------------------------ BurmaNet ------------------------ "Appropriate Information Technologies, Practical Strategies" ---------------------------------------------------------- The BurmaNet News: October 18, 1995 Issue# 254 Noted in Passing: Another objective is to unswervingly accomplish the aim of the Tatmadaw (military) to be able to participate in the leadership of the future state. - Lt. Gen. Tin Oo, Second Secretary of the SLORC (quoted in: BKK POST: BURMA JUNTA TO CONTINUE NATIONAL LEADERSHIP) HEADLINES: ========== INDEPENDENT LETTER: FORCED LABOUR DEBATE REUTER: U.N. RIGHTS OFFICIAL STILL HOPES FOR BURMA TALKS PRESS RELEASE: STATEMENT BY BRIG GEN WIN TIN AT WB/IMF NATION: BURMA AMONG MOST PEACEFUL COUNTRIES, ASSURES SLORC BKK POST: THREE NATIONS SWAP BORDER PACT BKK POST: BID FOR NEW START WITH BURMA BKK POST: OVERVALUED KYAT POSES BIG RISK FOR INVESTORS BKK POST: BURMA JUNTA TO CONTINUE NATIONAL LEADERSHIP --------------------------------------------------------- Produced with the support of the Burma Information Group (B.I.G) and the Research Department of the ABSDF {MTZ} The BurmaNet News is an electronic newspaper covering Burma. Articles from newspapers, magazines, newsletters, the wire services and the Internet as well as original material are published. The BurmaNet News is e-mailed directly to subscribers and is also distributed via the soc.culture.burma and seasia-l mailing lists and is also available via the reg.burma conference on the APC networks. For a free subscription to the BurmaNet News, send an e-mail message to: majordomo@igc.apc.org In the body of the message, type "subscribe burmanet-l" (without quotation marks) Letters to the editor, comments or contributions of articles should be sent to the editor at: strider@igc.apc.org ------------------------------------------------------------- INFORMATION ABOUT BURMA VIA THE WEB AND GOPHER: Information about Burma is available via the WorldWideWeb at: FreeBurmaWWW http://sunsite.unc.edu/freeburma/freeburma.html [including back issues of the BurmaNet News as .txt files] BurmaWeb: http://www.uio.no/tormodl Burma fonts: http://www.cs.bham.ac.uk/~lka/burmese-fonts/moe.html Ethnologue Database(Myanmar): http://www-ala.doc.ic.ac.uk/~rap/Ethnologue/eth.cgi/Myanmar TO ACCESS INFORMATION ABOUT BURMA VIA GOPHER: gopher csf.colorado.edu. Look under the International Political Economy section, then select Geographic Archive, then Asia, then Burma. ---------------------------------------------------------- BURMANET SUBJECT-MATTER RESOURCE LIST BurmaNet regularly receives enquiries on a number of different topics related to Burma. If you have questions on any of the following subjects, please direct email to the following volunteer coordinators, who will either answer your question or try to put you in contact with someone who can: Arakan/Rohingya/Burma- Michael W. Charney: GoMaha@aol.com Bangladesh Border Campus activism: tlandon@ewu.edu Boycott campaigns: [Pepsi] wcsbeau@superior.ccs.carleton.ca Buddhism: Buddhist Relief Mission: brelief@gol.com Chin history/culture: plilian@asc.corp.mot.com Fonts: tom@cs.colgate.edu History of Burma: zni@students.wisc.edu Kachin history/culture: 74750.1267@compuserve.com Karen history/culture: Karen Historical Society: 102113.2571@Compuserve.com Mon history/culture: [volunteer needed] Naga history/culture: Wungram Shishak: z954001@oats.farm.niu.edu Burma-India border [volunteer needed] Pali literature: "Palmleaf": c/o burmanet@igc.apc.org Shan history/culture: [volunteer needed] Shareholder activism: simon_billenness@mail.cybercom.net Tourism campaigns: bagp@gn.apc.org "Attn. S.Sutcliffe" World Wide Web: FreeBurma@POBox.com Volunteering: christin@ksc.net.th [Feel free to suggest more areas of coverage] ************************ INDEPENDENT LETTER: FORCED LABOUR DEBATE by Bertil Lintner October 4, 1995 I have been following with great interest the debate between Nicholas Greenwood and Wilhelm Klein re. forced labour in Burma. Without taking sides in this debate, I think we have to clear up certain legal issues. The argument that "the 1908 Villages and Towns Act which permits village councils to order citizens to work as forced laborers" is always used by the Burmese government to justify the use of forced labour. But, as so much else the Slorc claims, it is not based on reality. That old act gives the village councils the right to impose "compulsory service for public purposes without any discrimination on grounds of birth, race, religion and class." This is a far cry from the massive use of forced labour which has become a plight and a burden for people across Burma today. In fact, the use of forced labour violates Burma's first, 1947, constitution (which is above any act enacted in 1908, even if that act said what the Slorc claims it does). Article 19 section (ii) of that constitution stipulates very clearly: "Forced labour in any form and involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall be prohibited." Again, I do not wish to take sides in this debate, but we need to get the facts right. Bertil Lintner Bangkok ******************* REUTER: U.N. RIGHTS OFFICIAL STILL HOPES FOR BURMA TALKS October 17, 1995 RANGOON, Oct 17 (Reuter) - The U.N. special rapporteur on human rights in Burma, Yozo Yokota, said on Tuesday he was hopeful Rangoon's military government would begin talks with the pro-democracy opposition