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The BurmaNet News: March 26, 1998



------------------------ BurmaNet ------------------------   
"Appropriate Information Technologies, Practical Strategies"   
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The BurmaNet News: March 26, 1998    
Issue #967

HEADLINES:    
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US STATE DEPT: INTL NARCOTICS CONTROL STRATEGY REPORT (BURMA) - EXCERPT
THE NATION: PREMIER ORDERS FULL RETALIATION
THE NATION: YADANA THREATENS WATER SUPPLIES
BKK POST: YET ANOTHER VIOLENT SPASM
BKK POST: KAREN MEN IN REFUGEE SITES TO BE REPATRIATED
BKK POST: BURMA STILL MAJOR SOURCE OF HEROIN
BKK POST: FOOTPRINTS WINS FIRM TWO CONTRACTS
BKK POST: BURMA STUDYING FISHERIES PROPOSAL
FEER: BURMESE TALES
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US STATE DEPT: INTL NARCOTICS CONTROL STRATEGY REPORT (BURMA) - EXCERPT

March 1998

The following is the Burma section of the Money Laundering Chapter of the
March 1, 1998 International Narcotics Control Strategy Report (INCSR):

Burma. (Primary). Burma's criminal code includes anti-money laundering
measures, but they are not enforced. There is reason to believe that money
laundering in Burma and the return of narcotics profits laundered elsewhere
is a significant factor in the overall Burmese economy, though it is
impossible to measure accurately. The United States Embassy in Rangoon
reports that the Burmese government systematically encourages major drug
traffickers to invest in large-scale development projects which are of high
priority to the ruling junta. An underdeveloped banking system and lack of
enforcement against money laundering has created a business and investment
environment conducive to the use of drug-related proceeds in legitimate
commerce.

Burma has long led East Asia in drug production and smuggling. More
recently, it has become home to a growing array of trafficker-linked
investments and commercial enterprises, often in overt partnership with the
ruling military junta, now known as the State Peace and Development Council
(SPDC). The regime appears to have formed a codependent relationship with
several drug kingpins, allowing and even encouraging money laundering as a
way of propping up Burma's failing economy, while providing sanctuary to
these international traffickers -- several of whom are wanted for
prosecution in the United States.

After the January 1996 "surrender" of Khun Sa to the Burmese government, the
drug lord has been allowed to reside safely and comfortably in Rangoon,
where he is suspected of pumping millions of his drug proceeds into the
government- controlled economy. In a public interview, Khun Sa called
himself a "real estate investor" in Rangoon and confirmed that he is the
source of capital for the construction of a new highway between Rangoon and
Mandalay estimated to cost USD 250 million. It seems that Khun Sa is a major
source of development funding for the government. 

The regime has ovreseen investments and money laundering activity of other
traffickers as well. The holdings of some of these figures now include
hotels, ports, roads, bus lines, and banks. The family of Lo Hsing Han, a
notorious drug lord, now appears to be one of Burma's top domestic investors
and is a partner in over half of all of Singapore's investment in Burma. On
December 10, 1997, SPDC strongman and military intelligence Chief Khin Nyunt
publicly presided over the opening of a modern port facility in Rangoon,
built and to be operated for the next 25 years by Lo Hsing Han's family and
associates.

The lack of vigorous enforcement efforts against money laundering leaves
Burma vulnerable to the growing influence of drug traffickers and abuse of
the financial system by criminals. Burma needs to develop and enforce an
adequate anti-money laundering regime to protect its financial system and
economy from criminal activity. 


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THE NATION: PREMIER ORDERS FULL RETALIATION

March 26, 1998

Burmese attacks linked to logging

PIYANART SRIVALO,
MARISA CHIMPRABHA
The Nation

PRIME Minister Chuan Leekpai yesterday ordered all-out retaliation to any
intrusion on Thai soil by armed groups from Burma now that Rangoon has
denied any responsibility for a series of cross-border attacks.

In his strongest response so far to the western border problem, Chuan quoted
an intelligence report as stating the frequent invasion by the Democratic
Karen Buddhist Army (DKBA) was linked to illegal logging in Salween forest.

"The Burmese government, through its ambassador who received notes
protesting the invasions, has denied any responsibility or involvement with
the cross border attack and therefore cannot prevent them," Chuan said.

