BurmaNet News, Feb 10, 2004

[editor at burmanet.org]

Feb 10, 2004 Issue # 2420


INSIDE BURMA
AFP: KNU rebels delay peace talks with Myanmar junta until late February
Irrawaddy: Junta says National Convention this Year
Nation: National convention on democracy plans
Reuters: Myanmar Military Vows Constitution Talks This Year

BUSINESS / MONEY
Xinhua: Bangladesh's failure to sign regional free trade pact draws
different responses

REGIONAL
AFX: Myanmar's Suu Kyi to be released from house arrest soon - Thai FM
AFP: Thai govt orders midnight closures for most night spots

INTERNATIONAL
Crosswalk: Alarm Raised over Possible Nuclear Links Between Burma, North
Korea
AFP: Asia has highest number of children out of school: UNESCO

OPINION / OTHER
Irrawaddy: Money Laundering in Burma



INSIDE BURMA
___________________________________

Feb 10, Agence France Presse
KNU rebels delay peace talks with Myanmar junta until late February

Ethnic Karen rebels have put off until late February a new round of peace
talks with Myanmar's ruling military junta after calling a halt to five
decades of fighting, a Karen National Union official said Tuesday.

A junta official last month said the talks, aimed at brokering a broader
peace arrangement to conclusively end one of the world's longest-running
insurgencies, would take place in early to mid-February, but the KNU said
more time was needed.

"We could not hold another meeting (with the junta) this week or next week
because we are not ready," KNU deputy secretary general for foreign
affairs Nierdah Mya told AFP, adding that several preparatory internal
meetings needed to be held before the next talks.

"We are now preparing topics for the next round of negotiation, which is
expected to be held after Febuary 20 as it is the most convenient time,"
he said by telephone from the border region between Myanmar and Thailand.

Delineation of KNU boundary areas and armed forces relocation were
expected to be brought up at the next talks, he said.

Nierdah Mya is the son of General Bo Mya, commander of the rebel group's
military wing who led a delegation to Yangon last month and held a
two-hour meeting with the reclusive country's leader, Senior General Than
Shwe.

No meetings between the two sides had taken place since his historic trip
to Yangon, and though a ceasefire has been in effect the troops from both
sides have remained on guard and at their posts, Nierdah Mya said.

While the ceasefire is less formal than deals forged with 17 ethnic
"ceasefire groups", it is the most significant deal the government has
reached with Myanmar's restive ethnic minorities in 15 years, and comes at
a critical time for the political future of the military-ruled country.

Key concessions were made to the Karen rebels because the regime is
desperate for them to take part in a national convention to write a new
constitution which it says is the first step in a "road map" to democracy.

KNU headquarters released a statement Tuesday in commemoration of Karen
national day which called for Karens to "coexist" with Myanmar's other
nationalities, but said the fate of the ethnic group was not yet in their
own hands.

"The Karen people still have not gained the right to decide their own
destiny," KNU president Saw Ba Thin Sein said in the statement faxed to
AFP.

"The Karen people must struggle on together with the other oppressed
nationalities, with courage and determination, until victory is achieved."

The KNU is the largest of the handful of rebel groups still fighting
against Yangon's rule. The junta estimates there are 7,000 rebels in the
insurgent group which took up arms 53 years ago.
___________________________

Feb 10, Irrawaddy
Junta says National Convention this Year

February 10, 2004—Burma’s military government reiterated that it is
committed to reconvening the country’s National Convention to draw up a
new constitution before the end of this year. However, as yet, no
timeframe has been set.

Foreign Minister Win Aung told AFP that the conference will re-start
"maybe in the first six months [of the year] or during the second six
months, it depends on the completion of our preparation."

He made the comments on Monday while attending the Bangladesh, India,
Myanmar, Sri Lanka & Thailand Economic Cooperation, or BIMSTEC, conference
in Thailand.

"The government is doing all it can to normalize the situation," Win Aung
told reporters.

He said that the main opposition party, the National League for Democracy
will be allowed to operate normally and its leader Aung San Suu Kyi will
be freed from house arrest before the National Convention re-starts.

Opposition leader Suu Kyi and 13 other leading party members have been
under arrest since last May when her convoy was attacked by a
government-sponsored mob in Sagaing Division. Hundreds may have died in
the melee, but there is no official death toll.