led by Aung San Suu Kyi. Yokota, speaking to reporters at the end of a 10-day fact finding mission to Burma, said he had been encouraged in his talks with both the military and the opposition. ``Dialogue is not terminated. It's still waiting for an opportunity. I'm hopeful that something will appear in the near future,'' he said. Yokota met Suu Kyi, released from six years' house arrest in July, twice during his visit. He also had talks with senior officials of the ruling State Law and Order Restoration Council (SLORC), including military intelligence chief Lieutenant-General Khin Nyunt. ``I'm very much encouraged by the fact that both the SLORC and Daw Aung San Suu Kyi are still showing their willingness to restart, or continue their dialogue,'' he said. Suu Kyi, a Nobel Peace Prize winner, met SLORC chairman General Than Shwe and Khin Nyunt for the first time in September last year, while she was still in detention. She met Khin Nyunt again the following month. Neither Suu Kyi nor the SLORC has released any details of those two meetings. Since her July release she has made repeated calls for talks between the military and the pro-democracy and ethnic minority opposition. The SLORC has yet to make any public response to her calls. However, it told a visiting U.S. official that the government was considering talks. ********************************* PRESS RELEASE: STATEMENT BY BRIG GEN WIN TIN AT WB/IMF October 12, 1995 Statement by His Excellency Brigadier General Win Tin, Minister, Ministry of Finance and Revenue, Union of Myanmar, Governor of the Bank and the Fund for MYANMAR, at the Joint Annual Meetings Boards of Governors of the World Bank Group and the International Monetary Fund Washington, D.C. Press Release No.33 October 10-12, 1995 It gives me great pleasure to be privileged to address the Fiftieth Annual Meetings of the Governors of the Fund and the Bank. I wish to express my deep regret on the passing away of the former World Bank President, Mr. Lewis Preston. He will be long remembered for his dedicated services to the Bank. I also wish to extend my congratulations and warm welcome to the new President, Mr. James Wolfensohn and wish him all success in the important tasks ahead. I would like to join other Governors in welcoming Brunei Darussalam as a new member of the Bretton Woods Institutions. I wish to begin with a brief look at the world economy, which indicate encouraging trends in many aspects. Real GDP continued to rise since 1991, with inflation on the decline, this trend is more pronounced in the developing countries. Recently, slowing pace of economic expansion in the industrial countries and possible overheating in a number of developing countries may be observed. However, problems remain and challenges need to be addressed. We are also reminded of the haunting memory of the Mexican crisis, which rudely awoke us to the bitter lesson of how investor sentiment can upset the expected benefits from financial markets' liberalisation. Another lesson is the need for timely effective policy adjustments before being forced into action by the market. We therefore endorse a proactive role of the Bank and the Fund in surveillance and in assisting and advising developing countries in the management of capital inflows. Over the years we have seen the revolving role of the Fund and the Bank, to meet the demand for their services. Their financial involvements have increased manifold with comparable benefits accruing to the recipient member countries. But, we are concerned over the prospect of a fall and the growing sentiments against official development assistance among donors. We followed with keen interest on how the Fund and Bank have taken pains in attending to the needs of the countries in transition. We whole-heartedly community continue to support the transition process in those countries that implement and persevere with appropriate stabilization and reform policies". Although we appreciate this Fund's idea, we wish to remind the international community that these countries faced different circumstances and adapt their support with flexibility to enhance aid effectiveness. At the same time we urge the donor governments to adopt a more global view and take actions to increase official flows. Let me now turn to the Myanmar economy. Myanmar has overcome the stagnation and low growth in the aftermath of the 1988 disturbances and is now on a steady growth path. The four year plan from FY93 to FY96 has been formulated and implemented to accelerate the rate of economic development with the aim of building a new, modern, developed nation. In the first three years, growth rates of 9.7 percent, 5.9 percent and 6.8 percent, respectively, were realised, exceeding the projected growth rates for these years. This economic progress is attributable to the reform measures undertaken. Decontrolling of prices, encouraging private sector development, allowing direct foreign investments, removing some of the restrictions on foreign exchange transactions, improving and enhancing tax administration and allowing farmers to cultivate crops of their choice are the salient measures amongst others. Foreign investments surged, and at the end of August 1995, foreign investments approved amounted to U.S.