US embassy cable - 05RANGOON1054

C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 001054 
 
SIPDIS 
 
E.O. 12958: DECL: 09/12/2015 
TAGS: PGOV, PREL, BM, AU 
SUBJECT: AUSTRALIA SEES GRIM BURMA GETTING GRIMMER 
 
REF: A. RANGOON 1053 
     B. RANGOON 989 AND PREVIOUS 
     C. RANGOON 332 AND PREVIOUS 
 
Classified By: CDA SHARI VILLAROSA FOR REASONS 1.4 (b,d) 
 
1.  (C) SUMMARY:  Australian Ambassador Bob Davis painted a 
bleak picture of life in Burma today during Charge's initial 
call on him on September 13.  His outlook matched the 
pessimistic perspectives of Malaysia's and Brunei's 
Ambassadors on September 12 (ref A).   Davis said that Burma 
in 2005 is proving to be a bad place for foreigners to do 
business, and an Orwellian nightmare growing even worse for 
ordinary citizens.  Even those well connected to the regime 
are being watched more closely, and all must get advance 
approval from Senior General Than Shwe for overseas travel or 
meetings with foreign diplomats.  The rivalry between regime 
leaders over succession and their cuts of business continues 
to drive internal politics.  End summary. 
 
PARANOIA RUNS DEEP 
------------------ 
 
2.  (C) The October 2004 ouster of Khin Nyunt left the 
isolationists in charge of Burmese policy, Ambassador Davis 
told the Charge.  Even traditional friends of the Burmese 
regime find it difficult to gain access to decision-makers 
now.  The MFA now asks for 3-4 weeks advance notice of 
in-country travel and meetings with other Ministries and 
reviews each request before forwarding it to Cabinet or a 
sub-Cabinet group for final decision (or, often, no decision 
and no response). 
 
3.  (C) Any Burmese government worker, even at lower levels, 
who wishes to travel abroad must receive the personal 
approval of Than Shwe.  This has a chilling effect on 
training and scholarships, since few Burmese want their 
personnel folder to be reviewed by the Senior General, who 
may question why the nominee is held in high regard by 
foreign missions.  Likewise, any Burmese organization that 
meets with a foreign diplomat in country without advance 
permission risks being suspected of subversive aims, even if 
the meeting was totally innocent. 
 
THE POWER STRUGGLE 
------------------ 
 
4.  (C) The SPDC remains obsessed with the Khin Nyunt case, 
Amb. Davis said.  Some of the 5,000 former MI staff and Khin 
Nyunt associates the regime whom sought to arrest have gone 
underground or escaped to neighboring countries, and many of 
the regime's intelligence files disappeared last October. 
The SPDC is now trying to replace the files by calling in 
people who were arrested or questioned in the past and asking 
them to relate their life stories and all their contacts to 
new case officers.  The suspended sentence/house arrest that 
Khin Nyunt and others received is not a sign of judicial 
independence or a possible Khin Nyunt comeback, Amb. Davis 
believes, but a new regime strategy whereby those under house 
arrest can "buy" better conditions for themselves and their 
family members. 
 
5.  (C) The rivalry between Than Shwe and Maung Aye 
continues, Amb. Davis said, although he noted that the 
supposed "coup" last month (Ref B) gained notice more from 
filial ties than from facts.  According to the Ambassador,  a 
Bangkok-based Burmese exile reporter tried to sell the story 
of a leadership crisis to international wire services there 
and, when they refused to run it, gave it to his 
brother-in-law, the BBC World Service announcer who went 
public with the story.  The concurrent movement of senior 
officials when Maung Aye's daughter gave birth prematurely in 
a Rangoon military hospital and the father of Than Shwe's 
son-in-law was medevaced to Singapore then fueled the rumors. 
 
6.  (C) Amb. Davis said that Maung Aye clearly expects to 
move to the Senior General role once Than Shwe,s health or 
grasp on power weakens further, while Than Shwe does not seem 
comfortable with this prospect and has allowed other 
loyalists to rise to increased prominence in recent months, 
most notably Joint Chief of Staff Gen. Thura Shwe Mann, Prime 
Minister Soe Win (quietly promoted to Major General recently) 
and Secretary-1 Gen. Thein Sein. 
THE CONNECTED GET RICHER 
------------------------ 
 
7.  (C) Judging from the number of Mercedes, Ferraris and 
SUVs in the elite parts of Rangoon, the generals and 
businesspeople with the right connections continue to enjoy 
the good life while the rest of the country regresses.  Davis 
agreed with the Charge that there seem to be more wealthy 
Burmese businesspeople today than was true five years ago, 
but the gap between ordinary citizens of Burma and the elite 
grows wider every day. 
 
8.  (C) The regime likes public works projects, Amb. Davis 
said, because cronies get the contracts (such as the two 
crony construction companies building the new "capital" at 
Pyinmana) and the projects get them into the papers.  One 
Cabinet Minister candidly told Amb. Davis that the GOB 
continues to build power plants, rather than repair the sorry 
state of the existing transmission lines, because it is 
better to have photo ops at new generating stations than 
standing next to new power lines. 
 
9.  (C) Australia believes that about 80 percent of foreign 
trade and financial transactions involving Burma are not 
recorded.  A Burmese commercial lawyer told Amb. Davis that 
he understands little about the import/export business but 
makes $10,000 monthly (with a cut to his military patrons) by 
selling duty-free licenses to local supermarkets and hotels 
to bring in foreign goods.  Amb. Davis said that most 
foreign-based investors, especially Singaporeans, had been 
badly burned in Burma in recent years and would gladly sell 
their remaining investments if they could find buyers (NOTE: 
in contrast to the Singaporean Ambassador's assertions in Ref 
A). 
 
WHILE EVERYONE ELSE GETS WORSER 
------------------------------- 
 
10.  (C) The people of Burma tolerate their deteriorating 
living conditions, Ambassador Davis said, not because of 
Buddhist tolerance or stoicism, but simply from fear.  One 
may not see as many armed soldiers at street corners as in 
other repressive countries, but every citizen can feel the 
regime,s power every day.  The massacre of 1988 and attack 
on Aung San Suu Kyi in 2003, as well as the GOB's frequent 
use of indefinite detention, are potent reminders.  In most 
trials, the accused do not have access to their lawyers and, 
when they are, the lawyers are often not allowed to speak or 
take notes at the trial.  In some cases (ref D), "lawyers" 
from Special Branch or military intelligence are appointed 
instead of lawyers chosen by the accused,s family.  Many 
arrested never even get a trial: some have been held in jail 
without charges for over 15 years. 
 
11.  (C) Amb. Davis urged that international humanitarian aid 
to Burma be allowed to freely enter, especially in the public 
health, nutrition and education sectors.  The people hit 
hardest by cancellation of overseas aid efforts are in the 
ethnic regions furthest from the center, Davis said.  Ethnic 
issues still color much of Burmese politics, and the 
military's tendency to shoot first and negotiate later has 
grown even stronger since Khin Nyunt fell.  More than ever, 
one must be an ethnic Burman and a Buddhist to have any 
access. 
 
12.  (C) COMMENT: Ambassador Davis came across as a very well 
informed and insightful observer of Burma.  Charge cited the 
close collaboration at all levels of our embassies in other 
posts and pledge to encourage that here (it is already 
ongoing).  We should have very productive relations.  End 
comment. 
Villarosa