DAGAinfo(30 January 2002) No.128

2002-01-30 20:33

30 January 2002
No. 128

In this issue:
IMF strikes again
NEWS in Brief
China - China's WTO entry a 'wake up call' for Southeast Asia
Japan - Japan's Disarming Return to Asia
East Timor - UN diplomat cites racism as he quits
Philippines - US Military Advisors in Philippines
Burma - Rohingya asylum seekers arrested
Afganistan - Rebuilding Afghanistan to cost US$15 bln
Burma - Former Professor Arrested for Solo Prot

1. FEATURE - top

Economic debacle in Argentina: IMF strikes again
By Arthur MacEwan

In the midst of their fourth year of recession, with the official unemployy people could withdraw from their bank accounts, political demonstrations and the looting of grocery stores spread across the country. First the government declared a state of siege, but with the police often standing by watching the looting "with their hands behind their backs", there was little the government could do. Within a day after the demonstrations began, the principal economic minister had resigned; a few days later came the president's resignation.

A hastily assembled interim government immediately defaulted on $155 billion of Argentina's foreign debt, the largest debt default in history. The new government then promised a public works jobs program and announced it would issue a new currency, the argentino, that would circulate as a "third currency" alongside the old pesos and US dollars. Argentinians, however, seemed to have little hope for the new currency, and, fearing a severe devaluation, they continued to line up outside banks, hoping to get dollars from their accounts. As for the new programs, they did little to confront the fact that per capita income has already fallen by 14 percent in this recession. As economic instability deepened, the new government proved unable to win the popular support it needed, and it quickly dissolved.

At the opening of 2002, Argentina faced widespread political and economic uncertainty. The main question seemed to be whether the short run would bring more unemployment, severe inflation, or both. As to the stability of Argentina's currency, virtually everyone expects a sharp devaluation fairly soon.

Argentina's experience leading into the current debacle provides one more lesson regarding the perils of free market ideology and of the economic policies pushed on governments around the globe by the International Monetary Fund (IMF). In Argentina and elsewhere, these policies have been embraced by local elites, who see their fortunes (both real and metaphoric) tied to the deregulation of commerce and the reduction of social programs. Yet the claims that these free markement rate approaching 20 percent and with increasing cutbacks of social programs, Argentinians took to the streets in the days before Christmas. Sparked by the government's latest economic policies, which restricted the amount of monet policies would bring economic growth and widespread well-being have been thoroughly discredited. (In spite of the economic collapse and political turmoil in Buenos Aires, the wealthy appear to have protected themselves by having moved their money out of the country.)

From good to bad to ugly

Not long ago, Argentina was the poster-child for the conservative economic policies pushed by the IMF. The Buenos Aires government privatized state enterprises, liberalized foreign trade and investment, and tightened government fiscal and monetary policy. During the 1990s the country's economy seemed to do well. The good times of the mid-1990s, however, were built on weak foundations. Economic growth in that period, while substantial, appears to have been in large part the result of an increasing accumulation of international debt, fortuitous expansion of foreign markets, and short-term injections of government revenues from the sales of state enterprises. Before the end of the decade, things began to fall apart.

Argentina's current problems are all the more severe because, in the name of fighting inflation, in the early 1990s the government created a "currency board" charged with regulating the country's currency so that the Argentine peso would exchange one-to-one for the US dollar. To assure this fixed exchange rate, the currency board maintained dollar reserves, and could not expand the supply of pesos without an equivalent increase in the dollars that it held. The currency board system appeared attractive because of absurd rates of inflation in the 1980s, with price increases of up to 200 percent a month.

By the mid-1990s, inflation in Argentina had been virtually eliminated - but flexibility in monetary policy had also been eliminated. When the current recession began to develop, the government could not expand the money supply as a means of stimulating economic activity. Worse yet, as the economy continued downward, the inflow of dollars slowed, restricting the country's money supply even further (by the one-to-one rule). And still worse, in the late 1990s, the US dollar appreciated against other currencies, which meant (again, the one-to-one rule) that the peso also appreciated; the result was a further weakening in world demand for Argentine exports.

During 2001 the Argentine recession grew rapidly deeper. Although the IMF pumped in additional funds, it provided these funds on the condition that the Argentine government would entirely eliminate its budget deficit. With the economy in a nose-dive and tax revenues plummeting, the only way to balance the budget was to drastically cut government spending. Yet, in doing so, the government was both eviscerating social programs and reducing overall demand. In mid-December, the government announced that it would cut the salaries of public employees by 20 percent and reduce pension payments. At the same time, as the worsening crisis raised fears that the peso would be devalued, the government moved to prevent people from trading their pesos for dollars; it promulgated a regulation limiting bank withdrawals. These steps were the final straws, and in the week before Christmas, all hell broke loose.

