BurmaNet News, September 11, 2009

[Editor]

September 11, 2009 Issue #3795

INSIDE BURMA
KNG: Junta insists KIA be transformed to BGF
Irrawaddy: Body searches ordered at Suu Kyi compound
Irrawaddy: Junta cracks down on internet access in ministries
Xinhua: Kokang group ready to participate in 2010 Myanmar vote
Time: Inside Burma's War

ON THE BORDER
SHAN: Chinese delegation visits Panghsang

BUSINESS / TRADE
Reuters: Total says won't quit Myanmar after NGO accusation
Irrawaddy: Kokang crisis disrupts border trade
SHAN: Casinos in Mongla closed

HEALTH / AIDS
Mizzima: HIV/AIDS voluntary groups to register with health ministry

REGIONAL
AFP: Singapore banks reject Myanmar junta cash report

INTERNATIONAL
Irrawaddy: Webb to hold congressional hearing on US Burma policy

OPINION / OTHER
Asia Times: China, Myanmar border on a conflict - Brian McCartan
The Daily Star (Bangladesh): The Jamestown Foundation
Emerging Fault Lines in Sino-Burmese Relations- Larry Jagan

____________________________________
INSIDE BURMA

September 11, Kachin News Group
Junta insists KIA be transformed to BGF

The Burmese junta is insistent that the Kachin Independence Army (KIA),
the largest ethnic Kachin armed group, transform to the Burmese Army
controlled Border Guard Force (BGF), said KIA officers.

Lt-Gen Ye Myint, head of the executive committee of transition and junta’s
Chief of Military Affairs Security (MAS), reiterated the regime’s demand
of transforming KIA to the BGF to delegates of the Kachin Independence
Organization (KIO), the political-wing of the KIA during the meeting in
Kachin State's capital Myitkyina on September 9, said KIO delegates.

During the meeting, KIO delegates led by Vice-president No. 1 Lt-Gen Gauri
Zau Seng brought up other issues not related to the BGF. However, the
delegates were confined to the issue of transformation by Lt-Gen Ye Myint,
also Naypyitaw negotiator for all ethnic ceasefire groups in the country,
KIO delegates said.

In principle, the KIO has accepted the transformation of its armed wing,
the KIA but not to the junta-proposed Border Guard Force. It wants to
change KIA to a self controlled Kachin Regional Guard Force (KRGF).

A KIO delegate told KNG today, no decision was arrived at or any positive
result surfaced in the negotiation. However, both sides agreed to meet
next time after inter-organizational discussions over the latest
negotiation process.

On the other hand, the junta supremo Senior General Than Shwe has rejected
KIO's demands and has refused to meet KIO's civilian peace mediators led
by Rev. Dr. Lahtaw Saboi Jum twice. This is because the KIO had approved
the junta-drafted new constitution in May, 2008, said Naypyitaw sources.

Lt-Gen Ye Myint and Maj-Gen Soe Win, commander of Myitkyina-based Northern
Command repeatedly told KIO delegates that the junta is negotiating with
the KIO because of the goodwill of Snr-Gen Than Shwe and the military
government, when it is really not needed because the KIO approved the new
constitution, said sources close to KIO delegates.

If the KIO does not want any more meaningless negotiations with the junta
they may release a statement, sources close to KIO delegates in Laiza
headquarters on the Sino-Burma border in Kachin State said.

The KIO delegates returned to Laiza headquarters yesterday evening after a
two-day meeting with Lt-Gen Ye Myint. The KIO will respond to the chief
negotiator’s appeal on the transformation issue after organizational
meetings, said KIO officials in Laiza.

In a move to clarify the future policy of KIO, it dismissed six high
ranking officers from the party including Vice-president No. 2 Dr. Manam
Tu Ja and Deputy General Secretary N'Ja Naw Rip on September 2. They are
preparing to participate in the 2010 elections planned by the junta.

The KIO and KIA have a  manpower of over 20,000 and it also has an
alliance with three ethnic ceasefire groups in Shan State – the Kokang
group also called the Myanmar National Democratic Alliance Army (MNDAA),
the Mongla-based National Democratic Alliance Army-Eastern Shan State
(NDAA-ESS) and the United Wa State Army (UWSA).

KIA soldiers in Kachin State and Northeast Shan State are on high alert.
They have been ordered to fire at Burmese troops who intrude into their
territories since the junta captured the Kokang's capital Laogai on August
24.

____________________________________

September 11, Irrawaddy
Body searches ordered at Suu Kyi compound - Ko Htwe

Security guards at the compound of Aung San Suu Kyi in Rangoon now conduct
body searches, according to Nyan Win, one of her lawyers, who visited her
on Thursday.

“Suu Kyi said the tighter security is not appropriate,” Nyan Win said. He
met with Suu Kyi to discuss her appeal, which is scheduled to be heard on
Sept. 18.

“There are many security guards outside the compound. In the compound
there are only three women. If one lady leaves the compound, they make a
record. Suu Kyi said the security is too much,” Nyan Win told The
Irrawaddy on Friday.

“Only one person at a time is allowed inside Suu Kyi’s compound. I can not
tell the number of guards exactly. When you go in and come out they do a
body search,” he said.

Security around Suu Kyi’s compound was increased after she returned home
from Insein Prison last month, following her conviction and 18-month
sentence under house arrest.

Meanwhile, diplomats in Rangoon and Bangkok have asked Burma’s ruling
junta to allow Suu Kyi to receive diplomatic visitors.

Suu Kyi was convicted of violation of the terms of her house arrest after
she allowed an American intruder to spend two days at her home.

The leader of the National League for Democracy, Burma’s main opposition
party, Suu Kyi has been detained for more than 14 of the past 20 years.

____________________________________

September 11, Irrawaddy
Junta cracks down on internet access in ministries - Aung Thet Wine

Government ministries in Burma have clamped down on civil servants
accessing the Internet because of leaked information to Burmese exile
media, according to sources in Naypyidaw.

The ministries include the Ministry of Defense, Ministry of Home Affairs,
Ministry of Finance and Revenue, Ministry of Commerce, Ministry of Foreign
Affairs, Ministry of Hotels and Tourism and the Ministry of Industry No.1,
said the source.

An employee in the Ministry of Commerce in Naypyidaw said that information
from confidential files detailing the work of high officials with foreign
countries, especially North Korea, have appeared in the exile media,
including The Irrawaddy.

The source said that the order was posted by the ministry’s
director-general. Government workers who need to use the Internet now must
request permission.

Also, workers are now restricted to using government e-mail accounts
assigned to them, and they may not use non-government accounts at work.

Sources said the speed and efficiency of work has been greatly reduced,
because people routinely need to access the Internet for information.

A Rangoon civil servant said, “Before I could look at exile media news
from my office. But, after exile media reported about Burma’s plans to
acquire nuclear technology, they blocked Internet access at our office.”

A computer technician in Rangoon said, “Our government is trying to move
backward, while many other developing countries are trying to move
forward.

“They often boast that they will implement e-government systems within
ministries. If they want to do that, why are they restricting the
Internet?” he said.

