New Syria massacre, as Moscow ‘starts to distance itself’ from Assad

More than 200 Syrians have been massacred in the rebellious Hama region, say opposition sources, after the village of Tremseh was bombarded by helicopter gunships and tanks before being stormed by militiamen.

“If confirmed, it would be the worst single incident of violence in 16 months of conflict,” reports suggest

The site of the near the city of Hama, an epicenter of the 17-month-old uprising, was the first mass killing since United Nations cease-fire monitors were forced to suspend their work in Syria a month ago because conditions were too dangerous for them. Activists in Hama posted a video on Youtube (above), accusing the government of “ethnic cleansing in Hama,” and said the killings in Tremseh were “unlike any massacre that has previously occurred in Syria.”

The news broke as Syrian President Bashar Assad attempted to seize the diplomatic initiative by proposing Ali Haidar, his minister of reconciliation, as the regime’s representative in U.N.-sponsored talks to establish a transitional government.

Haidar was “not so bad a man” and “his hands aren’t dirty with blood,” said Menhal Barish, a senior official with the opposition Syrian National Council, while rejecting the idea that he could play a role in any political transition.

Other SNC figures were less charitable.

“Haidar is weaker than weak,” said the SNC’s Radwan Ziadeh, a former Reagan-Fascell fellow at the National Endowment for Democracy.

The head of a small party allied with the regime, Haidar has been hit by tragedy in Syria’s 16-month crisis, writes the FT’s Roula Khalaf:

His son Ismael was killed in March in what the government described as an armed terrorist attack. Some opposition figures, however, said Ismael was a well-respected pro-revolutionary activist who was killed by the regime, although this did not change his father’s position.

Diplomats said it was too early to tell whether Mr Assad’s move should be seen as an effort to quickly deliver an appointee and please Mr Annan or a delaying tactic by the regime.

“He has to be the right person – with the connection to the president and be acceptable to the opposition,” said one diplomat.

Assad’s appointment of Haidar , who “could not stand up to the smallest intelligence officer,” confirms that Assad is was not taking the Annan initiative seriously, said Samir al-Taqi, a Dubai-based Syrian analyst and former adviser to the foreign ministry.

The Syrian leader is “playing games with the Russians who know that if the Annan plan fails then they are in a worse position.”

According to reports, Moscow may be “starting to distance itself from the Syrian regime, due to the realization that Assad will eventually be ousted.”

Assad’s lack of commitment to a negotiated solution is evident from his discussions with UN envoy Kofi Annan (see the translation of his comments published on the ArabSaga blog.)

Annan’s latest peace plan – “perhaps better labeled the Annan-Assad plan — is a bad one,” writes Jeffrey White, a fellow at the Washington Institute, for Near East Policy:

The regime does not seek political compromise with the opposition. Rather, it wants to break the opposition, killing as many people — armed, unarmed, and innocent — as necessary. That has been apparent from the beginning. Lately, however, the regime has been losing control of the military situation, and its position in the distant provinces is crumbling. Therefore, Assad probably regards the new proposal as a way to shore up his defenses, at least temporarily. This makes Annan’s plan a bad deal for the Syrian opposition and all those seeking the regime’s end, but a good deal for Assad.

The Annan initiative “extends yet another lifeline to the regime, undercuts the armed opposition’s growing effectiveness, and substitutes diplomatic bustle for progress toward ousting Bashar al-Assad,” White notes. “Like Annan’s previous ineffective ceasefire, the new plan is almost certainly doomed to failure — and the sooner the better.”

It seems that even Assad’s staunchest supporters are starting to plan for his demise.

Damascus is going the way of Tripoli, Libya, with a one-year delay,” according to a contributor to Khabaronline, a website affiliated with Ali Larjini, the speaker of Iran’s Majlis who is close with Supreme Leader Khamenei.

“The entire world is against Syria and we are standing here defending Syria, a country accused of crimes against humanity. We are not playing this game very well,” said Mohamad Ali Sobhani, a current diplomat who has served as Iran’s ambassador to Lebanon and Jordan.

But Venezuelan President Hugo Chávez is “providing vital energy support” to Assad and conducting business with blacklisted Syrian firms, according to documents relating to the deals.

