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29 February 2000
No. 101

In this issue:
    Post-Crisis Agenda for Korea and Global Civil Society
  2. NEWS in Brief
    Korea - Korean Workers to support Australian BHP workers
    Hong Kong - North Korea to open consulate in Hong Kong
    Thiland - ABSDF Forced to Close Thai Offices
    Philippines -  Manila Hotel Employees on Strike!
    Burma - Message from U Aung Shwe, Chairman of the NLD.
  3. Urgent APPEALS
    INDIA: Social Reformist Asghar Ali Engineer attacked
    Religion and Culture in Asia Pacific: Violence or Healing?


1. FEATURE - top

Post-Crisis Agenda for Korea and Global Civil Society

by LEE Chan Keun
Professor, University of Inchon
Director General, Tegu Round Korea Committee


I must deliver my deepest thanks first of all to CCA, WCC and WARC for giving me a chance to present some of my ideas related with the latest currency and financial crises in East Asia. As we all know well, international debate has been going on quite intensively regarding the causes and remedies of the crises. Three main lines of argument have been put forth. First, the "internal limitations view" highlights the fundamental weaknesses of the national development model of East Asian economies as the cause of the crises. Second, the "external conditions view" points to massive, unpredictable movements of international speculative capital as the cause of repeated currency crises throughout the world, beginning in the 1980s. Third, the "anti-IMF view" stresses the overly harsh reaction of the International Monetary Fund as serving to exacerbate the situation, when a different approach might have resolved the problem in a relatively short period of time. Instead of reviewing the spectrum of views analytically, in this short presentation, I will try to derive several important implications of the crisis to East Asian economies with specific focus on Korea.

1.    Is IMF Program Successful in Korea?

Among the crisis-stricken countries, Korea is more or less regarded by the outside world as the case of the successful recovery. There is no doubt that its macro-economy performed very impressively over the year 1999: foreign exchange reserve reached $74bn; current account surplus recorded more than $20bn; GDP growth rate rebounded up to 10 percent; inflation rate was suppressed below 1 percent; stock market resumed booming rally; sovereign credit rating recovered the above - investment grade, etc.

Then, can we say that IMF has done a great job in Korea by implementing its dogmatic turn-around program? Even with such a broad range of positive signs, I must admit that it's still too early to judge Whether IMF program has been successful in Korea or riot. There are couple of important reasons.

Apparently, the turn-around of Korean Economy over 1999 doesn't seem to be achieved by the fundamental improvement of its competitiveness. Transient favorable external conditions emerged to the benefit of Korea. For example, foreign exchange rates realignment, that is, Japanese yen deeply strengthened while Korean won steeply depreciated relative to US dollar, is helping Korean products to regain price competitiveness. Arid Korea's staple export item, semiconductor, of which the price fluctuation is very severe, is currently enjoying the booming cycle in the international market. At the same time, it is highly likely that the current rebound of Korean economy took place partly as a natural adjustment from the drastic plunge of 1998.

More importantly, there exists indication that Korea comes to have triple structural diseases that will definitely take long to he cured: they are snowballing debt burden: rampant government deficit: and significant subordination of Korean industry to foreign capital. Let's see the structure of each disease.

According to the official statistics, Korea's total foreign debt amounts to almost $I5Obn. It is not insignificant. However, it does not include the important part of Korea' external debt burden. For example, Daewoo Group which recently announced near-bankruptcy at the peak of globalization has built up around 600 overseas business entities over the past 20 years and all of those overseas entities are as highly leveraged as their domestic mother companies. But their debt burdens are excluded in the compilation of Korea' s debt burden due to the reason that they are affiliated overseas in accordance with the law of the host country. Will the mother company not be claimed by the borrowers in case the overseas affiliate does not be able to service its debt? If not, we must admit that Korea's total external debt burdens are seriously underestimated.

Then how big is the Korea's external debt burden? We don't know exactly. Since Korean companies and financial institutions are not required to report the magnitude of their debt incurred overseas for overseas operations to the monetary authorities, we don't have the all-inclusive figure at hand. Let's assume as an exercise that so-called local financing is around $100 bn. Then, Korea's total debt burden will amount to $250 bn. With average annual interest rate of 10 percent, total annual interest payment will be $25 bn. Will Korea be able to serve annual interest payment safely with its trade surplus? Wouldn't such a high level of trade surplus engender backlashes from deficit countries? In this respect, we cannot rule out the possibility that Korea will be required to draw additional foreign debt only to serve its interest payment. As a result, snow-balling of external debt burden will follow.

