BurmaNet News, July 10, 2009

[Editor]

July 10, 2009, Issue #3751

QUOTE OF THE DAY: They do not have a school, they do not have a place to
stay because they had to run from the attacks.
— Tasanee Keereepraneed, founder of Thai-Burmese border-based Safe Haven
orphanage

INSIDE BURMA
AP: Last witness testifies in Suu Kyi trial in Myanmar
SHAN: Detained ethnic party leader suffering from leg swelling
Irrawaddy: Yettaw admitted to prison hospital
Irrawaddy: Khin Nyunt appears in public

BUSINESS / TRADE
Mizzima: Burmese Gem traders throng Kunming Gem Emporium

HEALTH / AIDS
IMNA: Second victim of H1N1 hospitalized in Rangoon
Khonumthung: Deaths among children in Kalemyo

DRUGS
DVB: Burma junta ‘unwilling’ to aid opium eradication

INTERNATIONAL
Ananova: Richard Gere backs Burma campaign
Mizzima: Former Canadian PM urged to withdraw from Ivanhoe

OPINION / OTHER
Mizzima: Foreign Investment in Burma: Analysing the statistics - Derek Tonkin
The Boston Globe: Editorial: Disillusioned in Burma

____________________________________
INSIDE BURMA

July 10, Associated Press
Last witness testifies in Suu Kyi trial in Myanmar

Yangon - Testimony wrapped up Friday in the trial of Myanmar's jailed
opposition leader Aung San Suu Kyi as the last defense witness argued that
she is innocent because the military government charged her under a
constitution abolished two decades ago.

Friday's court session came a week after the regime's top general rebuffed
a personal appeal by U.N. Secretary-General Ban Ki-moon to release the
64-year-old Nobel Peace Prize laureate.

Suu Kyi is charged with violating the terms of her house arrest by
harboring an uninvited American man who swam secretly to her lakeside home
and stayed for two days. She faces a possible five-year prison term.

The trial has drawn condemnation from the international community and Suu
Kyi's local supporters, who worry the ruling junta has found an excuse to
keep her detained through elections planned for next year. She is widely
expected to be found guilty when the verdict is delivered, expected
sometime next month.

A British diplomat barred from the court proceedings Friday condemned the
trial, saying it "fails to meet the most basic standards" of local and
international law.

On Friday, defense witness Khin Moe Moe, a lawyer and a member of Suu
Kyi's National League for Democracy party, argued during 3 1/2 hours of
cross-examination that the 1974 constitution under which Suu Kyi was being
tried had been abolished in 1988.

"I have known her (Suu Kyi) for 20 years and based on that and legal
points, I made my testimony. She violated no laws," Khin Moe Moe told
reporters. She said Suu Kyi looked "healthy and alert."

"The prosecution was on the defensive. We are satisfied with the
testimony," said Nyan Win, Suu Kyi's lawyer.

The nearly seven-hour session ended with the court setting July 24 for
final arguments in the case, said Nyan Win. He said the verdict could be
expected in the early part of August.

Security was tight around Insein prison — where Suu Kyi is being held and
the trial is ongoing — with roads blocked with barbed wire barricades
manned by police. Truckloads of riot police were also deployed around the
prison.

About 100 Suu Kyi supporters gathered Friday, as they have during earlier
court sessions, to give her support, sitting and standing as close as they
could to the prison gates.
Suu Kyi has been in detention for nearly 14 of the last 20 years, mostly
at her Yangon residence.

British Charge D'Affaires Jeremy Hodges asked to be allowed to attend Suu
Kyi's trial, but was barred from entry, the British Embassy in Yangon said
in a statement.

"I asked for access to the court where Aung San Suu Kyi's trial resumed
today. I was not allowed past the security cordon around the main gates of
Insein prison which leads to the court," he said in the statement.