"Therefore, we will order the Thai army to be in the full operation of
retaliating."

Chuan spoke after chairing a Defence Council meeting during which he was
told about the cross-border attacks on Thai camps for Burmese refugees in
Tak and Mae Hong Son province.

"We will not allow Burmese minorities to use Thailand as a base to attack
Burma," Chuan said.

He said security along the border was not in good shape and he planned to
merge the existing 19 Thai camps into 11 and move them deeper into Thailand.

However, the relocation of the camps would affect local people in the areas,
he added.

The Foreign Ministry on Tuesday named the intruders as the DKBA. In the
past, it had referred to them as an 'armed group from Burma'. The DKBA are
said to be connected to the Burmese ruling authorities.

Referring to a Foreign Ministry proposal that the United Nations High
Commission for Refugees (UNHCR) would be allowed to get involved with Thai
camps for displaced Burmese, Chuan said this will allow the UN body to
realise the existing problem.

He said the UNHCR will have a greater opportunity to inspect the Thai
authorities' administration of the camps.

"Our policy in dealing with displaced Burmese is open and transparent. If
the UNHCR does not witness what is going on in the camps, it can easily
criticise us without any sound information. Allowing them to go into the
camps will enable them to understand our difficulties in operating the
shelters," Chuan said.

Meanwhile Foreign Minister Surin Pitsuwan expressed strong support for
involving the UN agency with the shelters.

Surin said he expected positive results from the government's decision
although there was a division of opinions on the matter.

"The UNHCR should be allowed to realise the problems in the camps for
displaced Burmese. With the UN agency, which is competent in camps, we can
be helped with documentation, figures and data about the Burmese there," he
said.

Others will accept information about the Burmese ratified by UNHCR, Surin
said, adding the public would know the Burmese had been in these camps for
many generations.

The minister quoted UN Secretary General Kofi Annan as telling Chuan, when
they met in Kuala Lumpur at an international meeting last year, that the UN
was willing to help Thailand in dealing with the displaced Burmese.

In a separate interview, Permanent Secretary on Foreign Affairs Saroj
Chavanavirat said at the moment a committee was discussing the extent of
UNHCR's involvement on the matter.

"We are discussing the issue but it is too early to say that the UNHCR will
be allowed to administer the camps as it needs more discussion. What the
UNHCR could do is help our authorities in taking care of the camps," Saroj said.

Meanwhile, Army Chief Gen Chettha Thanajaro said the attacks from minority
Burmese groups in Thailand was old news.

He said similar incidents had occurred frequently along the Thai-Burmese
border in the Kanchanaburi province because the border had not yet been
demarcated.

"I will try to solve the immediate problem. I will expel refugees, who are
believed to be soldiers, from Thai soil even if it creates problems with
non-government organisations," he said.

Chettha said Thailand may be attacked over the human rights issue but the
root of the problem had to be dealt with. He said refugee camps should house
only women, children and the elders otherwise the problem will not be solved.

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

THE NATION: YADANA THREATENS WATER SUPPLIES

March 26, 1998

JAMES FAHN
The Nation

CONSTRUCTION of the Yadana pipeline and other development project in
Kanchanaburi could affect the water supply for local villagers, a geologist
has warned.

The area through which the Pipeline to being built _ along with many other
areas In Southeast Asia _ is composed of limestone karst formations, which
one means it is riven with underground channels and streams, according to
Dean Smart, a consultant with the Royal Forestry Department.

"Karst hydrology is very fragile," Smart said. "It's virtually impossible to
know which streams produce which springs, so construction work _ on the
Yadana pipeline, for instance _ could divert some channels, causing some
springs to completely dry up and new springs to form elsewhere." Smart noted
that the environmental Impact assessment (EIA) for the Yadana project "does
not even mention karat hydrology.

A review committee, chaired by former prime minister Anand Panyarachun, set
up to evaluate the Yadana pipeline has already voiced strong criticism of
the EIA for failing to provide adequate information on the project's impacts. 

Smart also warned that sediment washed down from the construction of the
pipeline track could wash into the karst formation and flow into streams,
again affecting water supply.

