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Burma Issues report on German invol
Subject: Burma Issues report on German involvement in Burma
Burma Issues
PO Box 1076, Silom Post Office
Bangkok 10504 Thailand
phone: 662 234 6674
Burma Issues (formerly Burma Rights Movement for Action,
B.U.R.M.A.) is a Bangkok-based non-governmental organization that
monitors events in Burma with a focus on human rights, ethnic
minorities and the ongoing civil war.
THE GERMAN CONNECTION
S'Aung Lwin, Bochum Germany
INTRODUCTION
This document hopes to shine some light on the issue of German
involvement and investment in Burma, and the close ties that have
developed historically between German business interests, the
German government, and the oppressive military junta which has
ruled in Burma since 1962. More specifically, this paper will
highlight the special relationship that one particular German firm,
Fritz Werner Industry, has had with the Burmese regime since the
early 1950's, and continuing up to the present. On a broader
level, the research presented here will attempt to demonstrate the
important role that German trade relations, developmental aid, and
political ties have had in sustaining the Burmese military elite in
power, and, thus, indirectly contributed to the oppression and pain
inflicted upon the Burmese people by their own government.
BURMA: THE GERMAN CONNECTION
THE VISIT
Very few observers from the outside world had noticed the
strong ties between the Federal Republic of Germany (FRG) and the
Socialist Republic of the Union of Burma until his excellency Dr.
Richard von Weizsacker, the acting president of the FRG, visited
Burma in February of 1986.
At that time the German president, his wife, and their
entourage were welcomed at Rangoon Airport by the Vice-President
of Burma, and the Vice Chairman of the Council of State, U Aye Ko,
and his wife, Daw Mi Mi Lay. The Burmese government, keen to
show their hospitality towards the German president, ordered
students, workers, and people from all walks of life, to line up
all along the president's route from the airport to the State Guest
House, to welcome the excellency and his accompanying entourage.
Many in the crowd, after waiting under the hot February sun all
morning, fainted as a result of the debilitating heat, and had to
be taken to the hospital for medical attention.
A banquet in honor of the German president, hosted by the
Vice-Chairman U Aye Ko and his wife, was held February 5th, 1986 in
the Banquet Hall on the Pyithu Hluttaw Premises in Rangoon. During
this celebratory occasion, Weizsacker praised the Burmese
socialist regime for its "unique" policy towards Germany, and
thanked the Burmese for its launching of a joint economic
enterprise, in the fall of 1984, involving the participation of a
German firm with long-established links in Burma.(Working
People's Daily, 5 Feb., 1986)
This was Burma's first joint venture with a foreign country
since its self-imposed isolation from the West after the coup of
1962. Although Weizsacker did not reveal the name of the German
firm, it was,in fact, Fritz Werner Industry Ausrustungen-GmbH, FRG
(FWAR), a company of notorious reputation among the Burmese
people.1 The German president later visited projects being
implemented under the auspices of this ground-breaking economic
cooperation agreement between the two countries. One of the
stops on his excellency's itinerary was the beach at Ngapali, a
popular tourist resort on the Araken coast. The German president
attracted much attention from the Burmese people while there, as a
result of a highly symbolic "PR" event, in which he was seen riding
an elephant. In the cultural and historic tradition of Burma the
ancient monarchs rode elephants as a symbol of their power and
divine royal authority. Through the eyes of the Burmese people,
therefore, this unusual display by the German excellency signified
culturally that the Burmese military war lords were honoring this
foreign "king" in hopes of receiving continuing and increased aid
and investment from Germany.
This seemingly isolated incident of the German president's
visit to Burma in 1986 is, in fact, an important, if largely
symbolic, manifestation of the close German economic ties that the
Burmese oligarchy has profited from historically, and continues to
cash in on up to the present date.
However, before delving further into these economic
connections, let us take a look at the recent intense political
turbulence within Burma, which serves as the context from which all
contemporary Burmese issues must be examined.
BACKGROUND: THE UPRISING OF 1988
In 1988 a student-led nationwide uprising emerged in Burma,
leading to the fall of the Burma Socialist Program
Party(BSPP), the same ruling party which was praised by the German
president Weizsacker just two years previous during his "historic
State visit". A reactionary, military "coup" in September 1988,
declaring a new era of restored "law and order", followed on the
heels of this spontaneous, grass-roots movement for democracy. It
is estimated that at least 8,000 people were brutally massacred by
this "State Law and Order Restoration Committee"(SLORC), the "new"
manifestation of the same governing military thugs who had run
Burma since 1962. Among the many victims of this crackdown were
grade school, high school, and university students, workers,
farmers, Buddhist monks, and people from all groups within the
ethnically diverse Burmese national landscape.