He added that the trial "fails to meet the most basic standards of Burmese
law and international practice," noting that 14 witnesses for the
prosecution had been allowed to testify but only two for the defense.
Myanmar is also known as Burma.

The United Nations has been trying to persuade Myanmar's authoritarian
regime to free an estimated 2,100 political prisoners and hold talks with
opposition leaders. However, U.N. Secretary-General Ban's personal visit
and appeals last Friday and Saturday failed to gain even permission to
visit Suu Kyi in jail.

Suu Kyi's lawyer Nyan Win said he was preparing his final arguments for
the trial and planned to meet Suu Kyi on Wednesday to prepare the final
version.

Also being tried in Insein prison's court are her American visitor, John
Yettaw, 53, of Falcon, Missouri, who is charged with trespassing. Two
female members of Suu Kyi's party, who were her sole companions under
house arrest, are being tried for violating the terms of her detention.

The mostly closed-door trial started May 18. The court at first allowed
only one of four defense witnesses to take the stand, while approving 23
prosecution witnesses, of whom 14 took the stand, according to Suu Kyi's
lawyers.

On appeal, the Yangon Divisional Court ruled that Khin Moe Moe also could
be heard but maintained the disqualification of prominent journalist and
former political prisoner Win Tin and party vice chairman Tin Oo, who is
under house arrest.

The defense has not contested the basic facts of the case but argues the
relevant law has been misapplied by the authorities. They also assert that
the security guards who ensure Suu Kyi remains inside her compound should
also be held responsible for any intrusion on her property.

Yettaw has pleaded not guilty and explained in court that he had a dream
that Suu Kyi would be assassinated and he had gone to warn her. Family and
friends have said he was working on a book and wished to interview her.

____________________________________

July 10, Shan Herald Agency for News
Detained ethnic party leader suffering from leg swelling - Hseng Khio Fah

The leader of Shan Nationalities League for Democracy (SNLD), Burma’s
second largest winning party in the 1990 elections, Khun Htun Oo, 66, has
been suffering from the swelling of his legs due to lack adequate exercise
and regular medical treatment, according to Sai Lake, the SNLD
spokesperson.

In April, Khun Htun Oo was reported to have been suffering from diabetes
and high blood pressure.

Specialists, on consultation by his family, said it was also due to
inadequate sunlight and ventilation.

However, he was refused to get medical checkup outside. He was only
allowed to receive oral treatment. His family is allowed to visit him once
a month.

But the family complains about difficulty of transportation to his place,
Putao, the northernmost town in Burma. “There is scarcely any plane that
flies to Putao even though we are allowed to send him some medicine,” one
of his family members is quoted as saying.

“His family is worried if his conditions will get worse,” said Sai Lake.

Khun Htun Oo was sentenced to 93 year prison in Putao on 3 November 2005
along with 8 other Shan leaders for defamation of the state, association
with illegal parties and conspiracy against the state.

____________________________________

July 10, Irrawaddy
Yettaw admitted to prison hospital - Lawi Weng

John William Yettaw, the American accused of unlawfully seeking refuge in
Aung San Suu Kyi’s home, has been admitted to hospital in Rangoon’s Insein
Prison after declining food for 49 days, according to his lawyer, Khin
Maung Oo.

The lawyer told The Irrawaddy on Thursday that Yettaw is being fed
intravenously. He said the 53-year-old American, a Mormon, had existed for
seven weeks on only water for religious reasons.

Khin Maung Oo said Yettaw told him the Bible had instructed him to travel
to Rangoon to protect Suu Kyi from assassination. He had had a vision of
Suu Kyi’s home, the lawyer said.

Yettaw has been charged with violating Burma’s security and immigration
laws after he allegedly swim across Inya Lake and entered Suu Kyi’s house
in May. If convicted, he faces a sentence of between six months and five
years imprisonment.