"Sedimentation could also cause the diversion of water channels," he added.

The labyrinthine nature of most limestone formations also means that other
kinds of development projects, such as dams and roads, can be quite
destructive. "Dams in karst areas cost about 50 per cent more than in other
areas because there is lots of leakage [through the subterranean channels],"
Smart said.

"For the Khao Laem Dam in Kanchanaburi, they had to build a concrete curtain
inside the mountain to block the leaks."

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

BKK POST: YET ANOTHER VIOLENT SPASM

March 26, 1998

Editorial

Just days after drawing international condemnation for the killing of
refugees and torching of their dwellings, Rangoon's Karen allies struck
again. Another protest has been lodged and the likelihood is that the right
arm will once again insist it does not know what the left arm is doing.

If there is a file titled Protests/Thai Border at the Burmese foreign
ministry, the chances are that it is no slim volume. The latest addition to
any such file might be the weightiest yet since it was delivered in person
by the deputy foreign minister; the subject of the protest being too serious
to be left to the responsibility of a ministry functionary.

The subject is one of great importance because it involves relations between
two countries that are being strained by the Democratic Karen Buddhist Army,
a thuggish organisation that has scant regard for the principles of
democracy or Buddhism or the safety and rights of the majority of Karen. At
issue here is Rangoon's insistence that it exerts no control over the
renegade Karen in the face of overwhelming evidence to the contrary.

It is no mere coincidence that the renegades have dedicated themselves to
attacking the Karen National Union, which continues to stand against the
State Peace and Development Council, the most recent incarnation of the
State Law and Order Restoration Council. It is no coincidence that the
renegades are free to operate along the border and carry the same weapons as
their colleagues in the Burmese military.

If Rangoon is serious in insisting it has no control over the renegades, it
is admitting it is victim to the political equivalent of motor neurone
disease. The point about the renegades is that they are small in number and
would be militarily insignificant and far less bold if they did not enjoy
support and sustenance from the generals in Rangoon. 

Furthermore, the internal intelligence system created by	the junta in which
Burmese spy on Burmese would show itself to be less	that the renegades than
useful if it failed to report the consequences of the renegades' cross
border operations. It would be difficult, after all, to fail to notice the
detonation of artillery and mortar	 rounds, and rocket-propelled grenades.
It would be hard not to notice the flames and smoke from the torched homes
of 9,000 refugees.

Such ignorance of reality, however, is typical of the generals who have
inflicted themselves upon a cowed population over decades in which they have
sacrificed a thriving economy on the altars of corruption- incompetence and
military might. The incessant violations and acts of international
criminality that have brought us thus far are but further reminders of the
folly committed in bringing the junta into the Association of Southeast
Asian Nations.

No other member of the regional grouping behaves in such a manner with a
neighbour and fellow member. Indeed, our border with Laos is sleepy and with
Cambodia positively peaceful by comparison even though a mini-civil war of
sorts is in progress. No other member would sanction and, in all likelihood
direct, armed raids into neighbouring territory in which acts of violence
are carried out and members of that country's armed forced abducted and
taken to Burma.

By-attacking civilian refugees in camps in Thailand, the junta and its armed
proxies are ignoring the cause of the problem and merely concentrating on a
symptom. The camps would empty immediately and the refugees go home
willingly if they felt they would be safe and free to earn a living in Burma.

The attacks on their camps tell them it is still not safe to return. Far
from it; plans are under way to re-house the refugees in camps to be
established up to 100km from the border and well out of the range of the
guns of a junta that persists in the charade of putting out the welcome mat.

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

BKK POST: KAREN MEN IN REFUGEE SITES TO BE REPATRIATED

March 26, 1998

Premier warns of retaliation measures

Post reporters

The army will start pushing all able-bodied Karen men out of refugee camps
along the Thai-Burmese border and repatriating them as a precaution against
further border violations by pro-Rangoon Karen rebels, the army chief, Gen
Chettha Thanajaro, said yesterday.

Meanwhile, Prime Minister Chuan Leekpai warned yesterday Thailand would use
force to retaliate against any further violation of its western border by
members of the Democratic Karen Buddhist Army.

In a shift of policy, he also said, the United Nations High Commissioner for
Refugees would be allowed to play a role in caring for the refugees. 

