Weekly Focus

2006-10-30T14:06:37+01:00

Inside Myanmar's secret capital

One year after Myanmar's secretive ruling military junta suddenly relocated the national capital 320 kilometers north from Yangon to Naypyidaw, the motivations behind the dramatic move are still unclear.

Foreign access to the new capital is strictly forbidden. But this correspondent's recent travels through the area showed that the junta has quietly continued to build around the new capital's greenfield site, which is rapidly swallowing the old town formerly known as Pyinmana. And recent construction of key infrastructure in other parts of the country's heartland Mandalay division offers new clues to the junta's grand designs for the region.

Although on a smaller scale than in the new capital, Myanmar's government is concurrently developing military, communications and transport infrastructure in a corridor that runs directly north from Naypyidaw to Pyin Oo Lwin, the town where the army's Defense Services Academy (DSA) training facility is situated.

The regime is building a new military airport just outside of Pyin Oo Lwin in nearby Anikasan town. The single runway, a 3,000-meter-long airstrip, took nearly two years to complete and immediately came into service last October when the junta received India's army chief of staff J J Singh in Pyin Oo Lwin. The Indian official was subsequently taken on a tour of the DSA as well as the Defense Services Technological Academy.

Residents of Pyin Oo Lwin and nearby Mandalay say the new airstrip is more commonly used to ferry high-ranking military officials between Naypyidaw and a newly built luxury housing complex between Anikasan Airport and Pyin Oo Lwin, which reportedly includes a large mansion belonging to State Peace and Development Council chief General Than Shwe. Strictly off limits to visitors, the site was built with the help of Htoo Trading, owned by Tay Za, the military's preferred construction contractor and a renowned arms dealer.

In July, just outside of Pyin Oo Lwin, the junta began construction on the Yadanabon Silicon Village, a new cyber-city that promises to serve as an integral part of the new capital's communication network. Although construction has just commenced, architectural blueprints seen by this correspondent at the site's foreman's cabin show plans for a sprawling complex devoted to software incubation and information-technology hardware suites, along with a modern residential zone.

In August, builders had cleared a channel for a new access road to the site, though construction of the complex itself has not progressed beyond initial landscaping. Builders could be heard by this correspondent blasting the hillside as part of the land-clearing process. As with the new capital Naypyidaw, photographing the site is strictly forbidden.

Military industrial complex

The junta apparently has an eye on concentrating key industry around the region. Old and new military installations line the main road from Pyin Oo Lwin to Mandalay, including the Defense Services Mechanical and Electrical Engineering School, which was built more than a decade ago. The town is also home to the Defense Services Institute of Technology, the Defense Services Administration School and the Army Training Depot.

Also just outside Pyin Oo Lwin is Myanmar's only iron-and-steel factory, which produces about 30,000 tons of metal a year, according to the Chinese state news agency Xinhua. In a bid to improve access to this increasingly significant military town, the government in 2003 decided to upgrade drastically the notoriously poor Mandalay-Pyin Oo Lwin road with the help of the Asia World Co, another preferred contractor owned by Steven Law, who has widely alleged links to the narcotics trade. It now takes less than an hour by car to reach Mandalay from Pyin Oo Lwin.

Almost equidistant between Pyin Oo Lwin and Naypyidaw is the strategically significant town of Meiktila, home to the country's air force. Meiktila has also seen extensive development in recent years coincident with construction of the new capital. Since 2001, there have been reports that China and Russia have helped upgrade the Shante air base, the country's main military airstrip, a few kilometers northeast of Meiktila.

Reports that both countries have recently sold and delivered fighter jets to the base seem to be confirmed by satellite images downloaded using Google Earth, which clearly show a number of olive-green Chinese Chengdu F-7M Airguard and light-khaki NAMC A-5C military aircraft along with blue Russian MiG-29s - all recent additions to Myanmar's air force. At the nearby Meiktila Airfield, Google Earth images also show a number of what appear to be Russian Mi-17 helicopters.

In addition to supplying military hardware, media reports have suggested, Chinese and Russian aeronautical experts have in recent years made regular visits to the various air force training schools around Meiktila.

