BURMA: A HEART-TO-HEART WITH THE WA

C O N F I D E N T I A L SECTION 01 OF 03 RANGOON 000704

SIPDIS

DEPT FOR EAP/MLS, DRL, INL AND IO
PACOM FOR FPA

E.O. 12958: DECL: 10/22/2019
TAGS: PGOV PREL PHUM SNAR PINR BM
SUBJECT: BURMA: A HEART-TO-HEART WITH THE WA

REF: A. RANGOON 573 AND PREVIOUS

B. RANGOON 447

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Classified By: P/E Chief Jennifer Harhigh for Reasons 1.4 (b) & (d)

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


1. (C) During a two-hour meeting on October 21, a
representative of the United Wa State Army (UWSA) told us
that the Wa did not participate in the August conflict
between the Burma Army and the Kokang. The UWSA is shoring
up its defenses but does not expect imminent conflict with
the Burma Army. The Wa remain firmly opposed to
participation in the Government's planned Border Guard Force
(BGF) and seek to preserve autonomy while remaining part of
Burma. The Wa political wing, the United Wa State Party
(UWSP),reeling from the recent death of its leader, has not
yet decided a position on the 2010 elections.


2. (C) For the Wa, retention of the UWSA is non-negotiable
and leaders are prepared to abandon all legitimate economic
interests throughout the country -- estimated by the Wa as
over USD 2 billion -- if necessary to preserve their right to
arms. Our contact said the UWSA currently includes
approximately 30,000 active duty troops and an additional
10,000 youth and "auxiliary" members. They reportedly are
well-armed, including with U.S.-manufactured grenade
launchers and shoulder-mounted surface-to-air missiles and
launchers provided by Russia. End summary.

Kokang Conflict
--------------


3. (C) UWSA Deputy Liaison Officer Soe Than (aka Aik Sao
Than) on October 21 said that there were many "hidden"
aspects of the recent conflict between the Burma Army and the
Kokang (Ref A). Ethnic ceasefire groups, including both the
Wa and the Kokang ("comrades" since the days of the Burma
Communist Party),had informally consulted to ascertain
responses to the GOB BGF proposal and "everyone" had decided
to refuse it. The SPDC, for its part, was actively looking
to find faults with the ethnic groups and had found a victim
in the Kokang region. The "factory" targeted by Burmese
authorities was not an official Kokang business and was
merely an arms repair shop, Soe Than claimed. (Note: During
a GOB-organized diplomatic tour of the facility in September,
Embassy officers observed hundreds of new gun parts in stock,
as well as manufacturing equipment. End note.) When Kokang
leader Peng Jiasheng did not accept the raid on the facility
and when a five-hour negotiation broke down, Peng fled.

"Red Alert"
--------------


4. (C) Soe Than said the Wa did not become involved in the
armed conflict, but did go on "red alert," which remains in
effect. SPDC troops did not enter the Wa-controlled area.
Wa leaders summoned all commanders and many Wa business
people back to Pangsan, where they remain. According to Soe
Than, the UWSA is not worried about an impending conflict
with the Burma Army but maintains a ready position should
conflict start.

On Drugs: "Everyone Works to Support His Family"
-------------- ---


5. (C) Soe Than labeled the Burmese authorities' drug
seizures in August and September as an attempt by the SPDC to
cut off the main source of Wa funds and to tar reputations.
(Note: If, as Soe Than claims, the Burmese are attempting to
cut off the main source of Wa funds, this is a good thing.
As far as tarring reputations, - the Wa already are known
narcotics traffickers. End note.) In a somewhat weak
defense, Soe Than added that the official Wa organization and
leaders are not involved in the drug trade, although it is
possible "associates" and family members, in pursuit of
personal greed, do engage in such activities. "Everyone

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works to support his family," he concluded. (DEA notes that
senior leadership of the UWSA are heavily and directly
engaged in narcotics trafficking. End note.)

Opposition to Border Guard Force
--------------


6. (C) Soe Than said the UWSA was shocked by Military
Security Affairs (MSA) Chief Lieutenant General Ye Myint's
proposal that the Wa agree to join a BGF under the control of
the Burma Army by October 18 (Ref A). (Note: This was not a
surprise. We believe ceasefire groups have been aware of
this GOB demand for some time, though the deadline may have
been news.) UWSA Central Executive Committee members
consulted widely with troops and family members in a General
Assembly and all agreed the proposal is unacceptable. Ye
Myint traveled to Pangsan in September to meet with UWSA
Commander Pao Yu Hsiang, who avoided him for two days.
Eventually, UWSA Liaison Officer (and UWSP Office Chief) Aung
Myint persuaded Pao Yu Hsiang to agree to meet Ye Myint.
They met for thirty minutes and reached no solution.

The Good Old Khin Nyunt Days
--------------


7. (C) When asked to compare Ye Myint with former Prime
Minister and MI Chief Khin Nyunt, Soe Than said UWSA
Commander Pao Yu Hsiang respected Khin Nyunt, who was warm
and friendly, had organizational skills, and was empowered to
make his own decisions. He kept promises. In contrast, it
appears Ye Myint must submit all matters to his superiors for
approval.