According to the CIA World Fact Book, there were 70,000 Burmese Internet
users in 2007 and 108 internet hosts in 2008, while Thailand had 13.4
million Internet users and 1.1 million Internet hosts in the same period.
Internet speed in Burma is normally slow compared to neighboring
countries.

Since September 2007, the junta has viewed Internet users as a threat to
military control of information. The international community learned of
the junta’s brutal crackdown on pro-democracy demonstrations in 2008
through reports from private citizens posted on the Internet.

The authorities post notices in Internet shops in Burma that warn
customers accessing banned Web sites is against the law.

____________________________________

September 11, Xinhua via China Daily
Kokang group ready to participate in 2010 Myanmar vote

Yangon - The new leader of the Kokang ethnic group has said it will
participate in Myanmar elections next year, the first in nearly two
decades.

Phe Sauk Chen, appointed head of the newly formed Kokang Region
Provisional Leading Committee after the former leaders fled following a
skirmish with government troops, said on Tuesday that his group also
agreed to join the nation's border security guards.

The issue of whether to take part in national elections has been a point
of contention among ethnic groups, which are being asked to put down their
weapons.

So far, the Kachin Independence Organization is the only other ethnic
group that has agreed to take part in the elections. Larger ethnic groups
like the Wa, which has a militia estimated at over 20,000 fighters, have
so far resisted. Critics say the elections are designed to cement the
military's grip on power. Myanmar has been under military rule since 1962.

The Kokang were the first among 17 armed ethnic groups to reach a peace
agreement with the government in March 1989.

Myanmar's military secured the northeastern region of Kokang late last
month and thousands of refugees have since returned to their homes.

Chinese Foreign Ministry spokeswoman Jiang Yu yesterday reaffirmed China's
non-involvement policy in Myanmar's internal affairs. Jiang was responding
to reports that Myanmar's action to send troops to Kokang region was based
on China's information.

____________________________________

September 21, Time Magazine
Inside Burma's War - Hannah Beech

Laiza - Duct tape holds together his Chinese-made assault rifle, and the
mosquito net in his rucksack gapes with so many holes that it practically
invites dengue- and malaria-carrying insects to feast on his body. Felix
has never fought in the jungles of northeastern Burma, where a rebel army
is preparing for war with one of Asia's largest militaries. With no heavy
artillery and little more than flip-flops and used flashlights to give
their recruits, the Kachin Independence Army (KIA) can only depend on
guerrilla tactics to deter soldiers of the Burmese military regime. The
24-year-old cadet at the KIA's military academy, deep in the
monsoon-drenched hills of Kachin state, juts his chin out, blinks back
tears and announces he is ready for deployment. "I am shaking very hard
inside," he tells me, his voice trembling. "But I have a responsibility to
complete my mission."

Felix was promoted to active duty last month, when tensions reached fever
pitch between Burma's ruling junta and various armed ethnic groups in the
country's northern borderlands. In late August, the military regime
unexpectedly overran the army of the nearby Kokang minority, sending some
30,000 refugees spilling into neighboring China. Now other ethnic militias
who control various jigsaw-puzzle pieces of northeastern Burma — the
Kachin, the Wa, the Eastern Shan — are reinforcing their ragged armies and
playing a terrifying guessing game: Who's next on the junta's hit list?
(Read "A Closer Look at Burma's Ethnic Minorities.")

Two decades after Burma's army dictatorship reached an uneasy peace with a
patchwork of ethnic militias, the country is again poised on the brink of
civil war. The junta has long maintained a tense relationship with the up
to 40% of the country's population that is composed of ethnic minorities.
When Burma won independence from the British in 1948, political groups
representing some of the country's 130-plus ethnicities agreed to join the
union in exchange for autonomy. But uprisings quickly proliferated in the
country's vast frontier, only worsening after the military regime wrested
control of the country in 1962 and began limiting ethnic freedoms.
Beginning in 1989, cease-fires were signed with 17 rebel militias, and
certain ethnicities were granted a measure of self-rule. The junta claimed
victory for having united one of the world's most diverse countries — and
promptly began mining the natural resources that abounded in tribal
regions.

With nationwide elections slated for next year, Burma's ethnic minorities
may soon lose what little sovereignty they have left. The junta claims the
polls are the final step in creating what it calls a
"discipline-flourishing democracy," after it ignored the results of the
last elections back in 1990. International human-rights groups, however,
decry the process as little more than a choreographed exercise designed to
legitimize the junta and stamp out any threats to its power. In April, the
Burmese government informed the cease-fire groups that as part of the
electoral run-up they would have to refashion their armies as part of a
centrally controlled border guard force, the first step in what many fear
will be the death knell to ethnic autonomy. The deadline to accede to the
regime's demand is October. Most ethnic groups have already responded with
a firm no — among them the Kachin and the Kokang, whose two-decade
cease-fire with the Burmese abruptly ended last month when junta forces
invaded its tiny territory. The ease with which the Kokang were defeated
presumably buoyed the junta, many of whose members gained their
battlefield experience against ethnic militias. "Everyone in the West
talks about democracy and [Nobel Peace Prize laureate] Aung San Suu Kyi,"
says Aung Kyaw Zaw, a Burmese military expert and former communist rebel
living in exile in China's Yunnan province. "But the junta's biggest enemy
is not her. It is the ethnics." (Read "Burma Court Finds Aung San Suu Kyi
Guilty.")

The renewed threat of civil war in Burma isn't just an internal problem.
The country's minorities are concentrated in its borderlands, and in
recent weeks, as the junta has surged into rebel territory, tens of
thousands of ethnic refugees have poured into Thailand and China.

Beyond the international humanitarian crisis also lies a potential
economic one. Neighboring nations are increasingly dependent on Burma's
resources, and most of the country's natural wealth — from jade and timber
to hydropower and natural gas — is concentrated in the tribal regions. The
planned route for a Chinese-financed project of dual natural-gas and oil
pipelines, for instance, begins in an ethnically troubled part of western
Burma's Arakan state and runs past the part of Shan state where fighting
raged last month in Kokang. Construction of the Shwe pipeline project, the
biggest ever foreign investment commitment to Burma, was supposed to begin
this month, but ethnic skirmishes may imperil that schedule. Reports are
also trickling in from Kachin state, where dam projects funded by foreign
investors are suspending operations because of potential violence. Little
wonder that Beijing, which usually shields Burma from any formal criticism
by the U.N., publicly condemned the Kokang assault, warning that the junta
should "properly handle domestic problems and maintain stability in the
... border region."

Read "Why the Omens Are Not Auspicious for the Burma's Junta."

Law of the Jungle
To get to the KIA's mountainous stronghold of Laiza, I first traveled deep
into China's southwestern Yunnan province, to a small trading settlement
called Nabang. Even though the border town is in China, many of its
residents wore Burmese longyis, or sarongs, and women's faces were painted
beige with the thanaka paste used in Burma as a skin salve. Despite the
occasional truck rumbling past overloaded with teak logs from Burma,
Nabang felt like it was just emerging from an opium-induced nap.

