Clinton talks with reformist Myanmar president

July 13, 2012 - 3:44 PM
Cambodia US Clinton

U.S. Secretary of State Hillary Rodham Clinton, left, greets U.S. Embassy staff at the Le Royal hotel in Phnom Penh, Cambodia Friday, July 13, 2012. (AP Photo/Brendan Smialowski, Pool)

SIEM REAP, Cambodia (AP) — Secretary of State Hillary Rodham Clinton declared Myanmar open to American investment Friday, introducing the reformist president to leaders of some of the U.S.'s biggest corporations and still prodding him to do more to expand democracy in his long-reclusive country.

Following the Obama administration's recent loosening of sanctions against Myanmar, Clinton met President Thein Sein for an hour in the Cambodian city of Siem Reap, praising him for several pro-democracy reforms while suggesting more could still be done.

Clinton and Thein Sein shared a warm greeting in a hotel courtyard, their national flags and tropical foliage behind them. The two seemed much more personally engaged than when they met last year, when Clinton became the first U.S. secretary of state in half-a-century to visit Myanmar. The city hosts the famous centuries-old temples of Angkor, recalling an earlier age of regional glory.

"I brought a very prestigious business delegation to see you. I wanted them all to hear from you tonight about your plans for the future," Clinton told Thein Sein, and she also asked after his family.

They then met the largest delegation of American businesses to Southeast Asia, including Coca Cola, Ford Motor Co.,, General Electric, General Motors, Goldman Sachs and Google.

Clinton called this week a "milestone" in U.S.-Myanmar relations as the Obama administration lifted restrictions on U.S. investments in the country. She said U.S. officials were taking 70 company representatives to Myanmar this weekend to speak with officials and explore opportunities.

"We're excited by what lies ahead and we're very supportive of President Thein Sein's economic and political reforms," she said.

The high-profile meetings reflected the sharp progress the country, also known as Burma, has made after years in the international wilderness.

Western economic and political sanctions had been imposed on Myanmar's previous military regime for its repressive and undemocratic policies. Thein Sein, who took power last year after a general election, has instituted liberalizing reforms in an effort to ease the sanctions and attract foreign aid and investment.

Thein Sein's government has enlisted Nobel laureate Aung San Suu Kyi in its political reconciliation efforts, welcoming her party into Parliament after more than two decades of hostility that saw her spend 15 years under house arrest and other democracy advocates jailed and harassed.

"We want to help you keep going. We're very committed," Clinton told Thein Sein ahead of their bilateral meeting.

"I am very pleased to see our bilateral relationship improving dramatically... We are pleased that President Obama eased the sanctions," said the Myanmar leader.

In their talk, Thein Sein told Clinton he would manage his country's expected new wealth responsibly, sharing it among its people, said a U.S. official who was present at their meeting who spoke on condition of anonymity because of its private nature.

According to the official, the Myanmar leader also said his country not only sought to benefit from extractive industries such as gas and minerals, but also sought help in increasing value-added industrial production.

Although the spotlight was on business, Clinton also pressed Thein Sein on human rights issues, said the official, specifically raising the fate of a Muslim ethnic group in western Myanmar.

The Rohingyas have been the target of discrimination, and tensions with Rakhine Buddhists last month exploded into violence that left at least 78 people dead and tens of thousands homeless.

Clinton stressed that the U.S. considers the Rohingya "internally displaced persons." Thein Sein this past week had proposed that the U.N. High Commissioner for Refugees resettle the Rohingya in a third country or take responsibility for them, a suggestion rejected by the United Nations as unsuitable.

Thein Sein's response to Clinton on the issue was to describe the situation as "very dangerous," said the official.

Clinton also expressed concern about several U.N. workers detained in connection with last month's unrest, political prisoners still being held despite several amnesties, and Myanmar's military cooperation with North Korea.

Thein Sein responded that Myanmar had no nuclear military ties with Pyongyang — an issue that has been the subject of much speculation under the previous military regime — and was reviewing the rest of its relationship in this respect.

Myanmar represents a similar sort of "frontier investing" climate for Americans that Vietnam did in the 1990s after the U.S. lifted its trade embargo. As Vietnam did, Myanmar is also transitioning to a free-market economic system.

But its peculiar history of isolation means it will be starting from a much smaller base. An idiosyncratic socialist regime barred most foreign investment from 1962-1989, and then Western sanctions against the repressive military regime limited its growth. A complicated dual-exchange rate system, changed only this year, also discouraged repatriation of profits.

Virtually every sector in Myanmar is underdeveloped, but several stand out for investors. Tourism is expected to boom, with a shortage of hotel rooms at all levels. The country already has large foreign investments in oil and gas exploration and production, but there remains room for growth.

The government has already vowed to seek foreign help in expanding the country's power supply, which is in such a sorry state that black-outs and limited service are common and have inspired public protests. Mining is another strong and underexploited sector, with Myanmar's gemstone reserves still considered among the world's best. The low-cost economy also makes Myanmar attractive for industrial production of garments and footwear, although it faces regional competition from Bangladesh, China, Cambodia and Vietnam.

The business gathering is the final scheduled event of Clinton's weeklong tour of Asia, before she heads to Egypt and Israel.

After stops in Japan and Mongolia, she looked for new investments and human rights advances in Vietnam, Laos and Cambodia - countries in China's backyard whose relations with the U.S. have warmed in recent years despite the difficult legacy of the Vietnam War.

The evolution reflects the wide fear among Southeast Asian countries of being swallowed up as China's military and economic might expands.

The Obama administration is hoping to coax Asian governments away from Beijing as it pivots U.S. power toward the Pacific.

The goal is to expand the American foothold in a part of the world that is increasingly becoming the center of the global economy, but where democracy and human rights lag. Containing China's burgeoning power is another objective.

Earlier Friday, Clinton announced that the United States will provide Vietnam, Laos, Cambodia, Thailand and Myanmar with $50 million over three years to assist them with health, education and environment programs.