The BurmaNet News - 11 February, 19

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"Appropriate Information Technologies, Practical Strategies
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The BurmaNet News, 11 February, 1998
Issue #932

Noted in passing:
"The combination of a sinking economy, a large, badly-paid army and a
tradition of warlordism could lead to a break-up of the country into a
number of fiefdoms run by regional commanders or ethnic chiefs."
-- David Arnott (see RELATIONS INTERNATIONALES ET STRATGIQUES: ONCE THE
RICE-BOWL OF ASIA - Part One)

HEADLINES:
==========
ABSDF MEDIA RELEASE: 8,000 PROTEST OVER WORKERS' RIGHTS
BKK POST: CHETTHA TO DISCUSS FISHERIES AND BORDER
BKK POST: PROTESTS HAVE COME TOO LATE, SAY CHUAN
XINHUA NEWS: MYANMAR INTRODUCES ECOTOURISM
RELATIONS INTERNATIONALES ET STRATGIQUES: ONCE

Human Rights Reports
TACDB: SITUATION REPORT (REF: BU.MAH.0001 5/97.)
THE GOVERNMENT OF KARENNI: SITUATION REPORTS
KNU PRESS RELEASE NO. 2/98: HUMAN RIGHTS VIOLATIONS
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----
       
ABSDF MEDIA RELEASE: 8,000 PROTEST OVER WORKERS' RIGHTS 
AT BURMA'S LARGEST MINE
10 February, 1998
                                                                     
More than 8,000 workers and their families staged a protest last
week at Burma's largest mine near Lashio in northern Shan State,
demanding better wages and conditions, according to local
sources. 
  
Workers from Nanmatu silver mine near Lashio in eastern Burma,
held the protest early in the morning on Monday 2 February.
Nanmatu silver mine is the biggest mine in Burma employing more
than 3,000 workers and is operated by the State Peace and
Development Council's (SPDC) Ministry of Mining.
  
Sources in Shan State say mine workers have become impatient with
low wages, poor conditions, lack of workers' rights, high
inflation, and their inability to afford basic goods.
  
The miners say they are forced to work from 6:30 in the morning
to 5:00 in the evening in order to fulfill government quotas.
  
The sources say that the miners are also angry because while they
and their families face many hardships, army security personnel
who guard the mine are fully provided for by the SPDC. 
  
During the protest the miners made eleven demands:
1. that rice is sold at same price given to civil servants
2. that enough rice is sold, instead of being rationed out 
3. that the authorities increase underground wages
4. that the authorities pay for sick leave and work-related       
   injuries
5. that the Medical Pension Inspection Board is abolished
6. that workers get a substitute holiday if they have to work on  
   Sunday
7. that salaries are raised for those in charge of underground    
   units
8. that the authorities pay 150 kyat per ton, instead of the      
   current 'piece-work' system 
9. that the authorities repair the workers' accommodation
10. that workers are allowed to meet with the Mining Minister     
    when he visits
11. that workers are allowed to meet with the township initiative 
    delegation.
  
Some 21 local workers met for four hours with mining officials
and the commander of Light Infantry Battalion No. 324 to settle
the dispute. According to local sources, the Mining Ministry and
the  Northeast Military Command Headquarters agreed to solve the
rice problem in order to prevent further protests. The workers
say the mining authorities have moved bars of pure silver from
the mine office to a safer place.
  
All Burma Students' Democratic Front
For further information please call 01 654 4984.

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

BKK POST: CHETTHA TO DISCUSS FISHERIES AND BORDER
DISPUTE IN BURMA
10 February, 1998

The army chief will raise a joint fisheries proposal and
territorial disputes with Burmese authorities during his visit to
Rangoon early next month.

The fisheries proposal has been worked out by the Agriculture
Ministry and is expected to be submitted to Gen Chettha
Thanajaro today,, army sources said yesterday.

Gen Chettha is expected to meet U top Burmese leaders- Gen Maung
Aye and Lt-Gen Khin Nyunt- and thank them for helping defuse
border tensions which arose late last month in Tak.

Burmese and Thai troops came close to a clash when Burmese
authorities threatened to send forces to drive off Thai soldiers
based on a 340 rai islet, which has been cut off from; mainland
in Ban Mae Kone Kane by erosion.

The troops have been deployed on  the islet to protect Thai
villagers who were reportedly intimidated by Burmese soldiers.

The talks between Gen  Chettha and top Burmese leaders will seek
to settle the border disputes, the sources said. 

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

BKK POST: PROTESTS HAVE COME TOO LATE, SAY CHUAN
10 February, 1998 [abridged]
by Suebpong Unnarat & Wasant Techawongtham

GOVERNMENT BOUND BY DEAL WITH BURMESE

Attempts to halt the Thai-Burmese gas pipeline have come too
late, the prime minister said yesterday. The government can do
nothing but abide by contracts signed with Burma.

Chuan Leekpai's statement came the same day that Anand
Panyarachun agreed to chair a "public information" committee to
sort out differences on the details of the project, according to
Pibhop Dhongchai, a leading project opponent.

Mr Chuan said the project undertaken by the Petroleum Authority
of  Thailand must continue to completion in the interests of the
nation.

"PTT has to follow agreements made with its partners," he said.
"The government cannot order the project to stop. We considered
things were over the moment the contracts were signed."

Mr Pibhop, secretary-general of Campaign for Popular Democracy,
expressed dismay at Mr Chuan's statement, accusing him of
undermining attempts to settle the long-running dispute. 
     
