Identifier
Created
Classification
Origin
04RANGOON1401
2004-10-26 10:22:00
CONFIDENTIAL
Embassy Rangoon
Cable title:  

KHIN NYUNT'S OUSTER: ONE WEEK LATER

Tags:  PINS PGOV ECON MOPS BM 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 001401 

SIPDIS

STATE FOR EAP/BCLTV
COMMERCE FOR ITA JEAN KELLY
USPACOM FOR FPA

E.O. 12958: DECL: 10/25/2014
TAGS: PINS PGOV ECON MOPS BM
SUBJECT: KHIN NYUNT'S OUSTER: ONE WEEK LATER

REF: A. IIR 6 812 0015 05

B. RANGOON 1372 AND PREVIOUS

C. RANGOON 1345

D. RANGOON 967

Classified By: COM Carmen Martinez for Reasons 1.4 (B,D)

C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 001401

SIPDIS

STATE FOR EAP/BCLTV
COMMERCE FOR ITA JEAN KELLY
USPACOM FOR FPA

E.O. 12958: DECL: 10/25/2014
TAGS: PINS PGOV ECON MOPS BM
SUBJECT: KHIN NYUNT'S OUSTER: ONE WEEK LATER

REF: A. IIR 6 812 0015 05

B. RANGOON 1372 AND PREVIOUS

C. RANGOON 1345

D. RANGOON 967

Classified By: COM Carmen Martinez for Reasons 1.4 (B,D)


1. (C) Summary: A week after Khin Nyunt's ouster there is
calm in the streets, Than Shwe seems comfortably in power,
and MI's political and probably economic power is being
eroded. However, there remain many variables -- especially
relations with ethnic cease-fire groups post-Khin Nyunt --
that could shake things up. End summary.

Khin Nyunt: Corrupt, Not Unhealthy


2. (C) After allowing former Prime Minister General Khin
Nyunt to "retire for health reasons" on October 19th, SPDC
Chairman, Senior General Than Shwe changed his tune. On
October 24th, new PM Lt. General Soe Win and Than Shwe's
right-hand man General Thura Shwe Mann addressed a large
group of "entrepreneurs" (as business cronies are generously
called) explaining that Khin Nyunt had been sacked because of
"insubordination...bribery and corrupt practices, and for
failure to carry out duties properly." Specifically the two
noted a September incident in Muse on the Chinese border
where regular army troops moved against a notoriously corrupt
MI-affiliated border unit (ref C). Dubious official
justifications aside, we continue to believe the real reasons
for Khin Nyunt's removal stemmed from long-standing personal
and economic conflicts between MI and the regular military
(ref D).


3. (U) Soe Win and Shwe Mann used their remarks (heavily
publicized on local television and in the GOB's mouthpiece
newspaper "The New Light of Myanmar") to proclaim repeatedly
that "no one is above the law" and that the regime will move
decisively against anyone -- either in the military or
private sector -- who "adversely affects the national
polices."

Than Shwe: A Comfort Zone


4. (C) Despite rumors that there are ongoing tensions within
the SPDC, Than Shwe departed as scheduled on October 24th for
a long-planned state visit to India. This shows supreme
confidence that his deputy, Vice Senior General Maung Aye,

has no scheme in place to move against the Senior General and
lends credence to the notion that the two connived to rid the
SPDC leadership of Khin Nyunt and the hated MI.


5. (C) Indeed in the last week there have been several overt
moves to eliminate the political and economic powers of MI,
while preserving the institution -- essential to the
maintenance of the SPDC's power. As reported in ref B,
following Khin Nyunt's removal, the SPDC named former Rangoon
Division Regional Commander Major General Myint Swe as the
new head of MI. On October 22nd, the SPDC abolished the
30-year old National Intelligence Bureau (NIB),the committee
that oversaw all intelligence and state-security operations
carried out by, among others, MI and the Ministry of Home
Affairs' Special Branch, Bureau of Special Investigations,
and Criminal Investigation Department police agencies (ref
A). The Bureau was chaired by ex-PM Khin Nyunt, giving him
tremendous power over his fellow citizens and fellow SPDC
members.


6. (C) It is unclear what will replace the NIB, but we are
confident a new coordinating body will be formed under firm
control of the regular military. One unverified report we've
heard is that the SPDC will establish a new "Inland Security"
Ministry that will take over the NIB's role but which will be
controlled by someone personally loyal to the Senior General.

Economic Conditions: Waiting for New Palms to Grease


7. (C) On the economic front there is uncertainty. Traders
report authorities have tightened border controls, making it
more difficult to smuggle in goods from Thailand and China.
One eyewitness in Taunggyi, an entrepot in southern Shan
State near the Thai border, indicated that black market
gasoline and diesel have disappeared from the streets as have
the dozens of illegally imported and unlicensed vehicles.
She said it was difficult to import these things as normal
since the shake-up because MI's role in facilitating illegal
border trade had been supplanted, but the new "regime" had
not yet settled into place. One gem smuggler told us the
usual route between Mogok (Burma's ruby and sapphire capital
in Mandalay Division) and Thailand was closed for now, but
should be back to normal "in a month or two."


8. (C) The crackdown on those close to Khin Nyunt and MI has
been inconsistent. Reliable sources report a large MI front
trading company has been closed and Bagan CyberTech, run by
Khin Nyunt's son, has been taken over by the army's signal
corps. However, Khin Nyunt cronies involved in projects
deemed "state priorities," such as edible oil production, or
who have family or other ties to Than Shwe or Maung Aye have
escaped the axe so far. Newspaper photos of the October 24th
lecture on corruption and rule of law included a few of those
cronies closest to the ex-PM, apparently still in the legal
fold.

Comment: Wait and See


9. (C) Despite the seamless ousting of Khin Nyunt and the
apparent return to business as usual in Rangoon, there is
still angst in the air. The business community is wary of
what a new order will bring in terms of vital smuggling
operations and economic policy. Though there has not yet
been a complete purge of business people with previous MI
ties, they worry about their economic and personal futures.
Politically there is also much insecurity with rumors rampant
of more changes to come, and the uncertainty of whether SPDC
relations with the various cease-fire groups can continue
placidly without Khin Nyunt -- the author of the cease-fire
"agreements." End comment.
Martinez