Friday, June 6, 2014

Democratic Voice of Burma

Democratic Voice of Burma

US govt fines Fokker $21 m for violating sanctions

Posted: 06 Jun 2014 04:21 AM PDT

Dutch aerospace firm Fokker has been hit with a US$21 million penalty by the US government for selling US-made aircraft parts and goods to customers in Burma, Iran and Sudan, in violation of trade sanctions.

According to a statement released Thursday by the US Attorney's Office in Washington DC, Fokker Services violated US laws by engaging in "illegal transactions involving the export and re-export of aircraft parts, technology and services to customers located in US-sanctioned countries, specifically Iran, Sudan and Burma" between 2005 and 2010.

More than 1,100 shipments of US-made spare, repaired or exchanged parts were sent to the three countries during this five-year period and the gross revenue amounted to approximately $21 million, the statement said.

Half of this amount will be forfeited as a claim settlement to the US Department of Justice, while the other $10.5 million will be paid out to the US Commerce and Treasury departments.

"For years, Fokker Services treated US export laws as inconveniences to be 'worked around' through deceit and trickery," said US Attorney Machen in the statement, adding that this action sends a "clear message" that companies trying to circumvent US trade laws will face consequences.

The "schemes" initiated by Fokker were described as "work-arounds" in internal company documents, and they included withholding aircraft tail numbers to US-based repair shops or providing false numbers; US- and UK-based repair shops were usually told that the parts were simply going to be kept as stock.

The Dutch company revealed these transactions in a June 2010 disclosure to the US Commerce Department's Bureau of Industry and Security and the US Treasury Department's Office of Foreign Assets Control.

Fokker Technologies, the parent company of Fokker Services, said in a statement on its website that after they submitted the disclosure, the company conducted an internal investigation into the number of transactions that violated US trade sanctions, and employees involved in this criminal violation went through a "disciplinary review."

"FS [Fokker Services] identified transactions related to the sale of maintenance parts and repairs for Fokker aircraft, to which trade restrictions of the United States applied," the statement said. "FS sincerely regrets the historic conduct. The current management of FS is firmly committed to compliance."

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Sean Turnell, a Burma economics expert from Australia's Macquarie University, told DVB by email that Fokker likely came forward with its 2010 disclosure because criminal charges, along with much higher fines, were looming.

"The [$21 million] fine is stiff, but the penalties are not as great as they could have been," Turnell said. "Fokker has many interests still in aviation services, some of which are located in the US. They needed to protect these."

With Burma's economic landscape changing so rapidly, especially in terms of potential aviation contracts as the country opens up, Turnell said that the Dutch company must have sense that it was "better to settle old problems now in the hope of better times ahead."

The aircraft supplier first came under scrutiny in relation to Burma after a Fokker-100 aircraft operated by Air Bagan – which is owned by Tay Za, a Burmese tycoon with close links to the junta — crash-landed in Heho Airport in Shan State, killing two and leaving 11 injured.

Kachin court slaps jailed IDPs with additional sentences

Posted: 06 Jun 2014 04:14 AM PDT

Three Kachin IDPs serving jail terms have been found guilty of further crimes.

On Thursday, a Myitkyina court found the trio guilty of breaching the Explosives Act and sentenced the refugees, La Ring, Lahpai Gun and Brang Yone, to prison terms of three, 13 and 14 years respectively.

The three were arrested in 2012 at the Baptist Church in Myitkyina where they were taking shelter after fleeing their homes amid fighting between Burmese government forces and the Kachin Independence Army (KIA).

Shortly after their arrest, the three, along with fellow IDP Zaw Bauk, were charged under the Unlawful Association Act for alleged links to the outlawed KIA.

Over a year later, in November 2013, each member of the quartet was found guilty and sentenced to serve two years in prison.

Further to this, arresting officers believed Lahpai Gun, Brang Yone and La Ring to be linked to a bomb plot. The three were charged with multiple crimes under the Explosives Act.

Those charges have been brought to court in a somewhat piecemeal fashion. In December, Lahpai Gun and Brang Yone were sentenced to five additional years in prison after being found guilty on a number of charges.

A Myitkyina court heard the remainder of the charges on Thursday, and further extended the IDP's stays in prison.

Their lawyer, Mar Khar, confirmed the lengthy additional sentences.