The warning of retaliation with full force against DKBA guerrillas came
after the Burmese ambassador to Thailand, who was summoned to the Foreign
Ministry to receive an aide memoire about the recent spate of border
incursions by the guerrillas, admitted the rebel group and its territory
were beyond Rangoon's control.

Gen Chettha said that only women, children and old people would remain at
the refugee camps, while male adults would be removed and repatriated. 

While admitting the forced repatriation might provoke protests from human
rights groups, Gen Chettha said he would try to explain to them the need for
such action because these people were the source of all the conflicts.

He said there were both supporters of the DKBA and the mainstream
anti-Rangoon Karen National Union among Karen refugees in Thailand, and Thai
authorities could not tell them apart.

After the removal of able-bodied Karen men, he said, Thai forces would
search the camps for arms.

The army chief also stressed the need to relocate the refugee camps, saying
several of them were too close to the border and within range of rocket and
mortar fire.

"If they are located some 10 kilometres from the border, then the threat
will be over," he said.

In Tak province yesterday, border patrol policemen were hunting for about 30
DKBA guerrillas who slipped across the border reportedly to attack the Huay
Kalok refugee camp.

An informed military source said the DKBA guerrillas, under instructions
from Rangoon, had been pressuring about 80,000 Karen refugees housed in
camps in Mae Hong Son and Tak to return home.

Mr Chuan yesterday said Thai forces had been authorised to make "full
extent" retaliations against DKBA intruders, adding his government would not
allow any foreign forces to use Thai territory for military purposes.

Army intelligence reports said the recent spate of DKBA attacks on refugee
camps were related to the Salween logging scandal, according to the prime
minister.

For the refugees' own safety, Mr Chuan said, the number of camps along the
border would be reduced from 19 to 11 and the refugees would be moved deeper
inland.

However, he said their relocation could not start immediately because new
sites were yet to be found.

Thai authorities were seeking means to enhance the UNHCR's role on the
border in order to ensure more timely help for refugees, Permanent Secretary
for Foreign Affairs Saroj Chavanaviraj said yesterday.

But the UNHCR would not be allowed to run any of the refugee camps on the
Thai-Burmese border as it did on the Thai-Cambodian border, he added,
referring to a string of camps that housed some 300,000 displaced Cambodians
a decade ago.

An army source said only after all the camps were moved deeper inland would
the UNHCR would be allowed in to look after the refugees.

"We are now discussing with concerned agencies measures to enable the UNHCR
to play a bigger part," said Mr Saroj.

Previously, the UNHCR had "virtually no opportunity of knowing what was
going on at the Burmese border, and was asked to help only on a case-by-case
basis, sometimes when it was too late," he said.

His disclosure came after Mr Chuan told his cabinet on Tuesday increasing
the UNHCR's role was one of two options being considered to deal with
frequent cross-border attacks on refugee camps on the Thai-Burmese border.

However, government spokesman Akkrapol Sorasuchart said yesterday Mr Chuan
had made it clear to the cabinet it would be up to the Foreign Ministry to
consider what would be the most suitable means to do so.

Mr Chuan also informed UN Secretary-General Kofi Annan of this option when
he attended an informal summit of Asean heads of state in Kuala Lumpur in
December, the spokesman added.

The other option, Mr Akkrapol added, called for relocating the refugee camps
further inside Thailand, and for reducing their number from 19 to 11.

The move to increase the UNHCR's role marked a significant policy shift
since the organisation so far has been allowed limited access to the
Thai-Burmese border, with its officials having to secure permission from
Thai authorities every time they want to visit a troubled area.

Western embassies have been urging Thai authorities for some time to allow a
UNHCR presence on the border. Ambassadors of Australia, Britain and the
United States, as well as the UNHCR's regional representative Amelia
Bonifacio visited Huay Kalok and Mae Hla camps last Friday with National
Security Council chief Boonsak Kamhaengridhirong.

In a statement released afterwards, the ambassadors and the UNHCR
representative welcomed plans to relocate the refugees in Huay Kalok and
other camps at risk.

