB committed to before the 1988 crushing of the democracy movement.  A
recent ADB staff mission to Burma in December 1995 allegedly held discussions
with Minister for Foreign Investment General David Abel and other SLORC
leaders to initiate a whole slew of new infrastructure projects in collaboration
with the SLORC Government.  There are ostensibly plans for a March 1996
ADB mission to Burma to examine the situation and make recommendations,
with the idea of approving projects at the ADB's Board of Directors meeting in
April 1996.  This timeline shows that the March evaluation mission is just a
cover, an empty exercise in political whitewashing, for a decision that ADB
staff (and some donor countries, perhaps -- like Japan) have already made:
that it is time for the ADB to return to Burma and support the projects of the
SLORC Government.

IV. Actions to Take Now

The current balance of the game is running against those of us who feel that
IFI support for Burma will further entrench SLORC's illegitimate and brutal
rule and we need to do something about it.  If we can't persuade the IFIs that
it is not economically appropriate to do so because of basic macro-economic
problems in Burma -- e.g. the SLORC has no legitimacy to seek revenue
(taxes) from the people and is spending huge amounts of the budget on
military arms -- then we must develop the necessary political pressure to stop
them.

Since the IMF is the key initiating agency in this process, we need to
concentrate on the IMF.  We need at least two or three of the remaining six
members of the G-7 to support the U.S. position at the IMF Board of Directors.
Another approach could be lifting the level of political heat in the U.S.
Congress (which must authorize the U.S. contribution to the IFIs) to the level
where the IMF and WB decide that their financing sources are more important
than a risky enterprise in a remote country with a pariah regime.

The key is to get the governments of the G-7 to raise these issues with the IMF
and World Bank.  IFIs are not democracies but bureaucracies -- so they don't
care about what you, as an individual citizen, think.  They do care a great
deal about what your government thinks and says to them, especially if you
happen to live in a Western country that gives significant financial support.

Possible strategies include the following:

(1) Express our support to the U.S. Government for its work so far in holding
out against further IFI involvement in Burma and urge them to continue this
important policy.

(2) Approach key decision-makers in the U.S. Congress in the House Banking
Committee and Senate Finance Committee and encourage them to demand
explanations from the IFIs and the Ambassadors in Washington, D.C. from our
G-7 allies  about this situation.  Concurrent with this effort needs to be
further explanations about the appalling abuse of human rights and forced
labor by the SLORC.

(3) In Europe and Japan, activists need to approach their Members of
Parliament and Government to demand explanations for the failure to oppose
the IMF staff monitoring.  After all, a Nobel Peace Prize winner has asked that
foreigners not invest in Burma at this time -- her wishes, supported by the
moral authority of the 1990 elections and the continuing support of the
Burmese people, should be respected.   The policy of those governments need
to be changed, so any action that contributes to that objective is worthwhile.
Europeans should concentrate on the IMF and World Bank first.  Japanese
activists should seek to focus their efforts on persuading government policy-
makers to prevent the ADB from expanding in Burma.  Japan controls the
largest share of the ADB's votes so this is important.  Japanese activists
should also contact the IMF, where Japan has a large percentage of votes as
well.

(4) Develop further information on the huge percentage of the SLORC
Government's budget that goes to the military.  Using the data on the SLORC's
expenditures in the IMF report of October 1995, rough estimates can be
worked out that defense spending is over 50% of the budget.  How does the
World Bank square this figure with its purported interest in "development"?
Obviously if the SLORC has decided that if the health of the people and the
education of the children has to suffer in order that the Army can buy new
weapons from China, Russia, Singapore or other nations, it doesn't care much
about "development".

(5) Bring into the public light as much information on Burma projects from the
IMF, World Bank, and ADB as possible.  For a starter, information and
statements from the October 20, 1995 IMF Board of Directors meeting should be
sought.  Other reports and information should be found and made public
knowledge.  When these issues are discussed behind closed doors, we are at a
significant disadvantage.  So we need to take them into the public domain
where issues like SLORC's horrendous treatment of the people of Burma
matter.
 
I welcome your suggestions to this issue and hope that you will join me in a
campaign to stop the IFIs from tilting the political balance in Burma against
Aung San Suu Kyi, the NLD, and the vast majority of the Burmese people who
voted for them in the 1990 elections.

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

S.H.A.N. : FORMER MTA HARDLINERS SNEAK AWAY
February 5, 1996
From: "SHAN<H.NG.P  SPM" <100706.1311@compuserve.com>

>From January 5 to 26, 1996, members of the Mong Tai Army ( formerly the most
powerful rebel group in the Shan State ) have been surrendering to the SLORC,
group by group, on various occasions and at different places. More than 10,000
are known to have surrendered so far.