Failure under the direction of the IMF

Economic policies in Argentina during the past 15 years have had substantial support among the country's business elite, especially from those whose incomes derive from the financial sector and primary product exports. These groups have gained substantially, and officials in the Argentine government have been active in formulating and executing the policies that have led to the current debacle.

At the same time, the country's economic policies during the 1990s were developed under the direction of the IMF. From the late 1980s onward, a series of loans gave the IMF the leverage to guide Argentine policymakers as they increasingly adopted the IMF's conservative economic agenda. As the country entered into the lasting downturn of the current period, the IMF continued, unwavering, in its support. The IMF provided Argentina with "small" loans, such as the $3 billion made available in early 1998 when the country's economic difficulties began to appear. As the Argentine crisis deepened, the IMF increased its support, supplying a loan of $13.7 billion and arranging $26 billion more from other sources at the end of 2000. As things worsened still further in 2001, the IMF pledged another $8 billion.

The IMF coupled its largess with the condition that the Argentine government maintain its severe monetary policy and continue to tighten its fiscal policy. Deficit reduction - which according to the IMF is the key to macroeconomic stability (which in turn is supposed to be the key to economic growth) - was undertaken with a vengeance. In early July 2001, on the eve of a major government bond offering, Argentine officials announced budget cuts of $1.6 billion (about 3 percent of the federal budget), hoping that these cuts would reassure investors and allow interest rates to fall. Apparently, however, investors saw the cuts as another sign that the country's crisis was worsening, and the bonds could only be sold at sharply higher interest rates (14 percent as compared to the 9 percent that similar bonds had commanded in mid-June). By December, the effort to balance the budget required far more severe expenditure cuts, and the government announced a drastic reduction of $9.2 billion in its spending, about 18 percent of its entire budget.

Argentina is now providing one more example of the failure of IMF policies to establish the bases for long-term economic growth in low-income countries. Numerous other countries demonstrate similar sets of problems: much of sub-Saharan Africa; Mexico, and several other countries in Latin America; Thailand, and other parts of East Asia hit by the 1997 crisis; and Turkey, along with Argentina in 2001. IMF policies do often succeed in curtailing inflation; sharp cuts in government spending and restrictions of the money supply will usually yield reduced price increases. Also, IMF programs can provide large influxes of foreign loans - from the IMF itself and the World Bank, from the US government and the governments of other high-income countries, and, once the approval of the IMF has been attained, from internationally operating banks. But nowhere has the IMF policy package led to stable, sustained economic expansion. Also, as in Argentina, it often generates growing inequality.

The IMF's mania for reductions of government spending in times of crisis has been rationalized by the claim that balanced budgets are the foundation of long-term economic stability and growth. The IMF officially laments the fact that these policies have a severe negative impact on low-income groups (because they both generate high rates of unemployment and eviscerate social programs). Yet, IMF officials claim these policies are necessary to assure long-term stability. Nonsense.

In recessions, moderate government deficits (like those of recent years in Argentina) are a desirable counter-cyclical policy, and balanced budgets only exacerbate down-turns. Also, curtailing social spending - on education, health care, physical infrastructure projects - cuts the legs out from under long-term economic progress.

Why does the IMF stick to failed policies?

Yet the IMF sticks to its policies, probably because those policies serve important and powerful interests in the US and world economies. The IMF, after all, is not an institution controlled by either the people or the governments of low- income countries. It is not even like UN agencies, in which governments have formally equal voice with one another. Instead, the IMF is controlled by the governments of high- income countries that provide the funds for its operations. The US government has by far the greatest influence at the IMF. With over 18 percent of the voting shares in the Fund, the US government has de facto control. Indeed, over the years, the IMF has operated largely as a branch of the US foreign policy apparatus, attempting to create a context that assures the well-being of US interests - which is to say the interests of US-based internationally operating firms. (The same context serves the interests of firms based in Europe, Japan, and elsewhere; so the US generally has the support of its allied governments in directing the IMF.)