"Brang Yone was sentenced to 14 years on Thursday under four separate charges while Laphai Gun was sentenced to 13 years, and La Ring to three years," he said, adding that all three were already serving terms in Myitkyina Prison – Brang Yong and Lahpai Gun seven years each and La Ring two years.

Mar Khar slammed the court's decision on Thursday as unfair, and criticised the judicial authorities for aligning with the government and military instead of seeking justice for civilians.

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"The sentencing of my clients show that the judicial system in Myitkyina is dented and there is absolutely no rule of law," said the lawyer.

"The courts are sentencing innocent civilians in favour of the government and the military, instead of providing them with legal protection."

The lawyer said he is planning to lodge appeals on behalf of his clients, focusing on the unlawful association charges.

The appeals will be heard at the Supreme Court in Naypyidaw on 17 June.

In July 2012, another Kachin IDP, Lahtaw Brang Shawng, was sentenced to two years in prison under the Unlawful Association Act, having been arrested by the Burmese army and allegedly tortured. Lahtaw Brang Shawng was freed as part of a presidential amnesty in June 2013.

For more background: https://www.dvb.no/news/kachin-idps-sentenced-to-5-years-under-explosives-act-burma-myanmar/35503

https://www.dvb.no/news/four-kachin-idps-sentenced-for-unlawful-association-burma-myanmar/34468

Burma Business Weekly

Posted: 06 Jun 2014 03:41 AM PDT

 

Ups and Downs

The Burmese currency held steady this week with the buying rate finishing on Friday at 965 kyat to the US dollar — slightly up from 966 last week – while the selling rate rose slightly to 972 kyat to the dollar. The price of gold also did not fluctuate drastically, sitting at about 650,000 kyat per tical compared to last week's 649,800 kyat. Fuel prices remain unchanged: Petrol is 820 kyat per litre; diesel 950 kyat; and octane 920 kyat a litre. Rice also remains constant: high-quality Pawhsanmwe rice is selling at 1,300-1,600 kyat per basket while low-quality Manawthukha retails at 900 kyat per basket in most Rangoon marketplaces.

 

Ooredoo defends itself in face of boycott campaign

Telecoms giant Ooredoo has defended its presence in Burma in the face of a campaign led by Buddhist monks urging customers to boycott the firm on the basis that it is based in a Muslim country: Qatar. "At the end of the day, we're an international telecommunications company and our focus is on providing great products and services for our customers," said PR manager Thiri Kyar Nyo. She noted that Ooredoo currently employs more than 700 local staff in Burma, and has an outreach policy focused on healthcare, education, women's empowerment, and youth programmes.

 

US govt fines Fokker $21m for violating sanctions

Dutch aerospace firm Fokker Services has been hit with a US$21 million penalty by the US government for selling US-made aircraft parts and goods to customers in Burma, Iran and Sudan, in violation of trade sanctions, according to a statement released Thursday by the US Attorney's Office in Washington DC. More than 1,100 shipments of parts were sent to the three countries between 2005 and 2010, and the gross revenue generated was approximately $21 million.

 

Six jetties underway in Rangoon

Construction is underway for six major jetties in Rangoon — four in Ahlone Township and two in Botahtaung — according to state media. The report said that the terminals or ports are designed to accommodate large freighters to ease handling of a surge in shipping trade. While imports and exports continue to rise, Burma still lacks large ports and modern equipment. According to the report, large ships have to anchor in the gulf and move products to smaller boats for docking.

 

Aid for Burma quadrupled in May

Burma received a total of about US$480 million in international aid and loans during the month of May — four times the amount received in April — according to data released by the Myanmar Peace Centre. The amount includes several newly implemented programmes, such as a $300m loan from China for transportation upgrades and $100m in aid from the World Bank for the education sector. An additional $55m from the International Monetary Fund will go towards the finance sector, while $12m from UNICEF has been allocated for child welfare programmes in Arakan State.

 

UPP gets go-ahead on $46m power plant

The Myanmar Investment Commission issued final permit documents to Singapore-listed conglomerate UPP Holdings Ltd, giving the company the green light on a US$46.5 million power plant project, according to Myanmar Business Today. UPP signed a turnkey agreement with Burma-based MSP Tractors Pte Ltd and Myan Shwe Pyi Tractors Ltd to build the power plant last August.