To escape execution or imprisonment, thousands of
students, teachers, peasants and workers fled to the jungle areas
along Burma's borders where they could take refuge among some
of the semi-autonomous ethnic minorities within Burma, many of
whom are fighting the central government in Rangoon. It is now
estimated that at least 338,000 refugees live along the
Sino-Burma, Thai-Burma and Indo-Burma borders.
THE CAUSES
The pivotal factors leading up to the uprising were numerous.
On an economic level, people were angry and hurt that their proud
and resource-rich country, once the wealthiest nation in the
region, was now ranked as one of the ten poorest countries in the
world by the UN. Perseverance, struggle, and hard work on their
part did not seem to have resulted in any upgrading of the nation's
development, nor any improvement in their own personal financial
status.
People were also angered by the military junta's sudden
demonetization of some of the major Burmese currency notes (which
are produced by the "Warzi Currency Printing Industry", which,
incidentally, was built through German technological and financial
assistance). Outrageously, no compensation was given to Burmese who
held these currencies in their hands, effectively wiping out many
people's essential savings. This tactic was designed to cripple
those hoarding cash for the purpose of dealing in illegal border
trade and smuggling. In reality, it most devastated those who could
least afford it - the poor - whose already minimal earnings, which
had at least sustained their hand-to-mouth existence, were now
suddenly useless paper.
The iron-fisted, one-party rule of the long-time dictator Ne
Win, and the lack of truly free elections, decent education, or
democratic participation in the running of the country, also added
to the people's growing mood of discontent. On a very personal
level, almost everyone had relatives or close friends in prison,
and fear of arrest was the daily diet of the people, as unjust
political imprisonment, harassment, torture, and killings had
become commonplace.
Some of Burma's ethnic minority groups(the Karen, Chin, Shan
etc.) had been fighting for their survival against the central
Burman government since as far back as the late 1940's, and student
protest of the Ne Win regime had emerged even in his first year in
power, 1962, resurfacing periodically since that time. So, as you
can see, there had been a long history of struggle against the
government from various sectors of Burmese society leading up to
this massive uprising in 1988.
At this point, let us turn our attention back to the more
specific question of how German economic involvement in Burma
relates to the desperate situation of oppression, suffering, and
injustice in Burma outlined above.
THE GERMAN-BURMESE ARMS CONNECTION
It doesn't require too much analysis to begin to make the
connections between German economic involvement in Burma, and the
daily injustices suffered by the Burmese common people. For
example, many of the estimated 8,000 peaceful demonstrators who
were viciously mowed down during the bloody showdown between the
military junta and the student-led movement in 1988, were killed by
the 22nd Light Infantry Army unit who, coincidentally, were armed
with G-3 and G-4 assault rifles produced and provided by Fritz
Werner Arms Industry, which, at that time, was owned by the German
Government.
The dubious role played by the German government in arms
production and supply of the Burmese military junta before and
since the now notorious 1988 massacre, is certainly an important
issue to focus on for those working for democracy and human rights
in Burma, as well as the international community in general
An exploratory German parliamentary inquiry in 1989 concerning
the link between the German government and the Fritz Werner
company yielded an evasive and rather impolite answer. (Minor
Parliamentary Inquiry, 15.2.89).
In March of 1990 Germany's major opposition party, the
Social Democrats(SPD), filed another inquiry, this time extending
their questions beyond the specific issue of Fritz Werner's
involvement in Burma, to the broader question of the German
government's relationship to the Burmese military junta in
general.- (Minor Parliamentary Inquiry, 7.3.1990). Up to this
point, however, the German government has yet to supply any
concrete reply to the Bundestag with reference to this inquiry into
their dealings with the Burmese junta, particularly in regard to
weapons trading.
Although the German government halted its official aid
disbursements to Burma in 1988 - in the turbulent wake of the
political crisis there and the accompanying international outcry
against the Burmese government - German companies, in particular
Fritz Werner, continue to privately work with the Burmese military
junta, and new Burmese-German joint ventures have been signed.(see
Appendix on Burma-Fritz Werner joint venture of 1990)
As a result of this on-going German involvement it now becomes
necessary for people concerned about Burma's future to seriously
evaluate if these joint ventures truly benefit the people of
Burma, or only contribute to continuing oppression and injustice.
In order to do this, it may be helpful to make a closer examination
of the oft-mentioned Fritz Werner Industry, and the nature of its
long history of involvement in Burma.
