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On 27 May, it was ten years since Burma’s democratic opposition, the National League for Democracy (NLD), won a landslide victory in the country’s first general election in thirty years.
Aung San Suu Kyi and Tin Oo are the only internationally known NLD leaders who have not been arrested, and only in order to avoid world-wide criticism. Equally disturbingly, it seems that both the policies of the West (sanctions and condemnation) and the Association of Southeast Asian Nations, or ASEAN (‘constructive engagement’) have proven unsuccessful in forcing Burma’s ruling military to adopt a more sensible approach to the country’s problems. Somewhat paradoxically, Australia and Japan seem to be breaking ranks with the rest of the world’s richer nations in favour of a ‘constructive engagement’ with Burma’s military authorities while Thailand, a prominent member of ASEAN, is moving away from that policy to take a more proactive stance against the regime in power in Rangoon. Both shifts reflect frustrations with failed policies, and the lack of political and economic progress in Burma.
Burma exported only a total of 63,700 tons of rice in 1999, a drop of 42.97 per cent compared with 1998 when it registered 111,700 tons, according to the latest figures of the country's Central Statistical Organization. Last year, export of fish and prawn another important foreign-exchange earner fell by 23.55 percent and 26.42 percent compared with 1998. While those declines were caused by internal economic mismanagement, external factors have also had an impact on the decline of the Burmese economy. n April, UK Foreign Office Minister John Battle formally asked the British petroleum company, Premier Oil, to disinvest its $200million from Burma. Oil services corp., Baker Hughes (Texas) announced it would withdraw from Burma in late March, after share-holders pressed human rights concerns. In late April, EU foreign ministers made economic and travel sanctions more strict, freezing the overseas funds of Burma's military junta.
The decline of the official economy has made Burma even more dependent on its still flourishing underground economy, primarily drugs from the Golden Triangle.
Former ethnic rebels who are now allied with the government in Rangoon run Burma’s drug refineries. The leaders of the most powerful of these, the United Wa State Army (UWSA), are especially close to Burma’s powerful intelligence chief, Lt.-Gen. Khin Nyunt. But Khin Nyunt’s special ties to Pao Yu-chang, Wei Xuegang and other UWSA leaders may go far beyond business interests, intelligence analysts suggest. Many commanders in the Burmese army are said to resent Khin Nyunt’s rapid ascendancy to power, which he achieved with minimal combat experience.
Lacking any real power base within the regular armed forces, the UWSA and other militias are of crucial importance for Khin Nyunt’s political survival. This division within the military establishment is more likely to determine the future of Burma rather than pressure by the international community, activities by the NLD and other opposition politicians, and even the country’s deepening economic crisis, informed observers suggest. The power struggle may intensify after the death of the aging strongman Ne Win, who turned 89 on May 24. Khin Nyunt was hand-picked by Ne Win in 1983 to become intelligence chief, and may be safe in that position only as long as the old strongman is alive.
Foreign diplomats in Rangoon often claim that Khin Nyunt belongs to a more ‘flexible’ and ‘moderate’ faction within the ruling military than army chief Gen. Maung Aye and his field commanders. Burmese insiders refute this. They emphasise that Khin Nyunt’s intelligence apparatus is the most brutal arm of Burma’s repressive military machinery and that his close links to the drug trade may make him even less interested than other members of the junta to accept more political pluralism and transparency. With the democratic opposition marginalised, and two equally inflexible military factions opposing each other, Burma’s political future looks extremely bleak.
WATCHPOINT: Economic difficulties may cause isolated anti-government protests, but Burma’s current leaders are not likely to lose their grip on power unless there is a split within the military, which may happen when the old strongman Ne Win dies.
About our company:
AFG Venture Group is an Asia and Australia based corporate advisory and consulting firm with over 20 years experience in creating alliances, relationships and transactions in Australia, South East Asia and India; including a 15 year history of corporate and equities advisory in Australia, undertaking merger, acquisition, divestment, fund raising and consulting for private and public companies.
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