Opposition activists are divided on the question of stopping all energy exports to Syria.

“In general, we want to see all sanctions tightened and strengthened,” said Ammar Abdulhamid, a Washington-based Syrian dissident. “But the issue of diesel is complicated, as our own people could get hurt.”

Recent high-level defections suggest that the regime may be fragmenting, but some observers are cautious.

“There are indications to me that the Sunni insulation is cracking,” said Andrew J. Tabler, a Syria expert who is a senior fellow at the Washington Institute for Near East Policy. “But these people are not from the core. It’s an important distinction.”

Two prominent defections over the past week “have stirred a debate within the opposition movement over what role—if any—former officials can play in ousting the Assad regime and serving in any transition government,” the Wall Street Journal reports:

Yet, the dearth of high-ranking defections, political or civilian, from the ruling Alawite sect also suggests that the peeling away of prominent Sunni officials could leave a small but still sturdy regime, comprised of the Assad family and the upper ranks of the military and security services. Analysts and activists say some Alawites—which comprise about 10% of Syria’s population of 23 million—have joined the opposition, but thousands in influential positions remain loyal.

“The recent defections are very important symbolically, because they signal the erosion of regime cohesion, and the assessment of key insiders that it is time to jump ship. But they are unlikely to have much impact beyond the symbolic,” said Steven Heydemann, a specialist on Syria and senior adviser at the U.S. Institute of Peace.

“I suspect that the established leadership of the opposition will make political use of high-level defectors, but will not be prepared, after 16 months of struggle, to give way to newcomers, even prominent ones, especially when these individuals have long histories of support for the regime and may have participated in the repression of the uprising,” Heydemann said.

International intervention in the conflict has been stymied by an absence of consensus and will among the world’s leading powers and fears that Syria’s complex mix of ethnic and religious affiliations could provoke civil war that will spread to neighboring states.

“Syria’s complexity also speaks to its geopolitical significance and therefore the international community’s interest in solving the conflict,” writes Ausama Monajed, executive director of the Strategic Research and Communication Centre:

Countries are reluctant to get involved in Syria because of its location and relations with its neighbours. But the longer the international community waits to help Syria, the less control it will have on the impact of the conflict on these relationships. Ousting Assad and assisting a democratic transition would serve multiple strategic interests of the US and its allies, by removing a key passageway and ally from the Iran-Hezbollah axis and disempowering a long-time foe of Israel and bully of Lebanon.

While opposition groups are reportedly receiving weapons from the Gulf States, “the Saudis and Qataris are incapable of running arms on the scale required,” says Reuel Marc Gerecht, a former CIA case officer and a senior fellow at the Foundation for Defense of Democracies.

Institutionally, intellectually and culturally, it’s not their cup of tea,” he contends. “To the extent Syria’s rebels have recently improved their performance, the reason is better coordination among the Free Syrian Army’s units, more defections from regime forces, and raids on regular army depots.”

Aside from the moral imperative to support Syria’s people, there is a strong strategic rationale for the West and its regional allies to be “more proactive in bringing about the end of the Assad regime,” argues Michael Herzog, the Milton Fine International Fellow at the Washington Institute, in a new report for BICOM, the Britain Israel Communications and Research Centre:

Speeding up the process of the regime’s collapse would avert the destabilizing consequences of a lengthy civil war, as well as dealing a blow to the radical, Iran-led alliance in the region. Although direct military intervention is not currently on the cards, there are other ways the West could intervene to help advance Assad’s fall. International involvement certainly comes with risks, but the costs of inaction will be far higher:

The Syrian government is battling a growing insurgency, with the situation developing into a civil war. Neither side is currently capable of overwhelming the other.

Whilst external powers interested in keeping Assad in power are actively protecting their interests, Western powers calling for Assad to go are relatively passive in supporting the Syrian opposition.

Continued relative Western passivity could result in a very long conflict within Syria, possibly lasting years, developing along sectarian lines and leading to the deaths of many more thousands with no clear outcome.

With Assad unwilling to negotiate his own departure and the bulk of the opposition unwilling to negotiate any solution with him, the Annan Plan has little prospect for success and a plan B is required.

