BurmaNet News, October 26, 2004

[Editor]

October 26, 2004, Issue # 2587

INSIDE BURMA
AFP: Myanmar junta seizes vehicles as purge of rivals goes on
Reuters: Myanmar court jails two for democracy protest

ON THE BORDER
Bangkok Post: More troops sent to beef up border
Hindustan Times: 50,000 Rohingyas to enter Bangladesh

BUSINESS
Dow Jones: China, Asean agree to eliminate tariffs by 2010
Reuters: China to sell power to Myanmar, Southeast Asia.
Thai News: Little effect on Thai-Burma trade expected following Yangon
political shake-up

REGIONAL
Thai News Service: Democrats urge government to review Bt4 billion Myanmar
loan
AP: Myanmar's top military leader visits India's technology hub
Reuters: Protests dog Myanmar strongman's talks in India
New Straits Times: Myanmar 'keeping Asean in the dark'
Hindustan Times: Myanmar supports India's candidature for permanent UN seat

INTERNATIONAL
Reuters: Tribute album launched for Myanmar's Suu Kyi

OPINION / OTHER
Nation: Burma's leadership change is aimed at its neighbours

ANNOUNCEMENT
Today, Rhino Records released a two-CD set compilation of 27 songs by
famous artists dedicated to 1991 Nobel Peace Prize recipient Aung San Suu
Kyi and the courageous people of Burma. You can purchase and learn about
the CD (and support the organization US Campaign for Burma) on the
website: www.uscampaignforburma.org

______________________________________
INSIDE BURMA

October 26, Agence France Presse
Myanmar junta seizes vehicles as purge of rivals goes on

Yangon: Myanmar authorities have seized vehicles worth about three million
dollars in a continuing crackdown against military intelligence following
the sacking of the country's premier last week, a source close to the
military said Tuesday.

The cars, expensive four-by-four vehicles belonging to the office of
military intelligence (MI) which had been headed by ex-premier Khin Nyunt
for two decades, were seized in the capital Yangon, the source said.

Members of the intelligence group continue to be targeted by rivals loyal
to the hardline head of the junta, Senior General Than Shwe, as officials
launched what they claimed was a nationwide anti-corruption campaign in
the wake of Khin Nyunt's ousting.

The intelligence wing was believed to control much of the black market and
drug money in Myanmar -- the world's second largest opium producer -- and
is a bitter rival of hardline army factions loyal to the junta leadership.

A source close to MI told AFP the unit had been "acting like the mafia"
and using its elite status to collect substantial "unaccountable income".

In Monday's official media, one of Myanmar's most senior officials gave a
blunt assessment of the extent of the corruption menace as the officials
vowed a broader crackdown.

"No individual can deem himself to be above the law," General Thura Shwe
Mann, a member of the ruling State Peace and Development Council, told a
gathering of officials and businessmen, according to the New Light of
Myanmar.

"Bribery and corruption at the border areas involves billions of kyats and
we have taken measures to remove the culprits as a national
responsibility," the general, the third highest official in the military
line-up, was quoted as saying.

Myanmar's official exchange rate is pegged at just over six kyats to one
dollar, while the market rate is currently over 900 to one.

MI corruption was believed to be particularly strong along the border
areas, and the army last month reportedly became disgruntled when MI began
moving into their own business territory.

Shortly afterwards regular army soldiers raided a busy checkpoint at Muse
near the Chinese border and reportedly arrested dozens of officials
including MI members.

On Friday the junta announced it had scrapped the National Intelligence
Bureau, the body that gave widespread powers to MI officers.

Myanmar is ranked among the top five most corrupt countries in the world
in a global corruption index released by watchdog Transparency
International.

Diplomats and analysts have stressed that the non-MI military faction is
also deeply involved in corruption. One former ambassador to Yangon
described it as so entrenched that it was simply viewed as unofficial
taxation or the accepted way of doing business.

____________________________________

October 25, Reuters News
Myanmar court jails two for democracy protest

Yangon: A court in Myanmar has sentenced two men to prison in connection
with a solo democracy protest outside U.N. offices in Yangon last month, a
lawyer said on Tuesday.