Khin Maung Oo said that when Suu Kyi discovered Yettaw outside her home
she told him to respect and comply with the rule of law in Burma. “She
gave him refuge because he was very weak when she found him,” the lawyer
said. Yettaw suffers from diabetes.
Khin Maung Oo said Yettaw had acted without financial or political
backing. He was a devout Mormon, guided by his Bible.

Yettaw’s wife Yvonne told the US magazine Newsweek that her husband
apparently suffered from untreated bipolar and posttraumatic stress
disorders and regarded himself as a man sent by God to protect foreign
leaders whom he esteemed.

Yettaw saw service in Vietnam and receives disability payments from the US
Veterans Affairs office. He has been pursuing studies in psychology.

The Burmese junta claims a Burmese opposition group was behind Yettaw’s
action.

Burma’s police chief, Khin Yi, told journalists in Rangoon in June that
the background to Yettaw’s intrusion needed more investigation.

Khin Yi said Yettaw had met with exiled and unlawful groups in Mae Sot
before his last visit to Burma. The police chief accused him of receiving
financial support from the groups.

Yettaw reportedly first visited Suu Kyi’s home unlawfully last November,
and his family says he was still in debt for the expenses he incurred
during that trip.

Before setting out for his second trip, Yettaw told his wife that he
planned to visit Asia for a book he was writing, according to Newsweek
magazine.

Burmese and Thai sources in Mae Sot, on the Thai-Burmese border, say he
spent more than a month at a hotel in the town after his first visit to
Rangoon. During this visit he managed to get in to Suu Kyi’s compound, but
her companions prevented him from meeting her.

While he was in Mae Sot, people recalled Yettaw saying that he planned to
return to visit Suu Kyi again. His second visit led to the fateful
encounter with Suu Kyi in May, sources said.

In Mae Sot, Yettaw stayed at the Highland Hotel, where he spoke to several
people about Burma and talked briefly about Suu Kyi. He openly told people
about his first visit to her compound.

____________________________________

July 10, Irrawaddy
Khin Nyunt appears in public

Burma’s former premier and spy chief Gen Khin Nyunt, who was ousted and
placed under house arrest in October 2004,  recently appeared in public
and appeared to be in good health, according to one Rangoon source.

Khin Nyunt appeared at the Rangoon home of a former Burmese minister,
Brig-Gen Tint Shwe, on July 7 and asked about the funeral of the
minister’s deceased wife, Khin San.

“He and his wife spent two hours at the former minister’s home. They
looked healthy,” said the source.

Burmese tycoon Tay Za and other businessmen associated with Burmese junta
chief Snr-Gen Than Shwe were also present, according to the source.

Since March 2008, Khin Nyunt and members of his family are occasionally
allowed to move freely, usually to pagodas and other religious places. He
and his family visited Shwedagon Pagoda last year.

According to unconfirmed reports, Khin Nyunt has often been summoned by
Burmese generals to Burma’s new capital Naypyidaw to help them plan the
2010 general election and also for discussions on foreign policy issues.

While he was in power, Khin Nyunt was believed to have good relations with
the ethnic armed groups, such as the United Wa State Army (UWSA) and the
Karen National Union (KNU)

In 2004, the year Khin Nyunt was ousted and charged with corruption, he
had ceasefire talks in Rangoon with the late KNU leader Gen Bo Mya.

____________________________________
BUSINESS / TRADE

July 10, Mizzima News
Burmese Gem traders throng Kunming Gem Emporium - Myo Gyi

Ruili – Gem traders, who are members of the Burma Gem Traders’
Association, showcased their exhibits at the Gem Emporium in Kunming,
Yunnan Province, inaugurated on Friday.

About 20 gem traders under the aegis of the Rangoon based Burma Gem
Traders’ Association led by Chairman Tay Za and other businessmen
exhibited their gems at the 9-day Kunming International Gem Emporium.

“We are from Myanmar [Burma] Gem Traders’ Association, led by Chairman Tay
Za. About 20 traders from different companies attended the emporium,” Mi
Mi Nge belonging to the Association told Mizzima.

