BURMA: TAY ZA'S COMPANIES MARKET GEMS, CELL PHONE

C O N F I D E N T I A L SECTION 01 OF 02 RANGOON 000441

SIPDIS

STATE FOR EAP/MLS, INR/EAP, EEB/TFS
PACOM FOR FPA
TREASURY FOR OASIA, OFAC
BANGKOK FOR USAID/RDMA GVP OFFICE

E.O. 12958: DECL: 07/15/2019
TAGS: ECON EFIN EAIR ETRD ECPS PREL PINR BM
SUBJECT: BURMA: TAY ZA'S COMPANIES MARKET GEMS, CELL PHONE
TECHNOLOGY

REF: RANGOON 333

RANGOON 00000441 001.2 OF 002


Classified By: Economic Officer Samantha A. Carl-Yoder for Reasons 1.4
(b and d).

Summary
--------------


1. (C) Regime crony Tay Za, at the behest of the regime, is
working with the Myanmar Gem Traders Association to promote
Burmese jade and gems at the ASEAN International Gem Emporium
in Kunming. According to Air Bagan staff, Tay Za is leading
the Burmese gem delegation and flew 40 merchants and their
gem stocks to Kunming free of charge. Several of Tay Za's
companies, including Htoo Trading, Central Marketing Company,
and Myanmar Avia Services, continue to expand their control
over Burma's mobile telecommunications sector through sales
of GSM and CDMA mobile phone SIM cards. End Summary.

Tay Za: the New Face of Burmese Gems?
--------------


2. (C) Burma is well represented at the ASEAN International
Gem Emporium in Kunming, which began on July 10. According
to U Zaw Win, Air Bagan consultant, the senior generals
requested that Tay Za lead the delegation, despite his lack
of knowledge about gems and jade. (Note: Tay Za owns
several jade mines in Phakhant, but his businesses do not yet
engage in the sale or marketing of jade and gems.) Tay Za
graciously volunteered to fly the entire delegation, 40
merchants plus family members, and their jade and gem stocks
to Kunming free of charge on his Fokker 100, U Zaw Win
stated. Tay Za was allegedly happy to take on this role, he
observed.


3. (C) According to MK Jewelers Managing Director Nay Min
Han, the majority of the gem merchants who traveled to
Kunming are private jade traders, rather than established gem
dealers with shops in Rangoon. He observed that the regime
selected the participants, who are members of the Myanmar Gem
Traders Association, based on their sales history with
Chinese merchants. He also speculated that since Burmese
Customs likely did not inspect the contents of Tay Za's
plane, he or any of the merchants could have smuggled to
China some of the highest quality stones, which are often
sold by general's wives and regime cronies in Singapore
(Reftel).

Conquering the Telecommunications Industry
--------------


4. (C) In December 2008, Tay Za's Central Marketing Co.
Ltd. (which is listed as a member of the Htoo Group of
Companies on Tay Za's business card) launched Burma's first
pre-paid SIM cards, expanding the availability of mobile
phone service. According to Than Than Htay, Central
Marketing Co. Ltd General Manager, Central Marketing Co.
Ltd., through its distributors and Tay Za's hotel franchises,
sells one-month (cost USD 20) and two-week (cost USD 10)
validity pre-paid GSM (Global System for Mobile
Communications) SIM cards. While Central Marketing Co. Ltd.
officials expected that tourists would purchase the majority
of cards, Than Than Htay noted that Burmese living in Rangoon

RANGOON 00000441 002.2 OF 002


are the primary users. These cards can only be used in
Burma's larger cities, since the GSM network is still
underdeveloped. She noted that Central Marketing Co. Ltd.
has sold more than 370,000 one-month GSM cards since December.


5. (C) Than Than Htay confirmed that Central Marketing Co.
Ltd. began selling one-month pre-paid CDMA (Code Division
Multiple Access Communications) SIM cards in July; each card
costs USD 50. To date, Central Marketing Co. Ltd. has sold
2,000 CDMA cards, primarily to locals living in Rangoon.
Central Marketing plans to expand sales of both CMDA and GSM
cards to Mandalay during the next three months, she stated.
Than Than Htay predicts sales of CDMA cards will boom, since
CDMA technology has a wider range and can be used in more
remote areas.


6. (C) Than Than Htay also confirmed that another Tay Za
company, Myanmar Avia, will work with state-owned Myanmar
Post and Telecommunications, to manufacture both CDMA and GSM
SIM cards at its factory at the Yadanabon Cyber City in Pyin
Oo Lwin (outside of Mandalay). She refused to speculate
about rumors that Tay Za's companies would assume
responsibility for Burma's mobile phone industry, but
acknowledged that several of Tay Za's companies are in talks
with the government about future services.


7. (SBU) The following is contact information for Central
Marketing Co., Ltd:

-- Central Marketing Co., Ltd; 5 Pyay Rd, Hlaing Township,
Rangoon, 11052; phone: 95-1-500-344, 95-1-500-355;
95-1-502-627; 95-1 504-418; fax: 95-1-502-692; General
Manager: Than Than Htay.

Comment
--------------


8. (C) Tay Za and his companies continue to provide
significant political and economic support to the regime.
Embassy Rangoon urges the Department of the Treasury to add
Central Marketing Co. Ltd. to the targeted sanctions list.


DINGER