"Mr Chuan's statement will cause some problems. Our groups will
discuss whether we can accept it," Mr Pibhop said. He accused Mr
Chuan of having undermined similar negotiations several times in
the past, including the recent talks among legal experts from the
opposition, PTT and the government to consider conflicting claims
over possible penalty if the project was delayed.

Mr Pibhop said Mr Chuan "whispered to PTT to proceed with the
construction even while the talks were in session".

Representatives of PTT and project opponents met yesterday to try
to agree on conditions of the public information process aimed at
revealing relevant information to the public.

The two sides have also agreed to a halt in the pipeline laying
for 10 days at Huay Khayeng forest between pipeline markers 18-28
where a group of opponents has camped out to block construction.

But at press time, they were still discussing a work stoppage at
another location at Dan Makham Tia where disputes between local
people and PTT remain unresolved, Mr Pibhop said.

"I wish that Mr Chuan would not close the door on the process to
consider the damage from the project   he said. "I wish he would
sincerely listen to the people through a public hearing, not
through a public threatening tactic."

Mr Chuan, meanwhile, promised he would ensure that PTT reafforest
areas where trees would be cut to make way for construction.

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

XINHUA NEWS: MYANMAR INTRODUCES ECOTOURISM
10 February, 1998

YANGON - Myanmar has introduced ecotourism in an effort to 
promote tourism without harming the nature by opening a mountain
resort in the Kyaukpadaung area, Mandalay Division. 

The 232-square-kilometer Popa Mountain Resort, which was
inaugurated Monday, is a forest reserve and a famous historical
landmark, Myanmar Minister for Forestry U Aung Phone was quoted
by Tuesday's The New Light of Myanmar as saying. 

The establishment of the resort and ecotourism services is to enable
tourists to study the significant features of the region and increase
the income of the local people, the minister said at the opening
ceremony. 

The resort with eight rest houses, undertaken by the Woodland Travels
Co. Ltd., is the only green place in the arid region, he noted. 

Meanwhile, to promote its tourism industry, Myanmar has opened some
islands including the Thahtay Island in Kawthaung to foreign investors to
build resorts. A resort hotel, the first of its kind, was already built and
opened by the Andaman Club Co.Ltd. of Thailand on the Thahtay
Island in November 1995. 

According to official statistics, tourist arrivals in Myanmar reached 168,787
in the first eight months of 1997, a 10.7-percent increase over a year
earlier. 

The data also show that foreign investment in Myanmar's hotel and
tourism sector stood at 763 million U.S. dollars in 39 permitted projects
at the end of 1997, out of a total foreign investment of 6.6 billion
dollars in the country.

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

RELATIONS INTERNATIONALES ET STRATGIQUES: ONCE
THE RICE-BOWL OF ASIA - Part One
Autumn, 1997
by David Arnott

The military destruction of Burma's economy (1) 
                                
PREFACE
 
This article originally appeared in French in the Autumn 1997 issue of
"Relations Internationales et Stratgiques" a journal widely read in French
government and military circles. The research and writing were done in May
and June 1997. Clearly a lot has happened in Burma since then, including
the widespread floods that destroyed a large proportion of Burma's paddy
crop, a disaster whose consequences will be seen in a few weeks at harvest
time; the re-constitution of the junta (now called the State Peace and
Development Council -- the SPDC); and the further decline of the economy
and the value of the kyat, a process exacerbated though not caused, by the
financial crises in the region.   
 
In my view the most significant feature of the reconstituted junta is that
the regional commanders, brought into the SPDC, are reported to be
retaining their commands. This may be seen as an attempt to consolidate the
different elements of the armed forces and discourage further fragmentation
of the country into fiefdoms ruled by the regional commanders and others, a
possibility touched on in this article. Power in the re-constituted junta
is also much more centralised.
 
No major revisions of the article seem necessary.  A few
alphabetically-marked updates are added to the endnotes. 
 
5 February 1998
 
------------------------------------------------------------------------ 
 
"States are weak because of the fragile nature of the civil society upon
which they have been built, their undeveloped institutional structures,
which are often unable to contain and channel political tensions, and their
problems of poverty and economic adjustment.  These weaknesses can lead to
breakdowns of law and order, to secessionist movements, to outright civil
war. The most susceptible states combine structural weaknesses with a
regime which is divisive in representing only one part of the community."
 
Lawrence Freedman, "War", Oxford 1994, p359
 
(Note: in place of italics, this Text version uses UPPER CASE for emphasis
and "inverted commas" for Burmese words and publications)
 
 ABSTRACT
The Burmese military's linked objectives, expanded military control of the
country and large-scale international investment to pay for it, are
mutually incompatible. Following their suppression of the 1988 Democracy
Movement, the generals decided to increase the size of the armed forces
from 186,000 to 500,000 in order to have a permanent military presence in
most parts of the country. This involved up to US$2 billion of arms
imports, mainly from China, a large recruitment drive and a reordering of
the military command structure.  Lacking the necessary funds to pay for
military expansion following the failure of the previous regime's economic
autarchy (and/or seeking a credible source of income to launder the
revenues from Burma's illegal exports, mainly heroin), the junta opened the
country to international investment, but the increased militarisation of
the state and the military's continued stranglehold on the main sectors of
the economy impeded the economic liberalisation and institutional reform
needed by investors. In the civil war, the enhanced capacity of the
re-armed and enlarged Burma Army allowed it to move from a strategy of
seasonal combat to one of occupation.
 