Tay Za, who has an excellent rapport with Burmese military junta supremo
Snr. Gen. Than Shwe, flew all the Burmese gem traders to the Kunming
emporium on his Air Bagan aircraft free of cost.

“Because this is the first ever business trip led by Tay Za, there will be
some inconveniences for us. Most of the gems we brought here are jade
jewellery such as sculpture, beads, bracelets among others. There are few
other gem stones,” Mi Mi Nge said.

Similarly members of the Sino-Burmese border based Ruili Gem Traders’
Association also attended and exhibited their jewellery in about 60
showrooms show casing  jade, raw jade, jade lockets, jade rings, red gem
stones and blue gem stones among myriad other precious stones.

The emporium mainly invites gem traders from ‘Association of South East
Asian Nations’ countries. So gem traders from other member countries came
and exhibited their products.

“A lot of people have come here. The Rangoon based Federation of Chamber
of Commerce and Industry also attended. The emporium is held under the
banner of ASEAN. But the traders are not entirely from all the member
countries. They are from Burma, Hongkong, Singapore, Taiwan, Thailand
etc.”, Phone Kyaw from Ruili based Gem Traders’ Association said.

Though the volume of sales was not high on the opening day of the gem
emporium, the buyers came and inspected the gem stones. Deals will be
struck later, he added.

“On the inaugural day, buyers came and inspected the gem stones and took
notes. The prices may be on offer the next day. The number of buyers who
came to the emporium is quite high. They came and saw our gems with keen
interest. Some of the gems brought to Burma by Chinese traders and
exhibited are of very high grade. Some of them are not available even in
Burma now,” a gem trader who came to the emporium said.

The opening ceremony of the gem emporium was held today at about 10 a.m.
local time and attended by Yunnan Provincial Communist Party Chairman,
Vice-Chairman and the General Secretary.

The emporium was organized by Yunnan Provincial Government and it will
continue till July 18.

____________________________________
HEALTH / AIDS

July 10, Independent Mon News Agency
Second victim of H1N1 hospitalized in Rangoon - Kon Chan

Another carrier of the flu virus H1N1, commonly known as ‘Swine Flu’, has
been detected in Rangoon, and officially announced by the Burmese
government television last night.

The victim, a 20-year old man, arrived in Rangoon International Airport
from Thailand on July 6. By July 7th he had become seriously ill, and was
sent to Way Bar Gi hospital in North Okkalapa, Rangoon. Although the
Burmese government has been testing travelers as they arrive at the
airport, they failed to detect any symptoms on July 6th. The man is
currently recovering, reported Burmese state-television.

The Rangoon Health Department has been testing the passengers and staff
from flights on which the man infected with H1N1 had traveled, however
thus far there has been no report that the H1N1 has infected any of the
other travelers.

Earlier in June, a girl 13-year-old girl who was returning from Singapore
was found to be infected with the H1N1 virus.

At the time officials from the Burmese, Singapore, and Japanese Health
Departments tested 36 people under the suspicion of having contracted H1N1
as they traveled with the girl returning from Singapore. There were so
signs of the H1N1 on any of the travelers though among the 36 passengers,
21 were suffering from a normal fever and 14 were in good health.

“The young girl’s teacher and her friends are being tested and are being
watched by a doctor,” said a doctor from Rangoon. “After more than 10 days
if we don’t find any sign of the H1N1 virus, we will let them go.”

The girl who tested positive for having H1N1 has recovered and was
released from Rangoon hospital on July 8.

Many people who are suspected of having H1N1, or are confirmed to have it,
are treated at the Way Bar Gi hospital, according sources that work there.

Many people in Rangoon are using masks to cover their noses and mouths
when they go out in public places such as schools, hospitals, cinemas and
markets. Masks thus far have been a basic defense and can be obtained for
relatively cheap.