Ohn Than, the solo protester, and Thet Wai were each given jail terms of
two years after a closed trial at Insein Prison, said lawyer Aung Thein.

Thet Wai was accused of aiding Ohn Than, who stood outside U.N. offices on
September 21, holding a placard calling for a genuine democratic
parliament.

"They were sentenced under Penal Code Section 505 (B) for public mischief.
They did not have the right to a defence, but we are planning to help them
appeal to a higher court," Aung Thein told Reuters.

Public demonstrations are banned in the former Burma, which has been under
some form of military rule since 1962. A former soldier who staged a solo
democracy protest last year was jailed for seven years.

Thet Wai is an official in pro-democracy leader Aung San Suu Kyi's
National League for Democracy. Ohn Than does not belong to the party which
won a 1990 election but was not allowed to take power.

____________________________________
ON THE BORDER

October 26, Bangkok Post
More troops sent to beef up border - Army wary of new leaders in Rangoon -
Wassana Nanuam

The Third Army has beefed up security forces along the Thai-Burmese border
following the recent leadership change in Rangoon.

Third Army chief Lt-Gen Picharnmet Muangmanee said thousands of soldiers
from the Pa Muang and Naresuan task forces had been sent to reinforce
those already deployed along the border with Burma.

The Third Army had earlier deployed about 30% of its men to patrol border
areas to prevent incursions by foreign forces and drug smuggling. The rest
of its soliders were posted in border villages.

Given the current political situation in Burma, the troop reinforcement
was necessary to watch out for possible security risks and activities of
ethnic minority groups in Burma that could lead to border troubles, said
Lt-Gen Picharnment.

It was likely the new Burmese leadership would adopt a tougher stance
against ethnic minority rebels, particularly the United Wa State Army
(UWSA), he said.

There were reports that Gen Maung Aye, the Burmese army chief, had given
the UWSA an ultimatum that it stop producing illicit drugs, reduce its
fighting forces, and rotate soldiers deployed at all its outposts every
year, he added.

The Third Army chief expected the new Burmese leadership's tough stance
towards minority rebel groups would contribute much to the fight against
drugs along the border.

He said Gen Maung Aye appeared to be giving minority groups some time to
shape up before using force to bring them into line.

However, it was likely the Shan State Army (SSA) would "breathe easier"
since it was not Rangoon's target of military offensive. But the group
would also be told to play by Rangoon's rule.

Lt-Gen Picharnmet said the Thailand-Burma regional border committee would
meet in mid-November as planned. The meeting would likely bring about an
unprecedented agreement on joint border patrol.

He had been assured by Maj-Gen Khin Saw, the Burmese Triangle Field Area
commander, that the political change in Rangoon would not disrupt the
planned meeting, where key development projects aimed at helping Burmese
minority groups give up their production of illicit drugs would be
discussed.

But Lt-Gen Picharnmet conceded that the leadership change in Rangoon could
slow down Burma's democratisation.

____________________________________

October 26, Hindustan Times
50,000 Rohingyas to enter Bangladesh

Dhaka: Some 50,000 Muslim refugees from Myanmar are camping across a river
waiting to cross over to Bangladesh, a media report said Sunday. The
paramilitary Bangladesh Rifles (BDR) and local villagers prevented at
least 3,000 Rohingyas from crossing the river in the second week of
October, Xinhua reports quoting The Independent. The government has closed
part of the southeast border, while local authorities there have taken
measures to keep a vigil on the border. The BDR troops are keeping a watch
over the movement of boats on the Naf River and are prepared to head off
any possible intrusion. The Muslim Rohingyas are ready to leave Myanmar
again due to the reported oppression of the Nasaka, or Myanmar frontier
guards, revealed a source.

According to the United Nations High Commissioner for Refugees (UNHCR),
over 250,000 Bengali-speaking Myanmar Muslim ethnic minorities, popularly
known as Rohingyas, fled to Bangladesh in late 1991-92 to escape Myanmar
military rulers' reported oppression. Many of these refugees later
returned to their homes under the UNHCR rehabilitation programme, while
over 19,000 refugees are still waiting to be repatriated.