Most importantly, the IMF tells governments that a key to economic growth lies in providing unrestricted access for imports and foreign investment. Virtually all experience, however, suggests the opposite - that extensive regulation of foreign commerce by a country's government has been an essential foundation for successful economic growth. Britain, the US, Japan, countries of Western Europe, Taiwan, South Korea - all built the foundations for development not on "free trade" but on government regulation of trade. The IMF gets around the inconvenient facts of history by conflating free trade with extensive engagement in the international economy. But the two are not the same. Yes, successful development has always been accompanied by extensive international engagement, but through regulated commerce and not free trade. The dramatic experience with financial capital demonstrates a similar disconnect between IMF proclamations and reality. Through the period of its increasing influence in the 1980s and 1990s, the IMF pushed governments in low-income countries to liberalize their capital markets. Capital controls were, claimed the IMF, anathema to development. Then came 1997, when the open capital markets of East Asian countries were instruments of disaster. In the aftermath of 1997, it seemed clear that the real winners from open capital markets were financial firms based in the US and other high-income countries.

These same financial firms are also the winners from another component in the IMF policy package. Fiscal responsibility, according to the IMF, means that governments must give the highest priority to repayment of their international debts. In fact, the immediate justification of new IMF loans is often that this influx of capital is necessary to assure prompt payments of past loans. While there is no doubt that banks operating out of New York and other financial centers gain from this policy, experience does not support the contention that when governments fail to pay foreign debts they bring on financial disaster. Instead, experience suggests that, at times, defaulting on foreign debt can be an effective, positive policy option. (Also, as has been frequently noted, as long as the IMF provides the funds to assure payment of loans made by the internationally operating banks, those banks will have no incentive to assure that they are making sound loans.)

IMF advocacy of privatization is one more example of its effort to open the world economy more fully for US-based firms. When state enterprises in low-income countries are sold, large internationally operating firms are often the buyers, able to move in quickly with their huge supply of capital. Of course, in Argentina and elsewhere, local business groups have often been the direct beneficiaries of privatization, sometimes on their own and sometimes as junior partners of firms based abroad. Either way, whether the buyers of state enterprises are national or foreign, this enlargement of the private sphere of operation works to the benefit of the private firms. The problem here is not that privatization is always inappropriate, but simply that, contrary to IMF nostrums, it is not always appropriate.

Privatization is especially problematic when it only replaces an inefficient government monopoly with a private monopoly yielding huge profits for its owners. Moreover, the record from Mexico City to Moscow demonstrates that privatization is often a hugely corrupt process.

A growing popular opposition

The policies of the IMF and those of the World Bank have generated a great deal of popular opposition in low-income countries as well as in the US and Europe. During recent years, that opposition has become increasingly strident, staging major demonstrations at meetings of the IMF and the World Bank, as well as at other gatherings of the government officials guiding globalization. This opposition has been dubbed the "anti-globalization movement". The title is misleading because most of the activists are not opposed to the growing international economic and cultural connections among peoples, but are opposed to the way those connections are being structured, benefiting large firms while creating hardship and instability for many, many people. Policies like those of the IMF in Argentina typify the problem. Also, the recent political upheaval in Argentina lends new strength to the argument of the opposition movement that the IMF adjustment policies not only fail to bolster economic development but also lead to social and political disintegration.

Pressure from this movement has had some impacts. The IMF's contribution to the Asian financial crisis in 1997 unleashed a torrent of criticism that the movement both built upon and contributed to. While no major policy changes have ensued, the IMF has responded rhetorically, renaming its "Enhanced Structural Adjustment Facility" as the "Poverty Reduction and Growth Facility". Over a longer period, the World Bank has also adjusted at least the appearance of its policies, focusing more attention on the issue of poverty and starting to examine the role of gender in economic development. The World Bank, in addition, has backed off from some of its large- scale water control projects in low-income countries as a result of pressure from local organizations and international environmental groups. These changes have not basically altered the programs of the international financial institutions, and the IMF has been especially resistant to change. Yet these adjustments do suggest that opposition has begun to have an impact.

The lesson is that the movement for change should increase its pressure on these institutions that are playing such central roles in shaping globalization. While the movement has emerged largely in response to the hardships and inequality that have grown - even while IMF-type policies generated some economic growth - this opposition will gain greater legitimacy as growth is replaced by crisis, as in Argentina. The appeal of alternative policies will be even greater as the IMF and local elites can no longer claim that economic growth will eventually solve all problems.

Beyond denunciation: Alternative strategies

There is, however, a need and an opportunity for the opposition movement to go beyond denunciation of the IMF's conservative policies and to articulate alternative strategies, strategies that would support a democratic, egalitarian form of economic development. Such strategies would promote structural adjustment in low-income countries, but a very different and more fundamental structural adjustment than has been advocated by the IMF. A democratic development strategy could begin with a focus on the expansion of social programs, a greater investment in schooling, health care, and other public services that would establish a social foundation for long-run economic expansion.