Burma first opened a National Convention in 1993. The NLD walked out in
1995 claiming junta interference and the conference was closed in 1996,
having failed to draw up a new constitution.

 We do believe there will be 
further positive developments very soon.
—Sihasak Puangketkeow

The position of the NLD and other political parties with regard to the new
convention is not clear. Burma’s government has not yet signaled any
welcome to any political parties that stood in the 1990 election.

"They could be a part of it," Win Aung said. "The question of whether the
NLD participate or not among themselves they are considering."

Last month, Prime Minister Gen Khin Nyunt met with a Karen National Union
delegation and Gen Bo Mya in Rangoon to discuss the ceasefire. The PM has
already met with more than a dozen ethnic ceasefire group leaders, who
have pledged support for the National Convention and the seven-point road
map announced by Rangoon last August.

Thailand’s Ministry of Foreign Affairs spokesman Sihasak Puangketkeow
expressed optimism. "We do believe there will be positive, further
positive developments very soon," he told Voice of America radio. Sihasak
also said he believed that Thailand and Burma had a clear understanding of
the timeframe for the National Convention.

At the Bangkok Forum last December—the first international conference set
up to discuss the Burma situation to have been attended by regime
delegates—Win Aung hinted that 2004 will be a busy year.
____________________________

Feb 10, The Nation
National convention on democracy plans

Burma will convene a national convention on its plans to restore democracy
before it discusses them with the international community in Bangkok at a
forum on the so-called 'road map' towards democracy, Foreign Minister Win
Aung said yesterday.

Speaking in Phuket, Win Aung said he planned to address the second round
of the international forum known as the Bangkok Process, provisionally
scheduled for Bangkok in mid-2004, on what he described as 'progress' on
the road map.

The date for the meeting depends on the development of a constitutional
convention by Rangoon.

A key provision of the seven-point road map that aims to foster democracy
and national reconciliation within Burma is that Rangoon should draft a
new constitution. Win Aung did not set a clear timeframe for a
constitutional convention, saying that decision would come from a
committee headed by the junta's Secretary Two, Thein Sein. But 'it would
not be very late in 2004', he said.

Observers speculate that Rangoon will open the convention in the second
half of this year.

Burma's previous national convention to draft a constitution collapsed in
1996 when the opposition National League for Democracy (NLD) walked out.
The Burmese government has said it would allow the NLD to participate in
the planned convention together with other political parties.

However, the NLD's Aung San Suu Kyi remains under house arrest and 13
other party members are still being detained. Suu Kyi has said she would
only accept her freedom when her followers were also freed.

Win Aung declined to say when the NLD members would be freed but said 'the
atmosphere is better now', adding, 'we realise the country's future lies
in the democratic form of government'.

Burmese Prime Minister Khin Nyunt has held talks with various ethnic
groups, and they have pledged to join the national convention, Win Aung
said.

The Burmese government has held talks with 17 ethnic groups that have
reached a truce with the junta. The largest group, the Karen National
Union, which agreed verbally to a cease-fire with Rangoon last month, is
qualified to participate in the convention.

Another participant will be one of the world's major narcotics producers,
the United Wa State Army, and its demand for an autonomous area could be
discussed then, Win Aung said.

As for the Shan State Army, the remaining rebel group still fighting the
Burmese government, Win Aung said it must accept a cease-fire and show its
willingness to deal with the government before it could become part of the
national convention.
____________________________

Feb 9, Reuters
Myanmar Military Vows Constitution Talks This Year - by Darren Schuettler

PHUKET, Thailand (Reuters) - Military-ruled Myanmar will try to resume
multi-party talks on a new constitution by the second half of 2004, but it
is up to Aung San Suu Kyi's party to decide its role, Foreign Minister Win
Aung said on Monday.

"I think she is also thinking about developments, and for her it is time
to analyze," said Win Aung. He said the government was in contact with Suu
Kyi, but declined to say more.

Win Aung insisted the government was working hard to include all parties
in its democracy "road map," but he did not say when restrictions on Suu
Kyi's National League for Democracy (NLD) would be lifted.

