BURMA AND VIETNAM: TRYING TO IMPROVE RELATIONS

UNCLAS SECTION 01 OF 02 HANOI 001279 SIPDIS SENSITIVE UNCLASSIFIED PAGE 02 HANOI 01279 01 OF 02 200954Z STATE FOR EAP/BCLTV E.O. 12958: N/A TAGS: PREL PTER PGOV ETRD BM VM ASEAN CTERR SUBJECT: BURMA AND VIETNAM: TRYING TO IMPROVE RELATIONS ¶1. (SBU) SUMMARY. THE VISIT BY PRESIDENT TRAN DUC LUONG TO BURMA UNDERSCORED A SHARED DETERMINATION TO ADVANCE THE MODEST TIES BETWEEN THESE TWO FELLOW ASEAN STATES. A MAJOR FOCUS WAS ON THE STILL LIMITED ECONOMIC RELATIONSHIP; BILATERAL TRADE IS ONLY ABOUT USD 10 MILLION ANNUALLY. NARCOTICS WERE APPARENTLY NOT ON THE AGENDA, BUT THE TWO SIDES AFFIRMED THEIR SUPPORT FOR INCREASED EFFORTS TO COUNTER INTERNATIONAL TERRORISM, WHILE CAVEATING THAT SUCH EFFORTS SHOULD NOT COMPROMISE NATIONAL SOVEREIGNTY. END SUMMARY. ¶2. (U) PRESIDENT TRAN DUC LUONG VISITED BURMA FROM MAY 5-8 AT THE INVITATION OF SENIOR GENERAL THAN SHWE, CHAIRMAN OF BURMA'S STATE PEACE AND DEVELOPMENT COUNCIL (SPDC). HIS DELEGATION INCLUDED FOREIGN MINISTER NGUYEN DY NIEN, MINISTER OF AGRICULTURE AND RURAL DEVELOPMENT LE HUY NGO, AND THE DEPUTY MINISTERS OF DEFENSE, PLANNING AND INVESTMENT, AND TRADE. -------------- A "LANDMARK," SORT OF -------------- . (SBU) MFA SENIOR ASIA II EXPERT PHAM NGO THUAN WHO ACCOMPANIED THE DELEGATION, DESCRIBED THE VISIT AS A UNCLASSIFIED PAGE 03 HANOI 01279 01 OF 02 200954Z "LANDMARK," NOTING THIS WAS THE FIRST PRESIDENTIAL VISIT FROM VIETNAM SINCE HO CHI MINH VISITED BURMA IN 1958. ONE BURMA EMBOFF NOTED THAT RANGOON HAD PUSHED FOR THE VISIT BECAUSE IT WAS THE ONLY ASEAN COUNTRY THAT LUONG HAD YET TO VISIT. ACCORDING TO VU QUANG THIEN, SENIOR RESEARCHER AT THE SOUTH EAST ASIA STUDIES CENTER, THE POLITICAL RELATIONSHIP WITH BURMA IS "LONG AND ENDURING," WITH THE CONSULAR RELATIONSHIP DATING BACK TO 1957 AND AMBASSADORIAL TIES GOING BACK TO 1975. ¶4. (U) ANOTHER BURMA EMBOFF NOTED THAT THE TRADE VOLUME, WHILE STILL "NEGLIGIBLE" AT USD 10 MILLION LAST YEAR, COULD "EASILY INCREASE" TO USD 100 MILLION "WITHIN TWO TO THREE YEARS," ESPECIALLY IF SOME JOINT VENTURES DISCUSSED DURING THE VISIT WORK OUT. THESE INCLUDED OIL EXPLORATION, GEM MARKETING, AND RICE MARKETING. HE INDICATED THAT IN THE NEAR TERM, THE TWO SIDES WILL TRY TO INCREASE BARTER TRADE, SINCE RAISING CAPITAL IS VERY DIFFICULT, ESPECIALLY ON THE BURMESE SIDE. VIETNAMESE EXPORTS NOW INCLUDE BUILDING MATERIALS, CERAMIC TILE, AND COMMODITIES SUCH AS PLASTICS, INSTANT NOODLES, AND SOAP. THE EMBOFF PREDICTED THAT VIETNAMESE CONSUMER GOODS WOULD BE WELL RECEIVED IN BURMA SINCE THEY WOULD BE CHEAPER THAN THOSE PRODUCED IN THAILAND AND INDIA OR EVEN, IN MANY CASES, IN CHINA. BURMESE EXPORTS ARE LIKELY TO REMAIN LIMITED TO TIMBER AND SOME AGRICULTURAL PRODUCTS. CURRENTLY, TRADE RUNS HEAVILY IN VIETNAM'S FAVOR, WITH ABOUT 80 PERCENT OF THE VALUE OF TWO-WAY TRADE CONSISTING OF VIETNAM'S EXPORTS TO BURMA, ACCORDING TO EMBOFF. ¶5. (U) THE TWO SIDES SIGNED AN MOU TO FORM A "JOINT UNCLASSIFIED PAGE 04 HANOI 01279 01 OF 02 200954Z ECONOMIC WORKING GROUP" TO PUSH BILATERAL TRADE. THE FIRST MEETING IS SCHEDULED TO TAKE PLACE IN HANOI THIS JULY. THIS GROUP WILL BE ORGANIZED THROUGH THE RESPECTIVE MINISTRIES OF TRADE. THE MFA'S THUAN NOTED THAT THE ESTABLISHMENT OF THE ECONOMIC WORKING GROUP IS "AN IMPORTANT STEP" TO IMPROVING THE OVERALL RELATIONSHIP. -------------- NO CONNECTION WITH AUNG SAN SUU KYI'S RELEASE -------------- ¶6. (SBU) DURING THE VISIT, AUNG SAN SUU KYI WAS RELEASED FROM HOUSE ARREST. BOTH THE MFAS THUAN AND THE BURMA EMBOFF NOTED THAT THE SIMULANEOUS RELEASE OF AUNG SAN SUU KYI WAS ONLY A COINCIDENCE; NEGOTIATIONS HAD BEEN ONGOING "FOR MONTHS." ACCORDING TO THUAN, LUONG DID NOT COMMENT ON HER RELEASE DURING ANY OF HIS TALKS WITH THE BURMESE LEADERSHIP, NOR WAS THE SUBJECT RAISED BY HIS INTERLOCUTORS. THUAN