The Assad regime’s departure would deal a serious blow to Iran and to the Iranian-led axis and encourage those in the region standing up to repression.

To maximise the chances of Assad’s departure, while minimising risks, European powers along with the US should adopt a more proactive policy through:

significantly increased, though carefully calibrated support for the opposition;

further isolation of the regime;

continuing to seek Russia’s cooperation, whilst realising that the more inevitable the fall of the regime looks, the more likely Russia is to engage in a process to replace it;

support for Syria’s neighbours in managing the fallout from the conflict;

preparation of contingency plans to secure Syrian strategic weapons and prevent humanitarian catastrophes;

taking an opportunity to mend fences between Israel and Turkey.


South Africa’s anti-Apartheid leader Bishop Desmond Tutu famously said: “If you are neutral in situations of injustice, you have chosen the side of the oppressor,” notes Monajed.

“By not giving the Syrian people the tools they are asking for and need to bring down Assad, the international community is siding with him.”

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Who gets what? U.S. funding for Middle East democracy, governance and human rights

What does U.S. funding tell us about the priorities of the Obama administration and its policy response to the events in the Middle East? How are ongoing uprisings in some states, and transitions in others, affecting U.S. assistance to the Middle East and North Africa?  What are the most significant elements of U.S. funding and appropriations this year, particularly compared to last year?  What has been the impact of the ongoing U.S. deficits and budget cuts on funding for the Middle East?  And what may we expect from Congress in its upcoming appropriations process?

A forthcoming report by POMED Executive Director Stephen McInerney offers a detailed look at the U.S. funding and assistance for democracy and governance in the Middle East, the congressional appropriations process, and implications for U.S. policy in the Middle East during a turbulent time. As some countries in the Arab world embark on political transitions of various types, while others continue to protest authoritarian rule, it is important to examine U.S. funding for the Middle East and the impact on Washington’s relations with the region.

Please join a discussion of these issues organized by the Project on Middle East Democracy (POMED) and the Heinrich Böll Foundation of North America:

The Federal Budget and Appropriations for FY 2013: Democracy, Governance, and Human Rights in the Middle East

Stephen McInerney
Executive Director, POMED

Jennifer Windsor
Associate Dean for Programs and Studies at the School of Foreign Service at Georgetown

Tamara Wittes
Director of the Saban Center for Middle East Policy, Brookings Institution

Moderator: Cole Bockenfeld
Director of Advocacy, POMED

Introduction by: Sebastian Gräfe
Program Director for Foreign & Security Policy and Transatlantic Issues at the Heinrich Böll Foundation

Thursday, July 19, 2012
U.S. Capitol Visitor Center, SVC 201-00

Click here to RSVP for the event.

The Federal Budget and Appropriations for Fiscal Year 2013: Democracy, Governance, and Human Rights in the Middle East will be available on on July 19th. (Last year’s report can be found here.)

Please contact Anna Newby at with any questions,
or call (202) 828-9660, ext 23.

The Project on Middle East Democracy is a grantee of the National Endowment for Democracy.

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Tunisian Islamists stress democracy, as US voices call for trade pact

Tunisia’s ruling Islamist party today highlighted its commitment to a civil, democratic state at the opening of its first congress since taking office (above). The conference coincides with moves to promote a U.S.-Tunisia free trade agreement to help support a transition threatened by an ailing economy.

“Despite the challenges, our country has preserved its civil character and attachment to democratic principles, all based on an Islamic reference,” said Hemadi Jebali, the prime minister and party secretary general, stressing “freedom as a fundamental value and the sanctity of human rights.”

The party’s spiritual leader Rached Ghannouchi told some 10,000 supporters that Tunisia needs a new consensus to resolve tensions between secularists and Islamists.

“I want to assure the people that the country is in good hands,” he said.

“This country needs a national consensus. We call for national reconciliation,” said Ghannouchi, playing down the crises that have shaken Tunisia and its ruling coalition as “normal” for a post-revolutionary state.

“In Tunisia, all movements can cohabit,” he said.

Observers believe the gathering will witness efforts to reconcile the party’s pro-democratic modernist faction with more militant hardliners.

