U.S. State Department Geographic Bureaus: East Asia and Pacific Bureau


"Prospects for Progress in Burma"

Remarks by
Deputy Assistant Secretary of State
Thomas C. Hubbard
at a
Meeting with Corporate Executives
sponsored by
The Asia Society
725 Park Avenue
New York

March 8, 1995

Burma, a resource-rich nation with proud traditions, has been left behind the wave of progress and prosperity that has swept through most of Southeast Asia. Burma missed Southeast Asia's economic take-off because its authoritarian and isolationist leaders were pursuing the "Burmese Road to Socialism," an autarchic detour that nearly took the nation to ruin. While Burma's current leaders profess to understand the need for an open economy and foreign investment and want better relations with their neighbors, they still do not grasp the basic fact that they will not be able to achieve their ambitions without treating their own people with respect. They can only join the international mainstream by taking serious steps toward representative government, respecting universally recognized human rights, and finding peaceful means to reconcile internal divisions. Our policy is designed to encourage these goals.

Last November I led the most senior U.S. delegation to visit Burma since 1988. The purpose of this mission, which was authorized by the President, was to emphasize the strong U.S. interest in three related areas: human rights, democracy, and counternarcotics. I made clear that the U.S. wishes better relations wih Burma, but stressed that any improvement must be based on progress in the critical areas of concern. I also clearly signalled the possibility that the U.S. bilateral relationship with Burma could be further down-graded if progress is not forthcoming in these areas.

Uncompromising Authoritarianism

I'll want to assess the results of my visit later in this presentation, but first let me try to describe the situation on the ground in Burma.

-- A military junta that took power in 1988, the State Law and Order Restoration Council (or SLORC) continues to rule without reference to popular authority. Having overturned elections in which the democratic opposition won some 80 percent of the seats in a constituent assembly in 1990, the SLORC jailed its most prominent opponents and forced many others into exile. In these circumstances, a national convention that now meets sporadically to consider a new constitution can hardly claim legitimacy.

-- Aung San Suu Kyi, the courageous hero of Burma's abortive democratic revival (and Nobel Peace Prize recipient) remains under house arrest after five and one-half years' detention. She has steadfastly refused to accept exile -- or a pledge to eschew political activity -- as the price for freedom.

-- Despite the release this year of some 100 other political prisoners, over 300 remain in prison, under brutal conditions. Despite frequent promises, the SLORC has yet to reach agreement with the International Committee of the Red Cross (ICRC) on a program of regular, confidential prison visits.

--The SLORC may differ from the previous Burmese dictatorship under Ne Win in its effort to reach out to its neighbors for political and economic ties, but there are few signs of receptivity to outside advice regarding its political system or human rights practices. Little has emerged from a dialogue with the UN on Burma's political future.

-- Burma's current rulers place great emphasis on national unity and cite peaceful national reconciliation as one of the main purposes of the national convention now under way. After reaching political accords with a number of ethnic groups over the past several years, however, the SLORC has seriously undermined its own avowed policy by renewing a military offensive against the Karen ethnic minority along the Thai border. This move had the effect of eliminating the democratic opposition's main sanctuary within Burma and driving 10,000 refugees into Thailand, to join the 70,000 already there.

-- Some of the most egregious human rights violations in Burma involve forced labor -- in cities, towns and villages alike people are rounded up or forced to "volunteer" to work on roads, railroads and other infrastructure projects. The military even forces villagers to carry supplies onto the battlefield. The SLORC has added insult to injury by claiming that Burmese culture encourages donations of labor to the state. But of course, if Burmese citizens truly wanted to volunteer their labor, they would not have to be taken from their homes at gunpoint.

-- Finally, in a situation with devastating impact on our own interests, opium production has doubled in Burma since the SLORC took power, and the drug trade has become more deeply ingrained in the political and economic life of the country. Burma now produces about two-thirds of the heroin that reaches the streets of America.