FRITZ WERNER'S HISTORY IN BURMA
A diplomat familiar with Burmese politics has noted that,
"Fritz Werner has a unique relationship with the Burmese ruling
elite that has been cultivated over the years. There is a great
deal of mutual trust between the company and the Burmese
government, whose military-minded leaders look for such
characteristics as reliability and discretion from a business
partner."2
The Fritz Werner company struck up this now historic
partnership with the Burmese government, referred to in the quote
above, in 1953, shortly after Burma obtained independence from
Great Britain in January 1948. This was a time of considerable
political disorder in Burma. Ethnic separatist movements seeking a
just autonomy were already emerging within the fragile,
newly-formed Union of Burma, creating an immediate demand for
weapons within the central Burman government. Fritz Werner
Company, which was wholly owned by the West German
government(falling under the jurisdiction of the West German
Ministry of Economy), quickly stepped forward to meet that demand.
Presently, Fritz Werner is the fifth largest exporter of arms in
the world.3
Since this original contact in 1953, the Commander-in-chief of
the Burmese Armed forces and long-time dictator, Ne Win, has
cultivated friendly relations with the Fritz Werner family, both
diplomatically and personally. Fritz Werner technical advisors
posted in Rangoon have had continuous access to the dictator, even
following his "retirement" in 1988, a rare privilege not extended
to the representatives of other foreign firms. Ne Win has even
been so generous as to build a grand, Burmese-style house for the
Fritz Werner family in Geisenheim, Germany. The fact that Fritz
Werner was owned by the West German government itself has
created a close personal relationship between the two governments,
making Burma "the friendliest nation toward West Germany in Asia".4
Fritz Werner's secretive Burmese operations, which have
often been shrouded under a veil of mystery, got into full swing in
1957. In this year they established their first weapons factory,
on the outskirts of Rangoon, and launched into full-scale
production of G.2 (Gun 2), G.3 (Gun 3), and G.4 (Gun 4) rifles,
7.62 mm. and 9 mm. small arms ammunition, and a range of
explosives including Claymore mines and mortar shells up to 81 mm
in size. (Dawn, Vol.1 No.23 Dec 1989, p 10) This start-up was
achieved with the assistance of the West Germany Arms company
Heckler and Koch. The factory was supervised by German
engineers from the German Technical Corporation Agency (GTZ).
The Burmese military has often used these German-produced
weapons to oppress the Burmese people and various ethnic minority
groups, especially following the military's seizure of power under
Gen. Ne Win in 1962. For example, on the 7th of July, 1962, just
three days after Ne Win's ruling Burmese Socialist Program Party
(BSPP) was formed, the students of Rangoon University, under
the leadership of the influential Rangoon University Students
Union (RUSU), organized a peaceful demonstration inside the
Rangoon University Campus. Ne Win and his close military
associates sent troops equipped with G-3 automatic rifles into
the university campus with orders to fire into the crowds of
thousands of students, who were peacefully demonstrating. Over 100
students were killed and many more injured. The next morning Ne
Win ordered the destruction of the RUSU building, which was a
treasured historical monument of the Burmese independence
movement against the British. The building was blasted to
pieces by heavy explosives, and every trace of it removed.More
recently, during the 1988 student uprising, over eight thousand
people were killed by more of these same German-produced weapons.
Not only did the Fritz Werner Co. produce the vast majority
of armaments required by the Burmese military, they also served as
a conduit for all importation of raw materials, machine parts and
chemicals used in explosives production. Most of this destructive
inflow of weapons material came from the countries of Belgium,
Sweden, and Singapore, as well as smaller amounts originating in
England, Pakistan and Israel.5 In order to sustain their export
sales in a declining world arms market, all of these nations seem
willing to turn a blind eye to the horrible consequences of their
trade in death.
THE GERMAN RESPONSE TO 1988
The cozy relationship between the West Germans and the Burmese
military was something of a closely kept secret until 1988, when
the democracy uprising and surrounding political crisis blew the
lid off the Burmese situation, and drew the attention of the whole
world. Due to the international pressure brought upon the West
German government by the horror of the September 1988 coup, it
suddenly became one of the outspoken critics of the Burmese
regime, as if they hadn't known before how many Burmese had died in
the past at the hands of the government - hands that were holding
West German weapons. The German government suspended development
co-operation activities with Burma, including negotiations
regarding Burmese debt cancellation(W.G. Cabinet June 1988).
The West German government also claimed that all export
authorization of arms to Burma had ceased. Despite assertions made
by the West Germans that the Fritz Werner Co. was no longer
participating in the production of weapons and explosives (124th
Parliament Session, 15th of Feb. 1989), and that technical
co-operation had been reduced to a minimum, the fact remains
that, to date, the manufacture of explosives and weapons
continues, and three German employees of the GTZ remain in the
country, disguising their true field of expertise.6
Despite the hasty withdrawal of German economic support from
Burma after the 1988 crackdown, it didn't take long before the
Fritz Werner company found an opportunity for renewed investment,
in partnership with their old friend Ne Win, and his SLORC
associates. But, before continuing the Fritz Werner-Burmese saga,
let us first set the economic context of Burma in the 1980's, as a
backdrop into which these renewed German business ties occurred.
