US looks to broaden reform in Myanmar

Posted: 12 May 2012 1125 hrs ....

Workers loading boxes of goods at a harbour in Yangon, Myanmar. (AFP PHOTO/Ye Aung Thu)


WASHINGTON: As Myanmar takes steps towards democracy, the United States is hoping that a broader section of the population will feel the fruits of reform, including potential foreign investment.

In the back of policymakers' minds is the lesson from China. Some experts believe Myanmar launched reforms out of concern of being too dependent on China -- and worry that the United States could similarly fall out of favour.

The United States has been at the forefront of a three-year diplomatic drive to bring Myanmar out of its isolation. But unlike the European Union, Japan and Canada, the United States has retained most sanctions on the nation formerly known as Burma.

In a scene unthinkable until recently, opposition icon Aung San Suu Kyi has entered parliament and Myanmar. But rights groups say that decades-long ethnic wars have festered in border areas, with troops carrying out abuses and at times defying ceasefires supported by reformist President Thein Sein.

"We are hearing from our friends in border areas that perhaps the reforms are a bit uneven and not reaching all parts of the country," said W. Patrick Murphy, the US deputy policy coordinator on Myanmar.

"It's important that distribution be even -- and not only in the reforms, but in the foreign assistance and commercial activity if and when that renews," he said at the Carnegie Endowment for International Peace, a think-tank.

Murphy said that international humanitarian workers' access to remote, violence-torn regions has improved but added: "We would like to see this regularized and become the norm, not the exception."

Hoping to provide incentives to Myanmar, the United States said last month that it would restore full diplomatic relations. Murphy said he expected an announcement of a US ambassador "in the coming weeks".

The Treasury Department has already ended a ban on financial transactions by US non-governmental organisations in Myanmar. But US policymakers are taking time to fine-tune the most far-reaching of the steps announced on April 4 -- the easing of US restrictions on investment into Myanmar.

US business interests, including the US Chamber of Commerce, have pressed for a full lifting of investment sanctions, saying that US companies would lose out to European and Asian competitors already allowed to enter Myanmar.

But human rights groups have called on President Barack Obama's administration to hold off on any sweeping end to investment restrictions without verifiable progress on areas such as ending ethnic violence.

Tom Malinowski, the Washington director for Human Rights Watch, said that the United States needed to ensure that its companies adhered to high standards. Many in Myanmar believed that Chinese investors damaged the environment and ignored local concerns through dams and other projects.

"We have a chance here to do it differently," Malinowski said.

"But the danger is that there will be this gold rush into Burma before we have the kind of institutional reform (needed) and the resentment we saw generated by Chinese investment is going to be felt about all foreign investment."

US officials and lawmakers have been adamant about maintaining sanctions on key exports from Myanmar, such as gems and timber, which are seen as cash cows for the military.

Georgetown University professor David Steinberg, an expert on Myanmar, said that a further risk was that investment would benefit a middle class that is largely of Chinese origin.

Myanmar was the scene of ethnic riots in the 20th century against both its Chinese and Indian communities. The Burmese-dominated military seized control of Asia's longtime rice bowl in 1962 in part to nationalise industries perceived as foreign-run.

"If the economy is once again seen to be in Chinese hands, there could be ethnic riots... and a return of some sort of state capitalism that will try and get the economy back under Burmese control," Steinberg said.

- AFP/al

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