But a quick splash across a few bamboo planks strewn across a river and I
entered another world. Laiza was very much awake, a hair-trigger
atmosphere only heightened by the fact that practically every teenaged boy
appeared to have a machine gun slung over his shoulder. Soldiers from the
KIA's mobile brigade materialized from the sub-tropical canopy, stealthy
as the tigers that prowl Kachin state. As my jeep climbed up a mountain
path, I passed teenagers with the hardened gazes of men trudging toward a
military-recruiting office. The number of youth who have volunteered to
enlist has skyrocketed, as the drumbeat of war with Burma's junta
escalates. (Read "Why Violence Erupted on the China-Burma Border.")

Many of these youngsters fit Hollywood casting for Southeast Asian
guerrillas: scrawny, scrappy adolescents who show no sign of needing a
shave anytime soon. But Felix, who sidled up to me as I watched the KIA
academy cadets run through their drills, disturbed the easy image of a
militia conscripting hungry boys in return for a fistful of rice. Armed
with a university degree in international relations, Felix speaks fluent
English and expresses himself eloquently on political philosophy. But as
an ethnic Kachin — an ethnicity more than 1 million strong, famed for its
fortitude while serving on the Allied side in World War II — Felix knows
his chances of succeeding in junta-controlled Burma are as slender as the
jungle vines KIA soldiers sometimes eat to survive. So he has joined other
disillusioned university graduates among the KIA ranks. "Some people say
we must have dialogue with the SPDC," he says, referring to the junta by
its Orwellian-sounding moniker, the State Peace and Development Council.
"But that is a snail's pace. The only thing the SPDC understands is force,
so we must meet their force with ours."

Ethnic Tinderbox
Although the Burmese majority faces plenty of repression, there's no
question that the junta reserves its worst brutality for ethnic groups.
International human-rights organizations have documented a wide array of
abuses against minorities, ranging from forced labor and army conscription
to mass rape and village relocations that have displaced 500,000 people in
eastern Burma alone. Complicating matters, some ethnic groups are not
Buddhist in a country where the junta celebrates that faith and often
persecutes those who do not. (The Kachin, Chin and many Karen, for
example, are Christian.) Career trajectories for many ethnic minorities
are stunted. Despite their proud martial tradition, Kachin know it's
nearly impossible to rise in the Burmese army beyond the junior rank of
captain.

In recent months, the decades of persistent discrimination have spawned an
unusual alliance between four armed ethnic groups: the KIA, the United Wa
State Army, the Eastern Shan State Army (also known as the Mongla army)
and the Kokang Army. The junta's lightning strike on the Kokang capital
Laogai, which is estimated to have caused some 200 civilian casualties,
left the other alliance members ill-equipped to respond immediately. But
exile groups in China and Thailand are reporting that the Wa — which, with
some 25,000 foot soldiers and an arsenal of heavy artillery, is the
strongest of the rebel armies — is providing support to the shreds of
Kokang forces still fighting, as well as giving sanctuary to Kokang leader
Peng Jiasheng. With the junta reinforcing troop levels in the country's
north, another ethnic militia, the Karen National Liberation Army in
eastern Burma, hopes to recuperate after a devastating series of losses
earlier this summer.

Cohesion among the ethnic groups, which spent considerable time fighting
one another as well as the junta, could change the nature of battle in
Burma. At the KIA's self-styled Pentagon, a collection of simple concrete
buildings on a breezy hilltop, members of other ethnic groups have come to
be schooled in military tactics from one of the most tenacious rebel
militias. One youth leader from the western state of Arakan spoke to me in
smooth, American-inflected English. "I need to do something practical," he
said. "I need to prepare for war. Politics in this country is crap. It's
just a way for the SPDC to stay in power."

The Politics of Money
As they face the possibility of renewed conflict, leaders of some of the
ethnic militias aren't just looking out for their downtrodden populaces.
They're also protecting their own interests in a region that, after all,
extends into the infamous Golden Triangle. Starved of other economic
means, some rebel armies have resorted to dubious funding schemes, like
selling opium, illegal timber and methamphetamines. During the ceasefire
period, the junta largely turned a blind eye to such businesses, which
financed spacious villas and golf courses for some ethnic commanders.

When U.N. special envoy Ibrahim Gambari visited Burma in 2007, one of the
people he met was Kokang honcho Peng, who was trotted out to represent the
junta's amity with ethnic groups. But this summer, Peng publicly rejected
the idea of turning his army into a border force. By early August, the
junta was accusing Peng of being behind an illegal arms-and-drugs factory.
The illicit activity, claimed the regime, compelled it to invade Kokang
turf, even though the warlord's business proclivities had been an open
secret for years. Indeed, both the Eastern Shan and Wa are also believed
to have financed themselves through such shady means; the latter's
southern commander, Wei Hsueh-kang, has been singled out by the U.S.
Treasury Department as a major drug trafficker. Indeed, one
battle-avoiding option for the junta is luring corrupt ethnic elders to
its side. "Divide-and-conquer tactics are the SPDC's best friend," says
KIA Brigadier General Gun Maw. (Read about the 2007 crackdown in Burma.)

The complicated ethnic landscape puts Burma's giant neighbor, China, in a
bind. Over the past few years, tens of thousands of Chinese businesspeople
have fanned across Burma, setting up trading companies and filling
downtowns with signs in Chinese characters. Much of the recent Chinese
influx is in ethnic areas, where rebel groups have also come to rely on
Chinese-made arms to continue their struggle against the junta. (The
Chinese, however, are an equal-opportunity weapons dealer, supplying the
junta with much of its military hardware.)

With the possibility of war breaking out along its long border with Burma,
China is finding that its presumption of easy political influence down
south may have been misplaced. High-level Chinese emissaries, say Burmese
analysts, recently visited Burma to warn the junta to avoid any border
instability in the run-up to the 60th anniversary of the People's Republic
of China on Oct. 1. The Kokang attack, which reportedly came as a surprise
to Beijing, was seen as a direct defiance of that admonition. Since the
Kokang clash, Chinese troop levels have doubled along sections of the
usually porous border, and China's Defense Minister embarked on an
emergency trip to Chengdu, whose regional army command covers the Burma
border region.

Clash of Titans
It's perhaps no surprise that the junta is wary of Chinese influence,
notwithstanding the two nations' growing economic ties. For decades,
Beijing financially supported communist rebels in northern Burma, even at
one point sending People's Liberation Army troops to reinforce their
Burmese brothers in arms. For the fervently anticommunist junta, memories
of this Chinese patronage are still fresh. It also doesn't help Burmese
nationalism that large parts of Mandalay, the country's second largest
city and historic royal capital, have turned into a giant Chinatown. "The
SPDC wants to remake its image as the new great kings of Burma," says Aung
Kyaw Zaw, the former communist rebel who now lives in Yunnan. "So even if
they take advantage of China for business reasons, they don't want any
foreigners interfering in their kingdom."

That notion of a Burmese kingdom has already been threatened by the
country's ethnic minorities. In the 1990 elections that the military
disregarded, its proxy party was trounced by Suu Kyi's National League for
Democracy. But what's often forgotten about those polls is that the
parties that finished second and third in terms of parliamentary seats
were ethnic ones from Shan and Arakan states, respectively. (The military
party came in fourth.) Burma's generals surely want to avoid a repeat of
that ethnic electoral success.