____________________________________

July 10, Khonumthung News
Deaths among children in Kalemyo

A number of children under 12 years of age have died from dengue in
Kalemyo, Sagaing division western Burma.

Reports available suggest that though there are some adults among the
dead, most are children under12 years.  Dengue broke out in the first week
of June 2009. Things have come to such a pass that the Kalemyo civil
hospital and private clinics are full of patients. There are not less than
100 patients visiting the clinics and hospital every day.

A lady doctor, who recently opened a private clinic said, "Most patents
admitted are children. With patients increasing by the day not enough beds
are available in the civil hospital. Two or three patients are sharing a
bed. The situation is terrible. The hospital is admitting only serious
patients".

Private clinics are also facing a rush of patients suffering from dengue.
Although the disease is not as dangerous for teenagers and adults, it can
be fatal for children. A number of children have died. However, there is
no record of the number of dead, she added.

The doctor said that the main reason for the rise in dengue is lack of
preventive measures and creation of awareness in the town and villages by
local authorities. The authorities have not sprayed anti-mosquito
repellants in the houses. If an individual has to take preventive measures
he has to spend at least one lakh Kyat. People below the poverty line
cannot afford it. Dengue results mainly from mosquito bites.

There have been instances of deaths among children from dengue in Pegu
Township, in Burma.

____________________________________
DRUGS

July 10, Democratic Voice of Burma
Burma junta ‘unwilling’ to aid opium eradication - Francis Wade

Prohibition on poppy cultivation enforced by armed groups in Burma’s Shan
state has caused a dramatic cut in opium production, although the
government has been ‘unwilling’ to help, says a report.

Bowing to pressure from neighbouring countries, most notably China, two
key armed groups in Shan state have implemented bans on growing poppies
for opium.

Once the world’s biggest source of the drug, the northern Burmese state
has significantly reduced its opium output, although the 80 percent of the
population formerly reliant on growing the crop have since struggled for
subsistence.

The United Wa State Army (UWSA) and the Myanmar National Democratic
Alliance Army (MNDAA) received support from aid agencies and governments
to kick start alternative forms of income for farmers.

Yet, says the report, From Golden Triangle to Rubber Belt?, the Burmese
government has “been unwilling and unable to provide assistance”.

Last month an expert on Burma’s opium trade, Khuensai Jaiyen, told DVB
that he “[didn’t] see any drug eradication programme” from the government,
let alone provision of alternative means of livelihood.

Furthermore, current levels of assistance supplied by NGOs and the UN “are
insufficient, and need to be upgraded in order to provide sustainable
alternatives for the population”, say the Transnational Institute (TI),
who released the report yesterday.

Many farmers are now struggling to provide for themselves and their
families, the report said, given that poppy is the only viable crop in
many highland areas in Shan state.

“It has been extremely difficult for them to cultivate more food, grow
alternative cash crops or find casual labour to solve their food gap,” it
said.

In the place of poppy cultivation, the UWSA and MNDAA, who control large
areas of Shan state, have developed rubber plantations with assistance
from China, where demand for rubber is soaring.

According to US publication Jane’s Intelligence Review, the UWSA receives
political and economic support from China, including financial assistance
and weaponry, and China has been keen to exert some authority over exports
from Shan state.

According to a UN report released last month, Burma remains the world’s
second largest source of opium, behind Afghanistan, although output is
beginning to steady.

Around 28,500 of the world’s 189,000 hectares for poppy cultivation are in
Burma, which last year produced around 4000 metric tons of opium.

____________________________________
INTERNATIONAL

July 10, Ananova
Richard Gere backs Burma campaign

Richard Gere has backed a worldwide campaign calling for the release of
five video journalists (VJs) imprisoned in Burma.

The VJs were arrested for secretly filming the 2007 Saffron Revolution.
Their story is told in the new documentary Burma VJ, which features
illegal footage filmed by the now-imprisoned VJs using concealed cameras.