NEW FRITZ WERNER/SLORC JOINT VENTURES
In the 1950's, Burma ranked second in Asia economically,
trailing only the resurgent Japanese in wealth and prosperity.
Sadly, by the 1980's, Gen. Ne Win's economic policy, heralded as
the "Burmese Way to Socialism", but more widely perceived as
straight-forward military mismanagement and ineptitude, had mired
the country in a desperate state of poverty and depression. This
degraded condition reached a symbolic low point with Burma's
addition to the tattered ranks of the UN's "Least Developed
Country"(LDC) status.
In an attempt to remedy this disastrous state of affairs, the
Burmese government(now called SLORC) once again turned to their old
friends, the Fritz Werner company, to form up a joint venture with
the Burmese Ministry of Industry in 1990.(see Appendix-Fritz
Werner/Burma joint venture) The venture focused on implementing
import-substitution schemes involving the glass and tire
manufacturing industries, and developing technology for production
of basic tools like bench drills and lathes.
The limited success of this joint venture was made possible
thanks, in large part, to an old loan of US$500 million that the
West German government had been disbursing to Burma since the
1960's.7 This infusion of cash included a US$65 million supplement
that West Germany had given Burma as recently as 1987, which was
divided between US$15 million in technical grant, and US$50
million for "capital goods imports".8 Even with this money, many
of the joint venture projects were closed down for want of spare
parts and raw materials, which leads one to question whether the
foreign exchange actually ended up in the projects they were
designated for(or was it perhaps transferred to the military for
defense purposes?).
THE NE WIN FAMILY AND FRITZ WERNER
As one diplomat commented about the whole affair,"the Fritz
Werner company stands by itself [in Burma], and their joint
venture is just something that has grown out of a very personal
relationship between them and the powers who are Gen. Ne Win, Phyo
Wai Win, Ne Win's son, and U Maung Cho."9 This quote highlights
the close personal nature of the Fritz Werner-Ne Win business team.
For a time, Phyo Wai Win and his wife and son lived together
at Ne Win's house in Munich, Germany. At present, however, Phyo is
working with Schlumberger Oil Company(which also invests in
Burma) in the Hague, Netherlands, and is living together with his
German girlfriend "Barbara".
The former Minister of Industry, U Maung Cho, is also known
to have long-standing personal ties with the Fritz Werner Company.
Maung Cho was educated as an armaments engineer, first in England,
where he spent four years, and later in the Federal Republic of
Germany, where he spent another three years, and ended up
marrying a German wife,Ingeborg. While in Germany Maung Cho
received on-the-job training from Fritz Werner.10 With Ingeborg he
has a daughter "Petra".
"It was lucky for the Germans he didn't marry an English
girl", quipped one seasoned Burma watcher. "Diplomatic relations
between the two countries have just emerged out of this thing",
said this diplomat, in reference to Maung Cho's personal
connections in Germany. (Germany-Burma, dpa 21 Feb. 1984)
These kinds of personal relationships with Fritz Werner have
helped preserve Gen. Ne Win's Socialist government in power,
despite the various insurgencies and unrest broiling over in his
country. The connections have also helped to line the pockets of
a small group of German businessman. Among the individual Germans
most benefiting from this cozy relationship are Joachim Frist of
Fritz Werner Company, Fritz Schlemmer, a pharmaceutical salesman,
and Siegfried Otto, the chairman of the Giesecke and Devrient
group of companies.11
With Fritz Werner Industry serving as an outstanding specific
example of German business involvement in Burma, let us next
broaden our scope to include an examination of Burmese\German trade
dynamics in general, and its interconnectedness to issues of peace
and justice for ordinary Burmese people.
GERMAN-BURMESE TRADE RELATIONS
AN OVERVIEW
Historically, Germany views Burma as a country with great
economic potential. Its excellent population to land area ratio,
and its status prior to World War Two, as the world's largest
exporter of rice and a major exporter of petroleum, earned Burma
the distinction of being one of the wealthiest countries in South
East Asia. Along with its huge agricultural potential and
promising oil and natural gas reserves, Burma has significant
deposits of minerals in the areas of gemstones, jade, tin,
silver, gold and tungsten. Furthermore, Burma is blesses with the
world's largest (though rapidly diminishing) teak forest and a
rich supply of other tropical woods. Offshore, Burma has access
to teeming fisheries. Labor is extremely cheap, which is
attractive for foreign investors as well. Burma's strategic
location at the crossroads of South East Asia makes it a
potentially ideal location for the export of cheap manufactured
goods throughout the region.
