Japan cuts aid to Burma in protest at military crackdown

(Guardian) - Burma's military regime came under further pressure yesterday as Japan halted a multimillion-pound humanitarian project in protest at the bloody suppression of last month's pro-democracy protests.

The cut in grants by one of the region's most influential players follows the EU's decision to toughen sanctions and signals from the US that it will shortly stiffen its measures against the junta's leadership.

Japan, once Burma's largest aid donor, said it had decided to cut the funding in response to international outrage over the crackdown. It hoped the move would encourage the regime to change course and work on moving towards democracy.

The foreign minister, Masahiko Komura , said Japan was cancelling a ?2.3m grant it had been discussing with the Burmese regime for a business education centre at Rangoon's university.

"The Japanese government needs to show our stance," the minister said. "We cannot take action that would effectively support the military regime at this moment."

The funding cut represents only a small proportion of the ?13m in humanitarian aid the Japanese government gave to the regime last year, but the minister said further grants would be reviewed on a case by case basis in future.

Up until 1998 Japan was the largest donor to Burma and it remains one of the pariah nation's most important humanitarian aid backers.

But it suspended low-interest loans for big infrastructure projects in 2003 in protest at the re-arrest of the opposition leader Aung San Suu Kyi , who has been detained for 12 of the last 18 years.

The significance of yesterday's move is that Japan has largely stuck by the generals over the years, in contrast to the sanctions imposed by the EU and US.

The shift sends a strong symbolic as well as economic message to the Burmese leadership and may yet encourage countries in the Association of South-East Asian Nations, which numbers Burma among its members and opposes sanctions, to adopt a stronger stance.

In Bangkok, the Thai prime minister, Surayud Chulanont , proposed a UN-backed regional forum on Burma, bringing south-east Asia together with India and China, the two countries with the greatest potential influence on the junta.