But there are still some hardliners who do not want to surrender to the Burmese.
On January 30, 1996, Major Yord Serk, a prominent fighter, managed to sneak out
of the area now under Burmese control, and crossed to the west of the Salween
with a 7-800 strong force. This news became known on February 2.

Their aim and destination is not yet known. But most people think they are
heading for Kieng Lome, Kieng Kham, Kho Lam, Kieng Tong and Murng Pan areas to
merge with SSNA  (Shan State National Army) troops in the areas commanded by Zao
Zai Yee.

It appears that these troops do not want the armed struggle to be completely
wiped out before their national aim is achieved. They could not keep following
the MTA, because it does not represent the Shan State anymore and they wanted to
remain faithful to the aims of Zao Korn Zurng, the late prime minister.

Though their aims and policies are not yet clearly known, they are assumed to be
as follows :
  -  To try to contact all other ethnic groups which can become a national force
of the peoples      of the Shan State and try to rebuild national unity.
  -  To strive to achieve democracy, collective leadership and protection of
human rights.
  -  To strive for the historical rights of the Panglong Agreement.
  -  To strive to improve the life of the people.
  -  To strive for peace in Shan State, Southeast Asia and the world.

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

ASIAN AGE: BURMESE MILITARY FINDS IT DIFFICULT TO IGNORE SUU KYI
February 6, 1996   New Delhi
From: chan@.unv.ernet.in

Rangoon, Feb. 5: Burma's military rulers have notched up successes against
ethnic insurgents and a backward economy, but they have failed to shift the
political focus away from pro-democracy Aung San Suu Kyi.
Regular commentaries in the state-run press refer to her dismissive and deride
her views, but they also serve as a continual remainder of her existence to a
broad spectrum of the population.

"These articles win us a lot of support," Aung San Suu Kyi told AFP in a
recent interview. "Some people feel we have a secret supporters (in the press),"
she added with a smile. Realistically, she and her National League for Democracy
are no closer to power than they were in 1990 when, although the party swept the
general elections, the junta refused to acknowledge the results and step down.
Officially known as the State Law and Order Restoration Council, the junta maintains
firm control over the government and the population in general.

"But she puts them on the defensive," a political observer commented, referring to
the pro-democracy campaigner. Both sides stubbornly insist they are in the right,
and the atmosphere does not appear favorable for substantive talks at this time.
"Perhaps the SLORC will offer some sort of `window-dressing' meeting with her
before(Yozo)Yokota makes his report to the UN in February," one long-time
resident of Rangoon speculated, referring to the UN special Rapporteur on
human rights.

But any talks could be dragged out for months or more, long enough for the
SLORC to get a new Constitution  adopted giving the military a permanent
"guiding" role in the government.

"Then they could hold new elections that come up with a result they can live
with this time, however that result is obtained," another analyst said. Such
speculation is only guesswork. The junta's membership is no secret, but its
workings are opaque. The few indicators emerging include and obvious
cosying up to other countries in the region, and particularly the ASEAN
nations.(AFP)

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

INDEPENDENT REPORT: TOTAL SIGNS FINAL EXPORT SALES
AGREEMENTS TO SELL BURMA OFFSHORE GAS TO THAI'S
PETROLEUM AUTHORITY,
February 2 1995 (UVI.net, Paris)

By Dawn Star

PARIS - Rebutting international furry over allegations that the Burmese
junta engages in a national campaign of forced labor, Total France, the
giant French gas and oil company, declared that the Myanmar Oil and Gas
Enterprises (MOGE), Total, Unocal, the Petroleum Authority
of Thailand Exploration and Production Public Co. Ltd (PTTEP),
nonetheless, had recently signed an export gas sales agreemnt with the
Petroleum Authority of Thailand (PTT). In the deal, the group agress to
sell to PTT natural gas produced from the controversial Yadana offshore field.

The agreement is the conclusion of a process that  follows last
September's  signing in of memorandum of understanding giving Total an
edge over its partners. According to Total's press office at the
company's Paris headquarters, since Thailand's PTTEP exercised its
option to take an interest in the project, the present ownership
structure is divided accordingly with Total, 36,75%, Unocal, 33,25%,
PTTEP, 30%. However, Burma's national oil company, MOGE, retains an
option to acquire up to a 15% interest in the project, which would thus
reduce the  different partners' overall stake. Total's share would drop
to 31,2%, accordingly.