$ 3 billion. Sector-wise, foreign investment i ign investors in Myanmar as of August 1995, are from U.K., France, Singapore, Thailand, Malaysia, U. S and Japan. Myanmar is bending its efforts for the development of its forestry sector. Like others, we wish to give priority considerations to environmental concer to further our forestry production. The progress we have made so far has not, however, blunted our awareness of the fact that much remains to be done. Like other countries in transition, have taken steps in all these areas. In our efforts to establish national reconsolidation, priority has been given to the development projects of the national races residing in the far-flu acilities, information services including television and electricity were provided and basic needs of the local national races were fulfilled and their standar velopment project. As a result of these substantial investments intended for long term benefits, together with other heavy expenditures for infrastructure developments, we The past half century has witnessed the impressive contribution that the Fund and the Bank have made to the social and economic development of their me r their services and we are confident that the twin institutions will come up with an even better performance. What these two institutions managed to achieve s In looking ahead to meet the challenges of the future, the Fund and the Bank will need to evolve according to the demands of a changing world. In this would like to join other members in pledging our cooperation and support for these two institutions in their task ahead to forge a better world for all of us. ===============to find out more information=============== go to Myanmar Home Page at URL: http://myanmar.com/myanmar/ ========================================================== **************************** THE NATION: BURMA AMONG MOST PEACEFUL COUNTRIES, ASSURES SLORC MAN October 17, 1995 Associated Press Burmese officials called here yesterday for more foreign investment in the country's growing tourism industry and slammed the international press for allegedly Brig Gen Tin Aye, deputy minister for hotels and tourism in Burma's military government, told prospective investors in the travel industry that his country was "It is absolutely safe and enjoyable to travel in Myanmar and we invite everyone to come and see it," he told a seminar aimed at generating greater Singapore i The country, renamed Myanmar by the armed-led State Law and Order Restoration Council which seized power in 1988, aims to welcome 500,000 tourists in 1996, whi The council has been an international outcast for crushing a pro-democracy movement and alleged human rights abuses against dissidents and minorities, but has Last July, it released opposition leader Aung San Suu Kyi from six years of house arrest. The general outlined tourism investment incentives, including 100 per rantees against nationalization and free repatriation of profits. He said tourism would have expanded faster were it not for "foreign media exaggerating about the insurgency and the distorted news of the actual situation in t But he admitted that transport bottlenecks were a problem. "Our major constraints are the airport and terminals and runways," he said, but added that pressure rports being built near the ancient towns of Bago and Mandalay. U Naing Bwa, deputy director general of the ministry of hotels and tourism, told the seminar that the maximum number of people who can be flown by four airline Negotiations are underway for more airlines to open flights by next year, he said. He also noted that tourists can now travel overland from Yunan, China and Th The officials appealed for more capital from Singapore, which has committed more than US$ 500 million to projects in Burma, mostly in tourism, making it the se ===== item ===== BKK POST: THREE NATIONS SWAP BORDER PACT October 17, 1995 Laos, Burma and China exchanged copies of their ratified border agreement at a ceremony attended by Laotian Deputy Foreign Minister Phongsavath Boupha and the The Laotian government considers the agreement to reflect "strong determination and sincerity of the three countries about their sovereignty and land" and to b t year. (BP) ******************************************** BKK POST: BID FOR NEW START WITH BURMA Chetha urges both sides to forget the past October 17, 1995 Report: Nusara Thaitawat, Sermsuk Kasitipradit and Wasana Nanuam " Thailand and Burma must start over. If we continue to refer to the past, we will find fault on both sides and it will never end. We must be firm in our deter This prescription to cure ailing relations between Thailand and Burma comes from newly-appointed Deputy Army commander Gen Chetha Thanajaro. He has been in cha n and the assistant commander under Gen Wimol Wongwanich. Both sides have voiced discontent and have thrown accusations at each other. They have also made promises. "Now it's time for action," said Gen Chetha, who too Officially visiting Burma first among Thailand's neighbours early last month, Deputy Prime Minister and Defence Minister Gen Chavalit Yongchaiyudh sought to st "However bad the situation may be, if the leaders are still talking, then the situation is bound to improve, more or less," Gen Chetha said. He said old links ers on the other created a friendly atmosphere for talks. "They wanted to talk directly to fellow military (leaders)," he said. For decades, the main problem between the two neighbours has been ethnic minorities which