However, lack of discipline and the low level of soldiers' pay have led to
the army living off the land, destroying the local economy, carrying out
massive violations of human rights, further alienating the local population
and creating refugee flows to neighbouring countries. The combination of a
sinking economy, a large, badly-paid army and a tradition of warlordism
could lead to a break-up of the country into a number of fiefdoms run by
regional commanders or ethnic chiefs. Such a scenario should be taken
seriously by the "Tatmadaw" the neighbours and the international community.
 
INTRODUCTION
The massacres conducted by the Burmese Armed Forces (the "Tatmadaw") in
1988 led to the suspension of international aid and development assistance,
with the result that in early 1989, foreign currency reserves were reported
to be down to US$9 million. At this point the new incarnation of military
rule, the State Law and Order Restoration Council (SLORC)decided to reverse
the previous policies of isolation and neutrality and "turn to foreign
sources to obtain the means of enforcing law and order and to compensate
its major constituency, the  Tatmadaw'"(2)  The decisions in question were: 
 
1)
To seek substantial arms imports from China in order to secure military
rule by strengthening the "Tatmadaw" and further militarising the state.
This also involved a large-scale recruitment drive, significant adjustment
of the command structure of the armed forces and the reorganization and
extension of military control in districts, townships and villages. The
target was a force of 500,000 to allow a permanent military presence in
most parts of the country; 

2)
To pay for this undertaking by opening the country to international
investment. The neighbours came for fish and teak; oil companies paid for
exploration rights and SLORC sold off part of Burma's Tokyo embassy. The
quick money from these sales saved the virtually bankrupt regime from its
immediate financial problems, but there was no major investment except in
hotel building and the offshore oil and gas sector. Here, discoveries by
European and US companies of large offshore deposits of gas, which Thailand
has contracted to buy, promise substantial long-term revenues. However, the
proposed pipeline to bring the gas to Thailand crosses Karen and Mon
territory, where insurgencies still continued, thus increasing the pressure
on SLORC to end the civil war. The lack of enthusiasm on the part of
investors was due in part to the low level of human and physical
infrastructure, the continuation of the civil war, but primarily to SLORC's
refusal or inability to liberalise more than the fringes of the economy,
which remained dirigiste, with the principal sectors remaining firmly in
military hands.
 
 
These linked projects, of strengthening military rule and attracting
investment, proved incompatible.  Not surprisingly, it was the former which
prevailed; and now that the fish and teak are sold off, "Visit Myanmar 96
Year"(3)  has fallen flat, no substantial investment is in sight and the
gas revenues are not due to come on stream until 2001, the economy is once
more in crisis. The bulk of the army is hardly paid, and to a large extent,
lives off the land, further alienating the civilian population. 
 
The de facto alliance with China implied by SLORC's massive arms
acquirements and the increased Chinese presence and investment in Northern
Burma(4) and, reportedly, access to naval and electronic monitoring
facilities, is opposed by many Burmese civilians, as well as groups within
the armed forces who have spent much of their career fighting
Chinese-backed troops. Burma's growing dependence on China is also a matter
of concern to India and the ASEAN countries, which see China as a
commercial and military threat, if not now, then in a 20-
or 30-year time scale. This is one of the reasons why India and the ASEAN
countries are interested in consolidating their mutual relationship. The
invitation to Burma to join ASEAN and the newly-formed BIST-EC
(Bangladesh-India-Sri Lanka-Thailand Economic Cooperation [a]) are in part
intended to prevent Burma falling further into the Chinese sphere of
influence and thus threatening Burma's (geographical) bridge function
between ASEAN and India. An unknown factor with regional and international
implications would be China's reaction to a major disintegration in Burma.
Such a disintegration is one of the possible results of the deepening
economic crisis, combined with a large, poorly-paid and badly-disciplined
army and the tendency of the regional commanders to turn their command
areas into personal fiefdoms.
 
 THE EXPANSION OF THE ARMED FORCES (THE "TATMADAW")
In 1988 the "Tatmadaw" numbered 186,000. Following a visit to China by
Burmese defence officials in 1989, an arms deal of $1.4 billion was signed
in mid-1990, and one for $400 million in 1994. The arms thus purchased
allowed a major expansion of the armed forces, whose strength is currently
estimated at 380,000, with the stated goal of being a well-equipped force
of 500,000 by the end of the decade. SLORC's intention to establish
military control throughout the country, and thus be able to dispense with
the need to rule by consent, is indicated in the following extracts from
Andrew Selth's 1996 book, "Transforming the Tatmadaw" (5):         
 
"The first and most important priority for the SLORC after the 1988
massacres was to consolidate its grip on government.  As a longer term
goal, it was determined to put into place all necessary means to ensure
that the "Tatmadaw" would remain the real arbiter of power in Burma.  To
achieve these aims, the armed forces needed to be large enough and strong
enough to answer any future challenge to military rule.." p129  
 
"Under the rubric of "non-disintegration of the Union", the SLORC has made
renewed efforts to exert military control over the country, and turn it
into a highly centralised, ethnically Burman-dominated(6) state, commanded
by the armed forces or its servants.  On this basis, any future
distribution of power or allocation of civic responsibilities to minority
ethnic groups seems bound to be an essentially token gesture.  Real
power will continue to reside in Rangoon and be exercised through regional
military commanders and pliant civilian administrators. To ensure that this
system works effectively, and to guard against any upsurge of irredentism,
the SLORC envisages a permanent military presence in almost every part of
the country. ... the implementation of such a policy, however, demands much
greater manpower and resources."   pp132-33
 