“The congress will resolve the direction of movement … whether it [be] the Turkish experience or a walk towards the Afghan model,” said analyst Nabil Zagdoud.

“It is likely that Ghannouchi will remain in his post as leader of the movement because he is the most able to communicate with the two components of the movement.”

“The most important objective of this congress is … to establish Ennahda as a moderate Islamist movement [that is] open, focused on the concerns of Tunisians [and] on achieving their ambitions,” Ghannouchi told journalists.

Tunisia must maintain its republican system and its record of promoting equality between men and women, said Mustapha Ben Jaafar, the head of the center-left Ettakatol Party, a coalition partner of Ennahda.

“Just as we have denounced the use of religion by the state, so we will not tolerate tyranny in the name of religion and the attacks on individuals’ privacy,” he said, referring to violent protests by Salafis.

The conference welcomed Khaled Meshaal, the leader of the Palestinian Hamas movement (right, with Ghannouchi), with “thunderous applause and cries of ‘the people want the liberation of Palestine,’” AP reports:

“Take your time to recover and rebuild,” he told delegates. “Getting over this transitional period is a priority. We are not a selfish nation. We cannot ask you to start a war against Israel when you have other priorities.”

“We want to prove that, with the philosophy of alliance, we can achieve a strategic convergence, because the transition period could last between 10 and 15 years, the objective being to establish stable and irreversible democratic foundations,” party official Riadh Chaiba said this week.

The US can most effectively support Tunisian efforts “to solidify democratic gains by expanding trade and commercial ties,” says House Rules Committee chairman David Dreier (R-CA), the founding chairman of the House Democracy Partnership.

“The Tunisian government is the one in the region that shows the most promise,” he told The Cable. “We’d like to see talks begin in early 2013.”

According to congressional sources, Dreier first discussed the topic with Tunisian Prime Minister Hamadi Jebali at the Davos meeting of the World Economic Forum in March, just months after Dreier introduced a bipartisan resolution calling for a free trade agreement with Egypt and the Office of the U.S. Trade Representative relaunched Trade and Investment Framework Agreement (TIFA) talks with Tunisia. Even though Dreier’s proposal has yet to gain a substantial congressional base, he is partnering with House Committee on Foreign Affairs senior member Rep. Gregory Meeks* (D-NY) and Ways and Means Committee member Rep. Erik Paulsen (R-MN).

Dreier can probably mobilize bipartisan support for a free trade pact, says Tamara Wittes, Middle East director of the Brookings Institution’s Saban Center.

“I think there’s a tremendous amount of support on the Hill for Tunisia. I think members of Congress understand how important it is to have a successful model in North Africa for the other countries struggling with democratic reform,” she told The Cable:

Washington has already pledged to help Tunisia with short-term economic problems like debt and unemployment.  In March, it was announced that the United States would transfer $100 million to Tunisia, which faces a $25 billion debt, and in June the parliament in Tunis voted in favor of a bill allowing for a $400-450 million sovereign bond issue “with up to 100 percent of the principal and interest guaranteed by the U.S. government,” enabling Tunisia to “borrow at almost risk-free rates.” The State Department’s Middle East Transitions office is pursuing a series of “smaller but important steps.”  

“There are investment regulations, border controls, and other regulatory changes that could help facilitate trade between the U.S. and Tunisia,” Middle East Transitions program director William Taylor told The Cable. “What we’re hoping is that by taking some of these steps earlier on, they might get some of these trade benefits sooner than if they were wrapped into one large negotiation for a free trade agreement.”

 *Rep. Gregory Meeks is a board member of the National Endowment for Democracy.

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Putin pushing ‘Stalinist’ NGO bill

A few days after she met a local journalist last year in Russia’s strife-torn Caucasus region, Tanya Lokshina (right), a researcher for the Moscow office of Human Rights Watch, had another, more surreal, conversation with him.

The journalist told her he had been called by a high-ranking government official and told that Ms Lokshina, a Russian who studied in the US, was not everything she seemed. “This woman is an enemy, she is an American spy. Don’t talk to her!” he was urged.