Back in the hills of Laiza, as mosquitoes began to swarm in the late
afternoon, I met Lieutenant Colonel Hkam Sa, who runs a training course
for KIA officers. He has been with the rebel army since 1963, just two
years after it was formed. For the first time since the KIA signed its
cease-fire with the junta 15 years ago, he canceled classes and sent his
battalion commanders back to active duty. "When I joined the KIA, I was 17
years old and I thought that Burma would end in the flames of civil war,"
he told me. "Today, if you ask me the same question, I will give you the
same answer: Burma will end up in civil war." If he's right, the hills of
northern Burma will crackle with gunfire once again, and Felix will be
heading off to battle.

____________________________________
ON THE BORDER

September 11, Shan Herald Agency for News
Chinese delegation visits Panghsang

A 15-member Chinese delegation crossed the border and was received by Wa
officials in Panghsang, the capital of Wa State  yesterday, according to
sources close to the United Wa State Army (UWSA), as tension continued to
escalate between the group and the Burmese military junta.

The delegation was made up of representatives from various government
agencies: the military, police, border security, cross border trade and
agriculture, among others. Identities of participants were not disclosed,
apart from the sources saying that most of the top Wa leaders are now in
Hsaopha to attend the funeral of the Wa State founder Chao Ngi-lai, who
died on September 8.

Yesterday’s meeting, where host officials were questioned about the
current stormy relations with Naypyitaw lasted from 09 to 11. “It ended
with a concluding speech by a visiting official that China would be happy
to see Burma resolve its problems in a peaceful manner,” said a source.

The speech echoed what Jiang Yu, China’s foreign ministry spokeswoman said
yesterday, according to Xinhua, in response to a question whether or not
China had provided information that had led to the Burmese Army’s recent
crackdown on the Wa’s northern ally the Kokang: “China never interferes in
Myanmar’s internal affairs and would like to see Myanmar resolve its
issues though peaceful consultations.”

The Wa territory on the Sino-Burma border is now besieged by the Burmese
Army in the north and southwest. The Salween forms a natural barrier in
the west and China a political barrier in the east. Only a small corridor
exists between it and its southeastern ally, the Mongla-based National
Democracy Alliance Army (NDAA).

____________________________________
BUSINESS / TRADE

September 11, Reuters
Total says won't quit Myanmar after NGO accusation

Paris - French energy major Total will not leave Myanmar, its head told a
French daily, after a U.S. environmental group accused it of supporting
the country's military junta with revenue from its gas operations.

The report by Earth Rights International (ERI) said the Yadana gas
project, which also involves Chevron Corp of the U.S. and Thailand's PTTEP
PTTE.BK, had generated $4.83 billion for the regime since 2000, nearly all
of which was siphoned off from the national budget and into offshore bank
accounts in Singapore.

"The mission of Total is not to restore democracy in the world," Total
Chief Executive Christophe de Margerie told Le Parisien in an interview
published on Friday.

"I repeat, leaving will not make human rights more respected ... If this
gas was not produced by Total, it would be by others, and it would change
nothing to the revenues of the junta."

Margerie also said Myanmar opposition leader and Peace Nobel prize winner
Aung San Suu Kyi, who has spent most of the past 20 years in detention by
the junta, had not asked Total to go.

"She never asked me to leave Myanmar. Never!" he said.

Despite a broad range of sanctions placed on Myanmar by the U.S. and
European Union because of political repression, its vast reserves of
natural gas have been a financial lifeline for the regime.

In November 2005 Total agreed to pay compensation to eight Myanmar
citizens who accused the group of forced labour.

Contacted by Reuters on Friday, a Total spokesman did not wish to comment
further on the interview

____________________________________

September 11, Irrawaddy
Kokang crisis disrupts border trade - Kyi Wai

Rangoon — The conflict in the Kokang area near the Sino-Burmese has
disrupted border trade and caused shortages of Chinese goods in markets as
far away as Rangoon and Mandalay.

The shortages will lead to price rises, according to local traders.
A shopkeeper who sells popular brands of Chinese-made snacks at Rangoon’s
Yuzana Plaza in Rangoon said: “If we don't get fresh supplies by the end
of this month, prices will jump.”

Other major Rangoon markets such as Mingala, Nyaung-bin Lay and Thein-gyi
also report shortages of Chinese goods. One trader said supplies of food,
medicine and electronic equipment had dropped in the past 10 days by
one-third.

A Chinese trader in Nyaung-bin Lay market said supplies of Chinese-made
formula milk powder, biscuits and dry noodles had run out. Suppliers were
reluctant to travel to the Kokang area, he said.

"No one dares to go to the border, because we are still receiving
information that the situation in that area is still not good,” said a
Mingala market trader. “So, there are no new imports. We are buying
supplies from other local traders from Muse and Mandalay. I am sure prices
will rise.”

In Mandalay, a trader said 70 percent of the consumer goods in local
markets came from China.

"We still have some consumer goods in storage to last the next two or
three months,” he said. “But we don't know when we can get fresh supplies.
So, we have to sell things very carefully."

The trader also thought prices were bound to rise.

Some traders with long experience of market conditions fear that the
Kokang conflict could have long-term effects on the Burmese economy.

One Mandalay trader said the Kokang crisis was being followed with concern
by Burmese-born Chinese.

"If the Wa group gets involved in this conflict, it will get much worse,”
he said. “My relatives in Lashio live in fear, because Burmese government
troops are collecting people at night and forcing them to be army porters.
Half the population in Lashio are Kokang and Wa.”

The trader said government forces in Northern Shan State are selectively
conscripting only Chinese, Kokang and Wa people as porters to be used in
the front line.

Meanwhile, the state-run newspaper Myanma Alin reported on Thursday that
the Kokang area is now peaceful and stable. The refugees who fled into
neighboring China are returning and 14,253 had so far crossed back into
Burma, the newspaper said.

Myanma Alin also reported that the authorities are selling chicken and
fish cheaply to residents of Laogai, the Kokang capital. Local stores,
shops and market are open for business as usual.

The newspaper said government troops were digging new drains and working
on other municipal projects for Laogai.

____________________________________

September 11, Shan Herald Agency for News
Casinos in Mongla closed

Ever since tensions were on the high between the Burma Army and the
ceasefire groups, operators of casinos in Mongla have departed leaving the
Wan Hsieo gambling complex south of the city a ghost town, according to
reports coming from the border.

Opened in April 2006, gambling houses in Wan Hsieo, 16 km southwest of
Mongla, are the result of China’s threat to its authorities in 2005 to
suspend its gambling operations that began in 1997. Beijing had been
reportedly losing billions of dollars siphoned by government officials.
[Casino on the Mekong at Tonpheung, Bokeo province, Laos (Photo: Manager)]

Casino on the Mekong at Tonpheung, Bokeo province, Laos (Photo: Manager)

But even better than Mongla, Wan Hsieo had provided Chinese gamblers with
internet facilities which enable them to do their bettings without having
to travel in person to Mongla.