"[T]he rapid expansion and modernisation of the armed forces after 1988
seems to have been based primarily on the fear that it might lose its
monopoly of political power.  The "Tatmadaw's" recruitment campaign and
arms procurement programme seem aimed above all else at preventing, or if
necessary, quelling, renewed civil unrest in the population centres.
Efforts to defeat ethnic insurgent groups in the countryside have also been
part of the regime's continuing determination to impose its own peculiar
vision of the modern Burmese state upon the entire country.  Yet, "BY
RELYING ON ARMED FORCE TO GUARANTEE THE COUNTRY'S UNITY
AND STABILITY, THE REGIME HAS MORTGAGED BURMA'S VAST AND DIVERSE POLITICAL
ECONOMIC AND SOCIAL RESOURCES TO CONTINUED DEPENDENCE ON MILITARY 
STRENGTH" p154 [emphasis added].
 
And of the command style of the "Tatmadaw" Selth writes: 
"...[T]he Burma Army has largely rejected its British (and British
Commonwealth) traditions and relies instead on the styles of command and
instruction which it learnt from the Japanese during the Second World War.
This approach emphasises centralised control, rigid discipline and
unquestioning obedience to orders, rather than the encouragement of
innovation and initiative, or attention to matters of personnel welfare..."
p62
 
THE STATE OF THE ECONOMY
Introduction
 
Apart from hotel construction in the cities, the military sector, and the
flourishing business in opium and heroin(7), the economy is crumbling
throughout the country. The ratio of market to official currency exchange
is now about 50 to 1(8)  and SLORC's money presses have been working
overtime (money supply has more than tripled since 1988). Rice prices have
more than quadrupled since 1988, and refugees from the Delta (the richest
rice-growing region), quote the impossibility of feeding their families as
a major reason for their flight. Light industry has been virtually
destroyed by cheap imports from China.  There is an increasing polarisation
between urban and rural areas, with reports of starvation coming from the
border regions. The hoped-for investment has not materialised, apart from
teak, fish, gas, jade and gem extraction, hotel building and and the trade
in opiates, none of which assists genuine development.  
 
The fundamental cause of these and other problems is that the structures,
priorities, ideology and lack of competence of SLORC rule are incompatible
with a modern economy and the needs of investors. Poor physical
infrastructure is one deterrent to investment; other factors are that
unlike Singapore, Indonesia and other economically successful Asian
countries,  the military has failed to institute the necessary
institutional reforms; there is a diminishing level of human
infrastructure, closely related to the lack of investment in education; and
defence spending, at an estimated 50% of Government disbursements, is both
ruinous to the economy and a major political obstacle to multilateral and
bilateral
financial assistance. 
  
A country of great promise 

Burma is a country of immense potential in terms of energy (gas and
hydro-electricity), minerals (it has large reserves of copper, gold,
tungsten, nickel, and other precious, strategic and industrial metals, in
addition to a wide variety of gems and jadeite) and agriculture (it was
once the main rice exporting country in the world); and up to a few years
ago it had the largest hardwood reserves of any country in Asia.  Of its
human resources, Khin Maung Kyi writes that "When Myanmar (then known as
Burma) attained its independence in 1948, international agencies identified
it as one of the most promising regional candidates for economic take-off.
Its modern technical and university education system, high rate of
literacy, well-trained civil service and a cadre of educated middle class,
basic infrastructure, and a well-run legal system were considered as good
ingredients for Myanmar's expected take-off."(9).  
 
The economy in a state of collapse

In 1987, after twenty-five years of incompetent military rule, Burma was
granted Least Developed Country (LDC) status by the United Nations. Japan,
Burma's major ODA donor, had halted major new projects in 1986 (two years
before the suppression of the 1988 Democracy movement) largely because, as
Donald Seekins comments: "Japan's powerful Ministry of Finance...was
increasingly concerned that more government funds not be poured into a
country that by the late 1980s was unable to pay back its foreign debt,
approximately US$5.0 billion.  Burma had sought Least Developed Country
status from the United Nations in late 1987 in order to gain shelter from
its international creditors"(10).  The Japanese Ministry of
Finance  was unwilling to countenance  "LOAN FUNDS TOSSED INTO THE BLACK
HOLE OF THE BURMESE ECONOMY ..."(11) (emphasis added)
 
The black hole is still alive and hungry.  According the Economist
Intelligence Unit's report on Burma for the 1st Quarter of 1997, "The trade
deficit soared in the first five months of 1996,  traditional exports
stagnated and imports surged.  Private-sector exports have been
languishing.  The current account deficit is likely to have widened
sharply, and reserves have slumped"(12);  the Nikkei Weekly reports that
"[a]ccording to a report released by the International Monetary Fund, the
country's foreign-currency reserves had plunged to $183 million as of
August last year [1996] from $663 million a year earlier"(13); in 1996
SLORC defaulted on its rice export commitments and on payments for oil
deliveries, and in June 1997 was reported to be putting pressure on foreign
corporations doing business in Burma to act as guarantors for loans from
foreign banks (14).
 
In this country rich in energy, minerals and agriculture, which was once
the largest rice exporter in the world,  "[a]n estimated 40 percent of the
population lives below the poverty line..."  according to the Asian
Development Bank (15),  and  "[t]he real incomes of many urban Burmese,
including government employees, have declined..."(16) 
 
Development is concentrated in the main cities

A major reason for rural impoverishment, with high levels of malnutrition,
infant and maternal mortality rates and other indicators, reported by
UNICEF and other international organisations, is the transfer of resources
to the city, either by way of draconian paddy procurement policies (17)or
by extortion by officers and men of the occupying army. See the following
section on the Civil War for other factors. 
 
