Asia Keeps Burmese Industry Humming

RANGOON, Burma -- Hundreds of women leaned over sewing machines amid the soft whir of industry. Row after row they sat, dark eyes intent on work, cheeks smeared with a traditional chalky cosmetic made from tree bark.

Many of their friends lost their jobs at the factory, leaving empty places at the machines after the United States banned imports from Burma in 2003 to protest the actions of the country's repressive military government.

But last month, the workers were stitching a sample batch of women's trousers ordered by a Taiwanese company for sale in Europe. If successful, the Burmese factory owner anticipates a follow-up order of as many as half a million pieces, which would make for a very busy year.

"We've suffered a lot, but it's getting better and better," he said. "There are so many new buyers."

Burmese industry and exports were on the decline in the 1990s as a result of progressive attempts by the United States to tighten economic sanctions on Burma, protesting its suppression of democracy. But the effort to pressure its rulers has been vastly undercut by the enthusiasm of other countries, especially Burma's Asian neighbors, to tap its cheap workforce and abundant natural resources, ranging from precious gems and teak to nickel and natural gas.

Some of the trade is legal, but timber and other products are also smuggled across Burma's remote, unsettled borders. Businessmen say some exports, such as seafood, garments and teak, are relabeled and shipped beyond the region.

The U.S. government first barred investment by Americans and U.S. companies in 1997, objecting to Burma's repression of the National League for Democracy, led by Aung San Suu Kyi, who received the 1991 Nobel Peace Price. Suu Kyi's party won legislative elections in 1990, but the ruling military never allowed it to take office.

Two years ago, Congress extended the sanctions to include the import ban, a prohibition on financial services in Burma and a freeze on the assets of some Burmese financial institutions.

While the NLD has endorsed the U.S. embargo, some of its senior members acknowledged that it has not been very effective. "Exports are continuing to increase," said a senior NLD member, who asked not to be named. "India and China will buy anything we sell. They demand a lot of our raw materials and agricultural materials."

India, for example, now hopes to import natural gas from a huge field discovered two years ago off Burma's west coast. With production still several years off, the Indian government has been negotiating with Bangladesh to build a pipeline to transport Burmese gas. Daewoo International, the South Korean company that is the largest investor in the gas development, reported last week that the site would produce up to 3.56 trillion cubic feet of gas, company officials said.

Two other Burmese fields are already exporting natural gas to neighboring Thailand, and several more are being explored by companies in China, India and Singapore. Official estimates put total gas exports at more than $1 billion a year.

Burma, whose government calls the country Myanmar, also ships agricultural products to India. And with its long coastlines and vast tracts of swamp, Burma is a major exporter of shrimp and other sea-based products. Businessmen said much of those exports are shipped beyond Asia, including to the United States, by way of neighboring Thailand.