The VJs risked torture, imprisonment and death to document the story
behind the 2007 uprisings, and they now face up to 65 years in prison for
simply recording the events in the film.

After seeing Burma VJ, Gere said: "It's desperately important that people
see this film and get involved in the movement to help Burma and Aung San
Suu Kyi.

"I was incredibly moved on many different levels by what the filmmakers
achieved. The conviction and urgency that Burma VJ conveys is very
difficult to communicate on film in an honest way."

He continued: "Supporting this film and the Free the VJs Co-operative's
campaign will enhance your own sense of responsibility by demonstrating
that you can effect positive change in the world.

"It is important that we keep ourselves connected by engaging human rights
issues around the globe and insisting that our government representatives,
business leaders and institutions like the UN do something when rights are
violated."

Burma VJ opens at 40 cinemas across the UK on 14 July.

http://www.ananova.com/entertainment/story/sm_3396365.html

____________________________________
July 10, Mizzima News
Former Canadian PM urged to withdraw from Ivanhoe - Salai Pi Pi

The Canadian Friends of Burma (CFOB), a Non-Governmental Organization, has
exhorted Jean Chretien, former Canadian Prime Minister to cancel his
contract with the Canadian firm Ivanhoe Mines operating a copper mine in
northwest Burma.
Speaking to Mizzima, Tin Maung Htoo, Executive Director of the Canada
based CFOB on Friday said, it is disgraceful that Jean Chretien had taken
a consulting contract with Ivanhoe Mines for personal interests. He urged
him to cancel the contract.

“As a former Prime Minister [of Canada], he should not have accepted a
contract with the company which has had a bad record regarding investment
in Burma because of personal interests,” Tin Maung Htoo said.

 “He should cancel his contract with the company [Ivanhoe],” he added.

The CFOB’s call came after Ivanhoe Mines on Wednesday issued a statement
where Robert Friedland, Executive Chairman of Ivanhoe announced the
appointment of Jean Chretien as the company’s senior international
adviser.

CFOB said Chretien was recruited by Ivanhoe possibly as a move to remove
Myanmar Ivanhoe Copper Company Limited (MICCL), with which Ivanhoe has a
50-50 joint venture in a copper mine in Burma, from the US sanctions list.

"Ivanhoe desperately wants to get their Burmese joint venture off the US
sanctions list. It is a major embarrassment for them and an impediment to
their international business interests,” Tin Maung Htoo explained, “Buying
the support of a former Canadian Prime Minister will certainly boost
Ivanhoe's efforts to remove their joint venture from the American
sanctions list.”

The US had put Ivanhoe’s joint venture MICCL in its sanctions list imposed
in 2008.

Moreover, the administration under Harper, Prime Minister of Canada in
2007, had imposed sanctions against Burma called the Special Economic
Measures Act, which included a ban on new investment in Burma by Canadians
and companies, following a bloody crackdown by the junta on the protests
led by Burmese Buddhist monks in August in 2007.

However, Ivanhoe was exempted form Canada’s economic measures against
Burma as the company was already in the country before 2007.

After the September protests, Ivanhoe in October 2007 announced that it
has no interests or activities or no personnel employed representing the
company in Burma. It said the company had divested all its interests in
Burma to an independent, third-party trust, which CFOB called a ‘blind
trust’ on February 27, 2007 under the terms of Ivanhoe’s negotiation of
its strategic partnership with Rio Tinto announced in October 2006.

However, CFOB said Ivanhoe is still operating a copper mine in Burma as it
has not publicly disclosed the ownership of its Burma assets known as an
independent, third-party trust.

“The ‘blind trust’ is extremely convenient for Ivanhoe because the firm
can continue to own a 50 percent stake in the mine and claim they've
pulled out of Burma,” said the CFOB in statement.

Moreover, CFOB said, Ivanhoe has done nothing to maintain the environment
and address toxic pollution caused by the mine which has severely impacted
neighboring farmlands, forests and rivers.

