Bloomberg News

Cameron Seeks Suspension of Myanmar Sanctions to Spur Change

April 13, 2012

U.K. Prime Minister David Cameron, right, meets with opposition leader Aung San Suu Kyi in Yangon, Myanmar. Photographer: Peter Macdiarmid/Getty Images

U.K. Prime Minister David Cameron, right, meets with opposition leader Aung San Suu Kyi in Yangon, Myanmar. Photographer: Peter Macdiarmid/Getty Images

U.K. Prime Minister David Cameron took the first steps by a Western leader to end Myanmar’s political and economic isolation by calling for an easing of sanctions to encourage further moves toward democracy.

Speaking alongside Nobel Peace Prize laureate Aung San Suu Kyi, Myanmar’s opposition leader, at her lakeside home in Yangon today, Cameron said the European Union should suspend rather than abolish sanctions apart from an arms embargo at an April 23 meeting. That would reward the military-backed leadership for changes so far while maintaining pressure on the government.

It was the first visit to Myanmar by a British leader since at least 1948, when the Southeast Asian nation, then known as Burma, gained independence from the U.K.

“I think it is right to take this first step,” Cameron said after 45 minutes of talks with the democracy campaigner during his groundbreaking visit. “If we really want to see a chance of greater freedom and democracy in Burma we should respond when they take action. It’s a bold move.”

The suspension of sanctions that apply to all non- humanitarian trade and the country’s reserves of precious stones, logging and mining will “strengthen the hand of reformers,” Suu Kyi said. Military sanctions will remain in place, Cameron said.

House Arrest

Suu Kyi, 66, who has spent 15 out of the past 20 years under house arrest in her Yangon residence, was restricted from seeing her two sons and husband, who died of cancer in March 1999. She declined permission to visit him in Britain before he died, fearing she wouldn’t be allowed back into Myanmar.

Cameron invited the opposition leader today to travel to Britain in June. “Perhaps,” she replied.

Cameron met Myanmar’s president, Thein Sein, in the capital, Naypyidaw, before traveling to Yangon. The premier told him before their talks in the presidential palace that “we need to see prisoners freed and changes to show the reform is irreversible.”

Suu Kyi has called for a “new era” in the Southeast Asian nation after her National League for Democracy claimed victory in 43 seats it contested in April 1 special elections. The NLD boycotted a 2010 election won by Thein Sein’s army-backed party, which along with the military still controls more than 80 percent of parliamentary seats.

“The world loves a happy ending,” Suu Kyi said. “I don’t at all mind that Prime Minister Cameron would like to see a happy ending to the democracy story in Burma. We will work towards that. We would hate to disappoint our friends.”

Humanitarian Aid

Britain currently discourages trade with Myanmar and EU sanctions prohibit all but humanitarian assistance. The U.K. is the largest aid donor to the country, a former British colony.

Myanmar lawmakers are pushing to revamp the financial system and attract investment to revive an economy hindered by military rule and the EU and U.S. sanctions. The central bank implemented a managed float of its currency this month to improve the business climate in the country of 64 million people that borders China and India.

In 1990, the military rejected an election victory by the NLD in which the opposition party won about 80 percent of seats for a committee to draft a new constitution. Suu Kyi, a Nobel Peace Prize winner known in Myanmar simply as “The Lady,” was detained during both that vote and the 2010 elections.

White House spokesman Jay Carney called the April 1 elections, held to fill parliamentary vacancies, an “important step.” Even so, U.S. Secretary of State Hillary Clinton said April 4 that “this reform process has a long way to go. The future is neither clear nor certain.”

Investor Interest

Rich in natural gas, gold and gems, Myanmar represents one of Asia’s last untapped frontier markets, attracting investors such as Jim Rogers, the chairman of Rogers Holdings, who predicted a global commodities rally in 1999. Cambodia-based Leopard Capital plans to raise $100 million for a fund to invest in Myanmar once sanctions are lifted, according to Douglas Clayton, its founder and chief executive officer.

Myanmar’s per-capita gross domestic product amounts to $2.25 per day, about half that of Vietnam and 14 percent of neighboring Thailand’s, according to International Monetary Fund estimates. Only one in 30 people have a mobile phone and even fewer have Internet access, Nomura Holdings Inc. said in a March 14 report.

For Suu Kyi to have a shot at the presidency in 2015, she’ll need the army’s help. The constitution passed in 2008 bans her from becoming head of state because her children have British nationality. Amending that article requires support from 75 percent of lawmakers, a quarter of whom are active-duty soldiers, followed by a referendum, according to the constitution.

To contact the reporter on this story: Gonzalo Vina in Yangon at gvina@bloomberg.net; Svenja O’Donnell in London at sodonnell@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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