However, since 2007, more casinos have sprung up in the neighboring Laos
especially in Boten, opposite China’s Mohan, where Mongla leaders have
also made investments.

“There are reports that Sai Leun (leader of Mongla) is also one of the
investors at Tonpheung,” said a Thai Burma watcher in Chiangrai.

The giant casino on the Mekong at Tonpheung, Bokeo province, Laos,
opposite Chiangsaen of Thailand and Tachilek of Burma, was opened
yesterday. Constructed on a 2,067.5 acres of land since last year, it is
spending $ 85 million for its first phase developments, reported
Thailand’s The Manager Online.

____________________________________
HEALTH / AIDS

September 11, Mizzima News
HIV/AIDS voluntary groups to register with health ministry - Nem Davies

New Delhi – The Burmese Ministry of Health has directed a network of
voluntary groups, which are providing assistance to people living with
HIV/AIDS, to register with the ministry.

The National Health Programme (NHP) under the Ministry of Health earlier
this month issued a directive ordering the networks working for people
living with HIV not to function in their own names but to register under
Sexually Transmitted Diseases and HIV prevention unit of the Ministry of
Health.

“They don’t want to see these networks working in their own names,” an
official of an INGO working for HIV/AIDS told Mizzima.

The directive states that if the groups want to function on their own,
they must apply for registration through various stages such as Township,
District and finally at the Home Ministry in keeping with the law.

“It’s almost impossible. We won’t be allowed to register even if we apply
for it. This is the usual phenomenon in Burma,” the official said.

“The directive does not say anything on action to be taken for
non-registration. So we are continuing our work as usual,” another
official of an INGO, who received the directive issued by NHP from
Naypyitaw, said.

The networks namely ‘Mee Ein Shin’, ‘Tet Myanmar’ and Padomma, are
basically formed with people living with HIV and these people are
personally involved in providing assistance to other people living with
HIV across the country.

“Peer-to-Peer relationship is achieving more understanding among us. We
can give them more care and sympathy. We can encourage our fellow people
who live with HIV,” an official at the ‘Myanmar Positive Group’ (MPG), who
is also living with HIV, told Mizzima.

These networks had started work in 2004 and have gradually expanded with
over 100 members involved in voluntary works.

An official of the UK-based international HIV/AIDS alliance group, which
is providing technical and financial assistance to these small networks,
said, “These networks are formed to encourage each other to enjoy social
freedom as other ordinary people and to resist social ostracism. This is
their main objective.”

These networks help people living with HIV to receive Anti-retroviral
(ARV) drugs by connecting them with groups that are providing medical
assistance, and serving as attendants in hospitals and distributing
pamphlets.

According to the announcement made by French NGO Medicines Sans Frontier
(MSF) on 25 November 2008, there are about 240,000 people living with
HIV/AIDS in Burma and over 75,000 of them are in urgent need of ARV.

But the actual availability of this essential drug is less than 20 per
cent of the total needy patients, the announcement said.

They have to give substitute drugs for ARV, the antibiotic Septrin
instead, an official, who is working in the field in central Burma for the
UK-based International HIV/AIDS assistance organization told Mizzima.

“Our organization can give ARV drugs to only 120 patients in the whole
country. The rest of them can be given only substitute drugs, Septrin,
just to contain the disease. It is less effective,” he added.

The organization has been providing essential drugs to only a limited
number of people with HIV/AIDS in central Burma region of Mandalay, Bagan,
Poppa, Yenanchaung, Myingyan, Sagaing and Monywa.

But sources said, a majority of the people with HIV still lack the drugs
and urgently need it.

“The government gives assistance on a small scale. They can give it to
only 50 people in Magwe. The requirement is much more than that,” another
official of an international aid group said.

The ‘Global Fund’, the main provider of assistance in the fight against
TB, Malaria and HIV/AIDS, suspended its assistance to Burma in August
2005, after citing government restrictions on the group’s volunteers.

After the junta restricted the movements of humanitarian assistance
workers in Burma and the suspension by the Global Fund, the fund for
fighting the three diseases have been given in the name of ‘Three Diseases
Fund – 3 D Fund’ since 2006.

Australia, the European Commission, Netherlands, Norway, Sweden and
Britain under the 3D funds provided USD 100 million to fight against these
diseases until 2011.

____________________________________
REGIONAL

September 11, Agence France Presse
Singapore banks reject Myanmar junta cash report

Singapore — Two Singapore banks have rejected a report by a US-based
rights group that said Myanmar's ruling junta deposited billions of
dollars with them.

DBS Group Holdings and Oversea-Chinese Banking Corp (OCBC) said in
separate statements late Thursday that there was no truth in the report by
EarthRights International (ERI).

"ERI's report is categorically untrue and without basis," a DBS
spokesperson said in the brief statement.

A spokesperson from OCBC also rejected the report.

EarthRights International had said in a report released Thursday that
energy giants Total and Chevron were propping up the Myanmar military
regime with a gas project that allowed the junta to stash almost five
billion US dollars in the two Singaporean banks.

The report said the junta had kept the revenues earned from the project
off the national budget and stashed almost all of the money offshore with
DBS and OCBC.

"Total and Chevron's Yadana gas project has generated 4.83 billion dollars
for the Burmese regime," one of the reports said, adding that the figures
for the period 2000-2008 were the first ever detailed account of the
revenues.

"The military elite are hiding billions of dollars of the peoples' revenue
in Singapore while the country needlessly suffers under the lowest social
spending in Asia," said Matthew Smith, a principal author of the report.

French energy giant Total has also rejected the report, saying the
document was riddled with errors and false interpretations.

____________________________________
INTERNATIONAL

September 11, Irrawaddy
Webb to hold congressional hearing on US Burma policy - Lalit K Jha

US Sen Jim Webb, a strong advocate of lifting economic sanctions against
Burma’s military junta, announced on Friday that he plans to hold a
congressional hearing on the impact and effectiveness of US policy toward
Burma.

Webb, who serves as the chairman of the East Asia and Pacific Affairs
Subcommittee of the Senate Committee on Foreign Relations, visited Burma
last month, when he met with Snr-Gen Than Shwe, who heads the ruling
regime, as well as pro-democracy leader Aung San Suu Kyi.

He was the first US lawmaker to visit the country in a decade.

Since his return from Burma, Webb has been seeking to ease US economic
sanctions against the country by arguing that they have not worked and
have only helped China to gain more space in Burma.

“Senator Webb intends a comprehensive hearing to examine Burma’s current
economic and political situation and to seek testimony regarding that
country’s long history of internal turmoil and ethnic conflicts,” said a
statement issued by his office.

The hearing will evaluate the effectiveness of US policy toward Burma,
with a focus on US-imposed economic sanctions that have not been matched
by other countries. It will also discuss what role the United States can
and should play in promoting democratic reform in Burma, and hear
testimony on how to frame a new direction for US-Burma relations.

The names of those who will testify at the hearing were not released.