He also dismissed Western critics who say the plan is vague and aimed at
maintaining the military's grip on power.

"The future of the country is something that we are now working on very
seriously because once in a lifetime we have an opportunity to chart our
course. The course is a democratic one," Win Aung said.

The Southeast Asian country's ruling generals want to reconvene a national
convention abandoned in the mid 1990s, but they have not given an exact
date despite pressure from Myanmar's regional neighbors and the West.

Win Aung, speaking on the sidelines of a regional economic meeting in
Thailand, said the convention would definitely be held this year --
probably in the second half.

"It could be in the middle or the second half, but in the year 2004. It
depends on the preparations and how fast we can make it," he told Reuters.

Thailand, which follows a policy of "constructive engagement" toward its
resource-rich neighbor, is pressing Yangon to announce a date. Thai
officials say Win Aung gave Thai Foreign Minister Surakiart Sathirathai a
clearer timetable during their talks on Saturday, hinting at a June start
date.

WESTERN SANCTIONS SLOWING EFFORT

The military dissolved the national convention in 1996, one year after the
National League for Democracy (NLD) led by Nobel laureate Suu Kyi accused
the military of manipulating the process and withdrew.  The NLD swept to a
landslide election victory in 1990 but has never been allowed to take
power by the military, which has ruled the country in various guises since
a 1962 coup.

Win Aung said the government was working to bring ethnic minority and
opposition groups into the constitution-drafting process, pointing to
Yangon's recent peace talks with the country's largest ethnic rebel group,
the Karen National Union.

He believed the KNU would eventually join the convention, but the
government was still waiting for a reply from the NLD.

"I think in the NLD there are some people who would like to join, some
people who might not. They are also unsure of what they want to do," he
said.

NLD offices have been shut since the government cracked down after a clash
last May between a group of pro-junta youths and NLD supporters. The junta
detained Suu Kyi and other NLD leaders immediately after the clash and
held them for months.

Although some NLD officials have been freed in recent weeks, Suu Kyi
remains confined to her lakeside home in Yangon.

She is not under formal house arrest, but she has no telephone and all
contact has to be approved by the government. U.N. officials say Suu Kyi
refuses to accept her own liberty until all her arrested colleagues are
freed.

Win Aung insisted she was there under a mutual agreement for her
protection and he criticized the West for trying to "groom" Suu Kyi as the
country's next leader. He also said further international pressure on
Yangon would slow the country's democracy efforts.

Last year, the United States slapped a ban on imports from Myanmar and the
European Union tightened its sanctions.

"I don't mean every Western nation, but those that do not understand us
should review their positions and encourage the government," he said.

Win Aung met U.N. special envoy Ismail Razali on Sunday but no date has
been set for Razali's next visit to Myanmar.


BUSINESS / MONEY
_____________________________________

Feb 10, Xinhua
Bangladesh's failure to sign regional free trade pact draws different
responses - Dai Xiaozheng

Bangladesh's failure to sign a regional Free Trade Area (FTA) framework
agreement with India, Myanmar, Sri Lanka and Thailand -Economic
Cooperation (BIMST-EC) draws different responses from business circle.

The FTA framework agreement was signed on Sunday in Phuket, Thailand, by
six South Asian countries including India, Myanmar, Sri Lanka, Thailand
and two new members Nepal and Bhutan. Bangladesh did not sign the
agreement.

Bangladeshi Foreign Minister M Morshed Khan said Monday that the country
loses nothing for not signing the agreement at present.

He said he did not sign the agreement because the country's commerce
minister could not go to Phuket for illness, and the draft agreement
received on Jan. 15 could not complete all formalities and got cabinet
approval.

Besides the procedural problems, the minister also admitted Dhaka's demand
remained not answered for inserting a clause that would provide
compensation for revenue loss the least developed countries (LDCs) would
suffer after opening up their markets to the other countries of the group.

He said "a little more time would have allowed us to come to a
satisfactory conclusion of some unresolved issues."

He further pointed out the country would possibly sign the FTA before the
grouping's summit in Bangkok in July.

Business leaders and experts came up with different responses to the
government's pulling out of signing the FTA framework agreement.