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BKK POST: BURMA STILL MAJOR SOURCE OF HEROIN

March 26, 1998

US study finds half world's supplies there

Nusara Thaitawat

Burma remains the largest source of opium and heroin, with an output of more
than half the world's supplies, according to a report released by the US
State Department this month.

The annual "Report on International Narcotics Control Strategy" estimates
Burma's 1997 crop at 155,150 hectares, which could yield up to 2,365 metric
tons of opium gum, enough to produce 197 metric tons of heroin.

The report said there was no evidence the Burmese government "on an
institutional level" was involved in the drug trade, but certain officials,
particularly military men posted in outlying areas, were.

The Burmese government made more seizures of illicit drugs and destruction
of refineries last year. It also arrested and prosecuted more corrupt
officials, and cooperated more with the United States and Thailand, but
these efforts suffered from lack of resources and political will, the report
said.

There was also no discernible effort during 1997 to stop money laundering,
suspected to be carried out on a massive scale. "The government
systematically encouraged leading drug traffickers to invest in
infrastructure, and other domestic projects," the report said.

Ethnic drug trafficking armies with which the Burmese government has
negotiated ceasefires, such as the United Wa State Army (UWSA) and the
Myanmar National Democratic Alliance Army (MNDAA-Kokang Chinese), remained
armed and heavily involved in the heroin trade, the report said.

It also listed top leaders of those ethnic armies which the US government
believes are involved in the heroin and/or amphetamine trade as follows:
Sai Lin (Lin Mingxian) of the Eastern Shan State Army (ESSA); Yang Maoling,
Peng Jiasheng and Liu Goushi of the MNDAA; Pao Yugiang, Li Zuru and Wei
Xuekang of the UWSA; Mahtu Naw of the Kachin Defence Army; and Yawd Serk of
the Shan United Revolutionary Army. Chang Shifu, better known as Khun Sa, is
also believed to still be involved, at least indirectly, in the narcotics
trade through his subordinates.

The report also said drug abuse, in particular intravenous drug use, is on
the rise in Burma and with it an alarming spread of HIV/Aids, especially in
the ethnic minority areas that are the sources of the drugs.

The US government urged Burma to prosecute drug trafficking organisations
and their leaders, to deprive them of assets from the illicit drug trade, to
act against drug-related corruption, and to hand over fugitive drug
traffickers to the United States through third countries, like the case of
Li Yunchung.

It also urged Rangoon to eradicate opium poppy on a wide scale in areas
under its direct control or immediate influence, to press ethnic groups such
as the Wa, the Kokang and the Kachin who have pledged to create opium-free
zones in their regions to make good their commitments, to enforce laws
against drugs and money laundering, and to provide strong support to
multilateral drug control projects in Shan State.

The United States cut aid to Burma in 1988 following its brutal suppression
of pro-democracy demonstrators. However, it has ended 500,000 under
congressional authority to a two year crop substitution, project in the
Kutkai area of northern Shan State. 

Counter-narcotics cooperation is limited to basic law enforcement
operations. The Drug Enforcement Administration's liaison office in Rangoon
focusses on providing intelligence on enforcement targets and on
coordinating investigations of international drug trafficking groups.

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BKK POST: FOOTPRINTS WINS FIRM TWO CONTRACTS

March 26, 1998

SSA outbid AsiaSat on two Burma projects worth $2.5m a year

Shinawatra Satellite Pcl (SSA) has won two telecommunications contracts in
Burma worth a total of US$2.5 million a year.

SSA, which outbid AsiaSat, attributed its success to the potential of
transponders on its Thaicom satellites, whose footprints cover from Japan in
the north to Australia in the south.

The two new Burmese clients that will rent transponders are Myanmar Radio
and Television (MRTV), and the Ministry of Post and Telecoms (MPT), SSA
executive vice-president Nongluck Pinainitisart said.

MRTV is a national television station under the supervision of the Ministry
of Information. The MPT is a government agency with operations similar to
those of Thailand's Post and Telegraph Department.

Dr Nongluck said MRTV would rent one transponder on the Thaicom 3 satellite
for seven years, starting in June.

The MPT will rent one-quarter of a Thaicom 3 transponder for seven years for
VSAT (very small aperture transmission) service, also starting in June.

MRTV will use the satellite to broadcast its {M4Global TV {M0programming to
Australia and Japan as well as other countries covered by the Thaicom 3
footprint.