The state-run New Light of Myanmar newspaper in April 2004 confirmed that lectures were administered by "local and foreign experts" at the Myanmar Aerospace Engineering University in Meiktila, which at the time was still in the process of being completed. This "new and separate university", the report said, would "make the teaching programs more effective by sending teachers going to work at the university to foreign countries for further studies and inviting foreign technicians to the university to give lectures".

Highlighting the military significance of the new facility, Than Shwe said during a 2004 visit, "Only when the university produces future technicians in aerospace and engineering fields for the state will the nation be able to keep pace with others." The military has also relied on Chinese and Russian assistance to help build other significant military installations in and around Meiktila.

In April 2004, around the time construction on the new capital began, the junta signed a US$500 million deal with Ukrainian state arms company UkrspetsExport to build an APC (armored personnel carrier) factory. Between 12km and 15km outside of Meiktila, according to a former employee of the Ukrainian firm who worked on the deal, the facility is designed over a 10-year period to receive about 1,000 70%-assembled BTR-3U APCs.

At the factory, Meiktila-based Ukrainian technicians are geared to work hand-in-hand with their Myanmar counterparts to complete the assembly process and pass along knowledge about the vehicles' inner workings, the company's former employee said. Although the deal was designed to run until 2014, Myanmar's failure to meet payments on time has recently soured relations between the two sides.

In a bid to receive past-due payments, Sergiy Korostil, UkrspetsExport's chief representative in Yangon, wrote a letter to Myanmar's Ministry of Defense this year. This was, however, rebuffed when the Myanmar side accused the Ukrainians of violating their side of the agreement when their technicians were discovered to have left their designated military compound without authorization. Whether this tit-for-tat exchange has killed the deal is unclear. Korostil is reportedly still operating out of his office at the Nikko Hotel in Yangon with a small team of staff, and the executive has since made visits to Naypyidaw to meet with government officials.

The hiccup with UkrspetsExport has not dampened other foreign firms' appetite to ink deals with the junta. Many Asian companies have traveled to Naypyidaw to sign a host of state contracts to build communication, transport and perhaps even military infrastructure. In 1998, prior to the UkrspetsExports episode, Myanmar agreed to a deal with China to build a landmine factory just outside of Meiktila, which is reportedly still up and running.

The junta has also made efforts to significantly upgrade transport links to Meiktila. In August, workers could be seen opposite the town's train platform working on the beginnings of a construction project between the two main lines that run through Meiktila railway station. On July 16, the government held a ceremony to launch the new Naypyidaw-Meiktila express-train service, one of a number of recently added routes to the new capital. The project included construction of "13 small and big bridges ... along the railroad", the state-run press reported.

South of Meiktila, the road to Naypyidaw has undergone considerable renovation, at least by Myanmar's poor standards. Although many roads in the new capital remain unfinished, an expansive new highway that leads off the main Yangon-Mandalay road to the new Ministry of Defense compound is nearly complete.

A Western observer who in recent months caught a rare glimpse inside the new 35-square-kilometer defense zone to the north of the new capital noticed giant statues of past Burmese kings along the main parade ground. "Most notable was the four-lane concrete road that passes through the entire complex, [which] becomes six then eight lanes as you enter the military side. Reportedly, this is so it can serve as an airplane runway," said the Western observer, who requested anonymity.

Mysterious motivations

While commentators have offered a host of reasons for the junta's sudden move north, ranging from astrology to military strategy to fears of a possible US-led invasion, the larger field of development in Myanmar's central heartland lends credence to the simpler strategic notion that the junta regards the central heartland as an ideal site to consolidate its resources.

Whether or not the move to Naypyidaw offers strategic military advantages is debatable, according to Andrew Selth, an expert on Myanmar's armed forces. "Building Naypyidaw emphasizes and utilizes that corridor, but there have long been plans to upgrade these facilities, as they are also important for economic and political reasons," he said. "In purely strategic terms, it would have been more sensible to diversify these critical north-south links and build more routes on the western side of the Irrawaddy [River], or in the east of the country."

Selth said the increasing separation of Myanmar's ruling military generals from the civilian population would make it far easier for a potential foreign invader to target the junta through air strikes. Nevertheless, the argument previously put forward that the switch inland from the old coastal capital Yangon reduces the risk to the junta of a land invasion was probably taken into account by the military.

