Cablegate: Natives Restless Over Scope of New Sanctions

This record is a partial extract of the original cable. The full text of the original cable is not available.




E.O. 12958: N/A

1. This is an action request. Please see paragraph 5.

2. The Charge d'Affaires, a.i. and Econoff held briefings on
the new U.S. sanctions on July 30th for U.S. citizens, and
July 31st for Burmese and third-country businesspeople, NGOs,
and the diplomatic and UN community. Both briefings were
well-received. We asked the attendees not to debate U.S.
policy, but to stay focused on technical issues. Generally
the two audiences complied, but were genuinely shocked, and
in some cases irked, by the ramifications of the sanctions --
particularly the ban on financial services. We tried to give
general advice and explanations about the sanctions, but
advised all to contact an attorney or OFAC directly to
discuss specific cases.

3. The U.S. citizens, including representatives of U.S.
companies and U.S.-based NGOs, were concerned that they would
not be able to import their personal effects when they
returned to the United States. Many have lived in Burma for
years, and have accumulated Burmese-made products of
significant value. Several asked whether there might be some
kind of waiver for U.S. citizens to carry home personal
effects, or for those who could prove they had purchased
Burmese products before the import ban went into effect.
U.S. citizens conducting business in Burma were quite worried
that they would no longer be able to get U.S. dollars
transferred to Burma from the United States or a
third-country. The businesspeople agreed that the impact of
the sanctions would depend in part if the GOB can adapt its
trade policy to accept letters of credit in currencies other
than the U.S. dollars.

4. The second briefing filled the American Center auditorium
beyond capacity and was somewhat more heated than the first.
Representatives of foreign embassies in Rangoon were upset
that remittances of dollars into Burma to fund Embassy
payrolls and operations were not covered by the first general
license. Several Ambassadors urged us to pressure Treasury
to issue such a license for them as soon as possible. The UN
representatives were pleased to be included in the initial
general license, but confused as to how they would be able to
bring in funds without relying on frozen correspondent
accounts in the United States. Many businesspeople and NGO
representatives asked about the status of payments that fall
afoul of the remittance ban and asset freeze, whether these
payments would also be frozen, or merely returned to sender.

5. Action requested: We would appreciate specific guidance
on the legality of transactions (both for those with general
licenses and those without licenses) in U.S. dollars from a
third-country bank outside the United States, directly to a
state-owned bank in Burma. Also, please advise whether U.S.
dollar letters of credit, even if between a third-country
bank and a Burmese bank, will become problematic under the
new law.

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