U.S. Policy

Our policy response has been to support those Burmese like Aung San Suu Kyi who have tried to bring democracy to their nation, while making clear to the SLORC that it cannot expect the international legitimacy and support it desires without accepting international norms of behavior. The United States has led the effort in international forums to condemn human rights violations in Burma, and we have urged the UN to play an active role in promoting reform through a political dialogue with Burma's leaders. We have refrained from selling arms to Burma and urged our friends and allies to do likewise, with some success.

We have suspended our own economic aid programs and urged other potential donors like Japan also to refrain from bilateral assistance. We do not provide GSP trade preferences and have decertified Burma as a narcotics cooperating country. This means that we are required by law to vote against assistance to Burma from international financial institutions, a stance which has in practice prevented most assistance to Burma from the IMF, the World Bank or the Asian Development Bank.

The United States has not had an Ambassador in Burma since 1990. We maintain full diplomatic relations, but are represented by a Charge d'Affaires ad interim.

Some in Congress and in the media have sought to portray sharp divisions between advocates of human rights and democracy and those who would like to pursue a more aggressive counternarcotics strategy. In fact, the dilemma is not as stark as it might seen. Given the seriousness of the drug problem facing American cities, we must address the narcotics production challenge posed by the world's largest producer of heroin. No one disputes that we must do all we can to diminish the amount of Burmese heroin exported to our nation. At the same time, our prospects for success are limited by the very nature of the SLORC.

First of all, direct assistance to the SLORC would grant legitimacy to a regime that seized power by overturning democratic elections and persecuting its opponents. Assistance could well be used to support human rights violations.

Second, under present circumstances in Burma, we have little reason to believe that assistance would have a tangible impact on the amount of heroin reaching our streets. That conclusion is based in part on hard experience. Between 1985 and 1988 the United States spent tens of millions of dollars on opium eradication in Burma -- and opium production quadrupled.

In the long run, our interest in narcotics control in Burma is profoundly related to our interest in accountable government and the rule of law. The authorities in Rangoon are not likely to succeed in the fight against drugs unless they find a way to exercise legitimate authority in drug producing areas -- as a government, not as an occupying force. They will have to achieve genuine reconciliation with ethnic minority groups, while denying legitimacy to narco-traffickers. They will have to take serious steps to end corruption, and to make the military more accountable to civilian and judicial authority.

Our counternarcotics efforts, therefore, are closely coordinated with a vigorous effort to promote human rights and democratic reform. We maintain a small DEA presence in Rangoon, but our assistance at this stage is limited to intelligence sharing and some assistance to the UN Drug Control Program and NGOs. We are prepared to expand narcotics cooperation once we are convinced that such assistance will be effective, and that it will not undermine our other important objectives. By necessity, the bulk of our counternarcotics approach for now is directed at traffickers operating in Thailand and other neighboring countries.

Implications for Business

Over the long term, the United States also has an interest in economic reform and liberalization in Burma. But for reasons that are practical as well as moral, we are convinced that political reform must come first.

In the last few years, the SLORC has taken several concrete steps toward market reform. And I have no doubt that the "Burmese Way to Capitalism" will prove more successful than the Burmese Way to Socialism. But the SLORC has not yet demonstrated that it has the will or capacity to truly remake its economy in the image of its most prosperous neighbors. To begin with, that would require real currency reform and freeing enterprises from state -- and that means military -- control.

Our view -- and the lesson we draw from experience -- is that sustained economic development is more likely where government policies are transparent, where courts provide due process, where uncensored newspapers are free to expose corruption and debate economic policy, and where business people can make decisions with free access to information. As Assistant Secretary of State Winston Lord has put it, "economic rights granted by authoritarians can as easily be taken away. The foundation of open economies -- rights that protect contracts, property, and patents -- can only be guaranteed by the rule of law."

