BurmaNet News: October 11

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"Appropriate Information Technologies, Practical Strategies"
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BurmaNet News: Tuesday, October 11, 1994
Issue #31

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Contents:

BKK POST: BURMESE DISSIDENTS BEGIN SEMINAR IN MANERPLAW
BKK POST: DRUG WARLORD KHUN SA STEPS INTO NEW BUSINESS
NATION: DRUG LORD PUTS HIS BEST FOOT FORWARD
NATION: MYANMAR AIR AND SINGAPORE AIRLINE SIGN PACT 
ECONOMIST: BUT WILL THE FLAG FOLLOW TRADE?

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BKK POST: BURMESE DISSIDENTS BEGIN SEMINAR IN MANERPLAW
October 11

BURMESE dissidents yesterday began a week-long meting
called the Constitutional Seminar on the Constitution of the
Union of Burma at the Karen National Union headquarters in
Manerplaw. Attending the meeting are members of the National
League for Democracy (Liberated Area) and other Burmese
pro-democracy groups, including those from Japan, Australia,
Europe and the United States. Topics scheduled discussion are
the SLORC-initiated National Constitution being drafted in
Rangoon, its chapters on fundamendal principles, and the
Democratic Alliance of Burma's draft constitution to establish a
federal government in Burma. A total of 150 delegates
representing 41 groups and 79 observers are attending the
seminar being presided over by DAB Chairman Saw Bo Mya.
According to an NLD spokesman a press conference is
scheduled for October 17. 

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NATION: DRUG LORD PUTS HIS BEST FOOT FORWARD
October 11

TO the surprise of many, drug war-lord and self-proclaimed
Shan freedom fighter Khon Sa has entered the world of high
fashion.

Since early this year, Khon Sa, who is on the most wanted list
of the United State' Drug Enforcement Agency, has been
producing haute couture wonmen's shoes and selling them at
up to 500,000 bath a pair - wholesale.

It is not the creativity, unique design, nor high quality like
those fro Italy and France that warrant such price tags, but
the glittering rubies and precious stones from the world
famous mines of Burma that are used to decorate his line of
women's shoes.

It is unclear where Khun Sa got the idea for his new business,
but he is very serious about it and its potential for profits.
The factory, called Mong Tai jewellery, has been built at his
headquarter in Hua Muang, some 40 kilometres deep into the
mountainous terrain of Burma' across from the Muang District
of Mae Hong Song Province.

Four experts from Hong Kong and Taiwan and at least two from
Thailand are training his followers in the art of stone cutting.
Top-quality leather shoes are imported from England and
decorate with rubies, diamonds, jade, and other precious
stones at the factory, and are reportedly re-exported to for
distribution in Bratain and beyond.

Sales figures still unavailable, but Khun Sa is known to be
facing a number of difficulties expected for a new name in the
highly-competitive world of haute couture.

First, despite several months of training, Khun Sa still does
not have a sufficient number of precision gem cutters.

Further, the trade of rubies and other precious stone is often
a dangerous operation in a country ruled by the military junta
known as the (SLORC) Compounding the problems faced in his
operation are the dozens of minority groups, large and small,
challenging the SLORC in their fight for self-rule.

Khun Sa insists on only the best rubies, which are supposedly
found in the Shan State, a region fiercely contested by three
factions - the SLORC,  Khun Sa, and the Wah minority - whose
territory surrounds the mines.

Thai businessmen are also eyeing a share of the stones and are
willing to pay high prices to whomever can supply them.
One businessmen is known to be investing upwards of 200
million bath in a factory in the Thai-Burmese border district of
Mae Sai, Chiang Rai Province, to cut gems and produce
jewellery.

And from a marketing standpoint, Khun Sa must somehow
devise a slogan to interest buyer in high-quality leather shoes
from England, decorated with rubies from one of the world's
most famous mines in Burma, made in the jungle headquarter
of an infamous drug kingpin, and priced at half a million bath.
The last hurdle for Khun Sa is trust. Many do not believe there
is a market for gem-studded shoes.Some believe the
undertaking serves merely a propaganda purpose for the
drug kingpin, whose headquaters has been surrounded by 
SLORC forces for some three months now, and whose supply
lines through Thailand have been cut.

Veteran observers claim it is the first time Khun Sa has
diversified from his heroin empire since he was forced to
relocate his headquarters from Thailand in 1981. He staunchly
maintains that he has never dealt drugs for money - rather,
for the sake of liberating the Shan people from Rangoon
oppression.

The past Thai administration of Gen Prem Tinsulanonda
ordered the removal of Khun Sa and his forces from their
headquarters at Ban Hin Taek, in Mae Chan District of Chiang
Rai Province, where they had lived for many years.
They initially relocated in Doi Lang near the Thai border after
taking it by force from some remnants of the Kuamintang force
and a group of Muser hilltribes who inhabited the area.
However, Khun Sa did not build his new headquarters in Doi
Lang because of it weak location as the "backdoor" of the Shan
State.

In 1982, together with the help of a key military officer of the
Kuamintang, Col Xhan Chu Chern, Khun Sa selected a more
strategic site; Hua Muang.