In the past, the junta felt most threatened through its vulnerability at the Bay of Bengal. In 1988, the US moved navy vessels into the area, apparently in the event of the state collapsing during the democratic uprisings. In 1992, junta abuses against Muslims in Arakan state prompted the wrath of Saudi Arabia, whose army chief Prince Khaled bin Sultan bin Abdul Aziz called on the United Nations to intervene and help the minority Muslims.

Selth reasons that relocating inland does not put the military out of reach of advanced missiles and aircraft of its perceived primary threat - the United States. President George W Bush's administration has recently referred to Myanmar as an "outpost of tyranny", though few security experts reckon the US would ever attack, because of China's heavy influence in Myanmar. But "if the external threat was seen as real and imminent, the regime may well choose to consolidate its military strength in central [Myanmar], with a view to a conventional defense of the [Myanmar] heartland," he said.

Whether efforts to expand resources and facilities in the country's central heartland truly shore up national defenses given that the main insurgency threat lies in the surrounding areas controlled by Karen insurgents is debatable, Selth said. "Given its make-up, it is difficult to see the current government doing anything that does not include some consideration of military and strategic factors," he said.

While evidence of massive construction activity in Mandalay division suggests that the junta may well see central Myanmar as the key to its ultimate survival, as ever, only Than Shwe and his inner circle know the real reason behind their dramatic and expensive shift to Naypyidaw.

Written: by Clive Parker, is a reporter at The Irrawaddy, an online news service and monthly magazine that focuses on Myanmar and Southeast Asia, based in Chiang Mai. He is possibly the first foreign journalist to report from Myanmar's new capital.

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East Timor on the precipite

After centuries of Portuguese colonialism and more than two decades of Indonesian military occupation, instability and violence continue to plague East Timor, simultaneously one of the world's newest and poorest nations.

Since East Timor won independence in May 2002, grave uncertainty has marked the future of the small, resource-rich island nation. Violent clashes that started this April and peaked in June are now kicking up again, indicating that the island's long struggle for freedom has now morphed into a violent fight for power among competitive armed groups.

Last week rival groups of marauding youths primitively fought one another with knives, machetes and bows and arrows, set fire to houses and, significantly, attacked the 1,600-strong foreign peacekeeping contingent, which landed in May and is made up mainly of Australian troops, with smaller contingents of Malaysians, New Zealanders and Portuguese. At least four people have died in the latest surge in violence.

That augurs ill for those who hoped foreign intervention and the July 8 appointment of former Nobel Peace Prize winner Jose Ramos-Horta would quell the violence and help to reconcile competitive groups inside the police and military. Rather, the recent disturbances have been interpreted by Brigadier-General Taur Matan Ruak, the current commander-in-chief of the armed forces, as an attempt to overthrow the new government.

He says the main objectives of the violent gangs are "the collapse of the executive branch, the dissolution of parliament, and the establishment of a government of national unity". Matan Ruak, a Ramos-Horta loyalist, was a legendary guerrilla leader who fought against the occupying Indonesians for 25 years.

Rioters have recently targeted international peacekeepers, notably after Australian troops shot tear gas last week into an improvised refugee camp, which injured a child near the airport in Dili, the capital. Australian troops also reportedly opened fire that same day when a man approached them in a perceived threatening manner. The director of the Dili hospital, Antonio Calere, told Portuguese reporters that four people were killed and 47 injured last week. Two Portuguese soldiers and one Australian were among the injured.

The United Nations Office in East Timor (UNOTIL) has since called for the replacement of Australian troops with UN police officers, who would be led by Antero Lopes of Portugal and include soldiers from Portugal, Malaysia and Bangladesh. Acting Police Commissioner Lopes told the Portuguese press that the violence last Wednesday reached the worst level since June, when more than 20,000 Timorese fled the capital for the nearby hills.

Ramos-Horta said by telephone from Rome - where he was visiting the Vatican to invite Pope Benedict XVI to visit East Timor - that "different groups in Timor are trying to manipulate the foreign military forces, alternately accusing the Portuguese and the Australians".

"Members of a group that was neutralized by the Australians accuse them of supporting the other side, and members of a group neutralized by the Portuguese accuse the Portuguese of favoring the other side. It's a never-ending story," said Ramos-Horta, who concurrently serves as the country's defense chief.

