SPDC-KNU TALKS ABORTED; POSSIBLE RESUMPTION IN

C O N F I D E N T I A L RANGOON 001385 SIPDIS STATE FOR EAP/BCLTV; PACOM FOR FPA E.O. 12958: DECL: 10/22/2014 TAGS: PINS PREL PGOV BM SUBJECT: SPDC-KNU TALKS ABORTED; POSSIBLE RESUMPTION IN DECEMBER-JANUARY REF: A. RANGOON 1372 ¶B. RANGOON 1370 ¶C. RANGOON 960 AND PREVIOUS ¶D. BANGKOK 7303 Classified By: COM Carmen Martinez for Reasons 1.4 (b,d) ¶1. (C) Summary: After perfunctory SPDC-KNU talks on October 19 failed to get off the ground because of changes in GOB leadership, the regime will likely resume negotiations in December-January, when the dust from deposed Prime Minister Khin Nyunt's "retirement," (hanging over Military Intelligence-MI-which has had the lead on ethnic relations), is expected to settle. Meanwhile, a senior Thai military intelligence officer came calling from Bangkok to reassure the Burmese that the RTG will not interfere in their internal affairs. End Summary. ¶2. (SBU) Despite confusion surrounding changes in the Burmese regime's leadership, the latest round of SPDC-KNU talks opened in Rangoon on October 19 following several earlier delays (ref C). Brig Gen Kyaw Thein led the SPDC team while Pado Tu Tu Lay and Pado David Htaw headed the 16-member KNU delegation. Given a temporary vacuum left on the Burmese side by Prime Minister Khin Nyunt's "retirement" on the evening of October 19 (refs A and B),the discussions apparently reverted to being largely social occasions. SPDC representatives "escorted" the KNU delegation to Bago for a farewell luncheon on October 20, following meals together the previous day. The KNU team proceeded to Hpa-an (Karen State) from Bago and crossed the Thai border to Mae Sot on October ¶21. Press reports suggesting that members of the KNU delegation were detained or went missing at some point along the line are incorrect, according to reliable local sources. ¶3. (C) U Khun Myat (aka Khunmyat Lahtaw),a wealthy Kachin businessman and well established government intermediary on ethnic affairs, told poloff on October 22 that negotiations for a permanent cease-fire between the GOB and the Karen National Union (KNU) will resume in December-January. The exact dates the government will propose for the talks will depend on when the current "re-shuffle" within Military Intelligence has been completed and when the National Convention (NC) will resume its deliberations. If meetings are conducted under the NC's umbrella in December, the negotiations are likely to be pushed off until after the first of the new year. If the Convention does not crank up until January, discussions with the Karens could begin earlier. ¶4. (C) The SPDC's basic policies of "Non-Disintegration of the Union" and "National Consolidation" remain firmly in place, emphasized U Khun Myat. He noted that while MI will continue to have the lead on negotiations with the ethnics, he thought it likely that whomever is appointed as the senior negotiator would report through the new MI chief to the newly appointed "Secretary One," Lt. General Thein Sein (refs A and B),rather than to the Prime Minister (as was the case under Khin Nyunt). However, Khun Myat added, the deposed Prime Minister's policy of offering the cease-fire groups (CFGs) business concessions and other commercial "privileges" will likely remain in place. ¶5. (C) In a related but separate development, Lt. General Samut Phoke (sp?),a Thai military intelligence officer, happened by U Khun Myat's house while poloff was meeting with the latter. He was accompanied by an employee of Bangkok Airways, who was there to discuss expansion of that service's flights between Bangkok and Rangoon. U Khun Myat, who apparently has interests in Bangkok Airways, had facilitated meetings for the visiting General to re-assure Burmese counterparts who had expressed unease about the RTG's being out in front with public announcements earlier in the week on local leadership changes (ref D). Martinez