Ananya Raihan, research fellow of the think tank Centre for Policy
Dialogue, was quoted as saying getting a compensatory mechanism for
possible damage to manufacturing and revenue loss was a non-negotiable
position for Bangladesh, as it thinks the loss might be substantive, while
the deal would not pose much risk to Myanmar as it has huge natural
resources for exports to other member countries.

As to the resource restrained Bangladesh, Raihan agreed that the country
should not sign the pact before well prepared, and suggest conduct a study
on possible gains and risks of the deal.

"Dhaka may keep the items it imports heavily and depends for revenue
income on the negative list, and put those it imports few and not
dependent much for revenue earnings on the positive lists, " he observed.

There are also concerns that Bangladesh would be isolated in the region's
common market for not signing the deal.

If Myanmar, Nepal or Bhutan can sign the FTA agreement, Bangladesh cannot
afford to do away with it, said Abdul Awal Mintoo, president of the
Federation of Bangladesh Chamber of Commerce and Industry, the apex trade
body of businessmen of the country.

He said India has signed and is going to sign more bilateral FTAs with
many of its neighboring countries, and now it is in the BIMST-EC FTA deal
with Myanmar and Thailand.

If Bangladesh is not in this South Asian grouping, it will suffer from a
serious negative impact, added he.

President of Bangladesh Garment Manufacturers and Exporters Association
Qazi Moniruzzaman said Dhaka should remain in the grouping, but he also
stressed the need to weigh possible risks and gains before hand.

He raised the country's largest export item ready-made garments (RMG) as
an example, saying Bangladesh will be able to do good business if the
country can import duty-free fabrics from the BIMST-EC countries, while
export RMG via free market access to those countries under such a deal.

The framework agreement stipulates preferential treatment for the LDCs
including the suitable time frames for tariff reduction.

The agreement elaborates that India, Sri Lanka and Thailand would get five
years, while Nepal, Bhutan and Myanmar would get 10 years for tariff
reduction.

It was also agreed that tariff reduction program under first phase would
be completed within three years by India, Sri Lanka, and Thailand, but
within 5 years by Nepal, Bhutan, and Myanmar.


REGIONAL
____________________________

Feb 10, AFX News Limited
Myanmar's Suu Kyi to be released from house arrest soon - Thai FM

Myanmar's opposition leader Aung San Suu Kyi will be released from house
arrest before long, Thai Foreign Minister Surakiart Sathirathai said
Tuesday, confirming recent statements from the Yangon junta.

"When the time comes, she should be released, and it won't be long. We
have told them (the ruling generals) that when they are ready they should
quickly free Aung San Suu Kyi," Surakiart told reporters.

Myanmar's Foreign Minister Win Aung said Monday that Aung San Suu Kyi
could be freed before a landmark national convention planned for this
year, and that her crippled pro-democracy party will be allowed to operate
normally by then.

The convention is the first step in a seven-point "road map" to democracy
unveiled by the military regime last August which it said would begin in
2004.

Aung San Suu Kyi was taken into detention last May after unrest that also
triggered a crackdown on her National League for Democracy (NLD), leaving
it virtually closed down with all its branch offices forced to shut.

Surakiart, who held talks with Win Aung Sunday on the sidelines of a
regional meeting, said there were ongoing contacts between the junta and
Aung San Suu Kyi, who is under her third stint of house arrest since 1988.

"I have learned that there is a process of confidence-building to forge
trust between Burma (Myanmar) and Aung San Suu Kyi," he said.

"There is a lot of progress in Myanmar and they have said they will
convene the national convention to draft a constitution, including... the
participation of minorities."

Surakiart said Myanmar has also agreed to attend a second international
meeting on prospects for reform in the military-run state, after inaugural
talks were held in Bangkok last December.

The second meeting of the "Bangkok Process" will be organized in the next
few months, allowing Yangon to explain its domestic situation to the
outside world, he said.

Thai officials said on the weekend that they hope to hold the talks before
the middle of this year, suggesting they believe that at the minimum a
date for Myanmar's national convention will be announced by then.
____________________________

Feb 10, Agence France Presss
Thai Govt orders midnight closures for most night spots

Thailand's cabinet on Tuesday ordered the majority of bars, clubs and
other nightspots across the country to close at midnight, tightening a
morals campaign aimed at curbing crime and drug addiction.

