Across the Myanmar border

Protest in Rangoon.

Small public protests have broken out right across Burma's main commercial city, Rangoon, in the wake of last week's sudden increase in fuel prices. There have been regular, sporadic protests marches every day since Sunday, when the former student leaders, known as the 888 Generation -- as they led the pro-democracy demonstrations in the streets nearly twenty years go -- initiated the first protest rally against the petrol price increases.
These protests are very rare in Burma as the military regime keeps tight control. But the numbers joining these marches has grown since more than a hundred people joined the first demonstration demanding that the government immediately lower fuel and food prices.
"The government has raised fuel prices without giving any prior notice, and due to this hike, all the people are suffering. Therefore, we, the 88 generation students, NLD members, university students, high school students and civilians are protesting and demanding an immediate roll back in the prices of fuel," said one of the protestors at Sunday's march.
More than thee hundred protested on Wednesday, in a guerrilla action in several parts of the city, according to eye-witnesses. "We are marching to highlight the economic hardship that Myanmar people are facing now, which has been exacerbated by the fuel price hike," one of the protesters told local journalists covering the march. Later there were clashes with pro-government vigilantes; some were beaten and several whisked away in cars.
"More than 3,000 people have been on the streets in the last few days protesting against the government's economic policy," one of the protest organisers, Htay Kywe told this correspondent shortly before he was arrested by the authorities.
The police have arrested more than a dozen key 888 generation student leaders and, including the internationally renowned activist and poet, Min Ko Naing and the charismatic Ko Ko Gyi, and organisers of the demonstrations from the recently formed Myanmar Development Committee. They were detained for "undermining stability and the security of the nation," according to the state run media.
Several university students who took part in one of the protests have also been detained. The authorities have been using thugs armed with sticks, from the pro-government community organization -- the Union, Solidarity and Development Association -- to stop and dispersed the demonstrations.
"The junta is not scared of public statements or press releases by opposition groups, but they really do not want the public to come out to the streets, for this type of movement can get out of hand," the student leader, Ko Ko Gyi told this correspondent recently, before his arrest.
The arrests have only further fuelled public anger at the price increases. "More demonstrations are likely to follow, as Rangoon's residents are already fuming at the increase in fuel prices," according to western diplomat based in the country's capital.
At midnight last Tuesday, Burma's ruling military junta unexpectedly raised the price of rationed fuel by as much as 500 per cent. Compressed natural gas, which the government has been promoting especially for commercial vehicles, was increased five fold, while diesel and petrol prices were more than doubled.
Transport costs have already more than doubled throughout the country and the prices of essential goods are beginning to sky rocket.
"The poor people have been hit hardest," a European diplomat told this correspondent. "They were already finding it hard to survive, and the increase in fuel charges and the knock-on affect on food prices will make it even harder," he said. "It can only fuel further social unrest," he added.
Bus fares and taxi charges doubled immediately in Rangoon, Mandalay and Moulmein. Already there is a substantially reduced service in many parts of Rangoon. Traffic generally in the city is substantially reduced as a result of the astronomic rise in the cost of black market petrol, which many Rangoon residents depend to fuel their cars.
The increase in bus fares will severely affect the poor, said a financial analyst in Rangoon, who did not want to be identified. Manual workers and day-labourers in the country's main cities, who earn less than 2,000 kyat ($ 2) a day, will now have to pay more than half their wage in travel costs, he said. In some cases it may even be as much as three-quarters of their daily income.
"The increase in fuel costs will mean a rise in transport charges generally, which will then cause food prices to rise," said Win Min, an independent Burmese analyst based at Chiang Mai University. "Inflation is already running at more than 40% a year and this could now more than double," he added.
"There will be an increase in lay-offs as businesses are forced to close and we are likely to see a significant rise in the prices of food, clothing and basic commodities," he said.
Already in Rangoon food prices have risen steeply. Rice has risen by nearly 10 percent, edible oils by 20 percent, meat (pork and mutton) by around 15 percent, garlic and eggs both by 50 percent, according to aid workers in Rangoon who monitor the local market. A plate of Burmese noodles has tripled in the last week, an aid worker said.
"These price rises are crippling for most residents in Rangoon," a Burmese economist told this correspondent. "They could hardly afford food before, now their weekly budget for essential foodstuffs is going to buy even less -- their purchasing power has been reduced by more than 25 percent virtually overnight."
