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September 18, 1999
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Southeast Asia

Dealing with Burma: The unpleasant question
By David Steinberg

(This is a slightly edited transcript of a talk by Professor Steinberg, entitled "Approaching Burma/Myanmar: Foreign policy dilemmas", at Monash University on August 3,1999. This article is reprinted in full from the website of the National Centre for South Asian Studies at the Monash Asia Institute, Monash University in Melbourne, Australia: )


There is no other country in the world where the terminology one uses places one in a political camp. Hence I need to explain the terms Burma and Myanmar. I use both, and I attach no political significance to the use of either term here.

We are in a very difficult position with Burma for a number of reasons: we have little data; the little data we have are skewed; details are lacking and what details are available are influenced by the politics of the country. Second, polarisation affects how we look at society and makes it difficult to deal with policy issues It is now clear that it is impossible for the US government, for example, to compliment the military for anything they do or anything that might be right. For example, opium production is down 30% since last year but for the US government to say to the SPDC 'good work' legitimates the SPDC in the eyes of the opposition. On the other hand, if you want to criticise the opposition by saying they are wrong on a certain policy, that legitimates the military too. So politically it is very difficult to deal objectively with the situation in Burma.

Why Burma/Myanmar

The first question one has to ask is why bother about Burma/Myanmar? We had the first international conference on Burma in 1985 at the Wilson Center at the Smithsonian Institution, at which I was an 'unindicted co-conspirator'. The people who ran the Wilson Center asked why anyone should be interested in this country. There are a lot of other things in the world to be interested in, so why bother about Burma, which was isolated and to which few people paid attention?

There are several reasons today why we should be interested in Burma/Myanmar. There are geopolitical reasons. I want to go into these at some length later because the issues have also changed. There are international issues, which relate to refugees; then there are the questions of illegal labour, health and HIV, and prostitution. All of these have effects on the countries around Burma. Burma is no longer isolated and affects its neighbours in important ways.

There are also issues from which we might learn lessons-for example, Burma is a multicultural society, and the problems associated with that might apply elsewhere. In 1980, the question around Rangoon was what do we Burmese do in the post-Ne Win period? The answer was that what we need is the model of a post-Tito Yugoslavia. There are lessons here one ought to be thinking about.

There are also questions about the role of the military in society and how the military in Burma compares with other military; how and why the military gains power and leaves power. All of this is very important. There are additional issues about the private sector, about how it will or will not operate - questions about how to change a centrally planned economy into a more open one. In Burma's case, not a communist economy but a centrally planned one nevertheless, and one that has had a stormy relationship with the private sector

Then there are issues related to ASEAN.

About a lot of these things we can learn by paying attention to Burma, and I think we ought to.

These are my personal interpretations and, as you will see below, I find myself in disagreement with many opinions on all of these issues.

Burmese reality

So what is the contemporary reality in Burma today? In my view the military is determined to retain power in that society. It may civilianise but it will not have a civilian government it does not control. That, I believe, is its plan. The circumstances might change; but that is my view of the military's intent.

Second, the military is stronger now that it has been before. It is stronger and it has expanded its role and its numbers. Its armaments have increased-some US$1.4billion worth of new arms since 1988. It has effectively neutralised a large part of the minority opposition. There have been about 16 cease-fires which are fragile, but now the military is not losing troops except on Karen front. The Communist Party has disintegrated. So the military is in a strong position.

Third, the National League for Democracy is in a weaker position than it has been in the past. The military is out to destroy the National League, to isolate Aung San Suu Kyi from the League and to make sure they never come to power.

There has been a solidification of all the views held by everyone since the May1990 election, the results of which were not honoured by the government. The NLDP won 81% of the seats and 67 % of the vote, but have not been allowed to assume their seats. Since the elections, and as a result, the positions have all hardened. I believe that the military really believed that it would win that election. The Burmese military has been very bad at predicting election results. It failed to predict the results of the 1960 elections and the 1990 elections because of the isolation of the military hierarchy from the realities of society. But it then decided that it was not going to give up power.

The USA has solidified its position as to the need for a turnover of power; the result is that you have more of a stalemate since 1990 than before 1990. Remember that since 1962 Burma has had a repressive military regime, in fact a single party mobilisation state to which most countries gave foreign aid despite the poor economy and human rights violations. We have to ask ourselves, why the change? We will come back to that in a moment.

In the past year there has been an intensified confrontation between the military and the opposition. The military is out to destroy the opposition. It has forced the resignation of many members of the National League for Democracy; it has closed many chapters of the League ; it is clearly intent on eliminating the League as a force in society and it has basically destroyed the infrastructure of the League.

The League has responded by creating a set of confrontations with the military to gain support. The most obvious ones were Aung An Suu Kyi driving outside the town, being stopped in the car, sitting in her car and so on. There was a variety of other confrontations, including the creation of a parliamentary committee, declaring the laws of the military illegal, etc. All this created very strong international support for the National League. How much national support is unclear, but the international support is evident from the publicity they received.