The move is certain to cause uproar among owners and workers at thousands
of discos, karaoke halls, go-go bars and massage parlours which will be
affected by the directive which comes into force on March 1.

Under the complicated directive, all night spots outside specified
nightlife zones -- including three in Bangkok -- will have to shut at
midnight, while there will be some exemptions inside the areas.

Discos and hostess bars will still be allowed to open until 2:00am, the
current legal closing time for all establishements across the nation,
while restaurants featuring musical performances have until 1:00am.

"The cabinet approved the... regulation to set a closing hour of 2:00am
for entertainment places inside zoned areas while outside the zones they
must close at midnight," deputy government spokesman Sansanee Nakpong told
reporters.

She said that in Bangkok the zones cover major night-life districts
including the red-light centre Patpong, and the New Petchaburi and
Ratchada Phisek areas which teem which massage parlours and karaoke bars.

The directive covers 50 of Thailand's 76 provinces including the capital
Bangkok.

The cabinet rejected the interior ministry's proposal for earlier closing
times last month, saying the move would affect thousands of people and
needed to be reviewed.

The nightlife crackdown which began in August 2001 under the stewardship
of the government's "Mr Clean", Interior Minister Purachai Piemsombun,
ended the free-wheeling ways of Bangkok's bars and clubs which used to
shut at dawn.

Despite grumbles from club owners, the initiative was firmly backed by
most Thais who were alarmed by the epidemic of drug use among Thai youth
and the easy availability of methamphetamines made in neighbouring
Myanmar.

The government has said that the amount of drugs on the streets has
reduced sharply thanks to another arm in its moral campaign, a "war on
drugs" which has been strongly criticised by human rights groups.



INTERNATIONAL
____________________________

Feb 10,  Crosswalk
Alarm Raised over Possible Nuclear Links Between Burma, North Korea -
Patrick Goodenough

Pacific Rim Bureau (CNSNews.com) - U.S. policymakers were urged Monday to
pay close attention to the "growing relationship" - including reported
nuclear links - between the Stalinist regime in North Korea and the
military junta in Burma.

Keith Luse, an Asia specialist aide to Sen. Richard Lugar (R-Ind.), said
that the North Korea-Burma issue was a key area of concern to the Foreign
Relations Committee chairman.

"Is North Korea providing nuclear technology to the Burma military?" he
asked during a panel discussion in Washington, hosted by the Heritage
Foundation.

In 2002, Yangon announced that Russia was helping it to build a 10-megawat
nuclear reactor which both countries stated was for peaceful purposes.

Burmese Foreign Minister Win Aung at the time said his country wanted the
facility for medical research purposes and possibly to generate nuclear
power.

Hundreds of Burmese technicians have received nuclear training in Moscow,
and last April regional media reported that two shiploads of Russian
equipment for the reactor had arrived at a Burmese naval base.

But it was also reported later last year that Russia had pulled out of the
project as Burma was unable to meet the costs involved.

"What is the construction status of Burma's nuclear reactor," Luse asked.
"Is North Korea providing nuclear technology to the Burma military?"

He also asked whether North Korea was possibly selling Scud missiles to
Burma.

Luse noted that China was working to end North Korea's nuclear programs,
but questioned what Beijing was doing to help preventing Burma from
developing a nuclear program.

China, which has been Yangon's closest ally since a military coup in 1988,
has also been the junta's main weapons supplier.

Burma, also known as Myanmar, last November denied a report in a Hong
Kong-based publication about possible nuclear cooperation with North
Korea.

"Logically, why would Myanmar want to develop WMDs [weapons of mass
destruction] when the country needs all her strength and resources in
pursuing a peaceful, stable and smooth transition to a multiparty
democracy and an open-market economy?" a government spokesman said in a
statement.

As a party to the nuclear Non-Proliferation Treaty (NPT) since 1992, Burma
is entitled to pursue peaceful nuclear capability, under International
Atomic Energy Agency (IAEA) safeguards.

Asked about Luse's remarks, State Department spokesman Richard Boucher
said Monday he could not confirm Burma and North Korea were engaged in
such activity.

He added that the Administration's views about North Korean proliferation
efforts were clear and strong.

