US Extends Ban on Gems Imports From Burma

By Matthew Pennington 8 August 2013

WASHINGTON — The Obama administration on Wednesday extended a ban on imports of rubies and jade from Burma, reflecting worries about the powerful military’s continuing involvement in the murky industry based in conflict-wracked border regions.

Washington remains concerned about human rights abuses against ethnic minorities and the role of the army in Burma despite democratic reforms that have seen a shift from decades of authoritarian rule.

The reforms have led to a dramatic improvement in US relations with the Southeast Asian nation, and the overall trend remains a positive one for the government of President Thein Sein.

President Barack Obama issued Wednesday’s executive order to extend the gems ban because wide-ranging sanctions legislation lapsed when it was up for renewal in late July. The original sponsor, senior Republican Sen. Mitch McConnell, announced in May he would not seek to extend the 2003 legislation because of Burma’s democratic progress.

McConnell was for years one of the harshest critics in Congress of Burma’s military rulers and a fervent supporter of opposition leader Aung San Suu Kyi. The Burmese Freedom and Democracy Act he sponsored had imposed a broad ban on all imports from Burma. Obama waived its provisions in November other than on gems.

Deputy National Security Adviser Ben Rhodes said in a statement Wednesday that’s part of the administration’s efforts “to promote responsible trade and investment in support of Burma’s reform process.”

Engaging Burma has been a rare area of agreement between Obama and McConnell, largely because of Suu Kyi’s support for building relations with Thein Sein’s reformist government. The Republican senator is also supportive of the administration’s intent to gradually build ties between the US and Burma militaries.

But other US lawmakers have pushed back against that, and had cautioned that allowing the 2003 sanctions legislation to lapse could allow “conflict gems” into America.

Rhodes said it was maintaining the ban “due to continuing concerns, including with respect to labor and human rights.”

Kachin activists last month wrote to Obama and congressional leaders complaining that the Burma’s central government retains control of ruby and jade mining concessions in Kachin and northern Shan State. Some 10,000 Kachin people have been displaced by fighting in the gem-rich area of Hpakant as Burma troops sought to secure control of gem mining interests, the activists said.

Despite the US sanctions—that are backed by the threat of stiff fines and even jail terms for violators—gems remain an important source of revenue for the impoverished nation.

Burma is one of the world’s biggest producers of jade and by some estimates, source of up to 90 percent of its rubies. Gems auctions held under government auspices yield hundreds of millions of dollars annually. Burma sellers say the sanctions have little impact on their business because they rely on Chinese and Thai gem merchants, who are the major buyers.

The US restrictions also prohibit the import of Burma gems that have been processed in other countries.

US officials say Burma’s gems industry lacks transparency, and activists say working conditions in its remote mines are notoriously harsh. For the US ban to be lifted, Washington would likely be seeking more openness on ownership structures, revenues and how workers are treated.

While the Obama administration moved swiftly in the past year to allow new U.S. trade and investment in Burma, the United States still forbids its nationals from investing in military-owned companies. Several dozen Burma entities are also blacklisted because of ties to the former military junta, the drug trade and arms dealing with North Korea.