It is unclear how Col Xhan became allied with Khun Sa, but he
has been credited for training Sa's forces into one of the
strongest in Burma. At the time, Khun Sa had the money, but 
little experience in military training.

The two men are still together today after more than a decade,
with Xhan Chun Chern serving as Khun Sa's most trusted
right-hand man.

Several thousand families are now living in Hua Muang and the
near by Ban Muang  Mai, the area being gradually developed
into a major agricultural base to feed Khun Sa forces and their
dependents.

A hydroelectric dam, a reservoir, and other infrastructure
projects are under construction. If all goes according to plan,
they will be completed by year's end and Hua Muang will have
a more than ample supply of electricity.
It remains to be seen how profitable his business in gem
cutting and gem - studded shoes will be - Khun Sa's force are
still fighting to defend their headquarters and their trade in
deadly heroin.

It is the first time SLORC forces have managed to maintain
their position around Khun Sa's headquarters, although at a
distance, for three months.

Veteran observers note that  SLORC soldiers are no match for
Khun Sa's well-armed and well-fed forces, especially in such
difficult terrian, but Khun Sa has begun to feel the impact of
his supply lines being cut off since July.

The Third Army and the International Ministry argue the
checkpoints through which Khun Sa's supplies re transported
had to be closed because the fighting in Burma could endanger
the life of Thai villagers along the border.
Several months ago, Khun Sa asked a long -time confidant to
help him express his hidden affection for a famous Thai
television announcer whom he has seen on a military -owned
televasion channel in Bangkok.

The request was made in a very special way a Khun Sa. He sent
his driver out to find his confidant who lives on the Thai side
of the border. Upon locating the confidante, the driver asked
him to get into his truck and listen to Khon Sa's tape-recorded
request, played on the truck's radio. It is said the voice of the
charismatic drug kingpin was gentle and, at times, hesitant in
his request - for it was the first time to disclose the identity of
that female TV personality who held his affection and
admiration. The driver had been instructed to return with an answer 
right away.

The confidante agree to help but stressed that he could not
promise success in his mission; to secretly remove a pair of
shoes from the lady's home and return them to Hua Muang to
be studded with precious stones as a token of affection from
Khun Sa.

The drug kingpin, who already has a number of wives, was not
discouraged at all when told weeks later that the women's
heart be longed to someone else.  "I just want to give her 
some small token of my affection," Khun Sa said.

The mission, as yet unaccomplished, has been suspended
because of the ongoing fighting in the Shan State.
But the confidante has not given up because Khon Sa has not
given up.

So a little note to announcers of Thai army television
networks; if a pair of your shoes disappears, don't worry -
they are in good hands in Hua Maung, being refurbished with
precious stones. They will be returned with a value of roughly
500,000 bath - but also with the affection of Khon Sa.                 


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BKK POST: DRUG WARLORD KHUN SA STEPS INTO NEW BUSINESS
October 11

KHUN Sa has made his money from supplying what many  peo-
ple want, but his latest venture taps an entirely different
market. The leader of the Muang Tai Army is now dividing his
attention between the running of his heroin-financed freedom
and haute couture through the production of women's
footware selling at the wholesale price of 500,000 baht a pair.
What makes Khun Sa's shoes - a brand name has yet to be
decided on - so special is not their place of origin but the fact
each pair is decorated with rubies and other precious stones
from Burma's world renowned mines. Khun Sa is not thought 
to have any immediate plans to switch exclusively to footwear
production but he is said to be very serious about this latest
venture and its profit-making potential. A factory, under the
Muang Tai Jewellery name, has been set up at his Hua Muang
headquarters in Burma's mountainous Shan state and he is
reported to have recruited four experts from Hong Kong and
Taiwan and at least two from  Thailand to train his workforce
in gem cutting. Top-quality shoes are being imported from
England and decorated with rubies, diamonds, jade and other
precious stones before reportedly being re-exported to
Britain and beyond. Problems abound. Though there is not the
ready market for the shoes as there is for heroin, the
transport of gems within embattled Burma can be equally
thwart with danger.

Khun Sa apparently insists on using only the very best rubies
available from Shan State, but the region is contested fiercely
by his own MTA, government junta forces and the Wa minority
people. Thai businessmen are also said to be keen to grab a
share of the stones and are willing to pay high prices to
anyone who can supply them. One businessmen is known to be
investing up to 200 million bath in the Thai border district of
Mae Sai in Chiang Rai to cut gems and produce jewellery.
Having started this new venture early this year, Khun Sa now
faces the vexing problem of how to market his product - a shoe
made in England, decorated with rubies from the mines of
Burma, made in the jungle headquarters of an infamous drug
warlord and priced at half a million baht.