“Word of this encounter was nothing new for Ms Lokshina, who documents atrocities in war-torn southern Russia,” the FT’s Charles Clover reports:

Since Soviet times, officials from lowly bureaucrats right to the top have tended to see every setback as a foreign plot, every piece of bad news as a conspiracy. This same official paranoia, she and many others say, is now embodied in legislation intended to expose “foreign agents”, defined as any group that receives foreign finance and engages in politics. The law could be passed by parliament as early as this week.

“This is the same old tired accusation reheated from Soviet times and served up again,” Ms Lokshina says. “They are aimed at demonizing and marginalizing independent groups.”

The proposed NGO laws are reminiscent of Soviet secret police methods, the head of the Council of Europe said today.

“The wording is a problem. ‘Foreign agent’ sounds very bad to me and also, I think, to many others abroad and in Russia,” said Thorbjorn Jagland. “Some of those executed during the [Joseph] Stalin era were called foreign agents.”

“This was an expression that was used against dissidents during this period. It is also very often used in other authoritarian regimes against everybody that has different views,” he said. “It’s a simple way to get people out of the debate and to get the views you don’t like out of the debate.”

The Obama administration criticized the bill as a threat to basic liberties and human rights.

“The United States is deeply concerned by the Russian Duma’s consideration of legislation that would potentially limit the activities of Russian nongovernmental organizations receiving foreign financing,” said Patrick Ventrell, a State Department spokesman.

Credit: Moscow Times

During a meeting with senior advisers this week, President Vladimir Putin, “insisted on keeping the punitive label,” Michael Boehm writes in the Moscow Times. But Putin, who has previously described foreign-funded NGOs as “jackals,” also “understood that United Russia’s asymmetric response was overkill,” and specified a list of issues to be excluded from the bill’s provisions, including science, charities, culture, religious organizations, physical fitness and sports:

Putin conspicuously retained the most important restrictions — those that apply to NGOs devoted to building democracy and an open society, election monitoring, protecting human rights, improving transparency and accountability in government and fighting corruption. The Kremlin is most concerned about these NGOs because they expose some of the worst abuses of Putin’s vertical-power structure.

Take, for example, Golos, the election-­monitoring NGO funded in part by USAID. According to the Kremlin’s version of the December State Duma elections, there were only isolated cases of electoral fraud that had little impact on the results. But Golos, relying on documented evidence and exit polls, said election fraud amounted to 10 to 15 percent of the vote. Golos also documented electoral fraud in the March presidential vote.

“Notably, government corporations are also excluded,” notes Boehm. “Perhaps, Putin didn’t want Rosatom, which has received more than $1 billion since the early 1990s from the U.S. Defense Department to help destroy Russia’s stockpile of chemical weapons, to qualify as a ‘foreign agent’ of the United States.”

One of the bill’s drafters, ruling United Russia party legislator Alexander Sidyakin, singled out Golos as an example of U.S. efforts to “affect Russian politics,” citing “$2 million given to the organization in 2011 to dirty the Russian authorities.”

“It is quite clear what they are doing,” says Golos director Lilia Shibanova. “The word ‘agent’ means only one thing in Russian – spy.”

“It is an insult to be called this, because we are not taking orders from another state. We are, in fact, working on behalf of our own citizens and defending their interests,” says Ms Shibanova, who adds that Golos tried three times, unsuccessfully, to get grants from Russia’s Civic Chamber, which funds civil society projects.

“As for the organizations that got the [Russian] grants, no one ever saw them during the elections,” she says.

The bill’s main sponsor, Irina Yarovaya, who chairs the Duma’s security committee and heads the  party’s conservative wing, says the bill meets international democratic standards.

“Russia is a young democracy — we learn from various countries’ experience. The law aims to protect the interests of civil society,” she told a RIA-Novosti roundtable.

The bill obliges NGOs that engage in political activity and receive foreign funding to register as “foreign agents” and display this label in all their publications. It also criminalizes violations of already stringent requirements for registering NGOs.

Critics say the bill is designed to punish pro-democracy groups by branding them traitors, as President Vladimir Putin has implied he thinks they are. During mass anti-government protests last year, Putin openly accused the U.S. State Department of financing NGOs that were allegedly plotting regime change.

Yarovaya insisted that the bill was an ”instrument of openness” that threatens no one.