For Burma, the Federal Republic of Germany is an
important trading partner. As a supplier-country, it accounted
for 23 percent of total Burmese imports in 1983, which was second
only to Japan; as a purchaser of Burmese goods, Germany took ninth
place in world ratings, accounting for 2.1 percent of overall
Burmese exports.12
Increasing German-Burmese trade is expected in the future.
Support by private German firms for Burma's economic expansion
can be seen in the launching of a joint enterprise in the machine
building sector in the autumn of 1984 with the Fritz Werner
Company(as well as subsequent joint ventures as recently as 1990).
This undertaking by Fritz Werner was generally seen as
"trailblazing" for future economic relations between Burma and the
Federal Republic of Germany.
Another signal of the push for smoother trade between Germany
and Burma can be seen in the holding of a seminar designed to
promote Burmese exports to the Federal Republic of Germany.
This was organized jointly by the German Embassy in Rangoon
and the Federal Office of Foreign Trade in Cologne. 13
GERMAN EXPLOITATION OF BURMESE RESOURCES
Germany has a great interest in exploiting the economic
potential of Burma's wealth of natural resources. For example, it
has been involved in the exploration of nickel and copper deposits
in the Chin and Arakan mountains on the western fringes of Burma.
This project was carried out by experts and advisers from the
Federal Geo-Scientific and Raw Materials Establishment in
Hannover, Germany. This German scientific establishment was also
involved in the evaluation of mineral prospecting work, and
exploration for possible oil and natural gas deposits in different
regions of Burma.14
Germany hopes its close working relationship with Burma will
lead to further lucrative development of both copper and nickel
deposits, as well as new expansion into natural gas and
petrochemicals. For example, Germany has reserved money for
the Martaban Offshore Natural Gas Project which is designed to
extract natural gas from the Gulf of Martaban, and process it into
Methanol, and then, ultimately, into gasoline. Germany hopes that
a successful exploration in the Gulf of Martaban will lead to the
construction of new Burmese fertilizer factories operating on
natural gas. The Federal Geo-Scientific and Raw Materials
Establishment in Hannover has the full support of the German
government in this endeavor. The German government has already
supplied geophysical(seismological) equipment for the oil
exploration. The final details and contract arrangements between
the two countries have not yet been disclosed.15
The flip side of West German economic investment in Burma
can be seen in its importation of Burmese natural resources into
Germany. The Burmese government is rapidly selling off wholesale
its marketable natural resources in a desperate bid to bring in
much needed foreign exchange. For example, in the past eight
years, Burma's German-built "Five Star" ships (S.S.Sagaing, Magwe,
Pegu, Mandalay etc.) have exported a number of elephants,
thousands of tons of teak wood, animal food, and minerals to
Germany. (Burmese sources in Hamburg claim that arms from West
Germany have also been loaded on these Burmese Five Star Shipping
line ships.)16
GERMAN TRAINING PROGRAMS
In order to sustain long-term trade operations and
exploitation in Burma, the West German firms have sponsored
training programs for the Burmese. A list of the training
initiatives Germany has sponsored in Burma include:
- sponsorship of young military officials to study military,
intelligence, and armaments training techniques in Germany
- sponsorship of the Sinde Vocational Training Center and a
Railway Workshop in Mandalay
- supply of equipment and teaching aids to improve work and
training at the Bawdwin Namtu mining and foundry plants
- German assistance in the development of an integrated crop
protection service
- sending of advisers for the Paleik textile factory, also built
with German assistance
- setting up of a short-term pool of experts for preparation and
execution of technical cooperation projects
- Assistance in the drawing-up of a study for the electricity
supply in Rangoon
- sponsorship of the cooperative system (sending of advisers,
supply of equipment, training of specialists)
- sponsorship of the Syriam Trade Training Center, which trains
specialists in maintenance engineering and electrical maintenance
work for technical installations in the industrial sector
(especially in conjunction with the Industry and Defense
Ministries).
- German assistance in the further development of Burmese radio
(supply and installation of radio transmitters, financing of the
training of experts, etc.)
(Work of particular importance in this sphere is done by
Fritz Werner Industry, the Carl Duisburg Society, the German
Foundation for International Development, the Deutsche Welle Voice
of Germany overseas radio service, and - in the college and
university sector - the German Academic Exchange Service (DAAD)
and the Alexander-von-Humboldt Foundation.)17
The final entry listed above, the Burmese radio development
project, presents a clear, specific example of how German economic
investment and training in Burma is used to support the military
regime, and works against the people's struggle for democracy.