____________________________________
BUSINESS

October 26, Dow Jones
China, Asean agree to eliminate tariffs by 2010 - Owen Brown

Beijing: China and the Association of Southeast Asian Nations have agreed
to eliminate tariffs on merchandise trade as a step toward creating an
Asian free-trade zone, both sides said Tuesday.

The deal on a five-year process for paring back the tariff barriers will
pave the way for a profound and lasting process of economic integration
within Asia, said China's Ministry of Commerce.

But a lack of details from China or Asean ahead of next month's formal
signing of the deal tempered initial reaction, leaving some concern that
many protected products might remain excluded from the final agreement.
The announcement of a merchandise trade deal suggests no agreement has
been reached on the more contentious areas of trade in services and
foreign investment.

The agreement follows three days of high-level talks in Beijing that ended
last Wednesday, the Chinese ministry said in a statement Tuesday. The
Asean secretariat in Jakarta confirmed the deal but declined to elaborate.

In the statement on the ministry's Web site, spokesman Chong Quan said the
agreement on the tariff-reduction process and a dispute-resolution
mechanism will be signed in November at a summit of Chinese and Asean
leaders.

Asean groups Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the
Philippines, Singapore, Thailand and Vietnam.

"This step forward in strengthening already close cooperative ties between
China and Asean will not only benefit their economic development but also
make a positive contribution to the economic development of Asia and the
world," Chong said.

Some Sectors Possibly Excluded

But Hadi Susastro, an economist with Indonesia's independent Center for
Strategic and International Studies think tank, said most of the goods
included in the agreement are probably already subject to low tariffs.

"So they won't have to do a lot," Hadi said. "The more important thing is
what sectors are excluded from the agreement."

Each Asean member and China have excluded 200 to 300 sectors from the
trade agreement, he reckons.

China and Asean, which have been negotiating the details of the pact for
months, were spurred toward agreement by Asean's September decision to
treat China as a market economy. Under global trade rules, that lessens
the scrutiny applied to domestic pricing policies, a major factor in
investigating unfair trade practices such as dumping.

Free-trade agreements have become increasingly popular due to the slow
progress of multilateral talks at the World Trade Organization, with China
in several negotiations with trading partners.

Australia and China are conducting a feasibility study on a proposed
free-trade agreement. If the study is favorable, Australia will also have
to decide whether to grant China market-economy status before further
negotiations can proceed.

Some countries, including Thailand, have already concluded preferential
trade agreements with China.

Phatra Securities economist Thanomsri Fongarunrung said there aren't
enough details yet to determine how the tariff reduction agreement will
affect an existing China-Thai free trade agreement.

Thai companies and farmers have been complaining about nontariff barriers,
such as differing regulations and procedures between Chinese provinces,
and dumping of Chinese fruit and vegetables and electronics products in
Thailand.

_____________________________________

October 26, Reuters News
China to sell power to Myanmar, Southeast Asia.

Ho Chi Minh City: China's Yunnan Electric Power Group Co said on Tuesday
it planned to sell 400 megawatt of electricity to Myanmar and started
talks with Laos to build transmission lines as it expands power sale to
Southeast Asia.

"Our philosophy is to actively open up three markets: inside the province,
outside the province and overseas," Wang Da Zhuo, general manager of the
Yunnan-based firm, said in a statement obtained by Reuters at an energy
conference in Ho Chi Minh City.

The company, which produces around 35 terrawatt hour of electricity per
year, would sell 400 megawatt to Myanmar utility firm, Myanmar Olympic
Company, which will supply the Mandalay region, Wang said.

No details on transmission schedules were provided.

Wang said his company was also talking with Electricite du Laos for future
cooperation in power projects including a high-voltage transmission
network linking the two communist states.

In September the company started selling power to Vietnam with annual sale
estimated at 180-220 gigawatts hour.

The purchase has been made possible because China, which has been facing a
severe power shortage, has surplus capacity at its southern province of
Yunnan that borders Vietnam, Laos and Myanmar, officials from the company
said.

They also said China and Vietnam planned to connect their 500-kilovolt
transmission networks to realise large-scale power trade.