During his recent visit, Webb also told key leaders in Thailand, Laos,
Cambodia, and Vietnam that they and other members of the Association of
Southeast Asian Nations should join together in calling on the Burmese
leadership to free Suu Kyi from house arrest and allow her to fully
participate in elections scheduled for 2010.

Webb was the first American official ever to meet with Than Shwe. During
his visit, he secured the release of US citizen John Yettaw, who had been
sentenced to seven years’ imprisonment for illegally entering Suu Kyi’s
home.

On Thursday, New York-based Human Rights Watch (HRW) urged the US
government in a letter sent to Secretary of State Hillary Clinton that the
US should immediately conclude its Burma policy review and take
initiatives to make its policies on diplomacy, sanctions and humanitarian
assistance more successful.

HRW also said generalized sanctions on Burma that have had little or no
impact and have not targeted policy makers and human rights violators
should be reconsidered and phased out at an appropriate time.

“Delays in announcing a new Burma policy could encourage Burmese military
leaders to believe the US is weakening its commitment to human rights and
pluralism,” said Brad Adams, the Asia director of HRW.

____________________________________
OPINION / OTHER

September 10, Asia Times
China, Myanmar border on a conflict - Brian McCartan

Bangkok - An ominous lull has fallen over northern Myanmar since the
military government's defeat last week of Kokang ethnic insurgents. All
sides appear to be preparing for the next round, which, depending on the
scale of the offensive or counter-offensive, could plunge other ceasefire
regions into renewed civil war.

It is unclear whether Myanmar's generals are willing to challenge the
better-armed ethnic Wa and Kachin - and by proxy potentially China - or if
recent moves are part of an elaborate strategic bluff. By taking out the
Kokang, which in their tens of thousands fled across the border into
northern China, the junta has tested both Beijing's resolve to back
Myanmar-based insurgent groups and the willingness of the ceasefire groups
to militarily support each other.

Many analysts believed that past Chinese support for ceasefire groups
along its border would discourage the junta from carrying out its threats
to force them to transform into border guard units under the government's
command in advance of next year's democratic elections. That analysis was
bolstered by reports that Chinese officials told their Myanmar
counterparts that they would brook no instability along their shared
2,185-kilometer border in the run-up to this October's 60-year
celebrations of the communist victory in China.

Myanmar's junta has demanded that the main ceasefire groups in northern
Myanmar, including the United Wa State Army (UWSA), the Kachin
Independence Army (KIA), the National Democratic Alliance Army-Eastern
Shan State (NDAA) and the Myanmar National Democratic Alliance Army
(MNDAA) reduce the size of their forces and join a Myanmar
army-administered Border Guard Force.

The transformation of autonomous militias to state-controlled border
guards would require the various ethnic political organizations battling
for autonomy in their regions to lose their armed wings and effectively
diminish their negotiating leverage vis-a-vis the regime. All of the
mentioned groups rejected the proposal. Instead they requested to continue
with the current ceasefires until after elections and work out new
arrangements with a democratically elected government.

China has been supportive of the ceasefire groups through calls for
national reconciliation, by mediating in disputes between the groups and
Myanmar's military and by putting pressure on the regime to refrain from
using force to press its demands. Those overtures suit Beijing's broad aim
of maintaining stability in border areas while simultaneously providing
Beijing military and political proxies in case of instability inside
Myanmar, as witnessed in the massive civil unrest in 1988 and 2007.

Myanmar's stability is important to China because of its hefty investments
in natural resource extraction and the country's strategic geography as a
conduit to the sea for trade from China's landlocked southwest Yunnan
province. Construction of an oil and gas pipeline is slated to begin this
month and finish in 2012 which will allow China to receive shipments of
Middle Eastern fuel without having to travel through the Malacca Straits.
China is known to fear the potential of a naval blockade there in any
potential conflict with the United States.

The recent offensive against the Kokang resulted in China reinforcing its
police and military units along the border and a rare rebuke from the
Foreign Ministry. A statement released from Beijing on August 28 said
China "hopes that Myanmar can appropriately solve its relevant internal
problems and safeguard the stability of the China-Myanmar border". It went
on to request that the government "protect the safety and legal rights of
Chinese citizens in Myanmar".

Myanmar in turn apologized for any Chinese casualties that occurred during
the hostilities and thanked Beijing for its assistance in caring for
refugees. According to Chinese officials in Yunnan province, around 37,000
refugees streamed across the border in the wake of the recent fighting.
Security analysts are now eyeing the outcome of meetings between Chinese
and Myanmar officials and the impact they could have on regional security.

Dropping the gauntlet

Many were surprised by Myanmar's apparent willingness to challenge China
on the ceasefire groups. Opposition sources claim that two meetings
between high-level officials already took place on August 31, entailing
one in Yunnan between Myanmar Deputy Home Affairs Minister Brigadier
General Phone Swe and Chinese Minister for Public Security Meng Jian, and
another in the northern Myanmar town of Lashio between senior officers of
the Chinese People's Liberation Army and the Myanmar Army, including
Lieutenant General Min Aung Hlaing, commander of all units in Shan State.

An alliance of ceasefire groups known as the Myanmar Peace and Democracy
Front (MPDF) and encompassing the MNDAA, UWSA, NDAA and the KIA was
established in March to show a united front against the military regime
and its autonomy eroding Border Guard Force proposal. The alliance was
only announced in August when tensions between the Kokang-led MNDAA and
the Myanmar military began to mount. Another ceasefire group, the Shan
State Army (North) located in central Shan State, is also believed to be
linked to the grouping.

The MNDAA were recognized by the Myanmar military as the weakest link in
the loose alliance. By exploiting a split among the Kokang leadership over
its position on the Border Guard Force proposal, the regime was able to
move quickly against the MNDAA on August 27 and drive them from their
capital across the border into China or into the surrounding mountains in
only two days.

The offensive tested the resolve of the 20,000-strong UWSA to come to the
aid of their neighboring alliance partners. The alliance was previously
touted as a mutual security guarantee, but that is not how it played out
on the battlefield. Although a force of around 500 UWSA soldiers from its
northern Namteuk-based 318 Division initially reinforced the Kokang, they
pulled back the next day to Wa-controlled territory south of the Namting
River.

Some Myanmar watchers saw the tactical retreat as a lack of resolve on
behalf of the UWSA, an assessment the Myanmar army may now share. At the
same time, Myanmar's generals now have some idea of what China's response
would be to potential offensives against other ceasefire groups.

It is unclear what battlefield advantage Myanmar military's may have
gained by its successful assault against the Kokang, but its reinforcement
of units facing other insurgent positions, including the placement of more
artillery and tanks against the NDAA and Wa troops along the China and
Thai borders, suggests it believes it has won an upper hand.

At the same time, strategic analysts doubt whether the military could
launch a full-scale offensive against ceasefire groups and maintain
security over next year's elections. The UWSA and KIA represent stronger
adversaries than the MNDAA. The UWSA has 20,000-25,000 soldiers backed by
mortars, artillery and anti-aircraft weapons. The KIA has another 5,000
soldiers under arms and were previously able to hold the Myanmar army at
bay for nearly two decades.