A democratic strategy would not ignore macroeconomic stability, but instead of seeking that stability in government cutbacks, it would pursue expanding the government revenues (raising taxes) as a means to provide fiscal balance. Also, a democratic strategy could not ignore the private sector, but it would recognize the problems of allowing the private sector to be guided simply by private profits in an unregulated market. It would, for example, push the private sector toward high-technology activity instead of production based on low wages, and it would seek to provide support for local farmers to maintain their livelihoods and community stability.

The first problem in implementing an alternative development program in Argentina and elsewhere is to overcome the power of elite groups that have directed the existing system. In spite of the current difficulties, the policies that the Argentine government has followed in recent years, and the similar policies pursued by the governments of many low-income countries, have delivered substantial benefits to local elites. Those policies have allowed them to strengthen their positions in their own economies and secure their roles as junior partners with US- based and other internationally operating firms. Changing policies will therefore require changing the balance of power. Shifting the balance of power in a country is never easy, but the emergence of an international movement for change and the growing economic crisis present some substantial opportunities.

If people in low-income countries are to move in an alternative direction, they must find ways to deal with the oppressive burden of foreign debt. Not only is the debt itself a problem, creating a growing drain on countries' resources, but also the need to continually seek new debt in order to repay old debt forces governments to accept the IMF conditions that perpetuate the problem.

Here, those forces that want change can take a lesson from the high-income countries. As the governments of high-income countries work together in pursuing their economic relations with the low-income countries, low-income debtor countries have a common set of interests that could provide the foundation for common action. Working as a bloc, they would have a greater chance of gaining better terms, greater leeway in the conditions that come with foreign finance, and the freedom to pursue the meaningful structural adjustment of a democratic strategy.

Ultimately, the power of such a bloc would depend on the willingness of member countries to repudiate their foreign debts. Such repudiation would have legitimacy because of the coercive practices that have given rise to this debt, and repudiation would have wide popular support.

But would debt repudiation invite economic disaster? In Argentina, quite to the contrary, it was a refusal to repudiate the debt that led into the December debacle. The new government has now defaulted, but not in a controlled manner that might yield the greatest advantage, but as an act of desperation. Also, debt defaults in the past have generally not generated disaster, certainly nothing worse than the current Argentine situation. In any case, if forces in debtor countries could make the threat real, actual repudiation would probably not be necessary. The power that the high-income countries have in the threat to cut off new loans would be matched by the power that low-income countries would have from their threat to cut off the flow of repayments.

There are substantial political barriers to the emergence of democratic development strategies in low-income countries and to joint action by debtor countries. At the end of December, as a new spate of rioting broke out in Buenos Aires, US President George Bush told the Argentine government to seek guidance from the IMF and "to work closely with" the IMF to develop its economic plans. And the policies of the IMF are unlikely to change in any significant way. Indeed, as Argentinians went to the streets in response to their long suffering under the aegis of the IMF, the IMF disclaimed all responsibility. "The economic program of Argentina was designed by the government of Argentina and the objective of eliminating the budget deficit was approved by the Congress of Argentina," declared the IMF's spokesperson on December 21.

This continued pressure from the US government and the persistence of the IMF in pursuing its discredited policies make progressive change difficult. Also, powerful elites in Argentina and other low-income countries reinforce the barriers to change. Yet the economic case for change is overwhelming, and one way or another a political route to this change needs to be found.

[Editor's note: Since the time of writing, Argentina has yet another new president, the Peronist Eduardo Duhalde. He has devalued the peso by 29 percent, scrapping the decade-old peg to the US dollar, in an attempt to ease the economic crisis.]

Arthur MacEwan is Professor of Economics and interim provost and Vice Chancellor for Academic Affairs at the University of Massachusetts in Boston, United States. His most recent book is Neoliberalism or Democracy? Economic Strategy, Markets, and Alternatives for the 21st Century.

[Source:Asia Times]

2. NEWS in Brief - top


China's WTO entry a 'wake up call' for Southeast Asia: Supachai

China's World Trade Organization entry is a reminder for Southeast Asian countries to continue with economic reforms or risk being left behind in the global marketplace. Speaking at the one-day Institute of Southeast Asian Studies regional forum, incoming WTO chief Supachai Panitchpakdii said he saw "China's entry as more or less as a wake up call" for the region's countries to implement economic reforms as quickly as possible. Such reforms would allow Southeast Asian countries to forge closer economic partnerships with the world's most populous country fast emerging as an important export market.