"Any attempt by Burma to acquire nuclear missile or other technologies
from North Korea, or by North Korea to provide it and sell it, it would be
completely contrary to the kind of evolution we want to see in that
region."

This is not the first time Lugar has raised questions about Burma's
nuclear ambitions.

In an op-ed column last September, the Indiana Republican said that even
if the claims of peaceful research were true, "it would add an unnecessary
proliferation risk to a world where terrorists are on the prowl for
nuclear material."

"Most disturbing of all, Burma is renewing ties with North Korea," he wrote.

"The link-up of these two pariah states can only spell trouble. North
Korea's main export is dangerous weapons technology, and there have been
reports that Burma is getting missiles and other arms from Pyongyang."

Lugar called for U.S. to make Burma a priority in its relations with Asian
nations, "so that we can forge a multilateral plan to turn the generals
from their dangerous course."

If Yangon and Pyongyang have begun to develop clandestine ties, it comes
against a background of hostility.

Burma cut diplomatic ties after North Korean agents tried to assassinate
South Korean President Chun Doo-hwan during a 1983 visit to Yangon,
failing in the bid but killing 21 people in a bomb blast.

Burma was targeted last year by U.S. sanctions under the Burmese Freedom
and Democracy Act, which imposed a ban on all imports and other punitive
restrictions on junta members.

The action followed the junta's treatment of opposition leader Aung San
Suu Kyi, who was placed in "protective custody" after a violent clash
between her supporters and a pro-junta crowd.
____________________________

Feb 10, Agence France Presse
Asia has highest number of children out of school: UNESCO

Asia accounts for the biggest number of children in the world not
receiving a school education, despite steady increases in enrolment in the
1990s, according to a statistical report released by UNESCO Tuesday.

The report, based on official 2000 and 2001 education figures for 22
countries in South and East Asia, said that "an estimated 46 million
primary school-age children are out of school, and more girls (28 million)
than boys (18 million) are excluded from primary education."

With an estimated 104 million children out of school, Asia accounted for
45 percent of the worldwide total, just ahead of sub-Saharan Africa, where
42 percent of children are not enrolled, the report said.

The South and East Asia region studied stretches from China to East Timor,
and from Iran to the Philippines. The zone is home to 3.24 billion people,
or more than half the world's total, including more than a billion each in
China and India.

Although school enrolments rose "substantially" between 1990 and 2000, the
statistics showed that several countries had a high number of primary
school dropouts.

"In India, the Lao People's Democratic Republic and Myanmar, only half the
children who enter primary school will reach grade five, indicating a
dropout rate of 53 percent, 47 percent and 45 percent respectively," with
Nepal, Cambodia and Bangladesh close behind, the report said.

As schooling progresses, the gender gap widens, the reports' authors
found. Often negligible at primary level, the disparity in Asia between
the number of male versus female students reached 61 percent to 39 percent
at university.

"East Asian countries accounted for approximately two-thirds of total
enrolment, in large measure due to China, where the total tertiary
enrolment exceeds that of all the countries of South and West Asia
combined (12.1 and 11.3 million students, respectively)," the report
noted.

While China's tertiary enrolment looked to be improving to the levels of
the region's leaders -- Macau, Thailand, the Philippines and Malaysia --
some countries were struggling at the bottom of the list, namely
Afghanistan, Cambodia and Laos.

The preferred fields of study among university students in the region
slanted towards social sciences, business and law. The exception was
Brunei, where 49 percent opted for education studies.



OPINION / OTHER
_____________________________________

Feb 10, Irrawaddy
Money Laundering in Burma

Burma’s economic miseries are compounded by its collapsing banking sector
and the military government’s lack of transparency, as well as its
half-hearted efforts to eliminate illegal financial transactions in Burma.
International governments and independent financial task forces have
condemned Burma for failing to meet international standards in combating
money laundering. Drug money is widely suspected of keeping Burma’s
struggling economy afloat.

Below is a chronology of events concerning money laundering in Burma and
the full text of the laws enacted by Burma’s military junta, which first
appeared in the state-run daily, the New Light of Myanmar, in December 05,
2003 and June 17, 2002.