Vietnam, where power demand has been growing between 15 percent and 17
percent a year, aims to buy up to 480 megawatts of power generation
capacity from China by 2008 when sufficient transmission lines are
installed.

_____________________________________

October 26, Thai News Service
Little effect on Thai-Burma trade expected following Yangon political
shake-up

The abrupt change in Burma' s (Myanmar) ruling junta will have limited
effects on trade, investments and tourism between it and Thailand,
according to Kasikorn Research Centre, a unit of Kasikornbank, The Nation
reports.

As one of Burma's closest neighbours, Thailand has treated the junta with
kid gloves as much of the world condemned it. While unpopular, the
approach has led to more cross-border business between the two countries.
The change in leadership will barely register on the trade charts,
according to KRC.

The change of power in Burma had a minimal effect on trade between the two
countries, the report stated. Along the border areas, where frontier trade
flourishes, both Thais and Burmese hesitated doing business on the day of
the coup due to the uncertainty, but it was business as usual the next
day.

Frontier trade between Thailand and Burma this year has been strong, with
Burma doing most of the exporting. Exports of goods from Thailand to Burma
rose 65.6 per cent to Bt12.6 billion during the first eight months of the
year. Burmese exports dropped a tad to Bt29.5 billion during the same
period.

Natural gas accounted for more than 90 per cent of Burma's exports to
Thailand. Burma has enjoyed a trade surplus with Thailand since 2001, when
it started selling its natural gas.

The biggest threat could be the new leader's plans for the economy.
Thailand will have to closely monitor the Burmese government for changes
in economic policy.

The change in power is unlikely to affect Thailand's investments in Burma.
Most investors have shied away from Burma since the 1997 financial crisis.

The researchers said tourism in Burma would be most affected by the
political volatility, but even that sector would likely feel the
side-effects for a limited amount of time. KRC said the future for tourism
in Burma remained bright.

_____________________________________
REGIONAL

October 27, Thai News Service
Democrats urge government to review Bt4 billion Myanmar loan

Further rifts appeared today in the attitude towards Myanmar of the two
main political parties in Thailand, with the opposition Democrat Party
calling on the ruling Thai Rak Thai (TRT) Party to review the government's
Bt4 billion loan to Rangoon.

While echoing the government's non-interventionist policy, Democrat Party
Spokesman Ongart Klampaiboon voiced suspicions that the Thai government
was implicated in the recent political changes in Myanmar, which last week
saw Myanmar Prime Minister Gen. Khin Nyunt ousted from office and placed
under house arrest.

In particular, he urged the government to review its Bt4 billion loan to
Myanmar via the Export Import Bank of Thailand (EXIM Bank), saying that
the involvement of Shin Corporation - in which the family of Prime
Minister Thaksin Shinawatra holds shares - indicated irregularities in the
telecommunications development deal.

He also noted that the EXIM Bank had formerly voiced concern over the high
risks involved in the project.

Berating the government for using taxpayers' money to offer loans to
Myanmar, Mr. Ongart said while helping develop neighbouring countries was
a laudable mission, it was important that conflicts of interest were not
involved.

Hinting that the deal might have helped precipitate the recent political
change in Myanamr, he said that it was not yet apparent whether or not the
new Myanmar administration would uphold the terms of the loan agreement.

Unless the government reviewed its loan, he warned, Thailand's reputation
could be damaged further.

_____________________________________

October 26, Associated Press
Myanmar's top military leader visits India's technology hub

Bangalore: The leader of military-ruled Myanmar visited India's technology
hub in the south Tuesday -- the third day of a visit that has been
denounced by Myanmar exile groups because of the ruling junta's poor human
rights record.

Relations between India and Myanmar had been tense after the Southeast
Asian country's military rulers brutally crushed a pro-democracy uprising
in 1988. However, ties have improved in recent years as New Delhi seeks to
boost relations with Asian neighbors to counter China's growing influence.

On Tuesday, Senior Gen. Than Shwe visited Infosys, India's global software
company, in Bangalore, the capital of southern Karnataka state.