Economist Stefan Collignon writes that "In terms of political economy,
there are many indications that the SLORC has attempted to pacify the
political situation after 1988 by improving the living conditions in the
cities where the potential for unrest was greatest. But if there are signs
of economic improvement, they seem to have taken place partly because of
slightly better growth, partly at the expense of rural areas. This involved
a strategic shift over the previous 
"Burmese Way to Socialism" which had achieved a remarkable degree of
equality between rural and urban living conditions: the UNDP indicator for
rural-urban disparity in access to water, sanitation and child nutrition
services (67%, 87%, 93% respectively) is significantly higher than for
other low human development countries and above the aggregated values for
LDCs and all Developing Countries."(18) 
 
In a 1997 paper for the European Institute for Asian Studies, Collignon
wrote that "Foreign visitors arriving in Burma often notice a visible
improvement in apparent signs of wealth in the major cities, particularly
Rangoon and Mandalay, since 1988.  This is manifested in the substantial
construction boom between 1988 and 1991, although it has somewhat faltered
since then.  However, as soon as one leaves the larger cities, the
situation becomes different.  Poverty is widespread and infrastructures
like roads and railways are derelict.  In fact, despite apparent
improvements, sustained economic growth is still not taking place."(19) 
  
Reasons for the low level of investment:
 
In 1989, SLORC opened the country to international investment. However, as
Khin Maung Kyi notes, "Investment laws, rather hurriedly passed in the
early stage, were followed by the formation of a few private banks and
state-sponsored  joint-venture corporations, but long-term foreign direct
investment in manufacturing or agribusiness areas has not come in.
Institutional development measures such as the establishment of a civil
service with a fair degree of efficiency and responsiveness, the legal
administration system to dispense impartial justice, and development and
training of manpower for the next phase of growth were neglected or
sidelined"(20). 
 
Collignon lists some of the major obstacles to investment --
"Economic liberalisation since 1993 has slowed down and even, at times,
been reversed:
 
* Importers are required (and receive preferential licenses) to import
designated "priority" goods in amounts equivalent to one fourth of their
total imports or more.
 * The SLORC refuses to comply with the exchange rate regime precondition
of an IMF staff monitoring program, i.e. a simple market-determined
exchange rate.
 * As the investment ratio has declined, forced prison labour and
uncompensated people's "contributions" to state construction projects have
increased (Department of State,1996) 
 * No large State Economic Enterprises (SEE) have been privatised.
 * Most SEE monopoly privileges continue to dominate Burma's economy.
 * Fundamental macroeconomic disequilibria persist and distort the
incentive structure of the private and public sector."(21) 
  
He notes in his 1994 paper that "[T]he only attractive opportunity for
foreign investment are projects of VERY HIGH SHORT-TERM PROFITABILITY,
normally linked to the exploitation of natural resource rents (forests, oil
etc). The absence of a properly functioning monetary economy creates the
CONQUISTADOR-ECONOMY.(22)  
 
Writing in 1991, David Steinberg, a former consultant to the World Bank,
looks at some of the political-economic obstacles to investing in Burma:
"Political and economic pluralism depend on complex and alternative centers
of power -- political, economic, regional, institutional, or personal. 
Within those territories controlled by the state ... since 1962 only one
institutional center of power has been allowed to develop: the
"Tatmadaw"...The military not only control the state administrative
apparatus, ruling under martial law (the military have ruled by decree for
fifteen of the twenty-nine years (23)  since the coup of 1962), they have
staffed and effectively  militarized' the bureaucracy, established
themselves at the socio-economic pinnacle of power, eliminated or
controlled non-military approved avenues of social mobility (education, the
sangha (24), labor and mass organizations and businesses), developed an
elaborate set of institutional perquisites and rewards of office,
controlled internal sources of information, and (as many charge) have
dominated the informal and illegal economy and its fruits"(25). 
 
Khin Maung Kyi makes a similar point: "Military participation in the
administration will not be conducive to the development of an independent
and efficient civil service, given the habit of the Myanmar military to
want to do things its own way. As it is, since the abolition of the old
administrative system in the 1960s the administration has functioned only
at the beck and call of the power-holders and their agents. Administrative
impartiality, the strict rule of law, or the reliability and predictability
of administrative actions have lost their relevance. This overwhelming
control will not further the re-emergence of an efficient, impartial, and
consistent administrative system that is surely needed for an open market
economy.(26)  
 
Comparisons with economically successful [c] East Asian countries
 
In his important 1994 paper in "Asian Affairs", "Myanmar: Will Forever Flow
the Ayeyarwady?" Professor Khin Maung Kyi, Burma's most distinguished
contemporary economist (27), compares Burma's economy with that of several
economically successful Asian countries, including Indonesia: "In
successful East Asian states the government usually restricts itself to
providing basic services and maintaining law and order and stability. The
direction of the economy is guided according to long-term objectives but
the operation of the economy is left to the private sector with a minimum
of interference from the government....
 
"Myanmar's military has had no experience of running the country under
relatively pluralistic or permissive circumstances. It has been used to
operating as a stern disciplinarian or a top-down decision-maker. Going by
the experience of successful East Asian countries, power-sharing among
different elites, relatively free flow of information, rational economic
decision-making, an efficient bureaucracy, and an impartial and effective
legal system are deemed to be basic ingredients of all-round development....
 