Security experts, including a Thai intelligence officer who spoke on
condition of anonymity, believe it could take a decade or more of heavy
fighting to finally subdue the groups. Throughout the 1960s and 1970s, the
Wa fought bloody pitched battles with the Myanmar Army as part of the
Burmese Communist Party. The Wa are even better armed now than they were
then. Even without Chinese aid, the KIA, UWSA and NDAA could adopt
guerrilla strategies that prolong the fighting.

The insurgent forces of the Karen, Karenni and Shan on the Thai-Myanmar
border are also a thorn in the regime's side, despite losing substantial
territory and largely disowned since the 1980s by Thailand. Bangkok
previously supported ethnic groups along its border as a buffer against
Myanmar but now commercially engages with the regime, including the import
of crucial natural gas supplies.

Wider conflict
With the predictions of possible protracted warfare and by showing its
hand against the MNDAA, it is unlikely that Myanmar's military will be
able to exert control over the ceasefire regions in time for the 2010
elections. The large number of troops it would take to defeat the
insurgents would also weaken the regime's hold over security in other
parts of the country.

Myanmar's junta still clearly fears the possibility of widespread urban
civil unrest, as seen in the 2007 Buddhist monk-led Saffron Revolution and
which some Myanmar watchers believe is still simmering below the surface.
The regime thus requires a large security presence in and around Myanmar's
cities as a deterrent against future protests.

Ceasefire groups in other parts of the country are similarly peeved with
the border guard proposal and provisions in the new constitution and may
see renewed hostilities in the north as chance to resume their armed
struggles. Such groups, analysts say, could include the New Mon State
Party in the southeast, which was the first group to reject the border
guard proposal, as well as groups representing smaller ethnic minorities
such as the Karenni and Pa-O in eastern Myanmar.

The need for the army to shift troops to the north would also give
beleaguered non-ceasefire groups such as the Karen National Union and the
Shan State Army (South) breathing room and an opportunity to rebuild their
beleaguered forces. A worst case scenario for the regime could see these
groups joining with the northern insurgent groups in a new, wider
alliance. Although these alliances have not fared well in the past and for
the time being seem unlikely, it is a scenario that would quickly
over-stretch the regime's ground forces.

China may eventually call Myanmar's bluff. While China has willingly
accepted Kokang refugees onto its soil, Beijing would no doubt be less
tolerant of the sustained disruption in trade and investment caused by
large and persistent refugee flows driven by more open warfare. Ramped up
Chinese support for the ethnic groups would limit the impact of Myanmar
military assaults on border regions and potentially spark a protracted war
that Myanmar's cash-strapped regime clearly cannot afford.

That could mean the generals allow other ethnic groups to retain their
arms and ceasefire status until after the elections and then push them to
negotiate a new deal with an elected government under the new
constitution. That scenario, however, would require the generals to
swallow their military pride, something they have shown a strong aversion
to in the past.

Brian McCartan is a Bangkok-based freelance journalist. He may be reached
at brianpm at comcast.net.

____________________________________

September 12,The Daily Star (Bangladesh)
US Senator's Burma trip may lead to Aung San Suu Kyi's release - Larry Jagan

SENATOR Jim Webb's visit to Burma may yet prove to be extremely
significant as he seeks to swap western sanctions for engagement with the
military regime. "It is vitally important that the United States re-engage
with Southeast Asia, including Myanmar, at all levels," the American
politician told journalists during a press conference in Bangkok
immediately after he left Rangoon.

One of the key reasons he sees for the need for the US to strengthen its
role in the region is China's growing influence, which he believes is a
major obstacle to economic and political development in the area,
especially Burma. If the senator gets his way, and US policy begins to
change, it will also have important consequences for the countries of
ASEAN, India and Bangladesh. More importantly the senator's trip reflects
the junta's new approach to the international community and especially its
neighbours. The trip may also lead to the early release of the detained
opposition leader Aung San Suu Kyi.

Senator Webb's main mission on this visit was to meet the reclusive
Burmese military rulers in their hideaway in the mountains north of the
former capital Rangoon and try to coax them out of their isolation. He had
talks with the junta's top general, Than Shwe who rarely meets foreign
visitors and the detained opposition leader Aung San Suu Kyi.

But at this stage everything to do with his visit is still shrouded in
mystery. Despite meeting journalists on two occasions while in Bangkok,
the usually talkative politician was overtly coy, extremely evasive and
continually non-committal. “He is hiding something,” said a senior western
diplomat who closely follows Burmese affairs. “He knows more than he's
telling, something is surely afoot.”

This was certainly no ordinary or even private visit, despite senior state
department officials insisting that the senator visited Burma in a
personal capacity. The US Secretary of State, Hilary Clinton, rang him on
Sunday night to talk about the trip, Webb let slip during his press
conference last week. This only adds to the increasing suspicion that
something significant may be happening beneath the public gaze. After all
that is how serious diplomacy takes place.

Senator Webb, it must be remembered, is a rising political star in
Washington, close to the Clintons and President Barack Obama, according to
sources on the Hill. He is also tipped to become the next secretary of
defence, when the Bush-appointee Bill Gates stands down in around two
years' time. He is currently the chairman of the Senate foreign affairs
East Asia and the Pacific sub-committee. It is this guise he is using to
justify his visit. Add to that the fact that he is a former marine and
Vietnam veteran, making him some the senior general respect. So the US
could not have had a better envoy even if unofficially -- than this
conservative Democrat from Virginia.

While Webb as was expected told Than Shwe that Aung San Suu Kyi should be
released before the 2010 election, and allowed a political role. “We will
just have to wait and see how the Myanmar government responds,” he told
journalists at the end of his visit. “I am hopeful that they will give my
recommendation [that she be freed] serious consideration,” he added.

“Than Shwe can be in no dount, that without Aung San Suu Kyi being
released and her party the NLD [National League for Democracy] allowed to
participate in the elections, the US and the international community would
find it impossible to accept the process as free and fair,” he said.

For the generals, their apparent attitude to the senator during his visit
also significantly suggests that they are shifting in their usual position
on non-engagement with the international community. Senator Webb was given
a ceremonial reception with all the top generals that is usually reserved
only for visiting heads of state. Shown prominently on the state-run
television, it clearly shows Burma's military rulers now crave
international, especially American, recognition, said a long-time foreign
resident in Rangoon.

General Than Shwe is the master of disception and psychological warfare.
Divide and rule an approach to power cleaned from their colonial masters,
Britain -- has long-dominated the Burmese generals strategic options.
Their chauvanism and xenophpbia makes them extremely cautious about being
over reliant on any one ally.

At present there are growing concerns at the top of the military about
China's position, and the top gneeral is looking at how tobalance their
growing influence in the country. Relations with ASEAN, India and to some
extent Russia, was menat to do that but over the last twelve months
China's economic and military role has grown out of all proportions
dwarfing the position of the other Asian allies. “More critically, China
has not backed the regime strongly enough in its efforts to disorm the
ethnic cease-fire groups,” Win Min a Burmese academic at Chiang Mai
University told the Daily Star. “This has angered the Than Shwe, who may
now be looking for alternative ways to reign in the rebel groups.”