He posed for photographs but didn't talk to reporters. An Infosys official
refused to say whether the company planned to sign any deals with Myanmar
companies.

Than Shwe's six-day visit began on Sunday. His next stop is the northern
holy city of Varanasi.

On Monday, India and Myanmar signed three agreements including one on
cooperation in fighting terrorism and cross-border crimes.

The two countries also agreed to work on initiatives aimed at increasing
bilateral trade to US$1 billion by 2006. Last year, trade between the two
countries totaled US$430 million.

Than Shwe's visit -- the first by a Myanmar leader in 24 years -- has been
heavily criticized by Myanmar exile groups in New Delhi because of the
ruling junta's human rights abuses.

Western governments and human rights groups have condemned Myanmar's
military government for refusing to hand power over to a democratically
elected government in 1990.

The junta was also slammed for its refusal to release pro-democracy icon
and Nobel Peace Prize winner Aung Sang Suu Kyi, who has been detained
since a pro-government mob attacked her and her supporters in May last
year.

_____________________________________

October 26, Reuters News
Protests dog Myanmar strongman's talks in India

New Delhi: Myanmar's military ruler on Tuesday wound up talks with Indian
political leaders aimed at improving economic and security ties but
Myanmar dissidents poured scorn on his promise to bring democracy to their
country.

Senior General Than Shwe is the first head of much-shunned Myanmar to
visit India, the world's biggest democracy, in nearly a quarter of a
century.

He told Indian Prime Minister Manmohan Singh on Monday the government was
committed to bringing democracy to Myanmar and a consultation process was
underway to prepare a new constitution that was supposed to end four
decades of military rule.

But Myanmar dissidents dismissed Than Shwe's assurances on democracy,
saying it was merely lip-service by one of the world's most reviled
regimes.

"This kind of token talk about democracy does not work," said Tint Swe, a
member of Nobel laureate Aung San Suu Kyi's National League for Democracy.

"We are disturbed about this visit. India is the world's largest democracy
while Than Shwe leads one of the world's most brutal regimes. There is a
paradox here."

Suu Kyi's party swept a 1990 election but was never allowed to govern.
Instead the government cracked down on the pro-democracy opposition and
has kept Suu Kyi in detention for much of the past 15 years. Her latest
stint of house arrest began in May last year.

Than Shwe met Indian opposition leader Lal Krishna Advani on Tuesday
before heading to the Taj Mahal and the Buddhist centres of Gaya and
Sarnath.

Many Myanmar democracy supporters have fled to neighbouring countries such
as Thailand and India, while some Western governments have sought to
isolate its military rulers.

Activists from Myanmar and India have condemned India for hosting Than
Shwe who last week sacked the prime minister, a fellow general seen as
pragmatic and credited with drawing up a road map to take the country
towards civilian rule.

Exiles from Myanmar, which is also known as Burma, gathered in the Indian
capital to denounce his visit.

"Down with Than Shwe. Burma's killers are here," activists shouted as they
marched through the heart of New Delhi.

"How long can we live under military chains?" they shouted.

During Than Shwe's trip, India and Myanmar signed an agreement to fight
terrorism together, build a hydro-electric power plant in Myanmar and
increase cultural exchanges.

Both sides also agreed to step up trade and investment especially on their
common border, in India's turbulent northeast. (Additional reporting by
Kamil Zaheer).

_____________________________________

Oct 26, New Straits Times
Myanmar 'keeping Asean in the dark'

Kuala Lumpur: ASEAN would be better prepared to defend Myanmar
internationally if the country updated members on the unexpected
replacement of former prime minister Khin Nyunt, Malaysian Foreign
Minister Datuk Seri Syed Hamid Albar has said.

Myanmar should also inform other Asean nations on the impact the move
would have on the reconciliation process within the country, he said in an
interview.

His comments came amid growing concern within the region on recent events
in Myanmar.

The minister said the sudden replacement had sent shockwaves through the
international community and it was imperative for Asean to be apprised of
the true situation. He hoped the developments would not derail Myanmar's
intention to democratise.

Asean was being blamed for not being firm enough with Myanmar, Datuk Seri
Syed Hamid said.