The people worse hit though are the retired government employees whose meagre pensions will now be almost worthless. One very elderly retired office worker complained to this correspondent that her pension now barely covered the taxi fare needed to go and pick it up.
These price rises are bound to lead to increased demands for salary and wage increases to meet the inflationary impact on workers' incomes. It is highly unlikely that the government will increase these in the near future, having only recently granted government employees a major salary increase. The private sector is also going to find it hard to meet employees' demands to increase the wages bill.
Businessmen are already complaining bitterly and some have even had to close their businesses -- at least temporarily. Besides running motor vehicles, diesel is also used by many families and shopkeepers to run small power generators which they use to combat the power blackouts that frequently hit Rangoon.
An owner of a small printing works in Rangoon, who wanted to remain anonymous for fear of government reprisals, said the increase in diesel costs now made his business unprofitable. "In the coming weeks more and more businesses, which use natural gas and diesel, are likely to be forced to close," a Burmese economist in Rangoon told this correspondent on condition of anonymity.
Already restaurants and cafes are feeling the pinch. There is far fewer customers now than a week ago. The more up-market places have not been affected as badly as the lower priced establishments, according to a foreigner working in Rangoon, who wanted to remain anonymous.
The main market in down town Rangoon, Scot market is comparatively empty -- though not yet deserted -- an eye witness told this correspondent.
"It is difficult to fathom why the government has increased fuel prices, and why they have done it at this time," according to a western diplomat based in Rangoon. "It can only mean the government is strapped for cash."
The Burmese government is reportedly finding it difficult to find the funds to finance the massive expenditure on the new capital Napyidaw -- some four hundred kilometres north of Rangoon. Now they are heavily committed to the construction an new Internet and Communications Technology centre -- along the lines of the US's Silicon Valley -- known as Yadanapon Cyber city near the new capital.
"I have long suspected that the cost of building Napyidaw was bleeding the government's coffers dry," a specialist on the Burma economy, Sean Turnell at the University of Macquarie told this correspondent.
"The government is acutely short of revenue Napyidaw is itself absorbing more than the increase in income from gas revenues. On top of that there is the dramatic pay rises in government salaries of last year, as well as now the potentially large expenditure needed for the planned nuclear reactor," he said.
Over the past year the government has been trying to introduce a measure of financial regularity into government economic policy. The main aim has been to reduce government expenditure and increase government revenue.
"In the past the Burmese government regularly just printed money when funds were needed, but over the last year or so there has been a greater effort to introduce fiscal responsibility into government economic policy," Sean Turnell told the Daily Star.. "Instead of simply printing money they have also tried to reduce expenditure on subsidies (on goods and fuel) and improve revenue collection."
This rise in fuel charges will only increase the level of poverty in Burma. "More than ninety percent of the country's population already lives in dire poverty," according to a Burmese economist. "It is not so much a case of food shortages as families' incomes being insufficient to purchase their daily needs," he added.
UN country-wide surveys in last few years have revealed this trend of increased poverty in Burma and the growing income gap. "More than ninety percent of the population live on less than 300, 000 kyat (around $300) a year," a senior UN official told the Daily Star, but declined to be named.
"Food security has become a significant issue in many parts of the country, especially in the remote and border areas," he said. The worst areas are in Chin, Kachin, Rakhine and Shan states, according to a recent UN report seen by the the Daily Star.
By far the worst area is Chin state, according to the UN surveys, where 40 percent of the population just do not get enough food to live on. In Chin state nearly three out four people live below the poverty line, according to the UN's resident humanitarian co-ordinator in Burma, Charles Petrie.
In eastern and northern Shan state more than half the population live under the poverty line. "They just do not have sufficient income to ensure food security, let alone provide a balanced or varied diet," according to one of the UN researchers.
In the meantime the protests in the streets of Rangoon are likely to increase. Some Rangoon-based analysts are drawing parallels with the period prior to 1988, when the demonetarisation with sparked mass protests for democracy and brought the country to a standstill until the army brutally crushed the movement and seized power.
"There is little likelihood of a new people's power movement emerging," said a senior Burmese analyst, "as the military learned their lesson last time and will try to nip it in the bud this time before it gets out of hand." What is certain is that there will be an dramatic increase in repression.

Larry Jagan is a former Current Affairs Editor, Asia, BBC World Service.