"The Australian, New Zealand, Malaysian and Portuguese forces went to East Timor at the request of the presidency, parliament and the government. In general, the troops have behaved in an exemplary manner. Incidents have occurred, but they have never been deliberate," he said.

That's not necessarily how the UN Independent Special Commission of Inquiry for Timor-Leste, which was established to investigate the causes and culprits of the recent violence that led to at least 40 deaths and triggered the ongoing crisis, views the situation. Released last month, the UN inquiry recommended that some 90 high-ranking Timorese officials and others be investigated and, if the evidence warranted, prosecuted in local courts. One top official named by the UN commission: army commander-in-chief Matan Ruak.

Ramos-Horta said in the interview that the armed forces and Matan Ruak had already "presented public apologies" after the UN special commission issued the results of its investigation. "It is very rare for a military force anywhere in the world to show such integrity, courage and humility, an attitude that will help cure many wounds in our society," he stated.

In late June, East Timorese President Xanana Gusmao asked for the resignation of prime minister Mari Alkatiri and defense minister Roque Rodrigues, and named then-foreign minister Ramos-Horta to both posts. The reason given for the move was alleged discrimination against the Loromunus ethnic group from the western part of the island by the Lorosae from the east, who significantly have much greater representation in the armed forces and police.

But analysts in Portugal and Australia say the problem is not so much ethnic as economic. They point in particular to the competitive interest for political control over the country's vast oil and natural-gas reserves. Once brought online, those reserves are expected to lift significantly the country's gross domestic product per capita of about US$400 and help solve the country's endemic unemployment.

"We do not have a middle class in the real sense of the word, nor any significant private sector, and I say that because no country develops without a private sector and a middle class," Ramos-Horta said. "As everyone knows, this takes many years to develop. Sometimes people forget that we are only in our fourth year of independence."

For his part, Matan Ruak has said a parliamentary investigation commission should be set up "to guarantee a rapid return to peace". The aim of the commission would be "to determine the objectives and strategies" of the violent groups "and identify the moral and intellectual authors behind the crisis - and, above all, to hold them accountable".

Ramos-Horta said it was "only natural" that the UN would call for further investigations. "It is the responsibility of the attorney general to determine whether or not that is necessary," he said, adding: "For my part, I continue to have full confidence in Brigadier-General Taur Matan Ruak."

Unfortunately, not everyone else that matters is in agreement. Major Alfredo Reinado, who deserted the armed forces with a group of his military followers in June, is still holed up in the jungle. Ousted prime minister Alkatiri is still disgruntled and politically powerful. And the prognosis from the streets is for more violence in the weeks ahead.

Written: by Mario de Queiroz

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Hong Kong's low-cost airline with all the frills

The first low-cost carrier to fly between Hong Kong and London took off yesterday, a day late, offering the usual trimmings such as food and films at a fraction of the normal price.

Oasis Airlines' inaugural flight was due to land at Gatwick, carrying its chief executive, Stephen Miller, financier Reverend Raymond Lee and about 300 passengers. The original departure, set for Wednesday, had to be postponed after the flight plan was rejected by Russian aviation authorities.

The cost of economy seats started at HK$1,000 (£75) before tax. Business class seats were HK$6,600 before tax. Most industry analysts are supportive, even though the idea of providing no-frills prices, with frills, seems hard to sustain. Four flights between Hong Kong and London are planned for the first month, with daily flights from November 25. Oasis says it has pared down costs by extracting more flying hours out of each plane, planning a cargo service and using subsidiary airports.

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India's Sensex breaks 13,000 mark

India's main stock index, the Sensex, has broken the 13,000 milestone and reached its best-ever finish on Monday. At close in Mumbai the 30-share index reached 13,024.26 - a gain of 117.45 points, or 0.91%, on last week's close. Shares were boosted by solid earnings from several key banks and technology firms, but analysts said investors may now take profits.

The index has now risen 36% in 2006, and has shrugged off a sharp slide in June to below 9,000.

Beyond expectations, corporate earnings growth has been beyond expectations. The Sensex, which reached a previous best of 12,994 points on 17 October, was boosted on Monday by aggressive buying by funds of stock in Infosys Technologies. The record level comes ahead of a Reserve Bank of India review of interest rates. The bank is expected to keep a key short-term rate unchanged.

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Written: by LuisB

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