"In Myanmar since 1962 the role of top civil servants whose experience
could be very useful even under the new circumstances, had been down-graded
and many of them replaced by loyal cadres who subscribed to the new
socialist order. The continuity of the judicial tradition has also been
disrupted because only elected representatives could serve as judges under
the socialist regime. All this is in sharp contrast with the situation in
Indonesia where the military rulers co-opted intellectuals, economists, and
other professionals into the ruling group from the outset. In fact, the
so-called Berkeley Mafia, a group of able economists, reputedly engineered
the Indonesian  modernization-cum-development process. It is difficult to
envisage the Myanmar military to radically change its mind set, given its
history of "absolutism" or the tradition of "we alone can do" doctrine."(28)
 
Stefan Collignon presents a shocking comparison  of the export performance
of Burma and Thailand: "While high performing countries, like Thailand,
have persistently increased their export and import shares as a consequence
of their export promoting development strategy, Burma's share has steadily
declined since the early 1980s....OFFICIAL EXPORTS AMOUNTED TO 2% OF GDP IN
1994, THE LOWEST IN THE WORLD." (World Development Report 1996) (29)
(emphasis added)
 
 A dilapidated physical infrastructure
 
On the physical infrastructure Khin Maung Kyi states: "As regards
conditions for the rapid growth of the economy, the importance of
appropriate physical infrastructure cannot be overstated. The existing
stock of physical infrastructure is so limited and dilapidated that
large-scale international official development assistance (ODA) will be
needed. Likewise, technological development and training will require an
equally large dose of investment. Retraining adult workers technically and
training and educating the youth need time to take effect. Without these
improvements, large inflow of private entrepreneurial resources may not
materialize."(30)
 
Disproportionate Defence Spending
 
In 1996, the US Embassy in Rangoon issued its annual Country Commercial
Guide, accompanied by a more technical report, "Foreign Economic Trends".
One innovation made in the 1996 reports was to adjust the statistics to
take into account the different exchange rates used in official and
unofficial financial reports: of defence spending, the "Guide" states that
"Under the SLORC, defense spending appears to have grown both in real terms
and as a share of central government operating expenditures.  In FY 93/94
and FY 94/95, defense operating disbursements appear to have constituted at
least half of total central government operating disbursements, despite the
absence of any evident external military threat
and the successive pacification of most ethnic insurgent groups."(31) 
 
"Burma's economic growth may continue to fall well short of its potential
so long as defense spending remains high and continues to be funded
disproportionately by implicit or explicit taxes on the external sector (32). 
 
Forecast
The Economist Intelligence Unit, in its report for the 1st Quarter of 1997,
predicts  that: "Over the next two years, in the absence of movement
towards liberalisation, growth will slow from recent levels and inflation
will remain high.(33)  p3 
 
In his 1997 paper Collignon states that "The SLORC is under significant
economic pressure: it cannot make ends meet, foreign exchange reserves are
running out and economic growth is steadily faltering.  The economic bond
fire of recent years may have allowed the SLORC to stabilise its rule, but
this will not last.  Either it will change fundamentally, or it will be
confronted with a new public uprising -- as history has shown
consistently."(34)  
 
There will be no substantial economic progress in Burma under the present
system and priorities. Such progress requires massive assistance for
infrastructure development, on a scale which can only be provided by World
Bank, IMF, ADB, UNDP and Japanese  funding.  Most of these multilateral and
bilateral sources were cut after the massacres of 1988 (35), and are
unlikely to be renewed while the black hole phenomenon persists and until
there is a significant and irreversible political process leading towards
higher levels of popular participation at all levels of government.   

 -- End of Part 1 - Part 2 will be posted in tomorrow's edition 
of The BurmaNet News --

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TACDB: SITUATION REPORT (REF: BU.MAH.0001 5/97.)
September, 1997

A REPORT ON THE SITUATION AT MAHACHAI POLICE 
STATION, SUMUTSAKHON PROVINCE, THAILAND

[This report was written in September, 1997. Due to the sensitive nature of
information received, we have only decided to disseminate it now]

AREA PROFILE
As of April 1997, NGO workers estimate that there is around 50,000 Burmese
nationals residing in the township of Mahachai, located in the Samutsakhon
Province of Thailand approximately 2 hours from Bangkok. The area often
termed 'Old Mahachai' is renowned for it's seafood processing industry,
which is the largest employer of illegal Burmese nationals. Other major
regional industries providing work opportunities include the building and
construction industry, the aluminium, glass and plastic product
manufacturing industries. Mahachai is home to an estimated 500,000 Thai
nationals. Official figures on the exact number of people living and working
in this area of Thailand is hard to obtain, as the population is quite
transient and constructing population profiles under such conditions becomes
difficult when few government resources are ear-marked for such activities. 