 

ADB supports renewable energy in Burma

The Asian Development Bank is to provide an additional US$2 million to encourage the Burmese Ministry of Agriculture and Livestock to harness renewable energy sources. The technical assistance project will provide access and investment plans for renewable energy, as well as demonstrate the implementation process through the construction of small solar and biomass power generators. Contrary to other media reports, the loan will not support power to an eventual 400,000 homes. The loan is in fact an extension to a $60million loan for a Power Distribution Improvement Project.

 

Thilawa villagers submit complaint to JICA in Tokyo

Three villagers from Rangoon's Thilawa Port area submitted a formal complaint on Monday to the Tokyo headquarters of Japan International Cooperation Agency (JICA), which is leading the controversial development of a special economic zone. Farmers Mya Hlaing, Sansha Tin and Khine Win travelled to the Japanese capital, with help from monitoring group Mekong Watch, after their concerns over deteriorating living conditions were allegedly ignored by JICA's office in Burma. The delegation also met with Japanese parliament members.

 

Burma to substitute white rice with parboiled rice

Burma is planning to replace white rice with parboiled rice for local consumption, with the Ministry of Health citing the health and cost benefits of this type of rice, which has been partially boiled in the husk, according to rice industry publication Oryza. Together with the Myanmar Rice Millers Association, the ministry started a campaign to promote parboiled rice, which contains vitamin C and is 15 percent cheaper than white rice.

Read more here

 

Presidential advisor warns about widening wealth gap

The wealth gap in Burma between rich and poor is increasing and should be a cause for worry, an economic advisor to the president said last week. "Twenty percent of people in a population of 60 million hold 80 percent of this country's wealth," said Aung Tun Thet, adding that there should be an economic development plan that is more inclusive to the poor and that addresses social and environmental issues. The UNDP estimated that one in four people in Burma live under the international poverty line.

 

Displaced Thilawa villagers descend on Tokyo

Posted: 06 Jun 2014 01:06 AM PDT

A group of residents living in Rangoon's Thilawa have travelled to Tokyo to lodge a formal complaint to Japan International Corporation Agency (JICA).

JICA is leading the development of a Special Economic Zone (SEZ) in Rangoon's Thilawa port.

But locals living in the project area say they have repeatedly called on JICA's Rangoon office to address concerns over the deterioration of conditions and standard of living that occurred after the Japanese agency moved in.

The villagers say JICA has ignored their requests for a meeting.

"We came to Japan because we were repeatedly denied a meeting by JICA's Rangoon office, despite sending many letters raising issues about how local residents are affected by the Thilawa SEZ without any assistance to rehabilitate our livelihoods," said Myint Hlaing, farmer and member of Thilawa Social Development Group, which represents local residents.

The Thilawa Social Development Group have outlined damages that villagers have incurred during the relocation of their homes and land. The damages include loss of farmland and access to farmland resulting in a loss of livelihood, impoverishment, and a shortage of educational opportunities for the villagers' children.

Those living in the Myaing Tha Yar resettlement site have complained of substandard housing and basic infrastructure, as well as lack of access to clean water.

Fed up with the silence from JICA's Rangoon office, three Thilawa residents, with the help of Japanese monitoring group Mekong Watch, travelled to their headquarters in Japan to hand over a formal complaint to a representative, Sachihiko Harashina, who promised to examine their case.

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"JICA's advisor and inspection officer pledged to inspect the area in accordance with their regulations and to follow up our concerns," said Myint Hlaing.

The delegation also met with Japanese MPs and held a press conference. They plan to tour across the country to study how Japan's government deals with these issues domestically.

"We are very satisfied with the warm welcome given by the officials here. We hope that we will prevail," said Khine Win, a Thilawa farmer and member of the Thilawa Social Development Group.

JICA, an independent agency that oversees official development assistance for the Japanese government, has announced plans to draft a comprehensive 30-year master plan for Burma's former capital and financial centre, Rangoon.

Japan is Burma's tenth largest investor, having channeled more than US$300 million into the private sector by the end of 2013.

Burma needs modernized rice mills, says industry association

Posted: 05 Jun 2014 10:20 PM PDT

The Myanmar Rice Millers Association (MRMA) has stressed the need for setting up modernized rice milling units in the country to be able to increase exports of high-quality 5 percent broken rice, according to local sources.