“According to a survey, among 5681 acres of mining area, 1507 acres are
contaminated by toxic pollution,” Tin Maung Htoo said.

____________________________________
OPINION / OTHER

July 10, Mizzima News
Foreign Investment in Burma: Analysing the statistics - Derek Tonkin

The article by Solomon in Mizzima on 6 July highlights the latest data
about foreign investment in Burma. Perhaps I might try to interpret them
from the perspective of a former investment director.

The figures quoted are taken from investments licensed by the Myanmar
Investment Commission (MIC) set up under the 1988 Foreign Investment Law
(FIL). However, it is not obligatory for foreign investors to invest under
the FIL and many investments of US$ 250,000 to US$ 1 million made in SMEs
(small to medium sized enterprises) will have been made, quite legally,
outside the FIL. The benefits of investment licensed by the MIC are mainly
in the incentives and guarantees provided under the FIL. But investors in
SMEs may well feel that the procedure for securing an MIC licence are
time-consuming, and they are perfectly content to conclude investment
contracts outside the FIL.

This particularly applies to Thai and Chinese entrepreneurs, but European
investors with close connections in Burma or long residence there may well
choose to invest in this way. This situation is not unique to Burma, but
applies throughout South East Asia and further afield. The incentives
available under the foreign investment legislation may be attractive to
larger investors, but less so perhaps to smaller investors who recognise
that profits and business expansion can only come through trading
operations, and the sooner these start, the better. So the US$ 15 billion
investment licensed by the MIC under the FIL is by no means the whole
picture, and I would not be surprised if non-MIC authorised foreign
investment were to be as great, though I simply do not know and am
reluctant even to hazard a guess.

Another important qualification is that this US$ 15 billion is only
approved, that is, contracted investment registered with the MIC. Realised
or completed investment by its nature will not be as large, for a number
of reasons.  In the case of Western investment in the 1990s, notably in
the oil, gas and extractive industries, funds actually invested in Burma
appear to have been at least 80 per cent of contracted value, while the
realisation of Asian investment appears to have been rather lower, perhaps
as low as 60 per cent. In any case, contracted investment is frequently
based on two or more phases of investment, and though the first phase may
in due course be completed, delays in the second phase may occur, for
market or funding reasons. However, the contracted total remains, and it
is sensible to contract for all phases at the start because this avoids
the need to apply for additional investment authority from the MIC should
a second phase of investment not covered by the original licence be agreed
at a later date. Furthermore, investments, although approved, may be
deferred or abandoned.

A particular difficulty is pin-pointing the nationality of the beneficial
owner. An investment made in Burma by a company incorporated in a
particular country is not necessarily a guide to the nationality of the
beneficial owner, unless the company is a well-known multinational. The
preferred and recommended structure for an overseas investment in any
country in South East Asia is through a single-purpose off-shore company
which could be incorporated in jurisdictions as different as the British
Virgin Islands (BVI), Luxembourg, Labuan, Delaware, Netherlands Antilles
or Gibraltar. The BVI is especially popular, and though it is a British
Overseas Territory, almost all current investments in Burma made by a
company incorporated in the BVI do not have mainland UK beneficial
interests, but are made by companies incorporated in such diverse
countries as Hong Kong, Singapore, China, Malaysia, Russia, and Canada.
However these BVI companies are registered with the MIC as "UK" because
the BVI is a British Overseas Territory. In point of fact, mainland UK
investment mostly by oil and gas companies in the 1990s has in almost all
cases been sold on to other non-UK beneficial owners.