The same story applies to the Korea's budget deficit. In order to implement IMF-dictated corporate and financial restructuring, massive amount of government money is pulled out, automatically ending up with rampant government deficits. If the size of inevitable deficit is Won 200 trillion with the annual interest rate of 10 percent, Korean government will need to spend roughly 25 percent of its annual budget only to serve its interest charges. Will it he sustainable?

What kind of solution alternatives are open to Korea to resolve the severity of the debt problems? There are not many. Korean government sees it unavoidable to sell off as much as possible Korean companies and financial institutions to foreign capital. Don't we need to he concerned about the subordination of Korean economy to foreign capital. Of course, in this age of globalization, Korea cannot prevent foreign capital from acquiring its local companies. If Korea is allowed to acquire US companies freely, it must open its M&A market to US capital. But does it imply that Korea doesn't need to be concerned about the fire sale of its strategically important companies? Let's take an example of Daewoo Motor Company. What will happen to Korea if it is sold out to General Motors? Will GM regard Daewoo Motor's Buchon factory as importantly as its Detroit factory? When it faces the restructuring pressures from the market, what will happen to Buchon factory's over 15 thousand employees and those of numerous parts & components sub-contractors?

2.    Why Should IMF he Criticized?

IMF needs to he penalized for their own mistakes, a lot of mistakes and for a number of reasons.

First, IMF revealed lack of impartiality in its handling the crisis. Basically Korean financial crisis took place because private hankers mostly from the developed countries stopped rolling over their short-term credits to Korea. But the debtors in Korea were neither Korean government nor ordinary Korean citizens hut were the Korean business conglomerates and financial institutions. So its was not a public default as was the case in Latin American crisis, but a genuine private-private deal, But IMF, immediately after getting involved in Korean situation, stressed that the government had to make a public dollar funding to rescue Korean private sector, "You, the government, must repay or make a guarantee of repayment of private debts". At the same time the creditor banks heightened interest rates from 6% to over 18%, with the reasoning that Korea's country risk had been aggravated so much that interest penalties or risk premiums had to be added upon. As a result, creditor banks made incredibly high profits out of Korea's crisis. They did not lose any single penny on their loan principals and at the same time earned triple high interest earnings. Isn't it an extremity of moral hazard on the part of creditors?

Second, IMF encroached upon the realm of national sovereignty by applying the drastic restructuring program to Korea beyond its own mandate. In the Articles of Agreement of the IMF, it has the authority of policy recommendation only in the area of macroeconomic management. For example, it can ask for the change in monetary and fiscal policies. They have the right to say "You guys need to reduce money supply and fiscal deficits." But IMF does not have any mandate to demand the total restructuring of the socio-econornic system of the crisis country. In the letter of intent agreed upon by the Korean government, however, IMF specified the necessity to increase the flexibility of labour market, to restructure conglomerates and financial institutions, and to liberalize the whole economy. At this point we must raise the Question, "why do we need to have a nation state if the IMF take care of everything in the field of sovereign responsibility?

Third, IMF stick to its orthodox stringent monetary policy with the reasoning that high interest rate was the only way to stem from the continued withdrawal of foreign capital. At the launch of the program, IMF' predicted that the Korean economic growth rate for the year 1998 would be at least 2 percent, hut around the end of the year, it fell to minus 6 percent. This is absolutely a total disaster of IMF policy. Why did IMF stick to such a dangerous policy even though Korea was more vulnerable to wide-spread economic recession than the Latin American countries if the interest rate was heightened since Korean companies are far more financially leveraged? Of course, IMF economists are not stupid. They must know well that any economics textbook recommends the expansionary monetary policy to fight against the liquidity crisis. Then, why did IMF economists go against the textbook remedy? In retrospect, they must have been worried vet-v much about the short-term speculative nature of capital and waged to set the priority to retain foreign capital ahead of the economic recovery. At this point, we can suspect that the implicit assumption behind the high interest rate policy is based on the Vagaries of the speculative capital movement. Then, why is IMF not seriously considering the measures to contain or relax the volatility of short-term capital movement? Since we have kept observing over the past two years that IMF hesitates to introduce remedying counter-measures, we must doubt the intellectual honesty and fairness of the IMF economists.