The MRMA noted that Burma's high-quality 5 percent broken rice (locally known as tann myint) has huge demand from Europe and Japan, but local millers lack facilities to meet the demands. They say sophisticated milling units with rice polishers and colour-sorter machines, which can produce high-grade 5 percent broken rice, are needed to keep abreast with the market needs. Currently, there are less than 10 high-tech and modernized rice mills that can produce 100 to 400 tons in the country, according to the MRMA. Owing to the high cost of producing 5 percent broken rice, most of the millers have stopped its production.

The MRMA has been demanding government assistance in setting up hi-tech milling units but the government has allegedly been indifferent to the rice millers' demands. The Association says even the 25 percent broken rice (locally known as ae-ma-hta), which is largely exported to Africa, and many other varieties of rice produced in Burma do not get higher prices in foreign markets as they are not polished during the milling process.

Also, falling rice prices and surging electricity charges have forced many small- and medium-sized millers to shut down their operations, says a former MRMA chairman. MRMA data shows that there are about 2,000 regular mills with an average milling capacity between 15 and 100 tons.

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The Myanmar Agribusiness Public Corporation (MAPC) is constructing new parboiling rice mills with a combined capacity of 200,000 tons and 300,000 tons of parboiled rice annually. The general secretary of MRMA expressed hope that the government takes some initiative to construct a few tann myint mills also in the country.

Burma's government is keen on regaining its once top rice exporter status and accordingly plans to increase its rice exports to about three million tons over the next five years, up almost three times the current exports of around one million tons. It is also working on a new trade policy and would help rice exporters gain access to new markets. However, inadequate funding and government subsidies are discouraging farmers from producing high-quality rice suitable for international sales, say local sources.

USDA estimates Burma to export 1.3 million tons of rice in 2014 (January – December), up 12 percent from an estimated 1.16 million tons in 2013. The agency estimates the country to produce 12 million tons of rice in 2013-14, up about 2 percent from an estimated 11.7 million tons in 2012-13.

This article was originally published in Oryza on 5 June 2014. Oryza is an industry leader in rice and a media partner of DVB. 

KNU urges Thein Sein to head party in next term

Posted: 05 Jun 2014 08:14 PM PDT

A Karen National Union (KNU) delegation urged Burma's President Thein Sein on Wednesday during a meeting in the capital to run for president in the next election as he has been deeply involved with the peace process negotiations.

Led by the organisation's chairman Mutu Say Poe and General Saw Johnny, the commander-in-chief of the KNU's armed forces, the delegation arrived in Naypyidaw on Monday to meet with the president. According to Mahn Nyein Maung, a member of KNU's central committee, the delegation pushed for Thein Sein to head the Union Solidarity and Development Party in the following presidential term.

"We suggested to the president that he assume leadership of the country for the second term because he is the one who initiated the ongoing peace process," said Mahn Nyein Maung. "He and his ministers who are leading the negotiations have the best insight on the situation so it is likely we will have peace sooner if they continue to lead the effort."

Thein Sein responded that although he is not in very good health, he will continue working if "the people desired it," Mahn Nyein Maung said.

The government has long struggled to bring the country's ethnic armed groups to an agreement to set down arms, and the process of negotiations has been hindered by attacks on both sides in various states. Currently, the Nationwide Ceasefire Coordination Team (NCCT) – which comprises 16 ethnic armed groups – and the government negotiating body, the Union Peace-making Work Committee (UPWC) are working to flesh out a nationwide ceasefire agreement.

Senior General Min Aung Hlaing, the commander-in-chief of Burma's military, also met with the KNU delegation and told them that he wants a nationwide agreement implemented as soon as possible, said Mahn Nyein Maung.

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"The senior-general told us that the Tatmadaw [Burmese military] will assist with the basic factors in democratic reforms to ensure the tranquillity, unity and development of the country," said Mahn Nyein Maung. "He also expressed a wish to have no individual or group left behind from the peace process and to ensure inclusivity."

The delegation also had its first ever meeting with with parliament Speaker Shwe Mann on Thursday, he said, who found it to be an encouraging step forward in the KNU's relations with the government.

"We can call this the start of our engagement with Burma's parliament, and we are looking to discuss continued cooperation in the peace process," said Mahn Nyein Maung.

The KNU reached a bilateral ceasefire agreement with the government in 2012, but have condemned repeated military action against other ethnic armies, including the Kachin Independence Army, the Ta'ang National Liberation Army and the Shan State Army-North.
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