THAI/BURMESE RELATIONS - MAUNG AYE'S VISIT AND

C O N F I D E N T I A L SECTION 01 OF 03 RANGOON 000576

STATE FOR EAP/BCLTV
BRUSSELS FOR USEU
USCINCPAC FOR FPA

E.O. 12958: DECL: 05/02/2012
TAGS: PREL TH BM
SUBJECT: THAI/BURMESE RELATIONS - MAUNG AYE'S VISIT AND
OTHER ISSUES

REF: (A) BANGKOK 2907 (B) BANGKOK 3147 (C) RANGOON 574

CLASSIFIED BY: CDA PRISCILLA CLAPP. REASON: 1.5 (D).


1. (C) SUMMARY: THE THAI GOVERNMENT WAS PLEASED WITH BURMESE
ARMY COMMANDER MAUNG AYE'S VISIT. ACCORDING TO THE THAI
EMBASSY'S POLITICAL COUNSELOR, THE THAI GOVERNMENT NOW SEES
HIM AS A "PRAGMATIC" MAN OF RISING INFLUENCE IN BURMA WITH
WHOM THEY MAY BE ABLE TO WORK SUCCESSFULLY. WHILE IN
THAILAND, MAUNG AYE MET WITH THE KING, PRIME MINISTER THAKSIN
AND DEFENSE MINISTER CHAVALIT. HE ALSO PROMISED TO IMPROVE
COUNTER-NARCOTICS COOPERATION, TO RESTRICT THE ACTIVITIES OF
THE UNITED WA STATE ARMY'S HONG PANG COMPANY AND TO ESTABLISH
TWO NEW TOWNSHIP BORDER COMMITTEES. IN ADDITION, HE PUT THE
FINAL TOUCHES ON A NEW FISHERIES JOINT VENTURE AGREEMENT
WHICH WILL REPORTEDLY BE SIGNED IN RANGOON THIS WEEK. ON THE
OTHER HAND, MAUNG AYE DID NOT RESPOND TO THE MESSAGE CONVEYED
BY THAI FOREIGN MINISTER SURARKIART TO SECRETARY 1 KHIN NYUNT
IN EARLY APRIL REGARDING PROPOSALS FROM THE SHAN STATE ARMY
FOR TALKS, THOUGH THE CURRENT QUIET ON THE BORDER HAS
SUGGESTED TO SOME WITHIN THE THAI GOVERNMENT THAT TALKS MAY
HAVE ALREADY STARTED. END SUMMARY.


2. (C) MAUNG AYE AND KHIN NYUNT: THE THAI EMBASSY'S POLITICAL
COUNSELOR, KALLAYANA VIPATTIPUMIPRATES, TOLD POLOFF MAY 2
THAT THE RECENT VISIT BY BURMESE ARMY COMMANDER MAUNG AYE TO
THAILAND HAD GONE WELL. MAUNG AYE, HE SAID, WAS NOW A FIGURE
OF MAJOR INTEREST TO THE THAIS. MANY FELT THAT MAUNG AYE'S
POSITION WITHIN THE GOB WAS ENHANCED AND KHIN NYUNT'S
DIMINISHED BY EVENTS IN MARCH, INCLUDING THE ARREST OF THE
FAMILY OF KHIN NYUNT'S MENTOR AND PATRON. KHIN NYUNT, HE
SAID, STILL SEEMED TO BE FIRMLY IN CONTROL OF FOREIGN POLICY
AND THE MILITARY'S INTELLIGENCE NETWORK. HOWEVER, THERE WERE
SIGNS THAT HE NO LONGER HAD A FREE HAND IN DEALING WITH
BORDER ISSUES AND BURMA'S MANY ETHNIC GROUPS. SEVERAL GROUPS
CLOSELY ASSOCIATED WITH KHIN NYUNT, INCLUDING SOME CEASEFIRE
GROUPS AND SOME ETHNIC CHURCH GROUPS (THE KACHIN BAPTIST
CONVENTION),HAD RECENTLY COME UNDER PRESSURE, KALLAYANA SAID.


3. (C) MAUNG AYE, MEANWHILE, WAS A MYSTERY MAN FOR THE THAIS
-- THE SUBJECT OF MANY CONTRADICTORY REPORTS REGARDING HIS
FEELINGS TOWARDS THAILAND AND HIS PROFESSIONAL COMPETENCE.
AFTER MEETINGS BETWEEN MAUNG AYE AND THE KING, THE PRIME
MINISTER (ON FOUR SEPARATE OCCASIONS) AND DEFENSE MINISTER
CHAVALIT, HOWEVER, THE THAIS HAD COME AWAY WITH THE
IMPRESSION THAT MAUNG AYE WAS "A PRAGMATIC MAN" WHO WAS "NOT
NECESSARILY HOSTILE TO THAILAND."