Fourth, IMF revealed that it is not capable enough both to prevent and to manage crisis. In the annual report of the IMF which was published in August 1997, that is roughly three months before the occurrence of the Korean financial crisis, IMF praised a lot the Korea's macro economic management. So it means that IMF, such an important international institution, does not have a capability to predict financial crisis at all. More surprisingly, the IMF mission team first came to Korea early December 1997 and the team was composed of only seven specialists. They stayed only a week and then announced a comprehensive restructuring program. Can you imagine how such a small number of economists propose the total disintegration of the existing economic system in seven days? After the announcement of the IMF Proposal, foreign capital made a flight out of Korea even more seriously.

3.    Meaning of IMF Crisis to Korea and Asia

On the eve of the 21st Century East Asia has become a hostage to Western capital. Korean people, especially the opinion leaders, are so much indoctrinated by American values that they seem to have almost discarded Korea's own economic development model as well as the country's existing socio-economic systems.

The Koreas' submissive stance was fully revealed when the 1997 financial crisis began to unfold. Groundless speculation in international capital markets was a critical factor in exacerbating Korea's foreign exchange crisis, yet Koreans tend to accept all of the blame for the crisis, pointing to the internal weaknesses of the Korean system as the prime cause.

Koreans do not realize the fundamental change of surrounding conditions. During the early phase of its successful drive toward industrialization. Korean products were freely allowed to enter the US market given the strategic importance of Korea for the United States. However, the United States started to treat Korea differently since the end of the Cold War. It urged Korea to liberalize financial market, to deregulate exchange controls, to allow free flow of capital, to disband Chaebols, to privatize government-owned companies, etc. As a matter of fact, the IMF program is exactly the bundling of all US complaints against Korea sprouting after the end of the Cold War.

Then one has to wonder whether Korea will have a promising future if it completes the IMF-dictated reforms literally. Recognizing the dynamic potential of the Korean economy and the need for a preemptive control, the Western capital is trying to capitalize the crisis situation by attempting an assault aimed at depriving Korean corporations of the opportunity to earn substantial profits through economies of scale and brand recognition.

So, what does the Korean economy need to do in the face of such arrogant neoliheral doctrine, which is in fact to further the interests of Western capital? The propaganda that all industries and corporations regardless of nationality should be welcome to Korea in order to boost production, create employment, and increase tax revenue is somewhat misguided. It will effectively force Korean industries to succumb to Western capital and related interests.

History tells us the ironic lesson. Even the United States, the self-proclaimed free market leader, was a protectionist country for a long time. Indeed, until the early part of the 20th century, it applied various protectionist measures such as high tariffs, countervailing duties and anti-dumping duties especially against imports from Britain to help its fledgling industries to survive. It even refused to sign the Bern Convention and did not hesitate to infringe on British copyrights.

Given this background the critical stance of the globalization should not be regarded as old-fashioned protectionists. No one today would dare argue that local industries can be developed competitively based on a closed domestic economic environment. However, if advocates of globalization push too far, their arguments should be met with resolute counter arguments.
As the term "globalization trap" literally signifies, globalization brings with it many hidden pitfalls, in particular those related to multinational corporations and globalized capital Multinational corporations naturally seek hegemony in the world market. Indeed, no sooner had Korea shown its weaknesses than these companies demanded, under IMF pretenses, that Korea remove every harrier to doing business in Korea.

On the other hand, globalized capital often wages a "confidence game" in which international financial speculators seek to take advantage of minor misalignment in a country's foreign exchange rate. Once a speculative attack is unleashed, countries must gain the confidence and trust of international investors by adopting so-called anglo-american standards or Washington consensus in their economic management.

To be sure, direct confrontation with the United States is out of the Question. The power and influence of the United States must be duly acknowledged, while Washington's role of promoting global norms and standards should he accommodated. Small Asian countries do not seem to have either the right or the power to formulate international rules, though they seem obliged to adhere to them. Nonetheless, it is a serious mistake for the Asian people to indulge in sugarcoating the reality of globalization, which is not necessarily for everyone's benefit. Instead, Asia should ensure room for its own leeway in order to improve the region's competitiveness, enhance quality of life and brighten future prospects. In short, globalization can only be adopted with critical scrutiny it must not be pursued with blind, total acceptance.