'We need Myanmar to work collectively with us. Maybe it is too early, but
Myanmar has taken no steps to inform fellow Asean members or to reassure
us,' he said.

Meanwhile, Malaysian minister Nazri Aziz warned that lawmakers in the
region could ask their governments to suspend military-ruled Myanmar from
Asean if it did not speed up democratic reforms.

The recommendation could emerge at a Nov 27-28 conference in Kuala Lumpur
of Asean lawmakers and officials, he said.

_____________________________________

October 25, Hindustan Times
Myanmar supports India's candidature for permanent UN seat

New Delhi: Myanmar on Monday extended its full support for India's
canidature for permanent membership of an expanded UN Security Council.

This assurance was given by visiting Myanmar Head of State Senior General
Than Shwe during his meeting with Prime Minister Manmohan Singh.

Myanmar joins a host of countries including Russia, France, Britain and
Germany which have expressed their support for a permanent seat for India
at the Security Council.

While the US has remained non-committal, China too wants a greater role
for India in the Security Council.

_____________________________________
INTERNATIONAL

October 25, Reuters News
Tribute album launched for Myanmar's Suu Kyi

New York: A string of top musicians, including Paul McCartney, Sting and
Eric Clapton will launch an album on Tuesday dedicated to Myanmar's
pro-democracy leader, Aung San Suu Kyi, calling for the Nobel laureate to
be freed.

Nobel Peace Prize winner Suu Kyi has spent much of the last 15 years under
arrest. She was detained again in May of last year and remains under house
arrest by Myanmar's military rulers, who have held power in various guises
since 1962.

"Aung San Suu Kyi is a real hero," said Bono, lead singer of Irish rock
band U2, in a statement before the Oct. 26 release of the compilation
album "For the Lady. It also features Peter Gabriel, Coldplay and Damien
Rice.

The album includes previously unreleased material by R.E.M. and Pearl Jam,
as well as the U2 song "Walk On," which was dedicated to Suu Kyi and
banned in Myanmar, and a song written by a jailed student democracy
activist.

"Any time anyone inside Burma listens to my music, I want them to know
that they are listening to an artist that supports their freedom," Eric
Clapton said in the statement.

_____________________________________
OPINION / OTHER

October 25, The Nation
Burma's leadership change is aimed at its neighbours - Kavi Chongkittavorn

The dramatic changes inside Burma's top echelons did not occur in a vacuum.

They were meticulously calculated and executed and were aimed primarily at
further consolidating the supremacy of the State Peace and Development
Council (SPDC) and increasing its bargaining power against India, China
and Thailand.

The latter two, which are closely associated with the recently dismissed
General Khin Nyunt, must now readjust their positions accordingly.

After years of fence-mending and improved relations, India and Burma are
now confident enough to intensify and deepen their mutual engagement. At
another level, Burma would like to use India as a countervailing force to
China and, to a lesser extent, to Thailand. These countries share
thousands of kilometres of border with Burma.

The emerging Beijing-Rangoon-New Delhi triangle will have far-reaching
ramifications for Asean as well. In January 1995 in Bangkok the grouping
came to the erroneous conclusion that granting Burma unconditional
admission into Asean would decrease China's influence in the pariah state,
as if the grouping would have a neutralising effect.

Today, China's presence in Burma is highly visible in terms of both its
economy and its security situation. In the 16 years since the crackdown on
the Burmese pro-democracy movement, Beijing has been a most reliable
supporter of the junta leaders.

While China continues to have strong relations with Burma, the latter also
seems to feel the time has come to tilt towards its huge western
neighbour. For almost a decade, India and Burma have proved beyond any
doubt, through action and bilateral assistance, that they too are destined
to become reliable, if not strategic, partners, especially in the area of
cross-border security. India is keen to contain the insurgency along the
Indian-Burmese frontier and to improve its strategic position vis-a-vis
China.

Moreover, India is a big Asian player, no longer on the fringe of Asian
matters. As a major dialogue partner of Asean with a yearly summit meeting
with the grouping's leaders, India plays a big part in the win-win formula
for the junta in the post-September 11 world. Like China, India is not in
any position to harm Burma.