4. (C) ETHNIC GROUPS: KALLAYANA SAID THAT THE THAIS HAD
EXPECTED MAUNG AYE TO RESPOND TO THE MESSAGE REGARDING TALKS
WITH THE SHAN STATE ARMY WHICH THAI FOREIGN MINISTER
SURAKIART HAD RELAYED TO KHIN NYUNT IN EARLY APRIL (REFTEL
A). THAT MESSAGE BASICALLY STATED THAT THE SHAN STATE ARMY
WAS READY FOR TALKS, BUT WOULD ONLY ACCEPT TERMS COMPARABLE
TO THOSE GIVEN THE WA, WHICH WOULD LEAVE THEM IN CONTROL OF
THEIR OWN CEASEFIRE AREA. MAUNG AYE, HOWEVER, SAID NOTHING
ABOUT THE MATTER AT ALL. THIS LED THE THAIS TO CONCLUDE,
KALLAYANA SAID, THAT THE BURMESE HAD EITHER DISMISSED THE
SHAN STATE ARMY'S PROPOSED TERMS AS COMPLETELY UNACCEPTABLE,
OR HAD ALREADY ESTABLISHED A BASIS FOR TALKS WITH THE SHAN
STATE ARMY WITHOUT THAI HELP. IN ANY CASE, KALLAYANA NOTED,
THE NORTHERN BORDER THIS YEAR WAS FAR QUIETER THAN IT HAD
BEEN FOR SOME TIME.


5. (C) KALLAYANA ALSO SAID THAT THE THAI GOVERNMENT HAD BEEN
IN TOUCH WITH THE KAREN NATIONAL UNION'S FORMER CHAIRMAN BO
MYA WHILE HE WAS HOSPITALIZED IN BANGKOK. THE KNU, HE SAID,
WAS GROWING WEAKER AND WEAKER, AND BO MYA BELIEVED THAT IT
WAS TIME TO STRIKE A DEAL WITH THE BURMESE.


6. (C) BORDER INCIDENTS: KALLAYANA SAID THAT THE MOST RECENT
BORDER INCIDENT, WHICH ERUPTED LAST WEEK WHEN UNITS FROM THE
THAI THIRD ARMY TOOK PRISONER THE SON OF THE COMMANDER OF THE
WA'S 171ST BRIGADE, WOULD PROBABLY BE RESOLVED WITHIN DAYS.
THIRD ARMY COMMANDER UDOMCHAI, HE SAID, WAS JUST TRYING TO
TEACH THE WA A LESSON. UDOMCHAI HAD BEEN PERSONALLY
EMBARASSED BY A WA ATTACK THAT HAD FORCED CANCELLATION OF A
VISIT BY THE THAI QUEEN TO HIS AREA, AND HAD BEEN LOOKING FOR
WAYS EVER SINCE TO PAY THE WA BACK. KALLAYANA SAID THAT HE
EXPECTED BORDER INCIDENTS LIKE THIS MOST RECENT ONE TO
CONTINUE, GIVEN UDOMCHAI'S ANGER, BUT EMPHASIZED THAT THEY
DID NOT REFLECT THAI GOVERNMENT POLCIY AND WOULD NOT
INTERRUPT THE GENERAL IMPROVEMENT IN THAI/BURMESE RELATIONS.


7. (C) NARCOTICS COOPERATION: PM THAKSIN TOLD MAUNG AYE THAT
THERE NEEDED TO BE GREATER COOPERATION BETWEEN THE THAI
OFFICE OF THE NARCOTICS CONTROL BOARD AND THE BURMESE CENTRAL
COMMITTEE FOR DRUG ABUSE CONTROL IN SHARING INTELLIGENCE AND
CARRYING OUT JOINT OPERATIONS. MAUNG AYE AND BURMESE HOME
MINISTER TIN HLAING, WHO SAT IN ON THE MEETING, AGREED.
THAKSIN ALSO COMPLAINED ABOUT THE ACTIVITIES OF THE HONG PANG
COMPANY, WHICH IS THE HOLDING COMPANY FOR MOST OF THE WA
COMMERCIAL INVESTMENTS, AND RECEIVED A COMMITMENT FROM MAUNG
AYE THAT THE HONG PANG COMPANY WOULD BE SHUT DOWN "WITHIN TWO
WEEKS." MOREOVER, ACCORDING TO KALLAYANA, THAI INTELLIGENCE
REPORTS INDICATE THAT THE COMPANY'S BRANCHES ON THE BORDER
ARE INDEED BEING SHUT DOWN.


8. (C) ILLEGAL IMMIGRANTS: KALLAYANA SAID THAT 2,860 ILLEGAL
BURMESE IMMIGRANTS HAD BEEN RETURNED TO BURMA AS OF APRIL 30.
ANOTHER 20,000 WERE IN HOLDING CAMPS IN THAILAND. HE NOTED
THAT THE THAIS WERE PRESSING FOR QUICKER REPATRIATIONS AND
HAD ASKED THE BURMESE TO OPEN TWO ADDITIONAL RECEIVING
CENTERS AT KAWTHOUNG AND TACHILEIK, IN ADDITION TO MYAWADDY.
HE ALSO SAID THAT THE THAIS HAD AGREED TO SCREEN RETURNEES
FOR HIV/AIDS, BUT HAD MADE NO COMMITMENTS REGARDING SHARING
THE TREATMENT COSTS FOR THE MANY BURMESE WHO MAY HAVE
CONTRACTED AIDS IN THAILAND. HE ALSO SAID THAT THAILAND HAD
RAISED WITH THE BURMESE THE POSSIBILITY OF INVOLVING THE
INTERNATIONAL ORGANIZATION FOR MIGRATION (IOM) IN THE
REPATRIATION EXERCISE, BUT SAID THAT THE BURMESE HAD NOT YET
REPLIED TO THAT PROPOSAL.