Disregarding the democratic opposition leader and Nobel Peace Prize
laureate Daw Aung San Suu Kyi's appeal not to invest in Burma at this
time, the development of the Yadana field falls within a carefully
planned overall strategy by Total's senior management to extend the
company's operations throughout Southeast Asian energy markets. Coupled
with its existing natual gas production from Thailand's Bongkot field,
and   virtually ignoring reports in the international press and UN
resolutions over the pipeline's alleged use of forced labor by the
Slorc military regime, Total  is betting that this latest development
will secure it a profitable future as a leading energy supplier to
Thailand.

Since the Burmese government does not have trained engineers or
technicians capable to supervise and manage their part of the pipeline,
 the French company has assumed full responsability as both operator
for the development of the field, and, as well, on the pipleline to the
Thai border, with PTT  controlling operation of the pipeline within
Thailand. With the country plunged between warring factions, Total is
certain to risk more incidents of the kind that occured last March when
five Total workers were killed and 11 injured by ethnic Karen rebels
seeking revenge for the forced explusion of local villages along the
pipeline route, and outbreaks of violence last month that left at least
one death among security forces guarding the pipeline.

Terms of the  contract, says Total, give the French full authority to +
take all the necessary actions to ensure that deliveries to PTT will
begin by the scheduled date of July 1, 1998 ;. From the initial rate of
65 million cubic feet per day (mmcfd), deliveries are expected to rise
progressively over the next fourteen months to a plateau level of 525
million cubic feet per day.

Total's contract covers the next thirty years, with the gas to be
delivered to the Ratchaburi region, where it will then be used to fire
a 2,800 megawatt power plan managed by the Electricity Generating
Authority of Thailand (EGAT). According to Total, production from the
Yadana field, over the long term, may rise to 650 million cubic feet
per day, with the additional output being used to supply Burma's
domestic energy demand. The question, however, remains : will Total be
forced to engage mercenary security forces to further protect its
investment, thus propping up Burma's declining economy in order to
fulfill its grand energy plan for South Asia's, at the cost of millions
of suffering Burmese people who have been denied political freedom and
a  voice in determining the future of Burma's economic development.

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

NATION: ROAD TO MANDALAY NOT QUITE READY
February 7, 1996  (abridged)

Next year "Visit Myanmar" year. But is the blighted
country's infrastructure up TO it? MICHELE COOPER of AFP
reports from Pagan, Burma's premier tourist site.

According to a joke doing the rounds of foreign residents
here, Burma's ideal tourist is one who flies into Rangoon,
takes a suite at the Strand Hotel, spends US$555 and flies
out again the next day.

But the country has a lot to offer: from Rangoon 's landmark
Shwedagon pagoda to the bustle of Mandalay, the 11th-13th
century temples in Pagan and the picturesque floating
village on Inle Lake in the Shan State.

It also has substandard hotels, serious transportation
problems - antiquated rail and road network and inadequate
air links - and officials who are uncomfortable with
undisciplined foreign tourists.

"As long as people stay on the tourist circuit, they will
come away happy. Those who get off the beaten track to try
to get to know the "real Burma" will find their experience
is less happy," a tourism professional commented.

He was speaking after a group of 12 British and American
tourists were forced to cut short a bicycle tour of the
country because of a mix-up between Rangoon authorities and
those in the provinces over authorizations.

Tourism and Hotels Minister Kyaw Ba maintained in a recent
speech that income from tourism-related business had a
"miltiplier effect on the citizens of a nation."

Manager Ohn Gyaw of the Thiripyitsaya the last remaining
government-run hotel in Pagan, concurred, saying that in his
four years in the area he had seen living standards rise significantly.

The official view is that tourism helps everyone, from the
laborers used in construction and the staff hired to operate
business to the craftsmen who sell souvenirs to the tourists
and the farmers who grow crops to feed them.

Opposition leader Aunt San Suu Kyi disagreed.

"Building one hotel probably means a lot more profits for
the foreign countries involved than for Burma," she said in
a recent interview in Rangoon.

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

NATION: DRUG BOSS KHUN SA MOVED FROM SHAN STATE TO
RANGOON
February 7, 1996 Reuter   (abridged)

BURMESE opium warlord Khun Sa has been taken from his jungle
headquarters in the northeastern Shan state to live in
Rangoon, one of his officers and other sources said yesterday.

Khun Sa who surrendered to government forces last month, was
taken to Rangoon from his Ho Mong headquarters on the orders
of military intelligence chief Lt Gen Khin Nyunt around Jan
20, a Thai intelligence officer added.

He was accompanied by his right-hand man Chang Shu-chuan,
who is also known by the Shan name Sao Hpalang, a former
Chinese nationalist soldier who was worked with Khun Sa
since the mid-1960s, the Thai source said.