4.    Taegu Round

Facing the currency and financial crises starting from 1997, Korean people have inclined to seek its causes and remedies only in terms of shortcomings of the domestic economic systems of the individual countries, and thereby, to overlook problems inherent in the current international financial order. Of course, such an approach is partial and dangerously biased indeed. Therefore, civil activists, religious groups, trade unions, etc., formed Taegu Round Korea Committee June 1999 to address the issue of reforming the existing international financial order. Taegu Round Korea Committee understands that the current international financial order has the following problems.

Along with the rapid liberalization of financial markets and unfettered movement of international capital, tremendously large amounts of financial capital accumulated in advanced countries have transformed into international speculative money and have aggravated the volatility of the exchange and interest rates worldwide. As an unavoidable result of the disturbing movement of the international speculative money, many countries are now suffering from deep economic recession, high unemployment, and social disintegration while the governments concerned are left with few policy tools to cope with them. While the burden of foreign debts in developing and poor countries is getting heavier deepening the disparity between rich and poor countries, the IMF has not been playing the role of an impartial mediator, facilitating rather speculative transactions of international capital markets -- that is, helping creditors paid back, all the principal and interest, no matter how much they have contributed, through their speculations, to the destabilization of the economy concerned. As a result, the economic base of civil societies, in Korea and in the world as a whole. have started to collapse.

For a proper solution of such problems caused by the international speculative capital flows and growing foreign debts of developing and poor countries, an all-out change in our thinking paradigm is urgently called for. It is important, of course, for debtor countries to reform their economic systems so that they can be kept from incurring moral hazard. It is equally important, however, for the G-7, the IMF, and creditor countries to overcome the moral hazard by rectifying the existing one-way international financial order. Globalization implies there is no longer separate existence of the inside and the outside, the precarious situation of the outside inevitably affecting the inside. Therefore is required a simultaneous reform of the inside arid the outside together.

The Taegu Round Korea Committee, believe both creditor and debtor countries should sit together at a new Round to discuss on reforming the current international financial order. This new Round must represent both parties equally, based on a 'two-way' principle aimed at creating a sound international debt order as well as a sound international capital order. There is no doubt that the final agreement should be reached at a government-level Round. But to urge on the creation of such a government-level Round, and to complement it once it comes into being, we hereby propose to inaugurate a Pan-Civil Round on world level in advance.

The Taegu Round Korea Committee calls for the citizens of the world to understand that they are the firsthand victims of international financial turmoil and that they are the one who should take the initiative to establish a democratic control system on the globalized financial market. They should convince themselves they have the ability to do this.

Taegu Round Korea Committee held a Global Forum from Oct. 6th to 8th, 1999 by inviting one hundred progressive people from more than twenty countries and arrived at the following resolution.

- We demand that all global economic institutions, particularly the 17V[F, World Bank and WTO, be held accountable to internationally agreed human rights standards in conformity with their member governments' UN treaty obligations.

- We declare our support for the Jubilee 2000 Campaign and related activities such as the November 1999 Johannesburg South-South meeting and the July 2000 Okinawa initiative, with their goal of Third World debt cancellation, and promise to put organizational resources behind this enterprise.

- We urge the immediate adoption of global, regional, and national controls on short-term speculative capital in order to reduce its destabilizing impact on our economies.

- We demand that the IMF be brought to account for the destructive impact of its programs on the social and economic rights of the Korean people and the peoples around the world.

- We support the Korean Federation of Bank and Financial Labor Unions in their effort to take legal action against the IMF for activities injurious to the welfare of the Korean people.

- We support a moratorium on the Millennium Round of the WTO pending a full evaluation of the impacts of trade liberalization policies on people and the environment.

- We support the creation of an Asian Social & Economic Institute that with the full participation of civil society would study and try to solve issues of regional trade, investment, short-term capital controls, and foreign debt management with a view to formulating concrete action to promote sustainable regional development.

- To meet the above goals, we support the creation of the Taegu Round Global Network for Social and Economic Justice, which will bring together Korean and Global NGOs in a common endeavor.

* [The above article was a summary of the presentation made at a recent CCA-Development & Service Consultation held in Bangkok, Thailand. Please write to us if you want the unabridged version of the presentaion.]


2. NEWS in Brief - top


Korean Workers Solidarity support Australian BHP workers fighting for their rights.

The Sammi Specialty Steel Workers (President KIM, Hyun-Jun) brought up an issue of Australian Workers struggle to secure their rights, collective bargaining and freedom of association.

