VZCZCXRO3461
RR RUEHCHI RUEHDT RUEHHM RUEHNH RUEHTRO
DE RUEHGO #0138/01 0520857
ZNR UUUUU ZZH
R 210857Z FEB 08
FM AMEMBASSY RANGOON
TO RUEHC/SECSTATE WASHDC 7214
RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHGG/UN SECURITY COUNCIL COLLECTIVE
RUEHBJ/AMEMBASSY BEIJING 1739
RUEHBY/AMEMBASSY CANBERRA 0928
RUEHKA/AMEMBASSY DHAKA 4776
RUEHNE/AMEMBASSY NEW DELHI 4489
RUEHUL/AMEMBASSY SEOUL 8019
RUEHKO/AMEMBASSY TOKYO 5580
RUEHCN/AMCONSUL CHENGDU 1360
RUEHCHI/AMCONSUL CHIANG MAI 1398
RUEHCI/AMCONSUL KOLKATA 0228
RUEATRS/DEPT OF TREASURY WASHDC
RHHMUNA/CDR USPACOM HONOLULU HI
RUEHGV/USMISSION GENEVA 3526
RHEHNSC/NSC WASHDC
RUCNDT/USMISSION USUN NEW YORK 1357
RUEKJCS/SECDEF WASHDC
RUEHBS/USEU BRUSSELS
RUEKJCS/JOINT STAFF WASHDC

UNCLAS SECTION 01 OF 03 RANGOON 000138 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/MLS, EEB/IFD/ODF 
PACOM FOR FPA 
TREASURY FOR OASIA:SCHUN 
 
E.O. 12958:N/A 
TAGS: ECON EFIN PREL BM
SUBJECT: SOCIOECONOMIC DYNAMICS OF INLE LAKE 
 
REF:  A) 07 Rangoon 1001   B) 07 Rangoon 749 
 
RANGOON 00000138  001.2 OF 003 
 
 
¶1.  (SBU)  Summary.  Inle Lake, Burma's second largest lake and one 
of its most visited tourist sites, is a microcosm of the sharp 
divide between Burma's socioeconomic classes.  More than 70,000 
people live on or around the lake and most are dependent upon the 
lake for their livelihoods.  People's occupations and social classes 
are largely determined by their home village.  The photogenic 
"leg-rowers" and fishermen are generally the poorest, while traders 
and goldsmiths are in a higher socioeconomic class.  Villages in 
Inle reflect the social class of their inhabitants:  the fishing 
villages are the worst, with most people living in bamboo and straw 
huts with no electricity.  In the wealthier communities, people live 
in large multi-level teak houses, own satellite dishes and 
televisions, and many have multiple motorboats.  The economic 
disparity found in Inle Lake is indicative of the rest of Burma: 
most people are devastatingly poor while the few wealthy people live 
in the lap of luxury.  End Summary. 
 
Inle Lake: A Study in Economic Disparities 
----------------------------------------- 
 
¶2.  (SBU)  Inle Lake, located in southwestern Shan State, is 
approximately eighteen miles long and seven miles wide, with an 
average depth of five feet during the dry season and ten feet during 
the rainy season.  According to UNDP estimates, more than 70,000 
people live on the lake or along its shores, with more than half of 
them dependent upon the lake for their livelihoods.  The several 
hundred villages located on or around Inle Lake are home to people 
with various occupations, including fishermen, farmers, weavers, 
traders, and goldsmiths, and the villages are divided mostly by 
occupation.  Like with other places in Burma, Inle Lake residents' 
occupations are determined by where they live.  A few have broken 
the occupational cycle by going to work in Inle's tourism industry, 
but many of them continue to live in the villages where they were 
born. 
 