The sources said it was unclear why Khun Sa had been taken
to the Burmese capital.

An Agence France-Presse report yesterday quoted an official
source as saying that the Burmese junta has set three
conditions for the formal surrender of Khun Sa - that it be
unconditional, that he halt drug-related activities and that
he promise to obey the law.

The terms were conveyed to Khun Sa after he relayed his
offer to surrender through a Burmese army divisional commander.

The source rejected as "total rubbish" international news
reports that the military government in Rangoon had accepted
10 of Khun Sa's demands, including a full amnesty.

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

NATION: MON REBELS COOL TO JUNTA'S ECONOMIC OFFERS
February 7, 1996

SANGKHA BURI - Burma's ethnic Mon guerrilla movement is
taking "a cautious view" concerning economic offers made by
the ruling Burmese junta after both sides struck a ceasefire
agreement last June.

In an interview on Feb 4, Mon National Day, a senior leader
of the New Mon State Party (NMSP) said that it was pressure
from Thailand that forced them to enter into dialogue with
the Burmese military rulers.

Thailand had pushed for armed ethnic groups living along the
Thai-Burmese border to enter ceasefire negotiations with the
Slorc because of the "vast and ever-increasing economic
benefits for itself in commercial engagements with the
Burmese dictatorship", he said.

"Pressure. Pressure from our neighbour (Thailand) ..... to
facilitate trade, Thailand wanted to see its indigenous
neighbours in Burma at peace with the Slorc," said the
senior NMSP leader who asked that his identity not be disclosed.

He criticized the Slorc, saying that their
"Burmanization Policy" has failed to eliminate the desire
for self-determination by all the ethnic nationalities in
the country or " to win the hearts and minds of the Burmese
(Burman) , especially of the new generations". Burman is the
majority ethnic race in the country.

He rejected the idea that it was another victory for Slorc
when it struck a truce with the NMSP on June 29 last year,
saying that the event, in fact, meant Rangoon accepted the
Mon people's desire for self-determination.

"On the contrary, it means the Burmese Army has had to come
to terms with the NMSP and has accepted as legitimate the enduring
aspirations of the Mons to achieve self-determination," he said.

Slorc, he said, has tried to appease various armed ethnic
groups including the Mons by economic concessions.

But the NMSP "is in fact taking a cautious view", as Slorc's
decision to allow them to engage in sea trade with Singapore
and Malaysia "was only compensation for the revenue we have
agreed to stop collecting (in the form of taxes from people
passing through Mon territory)".

He rejected recent media reports that the NMSP supreme
leader, Nai Shwe Kyin, was excited by the ceasefire and
economic concessions given by Slorc.

"It is certainly not true as published in some reports that
Nai Shwe Kyin is excited about our future.

"Like most of our leaders, he hopes for the best but is
prepared for the worst," he said.

He contended that the ceasefire was only "a temporary peace"
and insisted that all ethnic nationalities in Burma believed
"in the absolute necessity of political reform".

Asked about the fate of about 18,000 Mon refugees taking
shelter along the Thai-Burmese border opposite Thailand's
Kanchanaburi and Prachuap Khiri Khan provinces, he said all
would return and be resettled.

He said a request for the UNHCR to monitor the resettlement
of the refugees "has met with silence from Slorc".

Therefore, the NMSP wanted to appeal to the American people,
their Congress and their administration "for assistance,
through existing relief channels in Thailand, for basic
necessities and medicine for those Mon resettling" and for
the 160,000 other Burmese victims taking refuge along the
common border. (TN)

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

BKK POST: SOLDIERS ARE THERE TO HELP
February 6, 1996

Burma aims for US$36-40m windfall from 200,000 visitors
Report: Nussara Sawatsawang and Supapohn Kanwerayotin,
Rangoon

Gun-toting soldiers patrol Heho airstrip in Shan State and
roam markets in Taunggyi and Kalaw. They also guard the
Ministry of Hotels and Tourism headquarters in Rangoon.

Hotels and Tourism Minister Kyaw Ba, donning uniform for the
interview, said the pervasive militarist presence would
ensure safety and security for about 200,000 visitors
expected in Burma this year.

The State Law and Order Restoration Council, a military
regime that has ruled Burma since 1988, has designated 1996
Visit Myanmar Year. The authorities expected tourism-related
spending to reach US$36-40 million this fiscal year which
begins in April and lasts until March next year, Lt-Gen Kyaw
Ba told Inside Indochina. The figure excludes hotel
earnings.