Thailand has given sanctuary to some of these ethnic minorities and, in the past, has also facilitated the delivery of supplies. The last ethnic minority still rlord Khun Sa. In more recent years, exploitation of Burma's natural resources, mainly fish and timber, as well as unfair trading, has become a tumour in relations. Gen Cheth He was referring to the shortcomings on the Thai side in cutting off all aid to minorities fighting Rangoon after pledging to do so a few years ago, and the Sl who fled from their former headquarters at Manerplaw and Kawmoora this year, among many cases. "Tit for tat, now we're even, let's start again," he said. During this year's reshuffle, the Thai Army has replaced its forces manning the border from Tak to M local level units might have developed ties with the groups over the years. Various units and task forces would be merged this year into one unit under the Third Army region, which would take sole responsibility to oversee security alo egion. "The Burmese appreciate our move. It has helped build confidence between us. We will take action against any of our men who help the minorities against Rangoon "Since we have reiterated our position to the Burmese, there has been no evidence of help to the minorities." Gen Chetha said Burma has asked Thailand "not to "Anyway, we cannot help him. He is a drug dealer and we will be condemned (by the international community) if we do." As for civilians of all minority groups, ance, including that for Khun Sa's Shans, if they fled from government attacks. "The Burmese must understand our obligations to provide humanitarian assistance to civilians fleeing from armed conflicts. "We have a standard practice for sol This called for understanding that Thailand did not mean to help any party when it sent soldiers home at another location. It could not send them back into the hands of their enemy. For the first time this year, the Slorc army has kept up its offensive encirclement of Khun Sa's forces in the Shan State during the rainy season, cutting all supply routes. The army expects these forces to be much weakened before it launches its dry seas on offensive at the end of the year or early next year. In addition to deploying a new force along the border, Gen Chetha said the Thais were ready to sign notes from a meeting of the Thai-Burmese regional Border Committee, which broke down abruptly in April when Thailand protested against Burmese forces' intr usion into Thailand to attack the Karens. Thailand had refused to follow the customary practice of signing the notes of the meeting and a courtesy call on then Army Chief Wimol Wongwanich was called off. Burma took it as a slap in the face and an indication of insincerity by the Thais because, during the meeting, it had raised a number of issues about the ethnic minorities and Khun Sa which could not be denied. Fisheries, logging and trade issues were als o raised at the meeting. "We're ready to sign the notes. The Burmese have been informed and now it's up to them when it's convenient for them to come, probably after November, after the rain," Gen Chetha said. The Army has been closely working with the Ministry of Foreign Affairs, informing it of all its moves with Burma, he said. The Army backed the Government's constructive engagement policy. "We should not interfere in the internal affairs of other countries. We must maintain relations with the government in power, if not who do we talk to. Criticism of Thailand is unfair. If we really look at where it comes from those countries with vested i nterests in Burma," he said. Gen Chetha expressed confidence the situation would improve between the two countries with both sides keeping their world. Gen Chavalit's visit has laid the foundation. Shophouses which encroached on the Moei river, the natural border between the two countries, are being demolished and construction of the Thai-Burmese Friendship Bridge is expected to resume soon. Gen Chetha believes it will take more time before the border is reopened for trade as Thailand need to continue the policies it told Burma. "We know each other too well. We cannot hide from the truth, otherwise whatever we say cannot be believed," he said . (BP) ===== item ===== BKK POST: OVERVALUED KYAT POSES BIG RISK FOR INVESTORS IN BURMA October 17, 1995 Report: Nicholas Copp, Coudert Brothers, Bangkok Are you thinking about investing in Burma? The most significant problem you are likely to face is that the non-convertible and overvalued kyat literally risks turning the rewards of your profitable investment into a stack of beans. The official exchange rate of five kyats per US$1 (editor's note: the rate is 6 kyat per dollar) overvalues the kyat by almost 20 times against the black market rate. This is partly due to the fact that the kyat is pinned to the International Monetary Fu nd's Special Drawing Right programme and multi- lateral assistance to realign the kyat remains to be seen. Avoiding the official exchange rate is something of a religious exercise in Burma, but it is not always possible. Foreign investor equity contributions are required to be paid-up in foreign exchange and converted at the official exchange rate. While payments in kind are permitted, foreign investment licensing authorities have considerable discretion in fixing their value. Burmese law prohibits a company from borrowing until equity