The economy is very weak but unlikely to collapse. Many people disagree on this, but if you talk to the World Bank they would essentially agree with my argument. It is a terrible economy; people are suffering, inflation is very high; according to General Abel, Chief Advisor on the economy to the SPDC, the government budget will be cut by 47% this year. The cut will be on services rather than the military, proportionally. So the country is going to be in a worse condition. Foreign investment has essentially stopped, not because of sanctions but because the economic crisis in Asia affected Thai and Malaysian investment. So things are bad.

I was just called an hour ago by the West Australian, a Perth based newspaper. They asked me what the likelihood is of a rebellion. The opposition in Perth, which has many expatriate Burmese, say that it is imminent. It was supposed to be imminent last year and earlier. According to what I hear, a rebellion is very unlikely in the foreseeable future. There is always the danger in an autocratic system that someone very low down in the system will do something so stupid that it will create a rebellion. Of course, if anything happened to Aung An Suu Kyi there would be a reaction. Remember that the overthrow of Syngman Rhee in Korea in 1960 occurred because some low-level policeman killed a student and threw the body into the harbour. All of a sudden the whole country rose up against the government and overthrew the regime. But right now this is unlikely in Burma, although it is always possible.

There is a basic element we have to understand in Burma, and that is the role of the state. The distance between the state and civil society no longer exists. The state feels it has the moral authority to interfere in society in a way that would not be acceptable in most Western democracies. It allows them to feel that they can intervene in the media, control what you read, what you say, with whom you associate in all aspects. It affects the economy, civil right, human rights and it means, I think, that any regime in Burma will intervene far more into society than would be acceptable in many other societies. Even the NLD would interfere but it would probably interfere much less than the military.

On the external side there are a number of factors that one has to look at-conditions that are very important today. The NLD is sustained by international support; but the more international support it gets, the more it is accused of being the axe-handle of foreign imperialists out to destroy the country.

I would argue that sanctions have not worked. US sanctions have had a marginal effect. Rather, it has been government incompetence and bad policies and, of course, the financial crisis in Asia that have impacted negatively on foreign investment in Burma. The reason why sanctions don't work is that we do not have a South African situation here. In South Africa, all the countries around were in favour of sanctions. But in the case of Burma there are no countries around Burma in favour of sanctions. In South Africa you had an elite and an economy geared to the West. This is not the case in Burma. With the President of Georgetown University, I had an audience with the King of Thailand in 1993 because the Queen of Thailand had received an honorary degree from Georgetown. We were talking about the King's projects and the King said to me that:

US policy on Burma was wrong; and that the US are the neo-imperialists; the Soviets were the imperialists. Aung San Suu Kyi was really a foreigner, and she should go back to her country, England. He first said that Burma was a democracy, but then stopped and said that rather, Burma was on the road to democracy, and if there were UN sanctions, it will be Thailand that would be hurt by sanctions because the Thais could not control their borders.

He had been well briefed by Thai military security, which at that time determined Thailand's policy on Burma. The King's words give you an indication of the problem.

I think that ASEAN's 'constructive engagement' with Burma was financially oriented and it was essentially phoney-although in Thailand you now have good foreign affairs leadership and some have written eloquently about human rights in Burma. But they are bound by the problems they have with Burma.

The US policy on the recognition of the elections of May 1990 basically says to the Burmese military: get out of power and then we will talk to you. That is a no-win situation. The Burmese military is not about to do that. So we have a stalemate.

Japanese policy is split. I spent a week in Tokyo recently talking with Japanese ministries, think tanks and so on, and it is very clear that Japanese foreign aid is being withheld because the Foreign Ministry is concerned about US reactions. Japan is providing humanitarian aid, including aid to rebuild the Rangoon airport to the value of over US$20million. It is said to be humanitarian because people will be killed if the airport is not fixed. In 1979, I negotiated the re-entry of the USA aid program into Burma with the Burmese Deputy Prime Minister. The first thing they asked was that the Rangoon airport be repaired. But I said that this was not related to basic human needs and that the US would not approve of such a plan.

Geopolitical issues

The most important external issue is Burma's geopolitical role in relation to China. And this relationship has changed markedly. Under the Burma Socialist Program Party (BSPP), Burma was isolated. No-one was interested. Despite the drug problem no-one took much notice except for some anti-narcotics programming. Burma was not part of the nexus of regional power politics. It is now.