Germany has been involved with the supply and installation of
radio transmitters to the Burma Broadcasting Station (which is
heavily controlled by the military), and also in the training of
Burmese journalists, and radio and television technicians. After
the German training these journalists and technicians have no
option but to work for the only radio and television stations in
Rangoon, which are essentially the mouth pieces of the military
government. Although these people are trained in Germany under the
guidelines of a free press, they never write or announce the real
situation as it happens in Burma when they return. All news is
simply headlines and propaganda produced by the military. So most
of the students trained in Germany end up coming back and serving
the dictator. As most of them are children or relatives of the
military elite, they will work only to please their elders.
This is one of the many methods used by the military to maintain
its power and oppress its own people.18
GERMAN TRADE, BURMESE OPPRESSION:THE CONNECTION
All of these facts and figures point to a trade relationship
between Burma and Germany of significant proportions. But how do
trade connections tie into the broader issue of oppression and
human rights violations in Burma?
The essential link between trade and oppression can be found
in the Burmese defense budget. In 1987 the Burmese government
stated that the defense budget took 50% of all foreign
exchange. Other observers of the government believe that the
percentage is much higher than this figure. Most of Burma's foreign
exchange is obtained through trade. Since 1987 the defence budget
has risen from 1.7 billion kyats to 2 billion kyats, while the
domestic economic situation has worsened even further.
Starvation is now rife throughout the poor urban areas of the
major cities. One can quickly see how providing the Burmese
government with foreign exchange through trade ends up translating
into more defense spending, more military oppression, and more
economic mismanagement inside Burma, all primary causes of
suffering among the common people.
Next, we will take a short look at the similar role that
German developmental aid has played in Burma.
GERMAN DEVELOPMENTAL AID IN BURMA
The official state visit to Burma made by the German president
in 1986, which was highlighted in the introduction, also pointed to
the potential future role that Burma may play as one of the focal
points of German developmental aid.
BILATERAL AID
Germany has certainly been a major player in Burma's
developmental projects historically. For example, during the
1970-1988 pre-crackdown period, the Federal Republic of Germany
was Burma's second largest donor of bilateral O.D.A (Official
Development Aid - see table 1 & 2). West German disbursements grew
impressively after 1978, reaching a record level of 1 billion DM
during this period.
In 1984-1985 alone, West Germany provided Burma with DM 150
million worth of financial aid. It was agreed to utilize these
funds for the rehabilitation of the Thayetmyo Cement Factory, the
purchase of shunting locomotives, spare parts and equipment
for Burmese railways, and for partial financing of the Kinda
Hydro-Electric Power Station. Commodity aid amounting to DM 10
million was also designated to be used for the purchase of urgently
required imports such as industrial inputs and spare parts.
Financial aid cooperation between the Federal Republic of
Germany and Burma is built upon the historic priorities of Burma's
own development policy. Earlier German aid assisted in the setting
up of industrial manufacturing plants such as the Syriam glass
bottle factory near Rangoon, the Bassein flat glass factory, the
Sinde pump and engine factory, the brick works in Hmawbi and
Danyigone, and the Paleik textiles factory. This cooperation in
the industrial sector has formed the basis for a close partnership
between Rangoon and Bonn, and encouraged a spirit of mutual trust.
Beyond the establishment and further development of industrial
production plants, this financial aid cooperation is focused
primarily on projects for the exploitation of Burmese raw
materials, resources, and reserves, the boosting of agricultural
productivity, measures designed to expand the transportation
infrastructure, and vocational/educational training. A large
proportion of financial cooperation funds is also set aside
for commodity aid, chiefly involving the purchase of raw
materials, food, spare parts and other badly-needed civil
requirements.
- ( All data based on statistics provided by the Federal
Statistical Office in Wiesbaden, Germany)
MULTILATERAL AID
In addition to this bilateral cooperation, the Federal
Republic of Germany has made available to Burma annually an
approx. total of DM 50 million through multilateral channels.
Beyond the direct loans of bilateral aid, Burma receives German
money indirectly, via international bodies such as the World
Bank, the Asian Development Bank, the U.N. Development Program
(UNDP), or the International Development Association. Germany is
a major contributor of funds to all of these institutions.
There is also German involvement in the "Burma Consortium", set
up by the World Bank to coordinate international aid to Burma.