Closer economic partnerships with Beijing would mean the region will be less dependent on outside trading forces in major trading areas around the world. While China is still a long way off from overtaking the United States as the region's most important export market, preparing the groundwork for closer cooperation will ready the region for its inevitable growing clout.

China and Asean (Association of Southeast Asian Nations) have increasingly become important trade partners. According to Wang Gungwu, a director at the East Asian Institute, China also has a role to play if its relationship with Southeast Asia is to flourish. For there to be genuine cooperation between China and Southeast Asia, the following conditions must exist.

Chinese strategists must shift their mindset and acknowledge that Southeast Asia, among all the four major regions that it borders, offers the greatest security for China, but only if it is prosperous and stable. It was in Beijing's interests to help the region return to its trajectory prior to the 1997-1998 financial crisis, said Wang. There are signs that that recognition has come to the authorities in Beijing, and this is encouraging.

Southeast Asia, for its part, also needs to try to overcome its history of suspicion towards China. "The region needs to reconsider carefully if its recent heritage of fear and suspicion is still justified," Wang said. If that kind of thinking continues, or if there is evidence that suspicions are indeed justified, then obviously cooperation will be long time coming. With Japan's influence waning in the region as Tokyo grapples with the country's deepening economic problems, both China and the region would need to cooperate more than ever should a crisis erupts.



Japan's Disarming Return to Asia

Japan will soon adjust its comprehensive disarmament policy to focus on conventional weapons proliferation, the Yomiuri Shimbun daily reported. Although the country has long been active in international efforts to stem the proliferation of nuclear and other weapons of mass destruction, Japan will now place greater emphasis on quelling the spread of small arms and land mines in places like Afghanistan and Cambodia, as well as on direct nonproliferation efforts throughout Asia and Africa.

The shift is part of a broader review of Japan's defense and foreign policies, triggered by rapid changes in international relations and domestic security considerations in recent years. In part, Tokyo hopes to carve out a new diplomatic niche for Japan as the main proponent of small-arms reductions, something that may bolster its case for a permanent seat on the United Nation's Security Council. In the long run, however, through direct involvement of Japanese defense-force personnel around Asia and Africa, Tokyo hopes to reverse foreign opposition to its expanding international defense role.

The sudden change in the global balance of relations after the Sept. 11 attacks offered Japan a chance to shift domestic attention away from the nation's dismal financial situation. At the same time, it allowed Tokyo to rapidly accelerate existing plans to redraw the role of its defense forces both at home and abroad. Ultimately, through its nonproliferation agenda, Japanese forces will once again be deployed throughout South and East Asia, thoroughly solidifying Japan's assumption of a regional security role.

[Source: Stratfor]


UN diplomat cites racism as he quits

The chief of staff for the United Nations mission in East Timor has resigned, citing management failures and racism as reasons for his departure. When Nagalingam Parameswaran leaves the capital, Dili, there will be no senior manager at the UN Transitional Administration in East Timor (Untaet) from a Southeast Asian country.

In his resignation letter, Mr Parameswaran said Untaet "has become very much a 'white' mission, an Eastern mission with a Western face". But UN sources said that while he may have a point about his origins working against him, the underlying reasons for his departure were more to do with debate over fundamental UN policy and office politics.

Mr Parameswaran, a Malaysian diplomat, has worked hard during his time in Dili on a key plank of UN policy - the bringing back to East Timor of the tens of thousands of refugees held by militia bosses in neighbouring Indonesian West Timor. He has been the only senior figure capable of speaking to the Indonesians in their language and has managed ties with militia leaders such as Nemecio de Carvallho, who has been brought back successfully to East Timor. But opponents within the UN, especially its Serious Crimes Unit, have accused Mr Parameswaran of "making too many deals" with the Indonesians, or of concentrating too much on the reconciliation aspect of the returns policy and not enough on justice against the militia bosses. He was disliked for his work with the militias from the beginning, and then his approaches began to bear fruit and other people started to encroach on his area.

In his resignation letter, Mr Parameswaran names the deputy to the Untaet chief, Sergio Vieira de Mello, as "often excluding" him from key decisions. The respected New Zealander Dennis McNamara was brought in as Untaet deputy last year, partly to improve the Serious Crimes Unit's performance. Debate on the justice versus reconciliation issue infects the whole question of East Timor's survival as an independent nation surrounded by Indonesia, the former invading power.