Our current policy is neither to encourage nor discourage investment. It is our practice to brief prospective investors on the documented violations of human rights and to caution them on the political risks of doing business in a situation where repressive government rules without effective institutional constraints. U.S. government programs such as OPIC insurance and Eximbank financing are not available in Burma. Although the issue of possible trade and investment embargoes is raised from time to time, we see little prospects of winning the multilateral support that would be needed to bring effective pressure on the Burmese regime.

Views of Other Nations

The recent adoption by consensus of the fifth annual UN General Assembly Resolution on Burma demonstrated that the international community continues to demand respect for internationally recognized human rights. However, the manner in which these views are expressed varies. European nations, along with Australia and New Zealand, have generally joined us in the effort to exert strong pressure for change, although most maintain ambassadors in Rangoon and have been more aggressive than we in promoting trade and investment. The ASEAN countries and Japan have generally favored greater economic and political engagement -- what the ASEANs have called "constructive engagement." In part, this stems from their genuine conviction that reform can be more effectively pursued through engagement than through efforts to isolate Burma. However, there are other calculations as well. Thailand, for example, attaches great importance to peace on its borders and has wanted to encourage SLORC efforts to negotiate peace with the various ethnic groups. The recent action against the Karen has, of course, shaken Thai confidence that its borders can be freed of violent conflict or that the SLORC will even respect its borders. Many nations of the region believe that Western efforts to isolate Burma will leave an open field for Chinese trade and influence. China has for some time been Burma's leading arms supplier, and its presence in Burma is growing. Finally, the Asian countries have strong commercial interests in Burma. Despite pressure from its business community, however, Japan has so far held the line against significant new aid to Burma,

Two Paths to the Future

This brings me back to my own visit to Rangoon. The November mission, in which I was accompanied by representatives of the NSC and the State Department's bureaus responsible for human rights and counternarcotics, took place against the backdrop of some hopeful signals on human rights, including the opening of discussions between the SLORC and Aung San Suu Kyi. An American Congressman, Bill Richardson of New Mexico, had recently become the first person outside Aung San Suu Kyi's own family to meet with the detained democratic leader, and he had also been allowed to visit selected other political prisoners.

My delegation's purpose was to explore whether direct contact between senior U.S. officials and the SLORC could help convert these signals into concrete progress in the principal areas of concern. In two days of meetings with senior SLORC officials and the Foreign Minister, we made clear that the United States would like to establish more constructive relations. We laid out a series of steps the SLORC needed to take on human rights, democracy and counternarcotics to enable us to move toward more normal relations, including naming an Ambassador and restoring narcotics cooperation. We also pointed out that the absence of improvement in these areas would lead to a further downgrading in bilateral ties.

Not surprisingly, SLORC leaders stressed the Burmese Army's role in national development. They spoke a lot about national reconciliation, but placed more emphasis on national unity and internal security than on human rights or the establishment of representative government. SLORC leaders voiced their strong interest in economic development, stating their realization that their nation's progress requires foreign investment and access to modern technology. I made clear that we want that for Burma, too, but that access to international lending would flow naturally from respect for human rights and genuine democratic opening.

I continue to hope that the SLORC will do what it must to build better relations with the U.S. and gain access to international lending and assistance. But the jury is still out on whether Burma's rulers are prepared to take the necessary steps. Progress since my visit has been disappointing. The SLORC followed through on its promise to allow U.S. government experts to conduct a joint opium yield survey with the participation and assistance of the Burmese Government, an important step in the counternarcotics field. But it failed to fulfill other key commitments to continue the dialogue with Aung San Suu Kyi and sign an accord with the ICRC on prison visits. And the military action against the Karen has introduced a new, disturbing element into the equation.

In these circumstances, the future of U.S.-Burma ties remains cloudy. The SLORC has not yet taken even the modest steps needed to merit a modest improvement in bilateral relations. We will continue to urge other nations to join us in exerting pressure for change. In the absence of progress on human rights and democracy, the second path of further restrictions in U.S.-Burma relations remains a real possibility. The choice is up to Burma's leaders. We sincerely hope they make the right choice for Burma's future.


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