The majority of Burmese nationals in the area are migrant workers, although
the population of unemployed Burmese is on the rise as workers bring their
extended families and friends to Thailand in search of a better life. The
migrant population in Mahachai is predominantly of Mon or Burman ethnic
extraction. Over half of these workers are women and young girls. Many
workers come to Thailand so that they are in a better position to be able to
assist their families and friends that they have brought with them to
Thailand or who remain back home in Burma. Ages of workers range from as
young as 10 years to as old as 60 years of age and many are working in food
processing factories or in construction under informal arrangements with no
or little security or protection. Working conditions of such Burmese are of
a questionable standard. Even those who have been able to pay for a work
permit and are fully registered for a two year period, must work under
questionable conditions. The numbers of Burmese nationals working in this
area is likely to increase drastically over the coming months as agents
procure more workers from inside Burma. Our sources supplied information
that another 1,000 Burmese workers arrived illegally in Thailand via the
common Ye-Ranong transportation route on the 23rd April, 1997. Many more
were expected in the following months just from one agent alone.
Additionally, our preliminary research findings have revealed that many
Burmese nationals currently working here do not intend to return to Burma
when their period of registration has expired. 

There have been many instances of abuse and exploitation of Burmese
nationals at the hands of Thai police officers stationed at Mahachai. The
situation within the police compound itself has been steadily deteriorating
over the time our organisation has been observing the situation. We urge
that action be taken as a matter of urgency as more Burmese nationals will
suffer human rights abuses at the hands of Thai officials, who are meant to
be upholding the law and offering protection to the communities they operate
within.

OUTLINE OF RECENT EVENTS
Reliable sources have informed TACDB of the situation within Mahachai Police
Station where up to 400 Burmese nationals have been incarcerated at any one
time. There have been many reports of deaths in custody as well as evidence
of other physical abuses taking place. The cells are overcrowded to the
point where it is virtually impossible for detainees to lie  down to sleep,
and women and men are being detained in the same cells where there have been
reports of sexual assault and harassment. 

Health Problems
Only one toilet is currently operational and both women and men must use
this facility in full sight of all detainees. Detainees are unable to clean
themselves properly due to the absence of running water and the
overcrowding. The health situation of detainees is grave, with a range of
skin diseases being contracted by Burmese nationals after just a short three
days of incarceration . High numbers of Burmese migrant men living in
Mahachai frequent locally operated brothels where many have contracted
sexually transmissible diseases such as HIV/Aids. Such diseases are highly
contagious under the best of health circumstances, but even more so when
people are being kept in such unhygienic circumstances. Only 2-3 water
bottles are given daily for between 15-20 inmates to share among themselves,
while two small meals are served per day to each inmate. Considering the
overcrowding and consequent health problems, the food served is not
nutritionally sufficient. New arrivals at the police station are often
harassed by longer term detainees into handing over their cleaner items of
clothing. 

Non-adherence to regulations governing the treatment and care of detainees
One Burmese national recently released from the jail told how he was forced
to pay a 40,000 Baht fine to officers after only a 16 day detention period.
According to current Thai law and illegal immigrant must pay a fine of 2,500
Baht as well as 17 Baht for each day of detention. For a 1,000 Baht fee, a
Burmese detainee can be transferred to Bangkok's Immigration Detention
Centre (IDC) where conditions are not as severe for inmates. It is often the
case that those people who have already finished their legally required
period of incarceration, and who are without money, are left to suffer the
unsatisfactory cell conditions at Mahachai police station, while transfers
to IDC are arranged quickly for those who can pay the large bribes the
police officers request.  There have been additional reports of Burmese
nationals being released during transfer between Mahachai police station and
IDC after paying larger amounts of money to the transferring officers. His
friends and family working in the area, also Burmese nationals, collected
enough money between them to arrange for this to happen.

A pregnant woman detained recently at Mahachai went into labour but could
not convince the officers to transfer her to the hospital until well after
her waters had broken and the baby's head had started to appear. After a
pregnant woman's waters break, she is highly susceptible to infection and
great care must be taken to avoid such infection. Given the presence of
contagious skin and other diseases in the cells and that appropriate care
was not taken by supervising officers, the woman suffered substantially as a
result. She had been arrested with a group of Burmese migrants who had been
gambling at the market in Talakoon, although she had not been participating
in the game and she possesed the required migrant worker documentation. This
did not deter police from arresting and detaining her. The Burmese migrant
population in Mahachai appear to be providing Thai police in the area with a
substantial second source of income. The woman's baby was born on the 6th
May at a hospital in Mahachai. One police officer charged the woman in
question 3,000 Baht for her release in Kanchanaburi. Fines charged to the
other Burmese nationals arrested with her were much less, even though they
had been charged with the added offense of gambling. Perhaps the police
thought that the local Burmese community would gather the funds to assist
her release. Thai citizens who frequent the Talakoon market area were said
to have assisted the other detainees fine payments. It is unconfirmed as to
whether police accepted bribes in this case. The Thai's who become involved
in these cases are quite influential people, usually higher-ranking local
authorities or the more successful local businessmen.

Thai Action Committee for Democracy in Burma (TACDB)
TACDB is a Thai-based non-government organisation that works to increase the
Thai population's understanding of real situation inside Burma and the
situation for Burmese people in Thailand. Additionally, TACDB is concerned
with highlighting the obstacles faced by Burmese peoples in their struggle
for the realization of peace, democracy and human rights in their country.
These obstacles are the reason that so many Burmese nationals are fleeing to
Thailand as refugees or migrant workers. 

TACDB actively supports and encourages the efforts of Burmese opposition
groups based in Thailand who aim to bring about peaceful political solutions
to the problems currently facing the Burmese people.

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THE GOVERNMENT OF KARENNI: SITUATION REPORTS
7 February, 1998

Militias, who were forcefully mobilized by the SPDC (State Peace and
Development Council), and troops of KNPA led by Lee Reh in tracts of 
Daw Ta Ma Gyi and Kay Hylar are ordered to collect one milk tin of rice 
Per household per day by the SLORC now SPDC since the beginning of 
December 1997. The local villagers are forced to provide food for the 
SPDC troops that are taking position in the areas.