Mr Parameswaran's claims of racism are more controversial. "If you go by the number count of white versus brown in the senior levels of Untaet, then Param is quite right. Param's point is that with his departure there will be no senior Asean figure at Untaet and he's right. My question is whether that was intentional and I don't think it was. I will say though that it is a shame that the UN didn't make more effort to hire people who can speak Indonesian and Tetum [the East Timorese language]. Untaet was anti-Indonesian from the beginning and only realised the importance of close ties to Jakarta too late," a senior Western diplomat at Untaet said.

[Source: SCMP]


Military Advisors in Philippines

American special forces are in the Philippines and at least 100 more will follow as the United States bolsters the Asian nation's defenses against radical Muslims linked to the al Qaeda network. With the war in Afghanistan in its third month, the dispatch of forces to the Philippines is an example of U.S. efforts to take the fight against terror elsewhere around the globe.

About two dozen U.S. special forces are doing logistical and security planning for the larger force that could arrive later, a defense official said on condition of anonymity. The full complement of Americans is to train and advise Philippine forces in counterterrorism tactics to use against the extremist Abu Sayyaf group, which is holding U.S. missionaries Martin and Gracia Burnham and Filipino nurse Deborah Yap hostage on southern Basilan island.

U.S. military officials have stressed that Afghanistan isn't the only country where Americans are fighting or plan to fight terrorists.

Overt and covert military operations are "going on in a great many places" to "do away with ... pockets of terrorism," the Afghanistan war's commander, Army Gen. Tommy Franks, said last month. He gave no details.

The U.S. advance team has been in the Philippines for weeks. Warplanes and other equipment are to be provided in an expansion of a longtime U.S. counterterrorism program in that former American commonwealth. They were approved in a November agreement between Philippine President Gloria Macapagal Arroyo and President Bush.

The Philippine government has been very seriously attempting to deal with terrorists on one or two islands. They have some hostages that have been taken over time, some of whom have been killed, some of whom have been released. But some are still held, including some Americans. The group has been linked to the al Qaeda network of Osama bin Laden, alleged mastermind of the Sept. 11 attacks in the United States.

The new U.S. assistance approved two months after the attacks on America expands efforts dating back to 1993 to help the Philippines fight terrorism. The U.S. experts will provide training, assistance and advice on subjects including psychological warfare, intelligence and night flying. Since the November agreement between the two presidents, the Philippines has received equipment including a C-130 transport plane, eight UH-1 Huey helicopters and 30,000 rifles. Officials are expecting a patrol boat in the coming months.

The agreement also specifies $100 million in U.S. military and law enforcement aid as well as hundreds of millions more in food aid, debt cancellation, trade guarantees, poverty reduction programs. U.S. military advisers will be allowed to join front-line Filipino troops bringing them directly into battle areas.

[Source: AP]


Rohingya asylum seekers arrested at UNHCR, Kuala Lumpur

Outline of situation:

28 Rohingya asylum seekers (10 women, 6 children, 12 men) entered the UNCHR centre in Kuala Lumpur, Malaysia at approximately 06:30 Friday 25 January 2001. The police were called to surround the gates. 20 others approached the UNHCR building but fled when they saw the police; 4 were arrested. The asylum seekers were permitted to stay at the centre Friday night. The protection officer was not in Kuala Lumpur until Friday evening. 3 cases were previously unknown to UNHCR and as such they met with officials but were denied protection. It does not appear that others were interviewed. Saturday morning, after meetings, the asylum seekers were told by UNHCR that they were not entitled to UNHCR protection; the regional office in Jakarta and head office in Geneva were consulted. Police moved in, with UNCHR permission, and arrested the asylum seekers at the UN compound. It is most probable that they will be detained by the Immigration Department before being sent to the Malaysia-Thailand border.

Altsean-Burma would like to express the following:

The definition of refugee, used by UNHCR in Malaysia and the Malaysian government, is unduly harsh. The definition is far too narrow and does not recognise group persecution. We ask the government and UNHCR to prioritise the needs of the displaced Rohingya population in particular, and people from Burma in general. As such we urge there be a change in refugee definition and protection. There is a compelling need for prima facie recognition of refugees due to the human rights violations and group persecution that is suffered by these communities.