Ultimate Goals
--------------


8. (C) Soe Than said that Burma's ethnic Wa population,
which he estimates is one million, strives to maintain
autonomy and authority. They have no intention to secede
from Burma. They like some aspects of the constitution, such
as the preservation of a "self-administered area." They most
want a federal system in which they can retain control over
their economy and local affairs, including education, etc.,
while accepting a central government based in Nay Pyi Taw.
However, the Wa cannot, and will not ever sacrifice their
army.

UWSP: No Decision on Elections
--------------


9. (C) The United Wa State Party (UWSP) has not taken a
position on the elections. The party did participate in
Burma's National Convention process; but it is still reeling
from the September 8 death of party leader Chao Nyi Lai (aka
Kyaut Nyi Lai) and has yet to discuss how it will approach
the elections.

A Vast Business Network
--------------


10. (C) Soe Than observed that the growing Wa economic
clout and military strength deeply concern the SPDC. He
detailed a vast network of legitimate businesses in Burma
under Wa control, including at least twenty official
companies in Rangoon. (Note: The stress on "legitimate"
investment suggests he is well aware of Wa illegal
businesses/economic interests as well. End note.) Soe Than
claimed the UWSA has over USD 2 billion invested in
transportation (including Yangon Airways),hotels (including
Yangon City Hotel),restaurants, gems, mining, teak,
road/building construction, property development,
manufacturing (including of the ubiquitous plastic rice
bags),wood processing (including a facility at the
Mingaladon Industrial Estate near Rangoon's airport),massage
parlors, and music recording studios (including "NASA"
Studio--NFI). According to Soe Than, Hong Pang Company,
based in Tachilek, is the parent company for many of the Wa
investments. Centers of Wa economic activity include

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Rangoon, Mandalay, Mogok, and Mine Hsu, and there is a
communications hub in Lashio, Shan State.

Current Strength of the Wa Army
--------------


11. (C) Turning to military might, Soe Than described how
the UWSA, officially prohibited from increasing its numbers
under the ceasefire agreement, has found clever workarounds,
including by dispatching numerous "liaison" and business
officers throughout Burma and filling their slots with new
recruits. He said current active-duty troops number 30,000,
with an additional 10,000 youth and auxiliary forces, many of
whom are enrolled in training or engaged in agriculture.
UWSA Commander Pao Yu Hsiang brags that the UWSA can defeat
10 times as many Burma army soldiers.


12. (C) Soe Than denied the UWSA is manufacturing
armaments. (Note: DEA has information that the UWSA
produces arms and munitions in Burma, primarily in Special
Region 2. End note.) Soe Than claims it is easy to purchase
arms from Thailand, China (including Hong Kong),and
Singapore. He boasted the UWSA uses U.S.-made grenade
launchers. (Note: Any U.S. weapons were likely seized
during the UWSA's conflict with the Mong Tai Army circa 1996.
Some U.S.-manufactured weapons might also have originated
from Thailand. End note.) Soe Than suggested the only
threat the UWSA is not prepared to face is major airstrikes
by the Burma Army, although he claimed the UWSA purchased
shoulder-mounted surface-to-air missiles and launchers from
Russia in 2005 or 2006. (DEA notes the UWSA receives weapons
and military training and advice from China.) Soe Than told
us he personally trained in China. End note.)

Reactions to U.S. Policy Review
--------------


13. (C) Soe Than said his superiors are extremely
interested in the new USG Burma policy. He has provided
reports (NFI) about the U.S. policy review conclusions to the
UWSA commanders, who he said are cautiously optimistic about
the outcomes. Nonetheless, Soe Than assesses the Burmese
generals have been vague about what they are prepared to
offer and are likely ultimately to "cheat" the U.S. He added
that the Wa were grateful that the U.S. provided assistance
to Burma after Cyclone Nargis and were baffled by the GOB's
initial refusal to permit humanitarian assistance by the U.S.
military.

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


14. (C) Soe Than seemed eager to talk with us. He said he
had sought prior permission from the second rung of Wa
leadership (NFI),as he was worried the top leaders might not
agree. His depiction of the UWSA as a formidable, organized,
and well-financed organization that would present a real
challenge if the Burma Army should provoke a conflict fits
with other accounts.


15. (C) The Wa position is clear; they value the status quo
-- autonomy and an army to protect Wa interests. The Wa may
or may not agree to participate in 2010 elections, but it
appears they have no interest in compromising on core issues
affirmed at the time of ceasefire, such as their right to
bear arms.


16. (C) The conversation highlights the complex nature of
the regime's relations with domestic constituencies,
including ethnic-minority ceasefire groups. The traditional
democratic opposition ) Aung San Suu Kyi and the NLD - is
only one aspect of the picture. The plethora of ethnic
groups and interests also loom large. It is always possible
elections could be postponed past 2010 if the regime is not
satisfied it has sufficient control over ethnic minority
groups and interests.
DINGER