Ironically, Burma, a rogue state, now has the world's two most populous
countries acting as guarantors for the survival of SPDC hard-liners well
into the next decade. It would be extremely difficult to ensure that the
Burmese opposition led by Aung San Suu Kyi and minority ethnic groups have
a say in the country's future.

With positive signals coming from India, General Than Shwe's scheduled
visit there will signal the start of this new regional power game. As the
international community continues its outcry and condemnation of the
possibly adverse affects this visit will have on the national
reconciliation process, Burma will obviously allow India to gain
additional footholds inside the country.

It is incumbent now on the world's largest democracy to determine whether
it is willing to assume the role of patron of the rogue leaders and to
what extent.

Thailand, meanwhile, is suffering from internal bleeding. Without Khin
Nyunt, Burma has upped the ante and gained much-needed leverage against
Thailand. Thaksin and Foreign Minister Surakiart Sathirathai demonstrated
a lack of diplomatic finesse and political leverage with their repeated
claims last week that bilateral ties would not change because they were
familiar with the new leaders in Rangoon.

What they did not say was that Thailand will have to pay a higher price to
maintain the current Thai-Burmese status-quo. Even the slightest changes
will cost Thailand a fortune. Thaksin's emphasis on making business deals
at the highest levels, most of the time off the public record, simply
plays into the hands of the junta leaders. With more than Bt10 billion in
loan exposure to Burma through the Export-Import Bank of Thailand, Bangkok
has no choice but to hold out even more carrots in the days and weeks to
come.

To be more specific, Thailand's ongoing policy of appeasement towards
Burma will not change. For nearly four years, Thaksin has single-handedly
manipulated and backed the SPDC under the leadership of General Than Shwe.
Indeed the Thai leaders, especially Deputy Prime Minister General Chavalit
Yongchaiyudh, know the junta leaders quite well. Back in the early days of
the crackdown on the pro-democracy movement in 1988, it was the maverick
Chavalit who blocked internationally imposed sanctions by visiting
Rangoon, legitimising the Saw Maung regime.

But this does not mean that the Thai leaders have any influence over the
Burmese leaders, old or new, as they would have us believe. The Tatmadaw
(the military) is united when it comes to formulating policies towards
Thailand. With a strong national ideology, it has excelled in manipulating
regional and Thai support to prolong its grip on power. As things stand
now, the prospects for democracy in Burma are quite dim.

While Khin Nyunt was still in power, the Thai government was constantly
coming up with new ways to augment Rangoon's political legitimacy. Bangkok
naively imagined that its regional influence would increase if it could
persuade the junta to accelerate the national-reconciliation process.
Success there would be a feather in the cap of Surakiart as he bid for the
position of UN secretary-general at the end of 2006.

The so-called Bangkok process was conceived to break the ice between the
junta and international community with selective countries chosen to
participate in the first meeting last year. Thailand was also the first
country to eagerly back the seven-point road map initiated by Khin Nyunt.
Without him in charge, it is doubtful whether it will now be carried out.

At the regional level, Burma-Asean ties will be put to a severe test once
again. Burma's status as the host of the 2006 Asean meeting hinges on
consultations that will take place next year in Malaysia, one year before
the designated host takes the chair. If the next Asean chair, Kuala
Lumpur, maintains its current position on Burma, as expressed in the Burma
Caucus within Malaysia, a tougher stance from the grouping may be
anticipated.

For the time being, Asean's unwavering support for Burmese membership in
the Asia-Europe Meeting was the regime's biggest victory since 1997. More
than Europe would like to admit, Burma's admission to this key meeting in
early October was tantamount to an acknowledgement of the regime's 16-year
existence. Being a rogue state has really paid off.

At the upcoming Asean summit in Vientiane, Prime Minister Soe Win will
meet the grouping's leaders. They will dutifully express support for
Burma's new line-up and officially urge the junta to pursue national
reconciliation. Sympathy will not be lacking. It is the Asean way, all the
way.

Certainly Burma will be polite, as always, and respond with a peaceful and
measured grin that when the time is right Burma will have democracy - of
course democracy by the lights of the SPDC leaders.