We urge the Malaysian government to recognise that displaced people from Burma have different circumstances from other 'illegal' migrants, suffering human rights abuses and political repression, both of which are well documented. Many of the individuals concerned in this instance, have been de facto stateless for many years. They cannot return 'home'. We call upon the Malaysian authorities to recognise this and provide these people and their families with human rights protection. The first step in this process is not to deport people from Burma, especially those who are stateless, recognising that they need a place of abode.

Some of the 28 have the right to appeal their rejection of refugee status. The chance of appeal is now lost as all will almost certainly be in police or immigration custody until they are deported, most probably to the Thai-Malaysia border. They will not be given the time and/or space to appeal. We consider this constitutes an infringement of the right to seek asylum. We are disappointed that UNHCR did not do more to protect these people from arrest.

UNHCR does not publicly appear to be taking a strong stance of protection. This feeling is intensified by the fact that news sources could not get statements from UNHCR officials at the time concerned and decisions were not publicly given. We call for more transparency regarding refugee decisions and procedures.

We encourage UNHCR to put those seeking asylum before the interest of the state police. We strongly doubt that the asylum seekers agreed to be arrested in the UNHCR compound; we are convinced they had more preferable alternatives as a remedy to the situation. By letting asylum seekers be arrested in the compound, UNHCR does not publicly appear a safe space for asylum seekers. There is increasingly the fear that their presence there will be met with increased hostility by the state. It is UNHCR's responsibility to ensure that the compound is a safe space which, while it may be difficult, is essential so that individuals may exercise their right to seek asylum.

Last, but certainly not least, we are concerned for the safety of those being deported. While UNHCR were pleased there was no violence, this does not serve as a 'peaceful solution' to the problem. The lives of those arrested, and of other asylum seekers, will be far from peaceful so long as they have no legal rights. While held by police or the Immigration department, asylum seekers are vulnerable. The 28 in this incidence will soon be deported to Thailand (the cheapest and easiest 'solution') where they are also 'illegal' and highly vulnerable.


Blair's 'rebuild Afghanistan' pledge to cost US$15 bln: World Bank

British Prime Minister Tony Blair, on the first visit to Afghanistan by a western leader since September 11, offered to help rebuild the war-torn country - an exercise the World Bank said would cost US$15 billion.

Blair, who flew into Baghram air base north of Kabul at the end of a three-country South Asian tour, stressed the international community was "here to help for the long term". "The purpose is to offer our support and partnership for the new interim government and through them give a very strong message to the people of Aghanistan," he told reporters.

Afghan leader Hamid Karzai welcomed the support. The World Bank's acting head Abid Hassan said in Islamabad that US$15 billion would be needed over the next 10 years to rebuild the country, shattered by more than two decades of war. To rebuild basic infrastructure such as hospitals, water supplies, power plants and schools would require around one billion to two billion dollars a year over the next decade.

Afghan officials have put the finishing touches on an ambitious 10-year reconstruction plan and are itching to begin rebuilding the war-shattered nation, according to Planning Minister Haji Muhammad Mohaqqeq.

The first priority of the reconstruction plan, he said, is to ensure security throughout the country. "Then we are concerned to see all internally displaced people return to their homes and all refugees living outside the country return to Afghanistan," he added. "We want to help people rebuild their houses. We hope to provide building materials and, for farmers, some cows, agricultural implements and seeds." The government, he added, wants to revive "family economies" in the farmlands. To persuade the more than five million Afghan refugees living in camps in Pakistan and Iran to return, the new interim administration sworn in on Dece 22 will need to provide job opportunities, Mohaqqeq said.

The reconstruction plan has also identified short-term projects that will take up to two-and-a-half years, and longer-term projects lasting up to 10 years. "Among the short-term projects we have, for instance, the reconstruction of schools, and in the longer-term projects we have the rebuilding of roads." Already a number of non-governmental organisations have begun reconstruction projects but the six-month administration, which is to oversee government until a transitional authority is installed, is too cash-strapped to do anything beyond completing the planning stage, he said.

[Source: AFP]

3. Urgent APPEAL - top

BURMA: Former Professor Arrested for Solo Protest

"Many students have already been killed. It is about time that you kill an old professor." (Dr. Salai Than Tun, Burmese Professor)

This appeal is for an international response to the arrest and detention of 74 year-old Dr Salai Tan Thun, a retired Burmese university rector who has publicly petitioned the military government to return power to civilian rule.

In December 2001 Dr Salai Than Tun peacefully handed out copies of a petition calling on the military regime to hold multiparty elections within a year, in front of the Rangoon Town Hall. Shortly after, security officials arrested him. Details of the case became known to The Irrawaddy news service in early January, when it also obtained a copy of Dr Salai Tan Thun’s petition.