This economic aid pipeline from Germany, both bilateral and
multilateral, sustains the Burmese military regime in much the same
way an active trading partnership does. It brings in much needed
foreign exchange, supplies investment for governmentally-planned
projects which fit into the state's security needs and strategies,
provides legitimacy and good publicity, both internationally and
internally, to the unconstitutional Burmese police state, frees up
other funds for military spending (the government's #1 priority),
and usually benefits only the wealthy military elite who rake in
any profits made off of economic development investment in Burma.
BURMESE-GERMAN POLITICAL TIES: A HISTORY
Finally, we will explore the nature of Burmese-German
political ties over the years and contemporarily. Presently,
diplomatic relations between Burma and Germany appear stable and
free of major problems. In recent decades a dialogue based on
mutual trust has evolved between the two nations. Despite the
difficulties presented by substantial differences in political/
social systems, and the intervening factor of geographical
distance, the countries share some similar affinities. Among these
is something of a common vision for profitable relations between
First and Third World nations, with the German government in Bonn
dedicated to playing a facilitating role in the development of
economic and political stability within LDC's like Burma.
One expression of the historic good state of relations between
Germany and Burma can be seen in the exchange of visits by
prominent public figures on each side.
Most prominently from the Burmese side was Gen. Ne Win's visit
to the Federal Republic of Germany in 1968, and subsequent trips in
the years 1982, 1984, 1985 and 1988, in his role as Chairman of the
Politburo of the Burma Socialist Program Party. The first four
visits centered on Ne Win's desire for German weapons, while his
final trip in 1988 was focused on exploring the possibility, via
the conduit of his German lawyer, of political asylum in Germany
or Europe, should the democracy forces overthrow his regime.
Furthermore, the former Burmese prime minister, U Maung Maung
Kha, went to Germany privately in 1984, and had visited previously
in 1976 while holding the position of Burma's Mining Minister.
There have also been several visits to the Federal
Republic of Germany by other Burmese parliamentarians and
ministers including the former Foreign Minister Chit Hlaing
(privately in 1984), Finance and Planning Minister (and deputy
Premier) Thura Tun Tin (1984, also in 1978, 1982 and 1983),
together with Defence Minister Thura Kyaw Htin (1982 and 1984),
and the Industry Minister Col. Maung Cho (who was trained by
the Fritz Werner company while living in Germany).
The most prominent visitors to Burma from the Federal Republic
of Germany have included the late Chancellor Ludwig Erhard (1958
in his capacity as Economic Minister), former Chancellor Kurt
Eorg Kiesinger (1967), Former Minister of State Hildegard Hamm
Brucher (1979), Overseas Aid Minister Jurgen Warnke (1984), State
Secretary Dieter von Wurzen (1984), and various delegations from
the Federal Parliament.
In summary, the German-Burmese political relations which were
initiated by the Fritz Werner family in 1950, and given impetus
by the late Chancellor Ludwig Erhard's visit to Rangoon in 1958 in
his capacity as Economics Minister, reached its climax in
February 1986 when his excellency, the president of the Federal
Republic of Germany, Dr. Richard von Weizsacker, made the
"historic visit" to Burma mentioned several times previously.
CONCLUSION
A CALL FOR GERMAN DISENGAGEMENT
Following the uprising in 1988, the European Community and
the United States began imposing economic sanctions on
Burma, identifying the high incidence of human rights abuses by
the government as the primary reason. At the same time this
anti-SLORC movement was happening in the West, German business
firms were accelerating their assistance to the Burmese military.
Despite the dire human rights situation in Burma, Fritz
Werner and other German firms are not slowing down their
investments, as their economic assistance continues to filter into
Burma. Many of these German firms are involved in highly
sensitive and complex fields in Burma, such as weapons production
for the military. All assistance relating to these sensitive
areas should be ceased temporarily until Burma can reach a
settlement to its long civil war, and become more stable and
democratic as a nation.
Investments by Fritz Werner and other companies bring benefits
not to the Burmese people, but only to these companies, and to the
military leaders who use them to buy more weapons to intensify
their civil war against the people of Burma.
Fritz Werner and many foreign companies now investing in
Burma, seem to fear that democracy will be restored in Burma and
their investments will all be in vain. It seems that they are
worried that when peace comes to Burma at last, and the 43 years
of civil war ends, they won't be able to make a profit as easily as
they are now. Perhaps this is why Fritz Werner and other foreign
firms continue to prop up the Burmese military economically, and
continue to supply them with weapons which are used to kill
innocent people, even after most of the world community has cut off
aid to Burma for humanitarian reasons.