contributions are fully paid-up and requires that equity capital remains intact. Domestic borrowings may not exceed half the value of equity capital. Offshore funds are, in practice, used to finance working capital expenditure and must be deposited with a local authorised bank there are no foreign bank branches in Burma. If withdrawn in kyat, their value is converted at the official exchange rate. Foreign firms can also withdraw funds as "Foreign Exchange certificates" or FECs, which may be sold in the black market for kyat or exchanged at a decent rate, but at a slight d iscount to the US dollar rate. By far the biggest problem facing the foreign investor, however, is how to obtain US dollars in Burma. It is vitally important to ensure that one earns sufficient US dollars to fund US dollar expenditures. Having a local joint venture partner responsible for payment of local kyat expenses (such as rents, labour and local purchases) is one way to ameliorate this problem but, in practice, the government levies taxes, utility charges and other official fees in US dollars on foreign enterprises. The privilege of invoicing domestic sales in US dollars requires special permission, but it usually brings inevitable adverse tax implications and scrutiny. Successfully avoiding the official exchange rate and producing US dollars in Burma is only half th e battle won. How to repatriate earnings is yet another part of the strategic game plan you must be able to implement. Despite foreign investment law rights, Burmese authorities strictly limit capital outflows for any purpose and, in practice, this includes the repatri ation of profits, capital, debt-servicing and payment of fees and royalties. Authorities payment of withholding tax, profits tax and other deductions, hard currency profits may be repatriated. If it is at all possible, it is best to structure hard currency receivables as payments offshore to begin with. Foreign firms often use barter and counter-trade arrangements to repatriate domestic earnings which basically means buying local products for export. Unfortunately, however, the availability of exportable local products is scare and the commodities which have an offshore market (such as teak, jewels or rice) are usually tied up with government controls or made impossible by the non-availability of export permits to the foreign company. Most foreign companies, therefore, leave the export of local products to a well-connected and trusted Burmese contact or joint venture partner. If the company is incorporated in Burma, export earnings must be deposited in a domestic account; but otherwise , foreign companies may deposit counter trade earnings offshore at a national exchange rate agreed with the local contact which is factored into the contract sale price. So far so good, but there are hitches all along the way and the price of the commodity may ultimately fall in the interim period eroding real returns on your investment in Burma. You may literally end up with a stack of beans. In all cases, early tax planning, an adequate capital structure and local assistance makes the difference to a successful venture but investing in Burma is definitely not for the fainthearted. (BP) ************************ BKK POST: BURMA JUNTA TO CONTINUE NATIONAL LEADERSHIP ROLE October 17, 1995 Agence France Presse BURMA'S ARMY chief-of-staff has stressed military plans to continue to play a role in the country's political life, according to official newspapers. Lt-Gen Tin Oo, second secretary of the ruling junta known as the State Law and Order Restoration Council, made the remarks last Wednesday at a preparatory meeting where "objectives" for the next Armed Forces Day celebrations were being laid down. One objective spelled out by Tin Oo was for the military to modernise so that it would be more effective in protecting the "new emerging nation". "Another objective is to unswervingly accomplish the aim of the Tatmadaw (military) to be able to participate in the leadership of the future state," Tin Oo was quoted as saying. A national convention is set to resume deliberations next month on the framework for a new constitution which is expected to confirm a continuing role for the military in the country's government. Tin Oo said the military had overcome both external and internal machinations and had managed to bring about "national consolidation" with 15 former anti-government ethnic rebel groups. "The Tatmadaw will not let the result achieved be lost," he said. He repeated claims that "certain big nations" were meddling in Burma's internal affairs, saying: "These nations employ all available means and resort to guile and wiles on the pretext of human rights." In another development, Lt-Gen Khin Nyunt, the SLORC's first secretary, has called for an elaborate ceremony to commemorate the United Nations' 50th anniversary. Burma has regularly observed UN Day on October 24 but plans, to do it "on a grand scale" this year to "significantly express the country's fine tradition of active cooperation with the organisation," official newspapers quoted Khin Nyunt as saying. UN rapporteur Yozo Yokota is in Burma to collect facts for an annual human rights report on the country. On October 10, he met Nobel peace laureate Aung San Suu Kyi, who was released from six years of house arrest three months earlier. Yokota concludes his fact-finding mission today.