France's Kouchner proposes Myanmar "incentive" fund

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SINGAPORE, Oct 29 (Reuters) French Foreign Minister Bernard Kouchner today proposed a fund to give Myanmar incentives to embrace democracy and urged China and Southeast Asia to put more pressure on Myanmar's ruling junta.

Kouchner gave no details on the size of the fund, who would administer it or who would receive the funds, but said that money could come from the World Bank and could be distributed in Myanmar in the form of micro-credits.

''We have to offer incentives. Sanctions and incentives,'' Kouchner, in Singapore as part of an Asian tour, told reporters.

He said he hoped the World Bank or other institution could ''offer a fund, money, to develop the country for the people''. He added the fund was a French idea but that it had British support.

''We have to set up a sort of go-between with NGOs, UN agencies in order to give them a sort of micro-credits...to offer them perspective of trade, development and also real industry.'' Kouchner also said that, following EU sanctions on Myanmar announced earlier this month, it was now up to countries neighbouring Myanmar to put pressure on the military regime.

EU foreign ministers on October 15 agreed to strengthen sanctions against Myanmar in response to the junta's crackdown on protests last month, broadening sanctions that include visa bans and asset freezes on generals, government officials and their relatives.

The EU also took new steps targeting the country's key timber, metals and gemstone sectors.

But China and the Association of South East Asian Nations (ASEAN), despite rare expressions of discomfort at last month's crackdown, refuse to contemplate sanctions, saying words are a more effective tool.

At least 10 people were killed when the military crushed the biggest anti-junta protests in two decades.

In an editorial published in Asian newspapers today, Kouchner called on China and Southeast Asian nations to put more pressure on Myanmar's generals to start talks about political reform with detained opposition leader Aung San Suu Kyi.

''I have come to Southeast Asia to tell Burma's neighbours that no progress can be made in Burma without their intervention and assistance,'' Kouchner wrote.

''The United Nations cannot achieve reconciliation on its own.

The capacity of China and ASEAN countries to engage in dialogue with the Burmese junta is irreplaceable,'' he said, referring to Myanmar by its former name.

Kouchner is due in Bangkok tomorrow.

UN special envoy Ibrahim Gambari, who visited Myanmar a month ago, is due to return in early November.

Gambari's first trip to the generals' new jungle capital resulted in the appointment of a retired general as a go-between for talks with Suu Kyi.

Suu Kyi's National League for Democracy (NLD) party won a 1990 election by a landslide, only to be denied power by the military, which has ruled since a 1962 coup. The 62-year-old Nobel laureate has spent 12 of the past 18 years in detention.

Senior General Than Shwe has offered talks with Suu Kyi, although some of the preconditions -- such as her abandonment of support for sanctions -- lead many to doubt his sincerity.

The generals have allowed Gambari to make a return visit slightly earlier than first planned and have also agreed to admit UN human rights specialist Paulo Sergio Pinheiro, who has not been allowed in since 2003.

Pinheiro plans to go before the annual meeting of Association of South East Asian Nations (ASEAN) leaders, to be held this year in Singapore on November 19-21.

REUTERS SKB KN1520

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