On December 19, 1997, about 100 SPDC troops from LIB No. 531 and 
LIB No. 337 arrested Thow Reh, former headman of Wam Ngaw village; 
Oo Reh, teacher of the same village, and Day Reh without giving any
reason.

On December 30, 1997, some troops of SPDC from unknown unit entered 
And threw a grenade in Thay So Leh village, Dee Maw So Township, 
Karenni. Three innocent villagers were killed. The names of the dead 
persons are not available yet.

January 2, 1998
Ministry of Public Relations And Information
The Government of Karenni

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KNU PRESS RELEASE NO. 2/98: HUMAN RIGHTS VIOLATIONS
7 February, 1998

Regarding Brutal Military Offensive by SPDC (formerly SLORC)
February 5, 1998
Toungoo District

The SPDC army Tac. (2) Commander Lt. Col. Thein Maung, LIB 707 
Commander Aung Hein Mya, IB 39 Commander Myo Lwin, 
commandeered the trucks of Gor-day villager Mar Ma and  Kler-lar 
villager Kyaw Mor Tor. The 2 trucks were loaded with supplies and 
ordered to follow the bulldozer going to Si-hkeh-doe and Tha-kwee-soe 
army camps. The trucks still have not returned.

6-1-98: The SPDC LIB 710 Commander Thein Tun and IB 39 
Commander Myo Lwin, seized Kler-lar villagers for portage. The 
villagers have not been released up to this day. 

9-1-98: An SPDC army column led by Maj. Htin Kyaw Thu from LIB 540,
under the Op. Commd. 3, came to Beh-gor-weh village, in Tharn-daung 
township, and demanded a pig and 20,000 Kyat of cash.

10-1-97: The SPDC government authorities in Toun-goo district issued an
order instructing the Halar rice- milling machine owners to sell 1,000
baskets of paddy each  to the government. Those who were not able to sell
the paddy must cease milling rice, the order said. Many millers who failed
to sell the paddy have been banned from milling rice, at the present. The
price of 100 baskets of paddy is 35,000 Kyat on the open market, whereas
the SPDC government price is only 26,000 for 100 baskets. In Tan-da-bin
township, the farmers are forced to sell the so-called "dutiful paddy"  to
SPDC agents at the rate of 12 baskets per acre tilled. Those who failed to
sell the full quotas are being pressured in many ways. In Tan-da-bin
Township, all the Halar rice-milling machines are closed down. Rice is not
permitted to be taken to Toun-goo. All rice found being transported to
Toungoo is confiscated.

12-1-98: A group led by column commander, Kyi Win U, from the SPDC 
LIB 540 came to the cardamom field huts of  Deh-doh villagers (1) Saw 
Glu Klu, (2) Saw Si Peh and (3) Saw Say Heh, and accused the villagers 
of keeping the  huts for the rebels . The SPCD soldiers then burnt down the 
huts together with the cardamom  seeds kept in them after harvest. The loss 
from the burning was estimated to be 150,000 Kyat.  The soldiers then 
entered Deh-doh village and took the rice, salt, cooking oil, chickens, pigs, 
dogs and etc. of the villagers, without any payment, and ate them. A villager
Saw Kwa Htoo, 25, was accused of being a rebel and tortured by various 
means. 

14-1-98: Soldiers from SPDC LIB 708 fired heavy weapon shells into
Glay-soe-kee village. When the villagers fled, the troops entered the
village and ransacked every house. This same group came to Kler-lar
village, on the same day, and arrested a family of 4 members and, later,
all the 4 were shot to death. 

14-1-98: The SPDC IB 39 Commander, Myo Lwin, and Tac.2 Commander, 
Thein Maung commandeered the trucks of Kler-lar villagers Saw Lu Bway 
Doh and Saw Lar Yu for hauling supplies to Gor-theh-doe village. On 
16-1-98, the truck of Saw Ta Bleh and on 19-1-98, the truck of Saw Gor 
Rey, both of  Kler-lar village, were commandeered for sending rice to 
Gor-theh-doe. At the present, the two SPDC commanders Myo Lwin and
Thein Maung have arrested truck owners of Kler-lar  and pressuring them
to bring back their trucks which have been sent away to the town . 

Nowadays, SPDC commanders Brig. Tin U of the Southern Command, 
Lt. Col.Thein Maung of Tac. 2 Command and Myo Lwin of IB 39, have 
been forcing people of Kler-lar, Ler-ko, Gor-soe-ko Be-tho-ko & etc. 
villages, which are near the motor road, to carry supplies to Si-hkeh-doe 
and Bu-hsa-kee military camps. As most villagers are afraid of going, they 
are paying 500 Kyat per family. So far the villagers have paid a total of 
100,000 Kyat.  

Words & Abbreviations: KNU = Karen National Union (the political wing
of Karen resistance); SPDC = State Peace and Development Council 
(the military dictatorship of Burma); Tac.= Tactical; Lt. Col. = Lieutenant 
Colonel; Maj.= Major; Brig. = Brigadier; LIB = Light Infantry Battalion; 
IB = Infantry Battalion; Op. = Operation; Commd. = Command; 
Kyat = Name of Burmese currency; By volume a basket = 8 gallons; 
Halar = Brand name of rice-milling machine

(Translated, printed and distributed by the Karen Information Center)

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