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NATION: MYANMAR AIR AND SINGAPORE AIRLINE SIGN PACT 
Oct 11  1994

RANGOON - State-owned Myanmar Airways signed a joint
venture agreement last week with Singapore's Air Mandalay
Holdings Pte Ltd to operate domestic flights in Burma and
package tours from there to Thailand. Under the agreement,
two French-made, 66-seater, ATR-72 airplanes will fly between
Burma's captial Rangoon and the country's second-largest
city, Mandalay four times a week. The joint venture also will
operate package tours between Mandalay and Pagan in Burma
and Thailand's major northern cities of Chiang Mai and Chiang
Rai, as will as the Thai resort town of phuket in the south of
the country. Air Mandalay's inaugural flight from Rangoon to
Mandalay will be Oct 18. Air Mandalay holds 60 per cent of the
joint venture and Myanmar Airways holds 40 per cent, having
invested $35 million. Lewis Tan, chief executive officer of Air
Mandalay Pet Ltd, said the joint venture was formed to handle
the demands of tourists as Visit Myanmar (Burma) Year 1996
approaches. The company is to buy two more airplanes to
extend its services by the end of this year. 

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ECONOMIST: BUT WILL THE FLAG FOLLOW TRADE?
October 8-14 Issue

"To go to Mandalay," snaps the character in a local magazine cartoon, "you
need to master Chinese conversation."  His gibe reflects more and more the
reality of Myanmar's second city, and to its inhabitants it is less and less
of a joke.

The former capital of Burmese kings, made familiar to westerners by Kipling,
is becoming the business capital of Chinese traders surging south from Yunnan
province in search of markets.  Mandalay is experiencing a boom that started
when Myanmar's ruling junta, the State Law and Order Restoration Council,
opened up border trade with China, a few hour's drive north-east of the city.

Flashy concrete villas are springing up at every turn in Mandalay's grid-
patterned streets, nearly all of them owned by Chinese.  So are most of the
growing number of hotels, with names such as the Silver Cloud and the Great
Wall Inn.  Lorries trundling in from the border via Lashio bring Chinese
goods for sale in Mandalay's markets.  In Mandalay's 80th Street, with its
Chinese temple, which locals call China Street, the main working language is
Chinese.

This invasion, however, is just the tip of a Chinese presence which, if
stories circulating in Yangon, the capital , are near the mark, has even
started to discomfit some members of the junta.  Name a large infrastructure
project anywhere in Myanmar these days and there is a strong possibility it
will be ion the hands of Chinese contractors.  Chinese engineers are working
on improvements to the highway from Mandalay to Yangon.  Chinese companies
are developing the railway line from Mandalay to Myitkyina, near the Chinese
border, and the line from Mandalay to the capital.  With the help of
chaingangs from Myanmar's prisons, they are also building a line from Ye to
Tavoy in Myanmar's far south-east.

The junta, with a taste for projects its generals can point to, wants
bridges.  China has built a huge road-and-rail bridge linking the capital and
Syraim, next door.  Against international competition, Chinese contractors
have won the contract to build a big bridge across the Chindwin river.  Other
Chinese ventures range from a new international airport for Mandalay to
housing for the armed forces and 30 irrigation dams.  It was the Chinese, in
association with Siemans, who last year installed a ground satellite station
serving the capital.

China has helped to modernise Myanmar's armed forces, selling the country
aircraft, tanks and patrol ships worth more than $1 billion.  Myanmar's
generals are known to grumble about the poor quality of Chinese equipment but
China is generous with cheap ling-term loans for arms.  It also provides
money for civilian projects that is unavailable from the West and Japan,
since those countries disapprove of the repressive junta.  Singapore has
emerged as a supplier or conduit for small arms and, joined recently by South
Africa, of ammunition.  But China still sends the big-ticket items.

China's influence in Myanmar through its business and arms supplies worries
its neighbours, India and Thailand.  They are keeping an eye on the military
installations that China is building along Myanmar's southern coast. 
Chinese-supplied radar on the Coco Islands can monitor ships entering or
leaving the Malacca Straits, one of the worlds' busiest shipping
thoroughfares.  China is said to be offering to help develop port facilities
once used by the British navy, at Kyaukpyu on Ramree Island, towards the
border with Bangladesh.

Is China planning a move in to the Indian Ocean?  Western analysts, pondering
the limited capacity of China's navy, are inclined to play down such
suspicions.  Trade seems the more plausible reason for China's growing
interest in this area.  For Yunnan's 43m. landlocked people, the Indian Ocean
is a route to vital markets.  The junta is adamant that it will not allow
foreign troops on its soil.

Myanmar's neighbours, however, note that Yunnanese state organisations are
offering credits and prices fixed by Beijing.  Put that together with
Myanmar's dependence on Chinese arms and there are reasons to worry about
China's leverage.







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ABBREVIATIONS USED BY BURMANET:

 AP: ASSOCIATED PRESS
 AFP: AGENCE FRANCE PRESSE
 AWSJ: ASIAN WALL STREET JOURNAL
 BBC: BRITISH BROADCASTING CORPORATION
 BI: BURMA ISSUES
 BIG: BURMA INFORMATION GROUP
 BKK POST: THE BANGKOK POST
 CPPSM: COMMITTEE FOR THE PUBLICITY OF THE PEOPLE'S STRUGGLE IN MONLAND
 FEER: FAR EAST ECONOMIC REVIEW
 NATION: THE NATION (DAILY NEWSPAPER, BANGKOK)

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