Dr Nongluck said that previously, both Burmese agencies had rented
transponders from China's AsiaSat, and the contracts were to expire in May.
They decided to shift to Thaicom 3 because of its superior efficiency and
broader coverage area, she said.

As well, she added, Thaicom 3 offered integrated services in the form of a
turnkey contract, making it more advantageous than other satellites.

The contracts were, further proof that Thailand's satellite industry was
well placed to compete in international markets, she said.

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BKK POST: BURMA STUDYING FISHERIES PROPOSAL

March 26, 1998

Thailand's joint fishery proposal has reached a top Burmese general for
examination before a formal agreement is to be signed.

The army chief, Gen Chettha Thanajaro, handed the nine-point proposal to
Lt-Gen Khin Nyunt, first secretary of the State Peace and Development
Council, during a ceremony to open the Nikko Hotel in Rangoon last Friday,
said, army source.

If Burmese authorities had no objection to the proposal, the agreement would
be signed soon, the source added.

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

FEER: BURMESE TALES

March 26, 1998

Letter to the Editor


How refreshing to read Ma Thanegi's The Burmese Fairy Tale [The 5th Column,
Feb. 19] and to find someone-most particularly a Burmese-audacious enough to
criticize Aung San Suu Kyi. What a change from the repetitive, ill-conceived
voices of Suu Kyi's mouthpieces abroad-all claiming to be experts working or
t c benefit of the Burmese people.

NICHOLAS GREENWOOD
London

I am not optimistic about Burma. Aung San Suu Kyi, beholden as she is to
Western interest groups, will likely hold fast to her principles while the
powers-that-be will be equally adamant in refusing to budge. The losers in
all this are ordinary Burmese. Human-rights groups must ask themselves this
Are they prepared to suffer and even die for democracy? If not, it's time
they sought a compromise or got out.

JOHN TEO
Kuching

The stern academic and diplomat who implied to Ma Thanegi that economic
hardship, if it causes a revolution, is a good thing, were insensitive, to
say the least. But Western friends of democracy aren't the only ones turning
Burma into a fantasy. The "Asian values" crowd would have us believe that
there is no problem in Burma that can't be solved by throwing money at it
(and getting nice profits back).

The social stability necessary for Burma's economic development cannot be
achieved without a political settlement because of the long history of
internal war, especially against ethnic minorities. Moreover, if Suu Kyi's
policy is too rigid, then the National League for Democracy, as a democratic
party, must deliberate democratically about a policy change. But this is the
business of the NLD.

Unfortunately, the situation in Burma is not at all conducive to the
operation of a democratic party. It is incumbent upon the current rulers to
foster an environment of lawful government, free discussion and basic
rights, not to sabotage the NLD or other opposition groups. If this were to
occur, probably Suu Kyi would drop her support for economic sanctions.

Reports about massive human-rights violations across the country are not a
fabrication. There is no guarantee that a new NLD policy of "pragmatism"
would benefit minorities. Indeed, if Suu Kyi gave in, I believe the
minorities would regard it as an inexcusable betrayal, deepening the
historic lack of trust they feel toward the ethnic majority.

Suu Kyi's international stature is just about the only thing standing
between the current rulers and full aid, trade and diplomatic normalization
with foreign countries. What pro-democracy activists in and outside the
country want first is a peaceful political settlement. Economic interests,
however, might welcome an assault on Suu Kyi's reputation since it would
benefit their bottom line. If this is so, they have no sense of political
responsibility.

For such reasons, I believe the time is not ripe for a post-Aung San Suu Kyi
era. But Ma Thanegi's essay should be the beginning, not the end, of debate
on this issue.

DONALD M. SEEKINS
Nago City, Okinawa

I take issue with Ma Thanegi's attribution of Burma's economic decay,
poverty and suffering to isolationism _ a condition, she implies, imposed by
the West at Aung San Suu Kyi's urging.

The reality is that the military junta does not want Aung San Suu Kyi to do
anything, except to get lost. They do not want dialogue with her. It is the
military who is determined to oppose her, not the other way round.

CHAO-TZANG YAWNGHWE
Coquitlam, British Columbia
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