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US closes loopholes in sanctions

Published by MAC on 2007-12-12

US closes loopholes in sanctions

12th December 2007

by Mizzima News

United States sanctions on the economic interests of Burma's generals and companies conducting business in Burma are one step closer to being further strengthened, following the House of Representatives unanimous vote in favor of the JADE Act.

The Block Burmese JADE (Junta's Anti-Democratic Efforts) Act, while focusing its attention on the trade of gemstones originating from Burma, looks to close significant holes existing in current sanctions policy.

"Millions of dollars in gemstones that are exported from Burma ultimately enter the United States but the Burmese regime attempts to conceal the origin of the gemstones in an effort to evade the sanctions in the Burmese Freedom and Democracy Act of 2003," according to the legislation.

"Burma's generals fund this repression of their own people by selling off the country's natural resources, especially oil and gems, leaving the Burmese people in poverty," said Democratic Representative Tom Lantos, sponsor of the bill and Chairman of the House Committee on Foreign Relations.

If passed, the bill will ban the import of all gems originating from Burma.

In justification of the need for this bill, the House Committee on Foreign Relations states that while Burma is known to supply 90 percent of the world's rubies; only three percent of rubies entering the United States are listed as coming from Burma.

Further, 99 percent of a stone's value is said to come from the stone itself, with labor accounting for a mere one percent of the value.

Therefore supporters of the legislation argue that the bill effectively targets economic interests of the Burmese state without significantly impacting the daily livelihood of Burma's citizens.

The Jewelers of America, representing over 11,000 stores nationwide, and several major retailers, have lent their support to the Act.

Another significant aspect of the bill is its targeting of the economic interests of Chevron Corporation, an American company actively engaged in the exploitation of Burma's energy resources.

The JADE Act will terminate tax deductions for Chevron's Burma investments. A move that it is hoped will prompt a domino effect among Chevron and its partners in Burma to desist in operations inside Burma due to rising costs and economic restrictions.

The regime's ability to make use of money laundering activities will also be negatively impacted by passage of the Act, in addition to a further freeze on assets associated with Burma's generals.

"The peaceful protesters of Burma are human rights heroes, and the reprehensible military dictators ruling them deserve to be nothing less than international pariahs for their dismal human rights record," reads a statement from Lantos' office. "I am deeply grateful that my colleagues on both sides of the aisle stood together today, shoulder-to-shoulder with the Burmese people as they struggle for freedom."

Upon final passage of the Act, Congressional annual review and renewal of the Burmese Freedom and Democracy Act of 2003 will no longer be necessary.

It is widely expected that both the Senate and President will offer their full support to the JADE Act, at which time the legislation will go into effect.

House passes bill hitting Myanmar gems, Chevron

Paul Eckert, Asia Correspondent, Reuters

11th December 2007

The U.S. House of Representatives passed a bill on Tuesday blocking imports of Myanmar rubies and removing tax credits for U.S. firms investing in the military-ruled Southeast Asian country.

The Block Burmese JADE (Junta's Anti-Democratic Efforts) Act, drafted after Myanmar's suppression of pro-democracy protests in September, was approved as the junta rejected a U.N. report putting the death toll from that crackdown at 31.

The legislation, sponsored by Democratic Rep. Tom Lantos, bans the import of Myanmar gems into the United States, freezes the assets of the country's leaders and stops the former Burma from using U.S. financial institutions via third countries to launder funds of its leaders or close relatives.

His amendment to U.S. trade sanctions imposed in 2003 also targets the sale in America of rubies routed through China, India and Thailand to circumvent curbs on trade with Myanmar.

The bill, which must be approved by the U.S. Senate and signed into law by President George W. Bush, also would stop the U.S. oil major Chevron Corp from taking tax deductions on its investment in Myanmar's Yadana natural gas field.

"The vile reaction of the Burmese junta to peaceful calls for democracy showed the world the moral bankruptcy of this regime," said Lantos, chairman of the House of Representatives Committee on Foreign Affairs.

"Unfortunately, the thugs in charge are not in a state of economic bankruptcy to match. Today's legislation hits these military dictators where it hurts -- in the pocketbook," he said in a statement after the bill passed unopposed.


Lantos has estimated that Myanmar produces more than 90 percent of the world's rubies and fine-quality jade and that the military junta is projected to make $300 million this year from the gem trade.

California-based Chevron said its stake in the Yadana gas pipe-line made it a "constructive, positive force" that helped support energy needs and economic growth and provided health and social development programs for local communities.

"Chevron shares congressional concerns for a peaceful resolution, however punitive tax measures against one company will not serve the purpose of helping the people of Myanmar and may have unintended consequences," it said in a statement.

Chevron warned that holding back taxes to the Myanmar government could lead it to violate its contract and possibly face a seizure of assets.

Aung Din, director of the U.S. Campaign for Burma, a pro-democracy group, called the legislation a timely rebuke to Myanmar generals as they defy U.N. recommendations for dialogue with opponents, including detained Nobel Peace laureate Aung San Suu Kyi.

"This is the time for the international community to increase pressure against the Burmese military junta," he said.

Myanmar has been under military control since a 1962 coup. The army held elections in 1990, but refused to hand over power after suffering a humiliating defeat at the hands of Suu Kyi's National League for Democracy.

(Additional reporting by Tom Doggett, edited by Richard Meares)

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