“Russians must be able to understand who in [the country] does political work paid with foreign money. That’s a standard of international democracy,” she said.

The US has given over $5bn to 260,000 Russian civil society groups since 1991, “and that is only official figures,” claims Veronica Krasheninnikova of the Moscow-based Institute of Foreign Policy Studies and Initiatives.

“The United States does not give money just like that,” she says. “They are trying to achieve a certain foreign policy objective.”

“Our entire civil society is being financed by foreign government[s]. Our own organizations cannot compete with the ones who get quoted in western newspapers, get foreign grants and are part of this huge money machine.”

Partly to address this, Mr Putin announced this week that Rbs3bn ($91.7m) would be set aside next year to finance NGOs. A senior Russia official told the FT that foreign support for NGOs became “a back door to financing political parties”. In many cases political activists worked for NGOs, he said, receiving a salary that parties could not afford to pay and blurring the line between civil society work and political activism. NGOs respond that they cannot prevent their employees from joining political groups.

Ms Krasheninnikova also says the new law will be almost identical to the US Foreign Agents Regisitration Act, which requires organizations “acting as agents of foreign principal” to disclose details of the relationship.

But Ms Lokshina says the two are very different – FARA applies only to organizations directly subject to the orders of a foreign principal. Those such as Greenpeace and Human Rights Watch, on the other hand, receive money from foreign governments but do not have to register in the US as foreign agents, while they will have to do so in Russia.

Many Kremlin officials and  United Russia members believe that Golos and other NGOs are part of a U.S.-sponsored special operation to discredit and destabilize Russia, writes Boehm:

These NGOs, the argument goes, are part of a U.S. conspiracy that relies on subtle, insidious “soft power” tools under the benign pretext of ”building democracy and civil society” to help stage an Orange Revolution. For example, during an ”Open Tribune” discussion on the NGO bill last week, Kremlin-friendly analyst and Public Chamber member Sergei Markov said the legislation would “help prevent the overthrow of our current president.” He also said the bill would help “strengthen Russia’s democracy.”

But the NGO bill is a “tactic taken right out of the Soviet playbook,” he observes:

Few rulers are fond of NGOs that expose government abuse, but it would be hard to imagine democratic countries supporting a bill that would effectively label them “spies,” suffocate them with unnecessary (and expensive) reporting requirements, or threaten them with excessive fines and jail terms for noncompliance. Like a critical and independent media, critical and independent NGOs are a necessary component of civil society, and their freedom-of-speech rights should be fully protected. Incidentally, the Kremlin’s only “politically active” NGO operating in the United States — The Institute of Democracy and Cooperation, whose mission is to monitor U.S. human rights abuses — does not fall under the U.S. Foreign Agent Registration Act, nor do any NGOs for that matter.

By trying to discredit NGOs as “foreign agents” and provocateurs, the Kremlin is relying on a crude decoy tactic, attempting to shift attention away from its own poor record of falsification, corruption, abuse of power and human rights abuses.


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Burma sanctions move: rare ‘snub’ to Suu Kyi or ‘inexact science’ of engaging reform?

Aung San Suu Kyi meets with Burmese worker rights representatives. Photo by SERC/ACILS.

Human rights and pro-democracy groups are criticizing the suspension of US sanctions on Burma as a premature concession to a regime still marred by rights abuses. But the head of the civilian-led, military-backed government insists that the scrapping of the penalties is “extremely important” for the success of the country’s fragile reform process.

In a move described as “a rare snub” for opposition leader Aung San Suu Kyi, the Obama administration this week lifted a ban on investment by US oil and gas firms imposed since 1997. The National League for Democracy issued a tentative welcome for the decision to ease sanctions, but Suu Kyi called more “transparency” as foreign firms invest in the country’s rich energy resources.

“President Thein Sein, Aung San Suu Kyi and the people of Burma continue to make significant progress along the path to democracy, and the government has continued to make important economic and political reforms,” President Barack Obama said. “Easing sanctions is a strong signal of our support for reform, and will provide immediate incentives for reformers and significant benefits to the people of Burma.”

The relaxing of sanctions “does not authorize investment with Burmese Ministry of Defense, state or non-state armed groups, or entities owned by the foregoing,” said White House spokesman Tommy Vietor.