On the 17th of February, at 14:00, around 100 protesters including Sammi Specialty Steel Workers, Korean Confederation of Trade Unions (KCTU), Korean Metal Workers Federation (KMWF), Korea Federation of Construction Trade Unions (FKCTU) and human rights organizations will protest against the Australian government's failure to effectively support and promote the freedom of association and collective bargaining as enshrined in the ILO conventions No. 87 and 98.

The protesters will gather near by the building of Australian Embassy to protest against Australian government s failure in supporting and promoting the freedom of association and collective bargaining and also against the BHP employers who ignore the union representation and try to introduce individual contract.

The Sammi workers are also fighting against the POSCO, the largest Steel company in Korea, since the POSCO employers failed in abiding by the workers freedom of association, and the Korean government showed no intention to settle the case. The Sammi workers have been fighting against POSCO's illegal dismissal with the POSCO's anti-union policy ever since they were unfairly dismissed in 1997.

The KMWF has been informed by the International Metalworkers Federation (IMF) that in 1996, the Australian government passed a law which allowed employers to take advantage of the anti-union legislation introduced by the right-wing Conservative government, and the BHP, the largest multi national company in Australia, refused to negotiate new terms and conditions of employment through the process of collective bargaining.

The main demands of the protest by the Korean workers are:
- The BHP should withdraw their trail of individual contract.
- The Australian government should abide by the ILO conventions No 87 & 98: freedom of association and collective bargaining.
- Recognize the rights to union membership and effective union representation
- Equal pay and benefits between staff contractors and collective agreement workers.

Currently, the Sammi workers are campaigning for their reinstatement along
side with the international solidarity protest to support Australian workers struggle. They will start their struggle tour nationwide in the early March to raise public awareness on the anti-union POSCO, and their reinstatement. To support their campaign, the KCTU and KMWF printed 5000 protest postcards and distributed them to unions worldwide. Metal unions and colleges from around 12 countries, showed their solidarity and support the campaign.


North Korea to open consulate in Hong Kong

HONG KONG, Feb 15 (AFP) - North Korea is to officially open a consulate in Hong Kong on Wednesday, a government spokeswoman said Tuesday.

"We have been informed that the Democratic People's Republic of Korea will open its consulate general in Hong Kong tomorrow," the spokeswoman said.

The consulate will be located in the waterfront business centre of Wanchai on Hong Kong island, not very far from the South Korean mission which has its office in the adjoining banking district of Central.

A spokesman for the commission of Chinese foreign ministry in Hong Kong, said "China has in principle approved" the proposal by North Korea to set up a consulate in the former British colony.

Hong Kong will be one of a few places where consulate generals from both sides of the divided Korean peninsula will be stationed at the same time.

A North Korean delegation visited Hong Kong a year ago to find a site for its consulate and China has reportedly granted permission for seven diplomats to be stationed here.

Hong Kong, which reverted to Chinese rule in 1997, has been a key base for companies from capitalist countries, including South Korea, wanting to invest in North Korea -- particularly in a struggling free economic and trade zone on its northeastern frontier.

Beijing has been a long-time ideological ally of Stalinist North Korea but, in a delicate balancing act, has also sought to improve its ties with the more affluent South.

North and South Korea fought a bitter war from 1950-1953 which ended in a fragile armistice, which has never been translated into a full peace treaty.


ABSDF Forced to Close Thai Offices


BANGKOK, Thailand (AP) - The main political group for exiled students opposed to Myanmar's military regime said Thursday it had closed all its offices in Thailand under pressure from Thai authorities.

The closure could be a crippling blow to the All-Burma Students Democratic Front, which has been under heavy Thai pressure since Myanmar rebels crossed the border last month and took hundreds of hostages at a Thai provincial hospital.

The siege ended with Thai commandos killing all 10 rebels, who included members of the radical Vigorous Burmese Student Warriors and God's Army, a fringe ethnic Karen group led by twin 12-year-old boys.

Though the front has disavowed the actions, Thailand, for years tolerant of Myanmar dissidents, has made clear it does not want the mainstream group to maintain a presence there.

Authorities have tightened security at the border with Myanmar, also known as Burma, where around 700 members stay.

"If our offices cannot open here anymore, we shall go back into the jungle of Burma," said Kyaw Kyaw, a central executive committee member.

On Wednesday, Thai police raided two of the group's offices in Mae Sariang district in northern Mae Hong Son province, 400 miles north of Bangkok. Three students were sent to a refugee camp along the border.

