PHOTOGRAPH FOR TIME BY JOHN STANMEYER—VII

Burma may be a political pariah, but companies are keen to invest there

Going Nowhere
	By doing business with Burma, Asian countries help its brutal military regime stay in power—while the Burmese people remain trapped in a time warp of poverty, oppression and economic misrule
	By Michael Schuman

Posted Monday, January 23, 2006; 20:00 HKT
Thaung Htun hasn't seen his homeland in 17 years. But the 49-year-old former doctor hasn't abandoned hope that one day democracy will come to Burma and it will be safe for him to return. In 1988, he participated in a student-led uprising against Burma's military regime and then fled to Thailand when the generals crushed the movement. Two years later, the generals purged the National League for Democracy (NLD), led by Nobel Peace Prize winner Aung San Suu Kyi, after it won a landslide victory in the 1990 elections, and Thaung Htun joined other fleeing democrats in a government-in-exile. Today, he remains cloistered among stacks of dusty papers in a one-room office across from the United Nations in New York City, wooing delegates to his cause. He and scores of other exiles and human-rights activists from Bangkok to London have received many a sympathetic ear. Last September, South Africa's Bishop Desmond Tutu and Vaclav Havel, former President of the Czech Republic, issued a call for the U.N. Security Council to press the generals toward political reform, warning that Burma "threatens the peace and stability of the region." U.S. Secretary of State Condoleezza Rice has labeled Burma an "outpost of tyranny," and Washington continues to impose sanctions that ban all imports from Burma and prohibit investment there by American companies. Critics as diverse as British Prime Minister Tony Blair and Hollywood star Susan Sarandon have implored tourists to boycott Burma, echoing Suu Kyi's insistence that any influx of foreign money helps legitimize—and enrich—the generals. The aim is to isolate and squeeze the junta until it cedes power to Suu Kyi or moves toward true democracy. After all his years of exile, Thaung Htun still hasn't given up. "I believe that I can go back to my country in my lifetime," he says. "History is on our side."

But foreigners such as Gong Nengzheng aren't on his side—and that's a key reason why Burma's military regime is still in power. While Thaung Htun tries desperately to keep overseas money out of Burma, Gong, the gung-ho mayor of the Chinese city of Ruili on the border with Burma, is striving to get more mainland money in. The Chinese government has turned the border area near Ruili into a special economic zone to boost trading ties between the two countries. More than $400 million in trade funnels through the Jiegao Border Trade Economic Zone each year. China exports household appliances, chemicals and medicines, and Burma ships back jade, seafood and timber. Jade bracelets and pendants cram glass cases in souvenir shops along the "China-Burma Friendship Street," which straddles the border. Residents on both sides pass between the two countries effortlessly, lugging sacks of clothing and wicker baskets of fruit back and forth to local markets. At one major crossing, marked only by a lone Chinese guard standing under a multicolored umbrella, dozens of army-green trucks file into Burma like a long line of soldier ants. Gong expects trade through Jiegao to triple to $1.2 billion by 2008. He has expanded a bridge over the Ruili River to handle the anticipated rush of rigs, and is constructing a towering ceremonial gate at the border to symbolize China's burgeoning relationship with Burma. Gong quips: "The countries are so close together, Burmese chickens lay their eggs in China."

Gong's enthusiasm for his Burmese neighbors is far from unique in China, which has become the military regime's most important partner. Officially, trade between the two countries more than doubled in five years to $1.1 billion in 2004, according to Chinese government statistics, and China has been a major provider of foreign investment and aid. But China isn't the only Asian country supporting the junta, despite its reputation for brutal repression. Many of Burma's neighbors are happy to do business there, attracted by its rich natural resources. Thailand's imports from Burma jumped 50% in the first 10 months of 2005 to nearly $1.5 billion, according to Thailand's central bank, and India is looking to make major investments there for the first time, particularly in the Burmese energy sector. In fact, no Asian nation has fully supported U.S. sanctions, not even democratic allies like South Korea. As a result, the junta's coffers are more stuffed than ever before. In 1988, Burma boasted only $89 million in hard-currency reserves, but by 2004, it held $685 million, according to the International Monetary Fund. All of this aid, trade and investment has enabled Burma's junta to shrug off 15 years of pressure from the international community aimed at bringing about democratic reform. The generals' "principal concern is to ensure their survival, and they have enough money to do that," says Robert Templer, Asia program director of the International Crisis Group in New York.

Continued...

	Caught in the Middle [Jul. 19, 2005] Hunted by Burma's military junta and unwanted by Thailand, the Shan are fighting for their lives Hunting the Junta [May. 23, 2005] A new report targets Burma's military rulers for crimes against its minority ethnic groups A Purge in Burma [Oct. 25, 2004] By sacking Prime Minister Khin Nyunt, the junta abandons even the pretense of a more liberal future Stone Age [Apr. 22, 2004] The military strongmen who rule Burma have made the country a global byword for backwardness and brutality More Related Items | Search all issues of TIME Magazine