Owing to inadequate infrastructure such as international
flight connections, hotel rooms, transport and service
personnel, the authorities have reduced the original target
of 500,000 visitors to a more realistic 200,000. "Our target
is 500,000 but international airlines cannot meet that
capacity," Lt-Gen Kyaw Ba said.

Besides, airports in Burma cannot cope with big aircraft. As
a result, the government is stepping up airport expansion
moves and negotiating with international flag carriers with
a view to receiving more visitors. Burma's Transport
Ministry is holding talks on opening flights into Burma by
major international airlines including Lufthansa, Air
France, Japan Airlines, All Nippon Airways and Korean Air.

"Agreements are most likely to be clinched this year with
the two Japanese airlines. If all these negotiations go
through, we will be able to receive as many as one million
visitors a year," Lt-Gen Kyaw Ba said.

Bangkok and Singapore are the key entry points of
international flight connections to Burma, served by Thai
Airways International which operates 10 flight a week,
Burma's national flag carrier Myanmar Airways International
and Singapore's SilkAir.

The Japanese top the list of foreign visitors to Burma last
year, accounting for 14% of total arrivals, according to
official statistics. Behind the Japanese are the Koreans,
Taiwanese, Singaporeans and the Thais. From Europe, Burma
has seen an increasing number of French, German, Italian and
British travellers.

In tandem with efforts to increase the number of
international flights are expansion of airports and the
opening up of more destinations inside Burma that were
previously off-limits such as the states of Kachin and
Kayah, as well as the Sino-Burmese border region.

Travel to these areas still requires package tour purchase
and permits. "Some tourists can instigate trouble and spread
misinformation in the areas. We have to maintain stability,
and security remains a key concern to us," the minister
said.

The military government is renovating the airport in the
northern commercial centre of Mandalay and building a new
one in the historic town of Pegu, which requires a two-and-
a-half hour drive along a bumpy dirt-track although it is
only 60 kilometres from Rangoon.

In Mandalay, Italian-Thai Development Plc of Bangkok is
carrying out the contract it inherited from a Singaporean
firm to build a new runway that can accommodate jet
aircraft. With the runway to be completed in two years, the
Burmese government is seeking foreign investment to build a
new terminal.

Apart from foreign tourists and investors, Rangoon is
courting the United Nations Educational, scientific and
Cultural Organisation in a bid to revitalise ties that Burma
allowed to lapse last year.

"We have now decided to co-operate with UNESCO. We are
holding talks so UNESCO an help conserve archaeological
heritage sites such as Pagan and the Bayinnaung Palace in
Pegu," Lt-Gen Kyaw Ba said, adding Burma planned to seek
World Heritage Site status for pagoda-dotted Pagan, which
has become a key tourist destination.

promoting Burma to the world travel industry requires a big
effort, as Gen Ne Win, the country's strongman, closed the
country for three decades starting in 1962.

The State Law and Order Restoration Council plans to spend
up to eight million kyat (about 32.5 million baht at the
official exchange rate) this year, mostly to produce
promotional materials depicting the country as a tourist
destination.

"Most people I met in American mistook my country for
Bahamas. As they'd say, Bahamas?" said U Htay Aung of the
Directorate of Hotels and Tourism of an experience while
studying for a master's degree at George Washington
University.

Slorc, which seized power in 1988 and suppressed the pro-
democracy movement, renamed the country Myanmar, reasoning
that Burma was a misnomer coined by British colonialists.

Burma has an agreement with Singapore for the city state to
assist in tourism promotion. The Tourism Authority of
Thailand has offered similar cooperation but so far no
formal agreement has been reached.

Despite the increasing dynamism of the tourism sector,
Burma's government has no plans to open up the country in
every aspect for independent travel. Two rules that stay in
force for now are visa requirements to safeguard security,
and the compulsory purchase of a "foreign exchange
certificate" for $300 by tourists not buying package tours.
This guarantees foreign exchange earnings.

The government has no plan to abolish this requirement, Lt-
Gen Kyaw Ba said. "IN the past, some tourists could cover
their weeklong expenses of travelling in the country by
selling two bottles of whisky and two cartons of cigarettes
on the black market. That's why we introduced the compulsory
exchange rule, which we are going to maintain," he said.

To boost Visit Myanmar Year, the government has lowered the
tourist visa fee from 470 to 250 baht and can process
applications within a day. Visas on arrival are granted only
to pre-arranged package tours and tourists arriving on
cruise ships and charter flights.

"We are taking a little more time to ponder further
relaxation of visa rules," Lt-Gen Kyaw Ba said, claiming
that some "people who have a negative attitude" toward
Rangoon might sneak in to "create trouble" if immigration
regulations were liberalised. (BP)