“Encouraging further liberalizations by a government still riddled with former generals and their cronies is a dicey process and an inexact science,” notes one observer. “The initial reforms came so quickly and abruptly that many Western governments (and many Burmese activists) were simply caught off guard.”

Rights groups fear that investment in the military-linked oil and gas sector will undermine the reform process by stifling moves to secure greater transparency.

“Suddenly funneling money into the country’s opaque, scandalously corrupt business environment is no way to help Burma progress economically or politically,” note Rhonda Mays and Robert Herman of Freedom House. “This is all the more true when the main investment goal is the exploitation of natural resources.”

But the country’s president insists “major” Western investment is essential to fund plans to accelerate the pace of democratization.

“It’s only if you lift the lid entirely that it allows everything to come out,” Thein Sein told the Financial Times. “It is extremely important that sanctions be lifted – both financial and other economic sanctions – to make possible the sort of trade and investments that this country desperately needs at this time.”

The former general highlighted the importance of opposition leader Aung San Suu Kyi’s engagement in the political process.

“All these economic sanctions have political reasons behind them,” he said. “It is one of the reasons why it has been so important to engage with [Ms Suu Kyi] and to include her in the process of political reconciliation.”

In a rare interview in the presidential palace in Naypyidaw, Thein Sein promised a “second wave” of reforms, rejecting suggestions that this week’s elevation of a former army intelligence chief to vice-president (“The military chose someone who they can count on,” said Aung Zaw, editor of the Thailand-based Irrawaddy magazine) illustrated the potentially destabilizing influence of hard-liners opposed to the reform process.

“This is an armed forces that the country has had to rely on for a very long time for security and to meet external threats as well in the past,” he said. “So it was important at this time that they were not left behind entirely.”

The long delay between Secretary of State Hillary Clinton’s May 17 announcement that the U.S. would ease sanctions and the Treasury issuing new licenses was partly due to an internal debate among officials over disclosure requirements, a source told Reuters.

“The central point of all of this is to focus on transparency, the theory being that the more information the greater the incentive to comply with responsible norms and practices,” the source said.

But the United States remains “deeply concerned about the lack of transparency in Burma’s investment environment and the military’s role in the economy,” Obama said, announcing the easing of sanctions and outlining a series of corporate governance rules to which investors must adhere:

The rules require U.S. individuals and entities making new investments of more than $500,000 to submit annual reports to the State Department on issues such as human rights, workers’ rights and environmental stewardship, the department said.

Annual payments exceeding $10,000 made to Myanmar government entities including state-owned enterprises must also be reported, while those investing in the Myanma Oil and Gas Enterprise must notify the State Department within 60 days.

“The purpose of the public report is to promote greater transparency and encourage civil society to partner with our companies toward responsible investment,” the departments of State and Treasury said in a fact sheet explaining the policies.

Activists believe the West should maintain sanctions until concerns over rights abuses are addressed, according to Irrawaddy, citing a recent joint letter by several advocacy groups—including the AFL-CIO labor federation, Freedom House, Human Rights Watch, Institute for Asian Democracy, Open Society Foundations, and the US Campaign for Burma.

“Despite holding by-elections and taking other positive steps, the government has yet to institute the reforms necessary to move Burma toward democracy, and basic political power remains with the military,” said the coalition. “It is imperative for the United States to retain its leverage until real reform occurs.”

Lifting investment sanctions on a nation where forced labor and other rights violations continue may “undermine progress toward political reforms in Burma, rather than encourage movement toward democracy,” said AFL-CIO President Richard Trumka. The labor federation’s Solidarity Center provides assistance to Burma’s independent trade unions and is a long-time campaigner for labor rights in the country.

A new report from the UK government raises serious concerns about ongoing human right violations, including atrocities arising from ongoing armed conflicts in ethnic regions.

“There is more work to be done to address the serious human rights concerns that remain,” according to the British Foreign and Commonwealth Office’s Human Rights and Democracy 2011.

“2011 was marked by some unexpected and positive political developments in Burma, although significant long-term challenges remained,” says the report, detailing government soldiers’ destruction of 30,000 houses from seven villages in Shan State in March last year and the arbitrarily detention and torture of civilians in Kachin State.