Chinese influence has been phenomenal. China has moved into Burma in a way that has upset India considerably. Burma received $US1.4 billion worth of arms from China as soon as SLORC came in, and China supported SLORC in 1988. India then hired Un Nu's daughter to run the Burma Service for All India Radio in opposition to the Burmese government. So under Rajiv Gandhi, Indian policy was anti-SLORC. Then Pakistan began to supply small arms to Burma because India was against it. As the advisor to the Thai Prime Minister said, Thailand was very concerned about China's role. I had lunch with a Chinese military attache in Asia and although we talked a lot about North Korea, I said I don't like China's policy in Burma. He said Burma is in China's geopolitical interest. I asked, 'What would you do if there was a coup against the SLORC?' He said China would support SLORC. I asked what China would do if there were a popular uprising against the SLORC. He said that this would be more difficult but China would still support SLORC.

Now I do not claim that this is an expression of the complete Chinese policy on Burma, but it indicates for me a frame of reference for China. What has China done in Burma? China has built a great deal of infrastructure-road infrastructure, airport infrastructure, bridge construction, and China has modernised the Burmese army in terms of equipment. The Chinese have also moved into Burma economically. There was a meeting in Chengdu a number of years ago with officials from Yunnan province and all the other surrounding provinces. They came together to discuss economic policy. In effect, they concluded that they could not compete with the eastern provinces of China in terms of exports, and said that their markets were south.

What had happened was this. In September 1987, before SLORC came to power, Ne Win demonetised a very large chunk of the Burmese currency and people came to no longer trust the Kyat (Burmese currency). They did not want to hold currency so the farmers started to hold rice, and this pushed up the price of rice. This was one cause of the people's revolution in 1988, in fact. What did the others do, the non-farmers? They purchased commodities. At the same time, the Burma Communist Party was being destroyed and the opening of the frontier with China became possible because that was where the Burma Communist Party had its bases. China was undertaking internal economic liberalisation. Burma had little foreign exchange to import materials for their light industry, so production was very low. But all of a sudden there was this demand for consumer products and the products came from China. I estimated that after 1988, Burma's two-way trade with China was worth about $US 3 billion a year-even though it was illegal. It later became legal under SLORC in 1988.

Burma was trading any commodity you can think of and the Chinese were sending in consumer goods. The Mandalay markets were full of Chinese goods such as rice cookers. In the local shops there were two rice cookers on sale-one made in China and one made in Burma under Japanese licence. The former sold for $20, the latter for $100. I asked the shopkeepers, 'Who buys the Burmese rice cookers?' The storekeeper said the Burmese purchased these to feed the monks. This is because the more you pay, the more merit you get for feeding the monks. This is a different kind of economic equation from those usually used by economists. It is not just economics; you are not only building up an account; you are building up spiritual merit.

China has moved into Burma in a big way. According to the Australian Department of Foreign Affairs, out of a population of one million in Mandalay about 200,000 are Yunnan Chinese. Mandalay was the seat of traditional Burmese culture. Now is has become in a large part a Chinese city, at least in economic terms. The Chinese can move down to Mandalay; they are not supposed to go there but they do. They can buy land by buying Burmese residency permits; they purchase registration cards from people who die and so on. The result is that there is an increased Chinese presence, especially in northern Burma, which I call Baja Yunnan. Northern Burma is tied to the Yunnanese economy. And this is going to be very dangerous. If there were a further crisis in the Burmese economy, it could be taken out on the Chinese, though not on the scale of the Jakarta uprisings against the Chinese. But remember that in 1967 under the Ne Win Government, there was an economic crisis and the resentment was turned by the Burmese government against the Chinese, who were involved in the Cultural Revolution at that time. There were demonstrations in Rangoon and elsewhere, and some people were killed and shops looted.

Chinese access to the Bay of Bengal worries many different people. A former colonel in the Burma Army and also in the top echelon in the BSPP told me that the Chinese are building the airport at Pegu-not far from the Bay of Bengal. Pegu used to be a port in the Bay of Bengal. That, he said, makes an Indian aircraft carrier obsolete in the Bay of Bengal.

That's a strong and important statement. The Japanese are very concerned about the role of China in Burma. A former Japanese general told me that the ability of China to import oil into southwest China via Burma (this is not happening now) and avoid the Straits of Malacca and the South China Sea increases Chinese self-reliance. And this is not in Japan's interest. Now I am not saying that that is a majority view amongst the Japanese, but it does indicate a problem. So far from being a country in which no-one was essentially interested, Burma has become important.

There is another side to this problem. Near the Tibetan border, the Indian government is encouraging the resettlement of tribal people, the Lahu and Lisu, as a buffer against Chinese expansion. Remember that this border was never settled after the Sino-Indian War of 1962, and northern Burma outflanks that region.

So what you have is a degree of tension and insecurity that did not exist before and it is important that we understand it; not that we can do much about it at the moment. But we still need to understand the dynamics of the region.


*Professor David Steinberg, Dean, Asian Studies, Georgetown University. (Reposted with permission from the Virtual Forum on South Asia Security.)

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