Investments made by companies incorporated in the BVI are rarely
channelled through the BVI itself, and dividends and other financial
operations connected with the investment in Burma are also generally
handled outside the BVI. But such off-shore companies are invaluable for
beneficial owners to "park" their equity (shareholding) for the tax
advantages (which vary from jurisdiction to jurisdiction) and for
flexibility in managing the share structure. Thus a Malaysian company
using a BVI company to register its investment in Burma can without
difficulty sell part of the equity of the BVI company to, say, a Singapore
company without having to renegotiate the original foreign investment
licence. When Rothmans of Pall Mall Singapore (owned by British-American
Tobacco in the UK) were persuaded to pull out of Burma in 2003, it was
only necessary for them to sell their holding in a Singapore Joint Venture
company to their Singapore partners Distinction Investment Holdings. The
Joint Venture in Burma with Union of Myanmar Economic Holdings, Rothmans
of Pall Mall Myanmar, remained essentially unchanged and licensed
production of "London" and "State Express 555" brands continued.

Countries in South East Asia have little alternative when reporting the
sources of foreign investment but to note the location of the investing
company, whose beneficial owners may well change within a very short time
of signature of contract. This is particularly true where promotional
entrepreneurs make an investment with the deliberate intention of selling
on at a profit as soon as possible. They have the expertise in the market
or in the sector, and investors will pay a premium for access to a well
structured investment which is fully licensed.

So when you read that the UK and colonies have invested US$ 1.8 billion in
Burma, I have no reason to contest that figure, but I would add that  the
beneficial mainland UK ownership of those investments today is in my
estimate less than 1 per cent of that total. The UK Government discourages
investment in Burma, but would be most reluctant to exert undue pressure
on the BVI Government to confront companies from Hong Kong, Singapore,
China, Malaysia, Russia and Canada which use BVI-based financial service
facilities, the main source of the islands' GDP.

Derek Tonkin is the Chairman Beta Mekong Fund Limited 1994-2000

____________________________________

July 10, The Boston Globe
Editorial: Disillusioned in Burma

TRUE TO form, Burma’s military dictator, General Than Shwe, showed only
disdain when UN Secretary General Ban Ki-moon visited that tortured land
last weekend. Than Shwe and the other four generals in the ruling junta
denied Ban’s requests for a democratic evolution. To his credit, Ban spoke
out afterward, asking, “How much longer can Burma afford to wait for
national reconciliation, democratic transition and full respect for human
rights?’’

Now that he has seen experienced the junta leader’s inflexibility
firsthand, Ban must confront the question: What can the world body do to
help liberate the people of Burma? The narco-trafficking regime there has
forced people into labor, used systematic rape as a weapon of war, and
conducted brutal army offenses that uprooted hundreds of thousands of
people from minority ethnic groups.

Ban had the right idea. Upon arriving in Burma, he planned to ask for the
release of Nobel Peace laureate Aung San Suu Kyi and 2,100 other political
prisoners. He would call for reconciliation with Suu Kyi’s National League
for Democracy, landslide winners of Burma’s last free election in 1990, a
mandate the junta never honored. Ban also wanted to foster humanitarian
aid and economic development.

But after Than Shwe refused to cede to any of these requests, Ban got the
message. “Neither peace nor development can thrive without democracy and
respect for human rights,’’ he told diplomats and aid agencies.

Ban is mistaken, however, if he thinks that proper monitoring will
legitimize an election scheduled for 2010 - an exercise rigged to
perpetuate military rule with a civilian patina. Burmese democratic
activist Win Tin has observed that the true barrier to democracy in Burma
is not the mechanics of next year’s balloting but the junta’s “unjust
constitution.’’ That document bars Suu Kyi from participating, reserves 25
percent of seats in Parliament for the military, and practically
guarantees the generals and their cronies an overwhelming majority.

If Ban really wants to help the people of Burma, he should side with the
55 members of the US Congress who recently signed a letter to President
Obama urging him “to take the lead in establishing a United Nations
Security Council Commission of Inquiry into the Burmese military regime’s
crimes against humanity and war crimes against its civilian population.’’
Such commissions were instituted for Rwanda and Darfur. Nothing less is
needed if the UN, that would-be parliament of nations, is to fulfill its
commitment to protect the peoples of the world from criminal rulers.