We call upon the international community to vigorously protest this denial of fundamental civil liberties so typical of the military regime in Burma (Myanmar). In particular, we call on the academic community throughout the world to act on this outrageous and unjust treatment of one of its peers. You can read the details of the case and the full transcript of Dr. Salai's petition below, or scroll down to the SUGGESTED ACTION section to see what you can do to support his brave protest.


Dr Salai Tan Thun is a 74 year-old retired rector of Yezin University, Pyinmana (Upper Burma). He holds a PhD in Agronomy from the University of Wisconsin, USA. He is a member of the Chin minority ethnic group (western Burma) and a Christian.

According to reliable sources of The Irrawaddy news service (Chiang Mai, Thailand) in early December Dr Salai Than Tun stood in front of Rangoon (Yangon) Town Hall in his academic gown. This is an historic site for resistance to the military regime. There he distributed petitions in his own name calling on the military government to:

Hold the multiparty general election within one year.

Let the election be held by a civilian interim government as soon as possible.

Let the election be supervised by ASEAN and UN officials.

Let all the eligible Myanmar citizens who want to contest in the election be able to complete including our military authorities as civilians.

Transfer the state power to any winner organization as soon as possible without any condition.

In addition, he urged the government to kill him if unwilling to meet the five points as "it is better to die than live under the military regime". Full text of the petition is in the next section.

Shortly after beginning his protest he was detained by security officers. His whereabouts are since unknown, however it is believed that he is being held in Insein Prison north of Rangoon, and that his relatives have not been granted access to him. He joins some 2000 political prisoners in jails throughout Burma. These include politicians, student activists, academics, writers, journalists, lawyers, unionists, comedians and many others who have publicly opposed the absolute military dictatorship in that country. The Burmese generals' release of a small number of political prisoners has attracted wide attention, but this progress must be put alongside the fact that not only do thousands remain locked up for their political views, but new prisoners of conscience are being detained to take the place of those released.

Note that due to the repressive social and political environment in Burma, to date no further information on Dr Salai Than Tun’s case is available. Those close to him are understandably reluctant to respond to enquiries as their lives are also in jeopardy. However if further details come to light an update to this Urgent Appeal shall be made available.

FULL TRANSCRIPT can be found at: http://www.irrawaddy.org/news/2002/jan13.html


We urge concerned parties to send letters to Senior General Than Shwe, chairman of the military regime, with copies to other officials and the UN Special Rapporteur on Burma, expressing outrage at the arrest of Dr Salai Than Tun. A sample letter and contact details are in the next section.

In particular, we urge the global academic community to forward the details of Dr Salai Than Tun’s case throughout its networks. We strongly recommend all academics refrain from actions that may lend legitimacy to the military government in Burma, such as setting up exchange programmes, attending conferences or doing research with Burmese military approval, until Dr Salai Than Tun and other political prisoners are released.


Dear Sr-Gen Than Shwe

I am writing to you to express my outrage at the arrest of Dr Salai Than Tun, retired rector of Yezin University.

Dr Salai Than Tun was detained last December while peacefully exercising his right to freedom of speech, in calling for a transition to democratic government in your country. His arrest reflects your government's consistent denial of the fundamental rights and freedoms of those you purport to represent.

The optimism created by the release of a small number of political prisoners in Myanmar is being undermined by the arrest of new political prisoners and the continued imprisonment of thousands of others because of their political views. I urge you to immediately release Dr Salai Than Tun and all other political prisoners in Myanmar.

Yours sincerely



Senior General Than Shwe
State Peace and Development Council
Office of the Prime Minister


1. Lt-Gen Khin Nyunt
State Peace and Development Council
Ministry of Defence
Signal Pagoda Rd
Fax (+951) 22950

2. U Win Aung
Minister for Foreign Affairs
Ministry of Foreign Affairs
Email: mofa.aung@mptmail.net.mm

3. Paulo S?rgio Pinheiro
Special Rapporteur on the situation of human rights in Myanmar
Office of the UN High Commissioner for Human Rights
Palais des Nations, 8-14 Avenue de la Paix,
FAX: +41 22 9170213
Email: secrt.hchr@unog.ch (please mark ATT: MR. PINHEIRO)

4. National League for Democracy
97B West Shwegondaing Street
Bahan Township

5. Myanmar Embassy/consulate in your country.


BLESSED AND HAPPY NEW YEAR to ALL friends and supporters of DAGA



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