The suffering of the Burmese people at the hands of these
military rulers has become undeniable. The irresponsible
investments of Fritz Werner and others are indirectly encouraging
the torture, persecution, and killing of many ethnic nationals,
clergymen, students, and organizations which are struggling for
democracy inside Burma. For the Burmese people, the cooperation of
Fritz Werner and other German firms has been extremely
discouraging. It is time for these corporations to stop considering
only how they can best exploit the untapped natural resources
of Burma, and start listening to the cry of the Burmese people for
democracy.
FOOTNOTES
1 Kaing Htan, "Burma and Fritz Werner" (in Burmese), March 1986.
2 "Germany - Burma" dpa Feb. 21, 1984.
3 "Stoppt den Rustungs Export der BOKO Co-ordanitationstelle,
Bremen".
4 Interview with the former staff of Fritz Werner in Geisenheim,
June 2, 1992.
5 International Institute for Strategic Studies, The Military
balance 1992-1993 (London, II SS, 1992): 173 & Far Eastern Economic
Review, Dec 6, 1990: 27.
6 Judith Richter "Deutsche Geschafte in Birma" April 24, 1991.
7 Embassy of FRG, Rangoon "Press Release" 1985.
8 Embassy of FRG, Rangoon "Press Release" 1985.
9 "Germany-Burma" dpa Feb. 21, 1984.
10 "Germany-Burma" dpa Feb. 21, 1984 & interview with the former
staff of the Burmese Embassy in Bonn, June 21, 1992.
11 Dawn News Bulletin, Bangkok "Military Aid to Saw Maung" Vol. 1
No. 23, Dec. 10, 1989.
12 Embassy of FRG, Rangoon "Press Release" 1985.
13 Embassy of FRG, "Press Release", 1985.
14 Embassy of FRG, Rangoon "Press Release" 1985.
15 Embassy of FRG, Rangoon "Press Release" 1985 & Bestelle Fur
Ausfenhandles Information (BFAI) Wirtschaftsentwicklung, Myanmar
(Burma) Wirtschaftsdaten May 31, 1990.
16 Interview with Kipp, European-Burmese Association, Hamburg, June
30, 1992.
17 FRG Embassy, Rangoon "Press Release" 1985.
18 Embassy of FRG, Rangoon "Press Release" 1985 & Fritz Werner
"Referenzliste Industrieanlagenbau Stand 7/91.
APPENDIX I
Summary of Correspondence Concerning the Establishment of a
Munitions Factory by Fritz Werner in Burma.*
Letter from the German Embassy in Rangoon to the Foreign Ministry,
Bonn, of 5 July, 1958
The Burmese Secretary of State, U Tun Thaung, informed the Embassy
that the Burmese government had decided to build a munitions
factory for an amount of 20 million kyat and to hire the Berlin
company, Fritz Werner, under the condition that, apart from a first
installment of 5 million kyat, the remaining installments can be
paid back within 4 to 5 years. That means the contract should
include the Hermes insurance (a German government body which gives
loans and guarantees to ease foreign investors' risks.) The
Burmese Ministry of Defense urged that the factory should be
completed in 2 years. There were other offers from Japan and the
CSSR, but the military institutions had special confidence in Fritz
Werner. Hermes should give its approval because Fritz Werner would
not have enough capital to run the project on its own. It would
also be important to strengthen the German position in this
important sector of the Burmese defense and to prevent that a
(communist) East European country gets the contract.
Response from the Foreign Ministry, August 1958
The Hermes Committee rejected Fritz Werner's application regarding
the delivery of a munitions factory, in spite of the Foreign
Ministry's approval. The reason for this rejection were the
conditions of payment which - according to the application - should
be handled in installments within 7 years, beginning one year after
the delivery - and not within 4 to 5 years, as stated before.
Terms of payments beyond 5 years would only be granted to projects
in developing countries which serve to build up a healthy economy.
However, the decision could be modified if acceptable payment
conditions were negotiated.
Handwritten note, 7/8/1958
Mr. Maier, a board member of Fritz Werner,s left for Rangoon for
further negotiations and to contact the German Embassy. Before
that, he got the assurance from the German Ministry of Economics
that Hermes would approve the project if a first installment of
10%, 15% on delivery, and the remaining amount in 6 half-year
installments (3 years) could be negotiated.
Letter from the German Embassy in Rangoon to the German Foreign
Ministry, 14 August 1958
On 11 August, Dr. Maier signed a contract with the (Burmese) War
Office to establish a munitions factory. The 20 million kyat deal
was made without the involvement of the Hermes-Insurance. The
payment for the German machines would be made step by step within
a period of 27 months. Mr. Maier had promised to inform the
Ministry of Economics about the contract. The War Office insisted
on the secrecy of the project. According to Fritz Werner, the
German company Zueblin AG had a good chance to get the contract to
construct the factory buildings.
*(All correspondence translated from German and summerized)