A third office in the district was immediately closed by the front itself, a member told The Associated Press on condition of anonymity.

A Thai official in Mae Sariang, speaking on customary condition of anonymity, confirmed the closures, saying it was Interior Ministry policy to "keep all refugees in a camp."

The front says its other offices have already shut.

The front was formed by students who fled the Myanmar military's bloody crackdown on a mass uprising for democracy in 1988.


 Manila Hotel Employees on Strike!

February 10,2000. Workers of Manila Hotel gone to the strike against the management's exploitative tactics and efforts of crush union. Workers in manila were forced to go to on strike by the management's callous indifference to workers plight. The management has also long begun its mission to harass and repressed not only union members, but also the entire hotel workforce.
Negotiations for union collective barganining agreement with the management headed by the Arnulfo Acedera (former AFP Chief of Staff) and Emilio Yap has been dragging for more than four months now, there have been no positive developments. The provisions in the present CBA (which has been in effect for 3 years now and still effective for one more year) have been railroaded and flagrantly violated. There are 820 workers in the union, and the management wants each one workers to back down from fighting for a just CBA. Twenty -four regular employees were terminated on shallow charges. Two union officers were arbitrality terminated on the mere suspicion of writing on anonymous grievance letter. What's more the management wants to impose a moratorium on the CBA renewal negotiations. The vacancies left by workers who were laid off were never filled, thus making the workload of the remaining employees greater. Management also initiated harassment tactics against union members, even filing a libel case against four union officers Jose Pepito Sales, Danilo Penaranda, Clodualdo Roxas and Ferdie Barles. The department of Labour and Employment (DOLE) has also conspired with the management by handing down an assumption of juricdiction order (AJ) on the same day that CBA negotiations failed, which was November 24, 1999.
As far the new CBA, the demands which workers are pushing is reasonable. Demands are given below:
Salary increase of P 2,000 and another P 2,500 for the year 2000. The year-end and mid-year bonuses are merely 1.75% of the basic salary for this year and 2% of that we expect to get in year 2001.
Management wants us to believe that the hotel is incurring losses. Whom do they think they are fooling? Just this week, 95% of all the hotel rooms are occupied. Service charges alone amount to P 4.1 million and over-all monthly profits are a whopping P41 million!
We should also like to air out righteous anger against certain key people in the management. Emilio Yap and his coterie of congressmen and generals the like of Gen.Arnulfo Acedera, Gen Edgar de la Torre, and Congressman Martin Isidro run the hotel like the profit-hungry capitalists that they are virulently anti-union, and anti-worker. What they have successfully done to the Manila Bulletin Union, they want to replicate at the Manila Hotel-bust the union, retrench the workers and keep the remaining workers on slave wages and working under exploitative conditions.
The workers in Manila Hotel are seeking your support in exposing their plight! Kindly support their strike because this fight is also the fight of all Filipino workers!
Send solidarity messages to:
Manila Hotel Employees Association
C/o KMU National Office
37-A Quinto's Compound, Tomas Morato Avenue
Quezon City, Philippines
Telefax: 00-63-2-7256781

Protest letters to:
Former AFP Chief of Staff Arnulfo Acedera
The Manila Hotel
One Rizal Park, Manila 1099
Telephone: 00-63-2-527-0011
Telefax: 00-63-2-527-0022-24

Mr. Emilio Yap
Chairman of the Board
The Manila Hotel
One Rizal Park, Manila 1099
Telephone: 00-63-2-527-0011
Telefax: 00-63-2-527-0022-24


 Message from U Aung Shwe, Chairman of the NLD.

Wishing you all happiness and good health. The 12th of February 2000 is Union Day in our country, Burma. I would like to explain how Union Day began in Burma's history.

Our national hero General Aung San and the ethnic nationality leaders from frontier areas signed the Panlong Agreement on 12 February 1947 in Panlong, Southern Shan State. The purpose of the Panlong Agreement was to reunite the ethnic nationalities in an attempt to gain independence. It was intended to build a federal union when the country gained independence.

The Agreement also established the Panglong spirit or the union spirit. However, the spirit has disappeared in recent days because no genuine federal union emerged. The ethnic nationalities do not trust each other and hatred and hostilities have grown among them. This also is due to the fact that the Burmese Socialist Programme Party (BSPP), dominated by members of the military, drafted and promulgated a unitary system constitution which installed a dictatorial regime rather than establish the federal union that was demanded by the people of Burma. As a result, the federal spirit has been destroyed.