Many observers believe the ongoing conflicts between the military and ethnic minority militias are the principal obstacle to Burma’s democratization. But Thein Sein insists that ethnic insurgents, including Kachin rebel groups, will become “part of the solution” by being incorporated into the reform process.

“As a soldier for my whole career, fighting these armed groups, I saw them as ‘the enemy’ – but when I became president, I realised the death of a Kachin soldier is the same as the death of a national army soldier – it is the death of a Myanmar citizen and therefore a loss to the country,” he tells the Financial Times in one of the first interviews he has given since becoming president 18 months ago. “Now I no longer see [rebel forces] as part of the ‘enemy’ but as part of the solution.”

For Mr Thein Sein, the critical turning point was his appointment as prime minister in 2007, having attained the rank of full general under Than Shwe – the junta leader known as the “senior general”. Suddenly, after years in the relatively cloistered military world, Mr Thein Sein was visiting neighbouring countries to liaise with counterparts, and even attending a UN session in New York. His formative experience from these years, however, was dealing with the devastation of Cyclone Nargis, which killed more than 130,000 people in 2008.

General Than Shwe, though brutal, xenophobic and highly superstitious, was quietly laying the groundwork for radical change, setting in train plans for a parliamentary system, a government overhaul and, crucially, his own retirement.

In another move that still confounds critics, General Than Shwe anointed Mr Thein Sein as his successor to run in the 2010 election. The poll was boycotted by opposition leader Aung San Suu Kyi and her party and condemned by the international community as fraudulent. Mr Thein Sein came to power under that cloud, branded the senior general’s key henchman.

Yet by mid-2011, Mr Thein Sein had launched radical reforms and was rapidly opening up a harsh and hermetic society under economically ruinous military management. Since then, he has driven reforms encompassing everything from labor unions and pensions to land use and crucial economic changes.

However, he stresses, “the system has changed”. “There was an understanding that things could not go on the way they were, there was a need for this change – and the legacy of General Than Shwe was to establish this system – now we are in this new era where this government and I are trying to lead things forward.”

While dismissive of suggestions that military hardliners are exercising undue influence or even striving to sabotage the reform process, he hinted that a forthcoming ministerial reshuffle will target figures resistant to change.

“There are some in the cabinet who may be slower or who may not be performing as well in terms of trying to realize the objectives the government has set out,” he said. “It is because of that that there may need to be changes.”

The administration’s announcement opens up Burma’s oil-and-gas sector to investment by U.S. firms, despite pleas by opposition leader Suu Kyi that foreign companies and governments refrain from working with the state-owned Myanmar Oil and Gas Enterprise.

New investments should be deferred until the M.O.G.E. , which operates without transparency or accountability, meets labor standards set by the International Monetary Fund, she said last month.

“We need to be very cautious in engaging with this business sector because there are many unacceptable business partners in Burma,” says Wong Aung of the Shwe Gas Movement.

“Many businesses are still controlled by the Burmese military and [its] cronies, and have been for a decade, so it is difficult not to engage with them,” she says. “We need to pass legislative framework to ensure that they are transparent and accountable and that local people can be protected. [Until then] I do not think the US government can ensure that there are accountable and transparent businesses in [Thein Sein's] administration.”

“By allowing deals with Burma’s state-owned oil company, the U.S. looks like it caved to industry pressure and undercut Aung San Suu Kyi and others in Burma who are promoting government accountability,” said Arvind Ganesan, the business and human rights director at Human Rights Watch.

Pro-democracy activists believe that in the absence of transparency, accountability and corporate governance reform, Burma’s democratic transition may fall victim to the “resource curse.”

“It is no coincidence that around the world, growth strategies based on extractive industries tend to reinforce the concentration of wealth and power and do little to advance general economic well-being — unless the country in question has a strong system of checks and balances and the rule of law,” notes Freedom House analysts Rhonda Mays and Robert Herman. “Despite the recent steps toward reform, Burma still has neither.”

Irrawaddy and several Kachin rights groups are supported by the National Endowment for Democracy, the Washington-based democracy assistance group. The Solidarity Center is one of the NED’s four core institutes.

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