Chronology of Money Laundering Events

January 27, 1993—Burma’s ruling junta enacts the Narcotic Drugs and
Psychotropic Substances Law that includes legal tools to address money
laundering, such as seizure of drug-related assets and prosecution of drug
conspiracy cases. It repealed the Narcotics and Dangerous Drugs Law of
1974. But critics say that the government didn’t exercise the Law. Burmese
drug officials themselves said that they don’t have enough expertise to
deal with money laundering and financial crimes.

July 17, 1995—The junta issues rules for the Narcotic Drugs and
Psychotropic Substances Law.

March 1998—US State Department puts Burma as a country of primary concern
in medium priority in its report on Money Laundering and Financial Crimes,
1997. The Department’s Bureau for International Narcotics and Law
Enforcement Affairs refers to the report issued by the US Embassy in
Rangoon that charges that the regime systematically encourages major drug
traffickers to invest in large-scale development projects which are of
high priority to the ruling junta. The Embassy adds that 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.

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 system to protect its financial system and
economy from criminal activity, concludes the report.

June 22, 2001—The Financial Action Task Force on Money Laundering, or
FATF, an independent international body based in Paris, France, identifies
Burma as non-cooperative in the fight against money laundering in its
Non-Cooperative Countries and Territories 2000-2001 report.

June 17, 2002—Burma’s military government enacts the Control of Money
Laundering Law. Minister of Home Affairs Col Tin Hlaing announces that the
purpose of the Law is to protect public interests.

(see - Control of Money Laundering Law:
http://www.irrawaddy.org/res/money-law.html)

The government forms the Central Control Board, or CCB, to administer the
Control of Money Laundering Law. Minister of Home Affairs Col Tin Hlaing
is appointed Chairman of the Board.

June 20, 2003—The FATF lists nine countries, including Burma, as
Non-Cooperative Countries and Territories. Others listed are Cook Islands,
Egypt, Guatemala, Indonesia, Nauru, Nigeria, Philippines and Ukraine.

November 03, 2003—The FATF decides to impose counter-measures on Burma for
the government’s failure to address major deficiencies in its anti-money
laundering since the FATF first identified the country as a
non-cooperative country in June 2001. The FATF calls upon its members to
apply counter-measures to Burma.

November 19, 2003—The US Treasury Department names two Burmese commercial
banks, Myanmar Mayflower Bank and Asia Wealth Bank, to be of "primary
money laundering concern," under Section 311 of the USA Patriot Act. The
Act is enacted to fight terrorism after Sept 11, 2001, attacks on the US.
The Department’s report notes that the two banks have been linked to
narcotics trafficking organizations in Southeast Asia. It also mentions
the military government’s failure to remedy serious deficiencies in its
anti-money laundering system, and announces plans to impose a ban on US
financial institutions having correspondent accounts with all Burmese
banks, allowing exemptions in certain cases.

November 2003—An official from Asia Wealth Bank denies the US allegations.

November 21, 2003—Burma’s military government releases a statement that
denounces US government sanctions against its banking industry, remarking
that any financial sector problems were partly the fault of developed
nations that failed to provide aid. The statement reads, "The US
government has been criticizing and condemning almost every institution in
existence in Myanmar, and now is the time and the turn for Myanmar
financial institutions to be accused of wrongdoing."

December 04, 2003—Burma’s Ministry of Home Affairs issues the Control of
Money Laundering Rules to implement the provisions of the Control of Money
Laundering Law that was enacted on June 17, 2002.

(see - Control of Money Laundering Rules:
http://www.irrawaddy.org/res/money-rule.html)

December 05, 2003—Burma’s ruling junta sets up an investigation body to
investigate the Myanmar Mayflower Bank and Asia Wealth Bank and uncover
any possible links to drug trafficking organizations. The Investigative
Body was under the Central Control Board of the Ministry of Home Affairs.
Finance Minister Maj-Gen Hla Tun says it would take three months and be
carried out under new regulations for controlling money laundering,
effected today. Col Tin Hlaing also states that the measures are aimed at
prevention of the laundering of any proceeds of national and transnational
crimes, including drug and human trafficking and dealing in weapons and
cultural artifacts.

(see - Investigation Body: http://www.irrawaddy.org/res/money-invest.html)
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