“The warm reception given to the US delegation led by Senator Webb,
including the diplomat staff based in Rangoon who are normally shunned or
called in to get a dressing down was a clear signal to the Chinese,” said
an Asia diplomat based in Rangoon. “See if you don't help us we can turn
to other powerful friends.”

So the Burmese military regime seems to be trying to make some
international re-alignments. But if they are serious about engaging the
international community, espcially the US, it may even heed some of its
concerns, and then they will have no alternative but to deal with Aung San
Suu Kyi. Than Shwe, at the behest of some of its Asian allies, especially
Singapore and China, is keen to improve relations with the US, according
to military sources in the Burmese capital Naypitdaw. The senator's visit
makes this extremely evident.

“You cannot fail to see in this that the junta is keen to tell the world
that sanctions do not work and we are open to dialogue at least with other
governments, if not Aung San Suu Kyi and the pro-democracy movement inside
the country,” said a western diplomat based in Rangoon. But the hints from
the Americans, is that this was more than an exploratory trip by the
Senator concrete matters were discussed and some kind of deal maybe in the
pipeline.

“I believe that if the right obstacles are removed and if the United
States has a very clear position on some of these obstacles the notion of
sanctions economically in this country is negative 
 it is not good,” he
told Burmese journalists at the airport before he left on Sunday.

One of the key obstacles is certainly the continued detention of Aung San
Suu Kyi. The season Burma-watcher, and former British ambassador to
Thailand and Vietnam Derek Tonkin is another who believes there is more to
Webb's than meets the eye as yet. “I sense there is more to this vists
than we know,” he told the Daily Star. “It is probably all about a deal on
Suu Kyi,” he added.

Aung San Suu Kyi will be released before the elections next year, a senior
military source told the Daily Star. These are expected to be held late
next years. But now is seems likely that the Lady, as she is frequently
referred to in Burma, may be freed before the end of the year.

The author writes for The Daily Star from Bangkok.

____________________________________

September 10, The Jamestown Foundation China Brief Volume: 9 Issue: 18
Emerging Fault Lines in Sino-Burmese Relations: The Kokang Incident - Ian
Storey

Armed conflict between Burma’s armed forces (known as the Tatmadaw) and
the Kokang militia (known as the Myanmar National Democratic Alliance
Army, MNDAA), along the Sino-Burmese border in late August brought into
sharp focus the complex and sometimes testy relationship between Burma
(Myanmar) and the People’s Republic of China (PRC). During the fighting
the MNDAA—which has close links to the PRC—was routed, over 40 persons
were killed, and tens of thousands of refugees streamed across the border
into China. The incident underscored how the ruling junta, the State Peace
and Development Council (SPDC), is capable of undertaking actions that
challenge Beijing’s interests, belying characterizations of Burma as a
client state of China.

Burma and China forged close relations in the late 1980s following
international disapprobation and economic sanctions in the wake of their
crackdowns on anti-government demonstrators in August 1988 and June 1989,
respectively. On balance, both governments benefited greatly from
tightening relations: the Burmese military regime was able to consolidate
power largely thanks to arms, economic aid and the diplomatic recognition
provided by the PRC; in return, China gained privileged access to Burma’s
rich natural resources and access to the Indian Ocean (China Brief,
February 7, 2007).

China’s economic penetration of Burma deepened in the first decade of the
twenty-first century as the West tightened economic sanctions against the
regime. Bilateral commerce reached $2.4 billion in 2007-2008, accounting
for a quarter of all Burma’s foreign trade and a 60 per cent increase over
what it was three years ago (Mizzima News, October 24, 2008). Chinese
companies have invested heavily in the country’s manufacturing, mining,
power generation and energy sectors, and in 2008-2009 China emerged as
Burma’s number one investor, pumping $856 million into the country, or 87
percent of all foreign investments (Deutsche Presse-Agentur, July 14).
Close relations with Burma have also enabled China to improve its energy
security situation. In March, after several years of negotiations, an
agreement was signed to build twin oil and gas pipelines from the port of
Kyaukphyu in Arakan State to Kunming, Yunnan Province. Construction of the
1,200 mile pipelines is scheduled to begin this month, with China footing
the $2.5 billion bill. When completed in 2013, the pipelines will not only
be used to transport oil and gas from Burma’s offshore energy fields to
the PRC, but also from the Middle East and Africa, thereby bypassing the
Strait of Malacca, which Chinese strategists view as a strategic
vulnerability (China Brief, April 12, 2006).

Despite the obvious gains Burma’s junta has accrued from its ties to the
Chinese government, the ruling generals—many of whom fought against the
China-backed Communist Party of Burma (CPB) in the 1960s and
1970s—resented their dependence on Beijing and from the mid-1990s moved to
lessen that dependence by joining ASEAN and courting other major powers
such as India and Russia [1].

Notwithstanding the SPDC’s success in diversifying the country’s foreign
relations, China remains Burma’s most important international partner.
Moreover, despite the absence of genuine trust between the two
governments, China and Burma have arrived at a mutually beneficial
arrangement: Beijing provides diplomatic cover for the junta at the United
Nations, soft loans and weapons supplies; in return it expects the SPDC to
provide stability so Chinese companies can reap long-term returns on their
considerable investments.

China has lived up to its side of the bargain. Twice in 2007 it wielded
its veto at the United Nations Security Council (UNSC) to protect Burma in
the face of international criticism (China Brief, October 17, 2007). More
recently, in August, China used its diplomatic clout at the UNSC to dilute
a statement of concern following the conviction of Aung San Su Kyi, leader
of the opposition National League for Democracy (NLD), for violating the
terms of her house arrest with the visit by John Yettaw—an American who
swam across Inya Lake to her house—in May (Straits Times, August 15).

On the bilateral front, the PRC has shown increasing signs of frustration,
however, with the SPDC for the slow pace of political reform and economic
development, both of which it believes would defuse popular resentment
against the regime and enhance stability. Beginning in 2004, Chinese
leaders publicly called on the junta to move forward with the so-called
“roadmap to democracy,” the framing of a new Constitution and national
reconciliation. A new Constitution was framed in 2008, but Beijing has
kept up pressure on the SPDC to maintain the momentum. In April, for
instance, on the sidelines of the Baoa Forum in Hainan Province, Prime
Minister Wen Jiabao told his Burmese counterpart Thein Shein that China
hoped the SPDC could achieve “political stability, economic development
and national reconciliation” (Xinhua News Agency, April 17). The detention
of Ms. Suu Kyi in May was a major setback for national reconciliation, and
prompted China’s Foreign Ministry to call for reconciliation, stability
and development through “dialogue with all parties” (Xinhua News Agency,
May 19). According to some reports, China has advised the junta to allow
U.N. Special Envoy Ibrahim Gambari to play a more active role in fostering
dialogue between the SPDC and Suu Kyi, advice the junta is loath to accept
(Mizzima, January 20).

For the remainder of this article, please visit:
http://www.jamestown.org/single/?no_cache=1&tx_ttnews[tt_news]=35468&tx_ttnews[backPid]=7&cHash=3cc6a7017c