It is very important for all our ethnic nationalities, such as Kachin, Kayah, Karen, Chin, Burman, Mon, Rakhaing, and Shan, to re-enforce the spirit of unity that existed when the Panlong Agreement was signed in order to prevent the country's disintegration. The NLD strongly requests and urges all the ethnic nationalities of Burma to rebuild the Panlong spirit or solidarity of ethnic nationalities by joining hand in hand, with courage, firm efforts and objectives, and genuine patriotic spirit. Moreover we believe that in order to achieve unity among the ethnic nationalities, it is necessary to draft a constitution in a democratic manner, acceptable to all people including ethnic nationalities.


3. Urgent APPEAL - top

INDIA: Social Reformist Asghar Ali Engineer attacked

Social Reformermist Dr.Asghar Ali Engineer was attacked by a fundamentalist group headed by Syedna Mohammed Burdanuddin, head of the Bohra community, at the Santacruz airport yesterday. Ali Engineer who was hit in the head and the face, has been admitted to hospital, where he is recovering now.

His residence and office at Santa cruz have also been ransacked by a group of anti-social elements who were the supporters of this fundamentalist group. This is the fifth of such attack on Asghar Ali Engineer.

This incident happened while on his way back from a workshop at Bhopal organised by Director General of Police, Madhya Pradesh on Communal Harmony.


Ali's organisations, Bohra reformist movement, struggles against communal forces in the country. Engineer has been attacked four times before: Calcutta in 1977, Hyderabad 1977 and 1981 and even in Egypt 1983.

Dr. Engineer struggles to liberate his community, the Dawoodi Bohras, a small Islamic sect, whose members are generally engaged in trade and commerce and mostly found in Gujarat and Maharashtra, from the medieval and brutal stranglehold of its priesthood.

The Bohris community controlled by a rigid system that has been documented in detail by two citizens' reports, headed by Justice Nathwani (1978) and the Justice Tewatia and Kuldip Nayar report of 1993. The Priests do not tolerate any dissent or discussion is evident in the attacks on the Bohra reformist movement for over two decades. The powerful Bohra priests have almost total control over the lives of their community.


The Bohra reform movement advocates for the democratization of the community management (Jamaat) and accountability of the funds collected from the community.

The reform movement is requesting the government to ban the priest from using "social boycott" to silence any democratic opposition from within the community and also to stop the heavy taxes payments make by the community to the priest.

The Reform movement is also demanding that the priest should not have any control over the secular affairs of the members of the community. The people must have the right to exercise their franchise according to their conscience and not according to his dictates. They should have the freedom to read the literature and magazines of their choice.

RECOMMENDED ACTION: We urge you to send faxes and letters to the authorities with following demands:

  • - those who physically assaulted him should be arrested, investigated and punished according to the law

  • - the priest responsible for the atttack must be investigate and proper action taken accoerding to the law

  • - full compensation for property damage and loss be paid to Dr. Engineer and his organisation


Shri R.K. Narayanan
President of India
Office of the President
Rashtrapati Bhavan
New Delhi 110 004, India
Telegrams: President, New Delhi, India
Faxes: + 91 11 301 7290

Mr L.K. Advani
Minister of Home Affairs
Ministry of Home Affairs
North Block
New Delhi 110 001
Faxes: + 91 11 301 5750

Chief Minister Shri Vilasrao Deshmukh
Chief Minster of Maharashtra
Office of the Chief Minister
Mumbai 400 032


Justice A.S. Anand
Chief Justice of the Supreme Court
Supreme Court of India
Tilak Marg
New Delhi 110 001, India

and diplomatic representatives of India accredited to your country.




Religion and Culture in Asia Pacific: Violence or Healing?

Theme: Religion and Culture in Asia Pacific: Violence or Healing?
Venue: RMIT University, Melbourne, Australia
Date: 22-25 October 2000

This international conference will be a unique gathering of people drawn from different faiths and cultural backgrounds. The main focus will be on how religious and ethical traditions in Asia Pacific are coping with conflict in the region. Keynote speakers in this conference include Xanana Gusmao, Chandra Muzaffar and Meenakshi Gopinath.

For more information on this conference contact Pax Christi at:
P.O. Box 31, Carlton South, Vic 3053, Australia.
Fax: 61-3-9379 1711



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