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Cablegate: In Search of Peace and Development: Thanlyin And

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

UNCLAS SECTION 01 OF 02 RANGOON 000219

SIPDIS

SENSITIVE

STATE FOR EAP/BCLTV, EB, DRL/IRL
COMMERCE FOR ITA JEAN KELLY
TREASURY FOR OASIA JEFF NEIL
USPACOM FOR FPA

E.O. 12958: N/A
TAGS: ECON PGOV PHUM EIND BM
SUBJECT: IN SEARCH OF PEACE AND DEVELOPMENT: THANLYIN AND
KYAUKTAN

1. (SBU) Summary: A recent trip to Prime Minister General
Khin Nyunt's home region of Kyauktan and Thanlyin (previously
called Syriam), only a 45-minute jaunt southwest of downtown
Rangoon, proved once again that kinship in this
patronage-rich society has its privileges. The region is
still very underdeveloped and agrarian, however there are a
number of incongruous development projects that are
magnificent and idle memorials to the largesse of its
favorite son. Though only a small corner of the country, the
region displays aspects of the GOB's economic development
strategy evident countrywide: a "bigger is better" approach
to infrastructure, pork barrel spending, a pervasive Chinese
influence, and neglect of existing industries. End summary.

Thanlyin: The Company Town

2. (SBU) A first stop in Thanlyin, the capital of southern
Rangoon (Yangon) Division, revealed an aging company town
with few economic prospects. Nearly everyone in the city is
employed by one of several state-owned enterprises -- a glass
bottle factory, a tin processing plant, a steel processing
plant, several technical universities, and a GOB garment JV
with Daewoo. The largest employer is, and has been for
nearly a century, an oil refinery -- the second largest in
Burma. The refinery, first operated by the British, can
process about 650,000 gallons per day though it rarely
operates at capacity. There is also a large naval shipyard
and base between Thanlyin and Kyauktan, but locals say that
it is staffed entirely by naval officials brought in from
outside the region.

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Thilawa Port: Style Over Substance

3. (SBU) The private sector has barely set foot in Thanlyin,
although it is very close to the capital over a bridge newly
built by the Chinese and even closer to the country's largest
container port, Thilawa, located between Thanlyin and
Kyauktan and completed in 1997 also with Chinese assistance.
Though able to handle three large container ships at one
time, a port official admitted that during boom times the
gigantic and modern facility handles only two ships a month.
The overgrown train tracks emanating from the port emphasize
this point. When we were there a small Bangladeshi grain
vessel was in port but no activity was visible. Traders and
shippers in Rangoon say the ports along Rangoon's river front
are smaller but far busier and more convenient for access
into the city and beyond. The Thilawa port, they claim, is
too far from any industry or consumers to be a logical option.

Kyauktan: A Pilgrimage to Khin Nyunt's Hometown

4. (SBU) Khin Nyunt's actual birthplace, the riverside town
of Kyauktan, is still quite rural with an economy based on
agriculture, shrimp farming, fish drying, and tourism -- a
famous floating pagoda lies just offshore. Thanlyin natives
gripe that since Khin Nyunt rose to prominence in 1988, juicy
development projects have bypassed the larger town in favor
of Kyauktan. Indeed, Kyauktan's roads and public buildings
are far newer and better maintained than in other small towns
in the region and a cell phone tower, a very rare commodity
outside Rangoon proper, dominates the town's skyline.

5. (SBU) Nonetheless, Kyauktan again proves that public works
projects alone do not make economic development. Near
Thilawa port, SPDC favorite Asia World Co. (the conglomerate
founded in the 1990s by ethnic Kokang drug lord Lo Hsing Han)
has built a network of well-paved roads with grassy medians
passing through a vast "development zone." As far as we
could tell the zone is currently populated by a single
unfinished and apparently abandoned wire factory, a number of
tumbledown huts, and dozens of stray dogs. Likewise, in town
we saw a spanking new "e-library" that had been "donated" to
General Khin Nyunt by sycophants at the Union of Myanmar
Federation of Chambers of Commerce and Industry. The library
building is nice and has five new computers available for
use. However, no "e" is available -- neither Internet access
nor, quite often, electricity. Would-be computer geeks are,
however, able to borrow any one of a hundred pirated software
titles including English and Chinese language CDs and at
least two "How to be a Hacker" instructional discs.

In Khin Nyunt's House There are Many Mansions...

6. (SBU) Religious harmony, a theme we've noticed elsewhere
on our travels, appeared to repeat itself in Thanlyin and
Kyauktan. Although Buddhist structures were clearly dominant
and better maintained, Catholic and Protestant churches exist
alongside mosques and an internationally renowned Buddhist
meditation center. At a 400-year old mosque in Thanlyin, one
Muslim official told us that in the region the majority
Buddhists get along quite well with the large Muslim
minority. There were no incidents of violence here during
the inter-religious disturbances that flared up in Rangoon
last October and November. He said that the government fears
the size and power of the Muslim community in Thanlyin and
thus does not harass it or enforce laws forbidding the
renovation of non-Buddhist religious structures.

Comment: One Economic Development Plan Fits All

7. (SBU) The economic situation and various development
projects in Thanlyin and Kyauktan illustrate some important
points about the GOB's current development "strategy."
First, projects like Thilawa port symbolize the GOB's
obsession with huge infrastructure projects, completed for
the glory of the country regardless of cost or usefulness.
Second, the port and the Thanlyin-Rangoon bridge reiterate
the pervasiveness of Chinese investment and assistance in
these type of grandiose, but economically questionable,
projects. Third, the location of these infrastructure
projects alongside the Asia World "development zone" and the
"e-library" show the nature of the pork barrel spending in
Burma, where the hometowns of the senior leadership get
priority regardless of appropriateness. Finally, the sad
state of Thanlyin's major state-owned, potentially
profitable, industries is a typical result of SPDC
development priorities that focus on newness and flash rather
than strengthening or rationalizing boring old existing
industries. End comment.
Martinez

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