President Clinton Latter To House S

[RANGOONP@xxxxxxx]

HEADLINE: Text of Clinton Letter on  Burma  
 
CONTACT: White House Press Office, 202-456-2100 
 
DATELINE: WASHINGTON, Dec. 9 
 
 BODY: 
Following is the text of a letter from President Clinton to the Speaker of the
House of 
  
   December 9, 1997 
   Dear Mr. Speaker: (Dear Mr. President:) 
   I hereby report to the Congress on developments concerning the national 

emergency with respect to  Burma  that I declared in Executive Order 13047 of 
May 20, 1997, pursuant to section 570 of the Foreign Operations, Export 
Financing, and Related Programs Appropriations Act (the "Act") and the 
International Emergency Economic Powers Act (IEEPA).  This report is submitted
pursuant to section 204(c) of IEEPA, 50 U.S.C. 1703(c) and section 401(c) of
the
National Emergencies Act, 50 U.S.C. 1641(c).  This report discusses only
matters
concerning the national emergency with respect to  Burma  that was declared in
Executive Order 13047. 
  
   On May 20, 1997, I issued Executive Order 13047 (62 FR 28301, May 22,
1997), 
effective on May 21, 1997, to declare a national emergency with respect to 
 Burma  and to prohibit new investment in  Burma  by United States persons, 
except to the extent provided in regulations, orders, directives, or licenses 
that may be issued in conformity with section 570 of the Act.  The order also 
prohibits any approval or other facilitation by a United States person,
wherever
located, of a transaction by a foreign person where the transaction would 
constitute new investment in  Burma  prohibited by the order if engaged in by
a 
United States person or within the United States.  This action was taken in 
response to the large-scale repression of the democratic opposition by the 
Government of  Burma  since September 30, 1996.  A copy of the order was 
provided to the Congress on May 20, 1997. 
   By its terms, nothing in Executive Order 13047 is to be construed to
prohibit
the entry into, performance of, or financing of a contract to sell or purchase
goods, services, or technology, except: (1) where the entry into such contract
on or after May 21, 1997, is for the general supervision and guarantee of 
another person's performance of a contract for the economic development of 
resources located in  Burma;  or (2) where such contract provides for payment,
in whole or in part, in (i) shares of ownership, including an equity interest,
in the economic development of resources located in  Burma;  or (ii) 
participation in royalties, earnings, or profits in the economic development
of 
resources located in  Burma.  
  
   The prohibitions of Executive Order 13047 apply to United States persons, 
defined to include U.S. citizens and permanent resident aliens wherever they
are
located, entities organized under U.S. law (including their foreign branches),
and entities and individuals actually located in the United States.   The 
sanctions do not apply directly to foreign subsidiaries of U.S.  firms,
although
foreign firms' activities may be affected by the restriction on United States 
persons' facilitation of a foreign person's investment transactions in  Burma.
  
   The term "new investment" means any of the following activities, if such an
activity is undertaken pursuant to an agreement, or pursuant to the exercise
of 
rights under such an agreement, that is entered into with the Government of 

 Burma,  or a nongovernmental entity in  Burma,  on or after May 21, 1997: (a)
The entry into a contract that includes the economic development of resources 
located in  Burma;  (b) the entry into a contract providing for the general 
supervision and guarantee of another person's performance of a contract that 
includes the economic development of resources located in  Burma;  (c) the 
purchase of a share of ownership, including an equity interest, in the
economic 
development of resources located in  Burma;  or (d) the entry into a contract 
providing for the participation in royalties, earnings, or profits in the 
economic development of resources located in  Burma,  without 
  
   Since the issuance of Executive Order 13047 on May 20, 1997, the Department
of the Treasury's Office of Foreign Assets Control (OFAC), acting under 
authority delegated by the Secretary of the Treasury, has implemented
sanctions 
against  Burma  imposed by the order.  During the current 6-month period, OFAC
issued several determinations with respect to transactions provided for by 
agreements and/or rights pursuant to contracts entered into by United States 
persons prior to May 21, 1997.  One license was granted authorizing a United 
States person's disinvestment in  Burma,  since this transaction necessarily 
facilitated a foreign person's investment in  Burma.  
  
   On May 21, 1997, OFAC disseminated details of this program to the
financial, 
securities, and international trade communities by both electronic and 

conventional media.  This included posting notices on the Internet and on 10 
computer bulletin boards and 2 fax-on-demand services, and providing the 
material to the U.S. Embassy in Rangoon for distribution to U.S. companies 
operating in  Burma.  
  
   In addition, in early July, OFAC sent notification letters to approximately
50 U.S. firms with operations in or ties to  Burma  informing them of the 
restrictions on new investment.  The letters included copies of Executive
Order 
13047, provided clarification of several technical issues, and urged firms to 
contact OFAC if they had specific questions on the application of the
Executive 
order to their particular circumstances. 
  
   The expenses incurred by the Federal Government in the 6-month period from 
May 20 through November 19, 1997, that are directly attributable to the
exercise
of powers and authorities conferred by the declaration of a national emergency
with respect to  Burma  are estimated at approximately $300,000, most of which
represent wage and salary costs for Federal personnel.  Personnel costs were 
largely centered in the Department of the Treasury (particularly in the Office
of Foreign Assets Control, the Office of the Under Secretary for Enforcement, 
and the Office of the General Counsel), and the Department of State 
(particularly the Bureau of Economic and Business Affairs, the Bureau of East 
Asian and Pacific Affairs, the Bureau of Intelligence and Research, and the
Office of the Legal Adviser). 
  
   The situation reviewed above continues to represent an extraordinary and 
unusual threat to the national security, foreign policy, and economy of the 
United States.  The declaration of the national emergency with respect to 
 Burma  contained in Executive Order 13047 in response to the large-scale 
repression of the democratic opposition by the Government of  Burma  since 
September 30, 1996, reflected the belief that it is in the national security
and
foreign policy interests of the United States to seek an end to abuses of
human 
rights in  Burma,  to support efforts to achieve democratic reform that would 
promote regional peace and stability and to urge effective counternarcotics 
policies. 
  
   In the past 6 months, the State Law and Order Restoration Council (SLORC)
has
shown no sign of willingness to cede its hold on absolute power.  Since
refusing
to recognize the results of the free and fair 1990 elections in which the 
National League for Democracy won a vast majority of both the popular vote and
the parliamentary seats, the ruling junta has continued to refuse to negotiate
with pro-democracy forces and ethnic groups for a genuine political settlement
to allow a return to the rule of law and respect for basic human rights.
Burma 
has taken limited but insufficient steps to counter narcotics production and 
trafficking. 

   The net effect of U.S. and international measures to pressure the SLORC to 
end its repression and move toward democratic government has been a further 
decline in investor confidence in  Burma  and deeper stagnation of the Burmese
economy.  Observers agree that the Burmese economy appears to be further 
weakening and that the government has a serious shortage of foreign exchange 
reserves with which to pay for imports.  While  Burma's  economic crisis is 
largely a result of the SLORC's own heavy-handed mismanagement, the SLORC is 
unlikely to find a way out of the crisis unless political developments permit
an
easing of international pressure.  I shall continue to exercise the powers at
my
disposal to deal with these problems and will report periodically to the 
Congress on significant developments. 
  
   Sincerely, 
   WILLIAM J. CLINTON 
 
LANGUAGE: ENGLISH 
 
LOAD-DATE: December 9, 1997