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Wanted: The Right Message To Send The Burma's Junta (Int'l Edition)


International -- Int'l Business: BURMA

WANTED: THE RIGHT MESSAGE TO SEND THE BURMA'S JUNTA (int'l edition)

The U.S. ponders an economic embargo to raise the pressure

The irony of it was as thick as the dank, humid air that hangs over Rangoon just before a tropical rain. As contract-hungry officials from Burma's ruling junta solicited foreign executives at a seminar called "Myanmar, Open for Business" in late May, police were busily arresting pro-democracy campaigners. More than 260 supporters of Nobel peace prize winner Aung San Suu Kyi were detained. But some 10,000 people, chanting and cheering, came to her party congress anyway.

Those arrests are deepening the quandary in Washington over how to respond to Burma's long list of human rights violations. Suu Kyi's supporters want the Clinton Administration to force U.S. companies out of Burma and impose an economic embargo. But embargoes against Cuba and Iran are angering trade partners (page 60), and the Administration worries that Japanese and European rivals would fill any void in Burma left by departing U.S. companies.

THE RIGHT KIND. The chances that any major trading nation would follow the U.S. lead are slim. While Japan and Thailand, in rare displays of candor, have publicly criticized the arrests and demanded the release of political prisoners, no country has yet moved to cut off investment to pressure the State Law & Order Restoration Council (SLORC), which rules the country. "If the U.S. lets up its pressure, the SLORC would be led to believe that no one would take them to task for their continuing oppression of the Burmese people," said Kent Wiedemann, a high-ranking State Dept. official, in testimony that was prepared for a Senate hearing on May 22.

The question is how to bring about the right kind of pressure. The Senate is considering a bill by Mitch McConnell (R-Ky.) that would bar all U.S. aid and investment, forcing U.S. companies already invested--Unocal, Texaco and Arco--to pull out. Another version in the House would ban all future investors but allow existing investors to remain. Responding to the debate, PepsiCo Inc. and OshKosh B'Gosh Inc. have just announced their withdrawal.

In a policy shift, the White House says it might impose sanctions on its own. "We very much share the concern of the Congress about the restoration of democracy in Burma," says State Dept. spokesman Nicholas Burns. But first, the White House wants to send an envoy to study the impact of cutting off American investment.

American investments in Burma total $226 million, more than Japan's but still behind Thailand, Singapore, and even France, whose Total has a $465 million share in a joint venture with Unocal. Pro-democracy campaigners would like those numbers curtailed until the junta shows signs of reform. "Anyone who really understands the economic situation in Burma wouldn't want to invest here," Suu Kyi argues. She says she "certainly wouldn't protest" U.S. sanctions because investment isn't helping common people anyway. But to get the U.S. to help, Suu Kyi may have to take a stronger line and declare Burma closed for business.By Robert Horn in Rangoon and Sheri Prasso in New York


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