9. (C) BORDER DEMARKATION AND CONTROL: THERE HAD BEEN NO
FURTHER PROGRESS ON BORDER DEMARKATION, KALLAYANA SAID, BUT
PM THAKSIN HAD ASKED MAUNG AYE TO OPEN TWO NEW TOWNSHIP
BORDER COMMITTEES IN THE KANCHANBURI AND THREE PAGODAS PASS
AREAS. HE ALSO PROPOSED THAT THE TOWNSHIP BORDER COMMITTEES
REMAIN PERMANENTLY IN SESSION TO HANDLE ANY DISPUTES THAT DID
EMERGE. MAUNG AYE REPORTEDLY AGREED TO BOTH PROPOSALS.


10. (C) FISHERIES: THE FINAL DETAILS OF THE GIANT FISHERIES
JOINT VENTURE WHICH THE THAIS AND THE BURMESE HAVE BEEN
NEGOTIATING SINCE THAKSIN'S JUNE 2001 VISIT WERE REPORTEDLY
WORKED OUT DURING MAUNG AYE'S VISIT. THE AGREEMENT WILL
REPORTEDLY BE SIGNED THIS WEEK IN RANGOON AND THE FIRST
OPERATIONS SHOULD START SHORTLY THEREAFTER.

COMMENT


11. (C) THREE POINTS ARE WORTH NOTING HERE. FIRST, THE
THAI/BURMESE RECONCILIATION THAT BEGAN LAST SPRING IS STILL
MOVING FORWARD. THE TWO COUNTRIES SEEM AS DETERMINED NOW AS
THEN TO ROOT OUT THE PROBLEMS -- FROM ILLEGAL MIGRATION TO
NARCOTICS TRAFFICKING AND SUPPORT FOR INSURGENT GROUPS --
THAT HAVE PLAGUED THEIR RELATIONS FOR THE PAST SEVERAL
DECADES. MUCH MORE NEEDS TO BE DONE, BUT THEY ARE STILL
WORKING ON THE ISSUES.


12. (C) SECONDLY, THE THAIS ARE PROBABLY RIGHT TO PAY MORE
ATTENTION TO MAUNG AYE, THOUGH THEY MAY BE OVER-EMPHASIZING
THE DEGREE TO WHICH MAUNG AYE'S STAR HAS RISEN IN RECENT
WEEKS. CERTAINLY MAUNG AYE APPEARS TO HAVE GAINED FROM THE
NOVEMBER RE-ORGANIZATION OF THE REGIONAL COMMANDS, WHICH
ALLOWED HIM TO PLACE OFFICERS HE TRUSTED IN MAJOR COMMAND
POSITIONS. HOWEVER, HIS GREATER INFLUENCE ON BORDER ISSUES,
PARTICULARLY ISSUES AFFECTING THE ETHNIC AND CEASEFIRE
GROUPS, MAY SIMPLY REFLECT A GROWING FEELING WITHIN THE
GOVERNMENT THAT RELATIONS WITH THESE GROUPS ON THE BORDER ARE
A SECURITY MATTER FOR THE ARMY. AS SUCH, THEY MAY NOW BE
CONSIDERED MORE PART OF MAUNG AYE'S PORTFOLIO, RATHER THAN
KHIN NYUNT'S.


13. (C) FINALLY, MAUNG AYE'S COMMITMENT REGARDING THE
SHUTDOWN OF THE HONG PANG COMPANY WILL HAVE TO BE WATCHED
CLOSELY. THAT COMPANY NOW HOLDS MOST OF THE UNITED WA STATE
ARMY'S COMMERCIAL INVESTMENTS, AND IS HEAVILY INVOLVED IN A
NUMBER OF LARGE CAPITAL PROJECTS. IT IS HARD TO BELIEVE THAT
THE WA WOULD SIMPLY WRAP IT UP ON ORDERS FROM THE BURMESE.
MORE LIKELY, THEY WILL SIMPLY MOVE ITS OPERATIONS OFF THE
BORDER. IN FACT, LABOR MINISTER TIN WINN CONFIRMED TO THE
CHARGE' ON MAY 6 (REFTEL C) THAT SOME HONG PANG BRANCH
OFFICES IN TACHILEIK AND AND OTHER BORDER TOWNS WERE BEING
CLOSED. FURTHERMORE, EVEN IF THE COMPANY IS LQUIDATED, IT
COULD RE-EMERGE UNDER ANOTHER NAME. THE WA NEED SOME VEHICLE
TO HOLD THEIR INVESTMENTS AND LIKELY WILL RESPOND TO ANY
PRESSURE FROM THE BURMESE WITH CHANGES THAT ARE AT BEST
COSMETIC. END SUMMARY.

CLAPP