Saving Fish from Drowning 
------------------------- 
 
¶3.  (SBU)  During a recent trip to Inle Lake, we toured several 
villages, witnessing firsthand the obvious economic disparities that 
existed between groups with different occupations.  Overall, the 
fishing villages are the poorest villages, with an average of five 
people living in small bamboo and straw huts.  These rickety homes, 
standing approximately eight feet above the water on bamboo poles, 
only last an average of five years.  According to local estimates, 
it costs up to $200 to build or repair a bamboo hut.  There is a 
sense of community in these villages, as home owners rely on other 
villagers to assist with home repairs and during financial troubles. 
 Most of the fishing villages on Inle Lake are sparsely decorated, 
and most homes lack electricity.  Instead, residents use 6-volt or 
8-volt batteries to power portable lights and radios, traveling 
several times a week to nearby villages with power plants to 
recharge their batteries.  To entertain themselves, adults visit 
their neighbors to catch up on the daily gossip, while the children 
play in the water or teach themselves how to row a boat. 
 
¶4.  (SBU)  Fishermen typically have a meager annual income, 
dependent upon how many fish they catch.  Most fishermen catch an 
average of two fish a day during the dry season and up to 10 fish a 
day during monsoon season.  Fishermen earn approximately 1,500 kyat 
($1.25) for each fish, depending on the weight of the fish and local 
demand.  To earn extra income, some farmers raise pigs in pens 
outside their huts, selling piglets to other fishermen or farmers. 
Some fishermen's wives also work to supplement their incomes, 
growing crops on small floating islands to sell in the local market 
or making cheroot (Burmese cigarettes) at home, earning 1000 kyat 
 
RANGOON 00000138  002.2 OF 003 
 
 
($0.83) for 1000 cigarettes. 
 
Farming on Water 
---------------- 
 
¶5.  (SBU)  Most who live in farming villages on the lake find 
themselves in a higher socioeconomic bracket than fishermen.  Rather 
than farming typical plots onshore, farmers in the Inle region plant 
crops, including zucchini, tomatoes, garlic, and leaks, on floating 
islands that they anchor to the bottom of the lake with bamboo 
poles.  In the larger villages, the community will establish 
communal farms and assign different farmers to oversee the 
production of certain crops.  Some farmers sell their products in 
local markets while others sell them to traders, who ship the 
products to cities, including Rangoon, Mandalay, and Taunggyi. 
Because communal farmers produce substantially more crops than 
individual farmers, these farmers as a group sell their crops 
directly to traders in cities and divide the profits equally. 
Compared to fishermen, farmers on Inle Lake can earn a decent living 
by Burmese standards, earning up to $50 a month during harvest time. 
 Farmers that also trade and sell their products in big cities tend 
to be wealthier than those who only sell their products in local 
markets. 
 
¶6.  (SBU) Unlike the homes in the fishing villages, many of the 
homes found in farming villages are single floor dwellings made of 
teak wood and straw, which can last up to 100 years.  Some poorer 
farmers have homes made of bamboo, although they often stand on teak 
stilts rather than bamboo poles.  According to UNDP, the average 
size of a farming family in Inle Lake is six people.  Both women and 
men farm, although the men are usually responsible for harvesting 
the crops while the women sell them in the local markets.  Farming 
families typically own at least one boat, with wealthier families 
having multiple boats or a motorboat, which costs approximately 
$750.  Larger farming communities have electricity and their own 
power plants, which they use to generate additional income by 
charging people to recharge batteries. 
 
Wealthier Occupations 
--------------------- 
 
¶7.  (SBU)  While the majority of people living on Inle Lake are 
either farmers or fishermen, several communities have developed 
niche occupations that bring in even higher incomes.  We visited 
several different villages, including a village where the 
inhabitants were silk-weavers, a village that specialized in the 
building and repairing of boats and furniture, trading villages, and 
goldsmith villages.  The greater economic wealth of these 
communities was obvious:  houses were multi-level (two or three 
floors) and made of teak with glass windows; people owned multiple 
boats including several motorboats; more than one house in the 
community had a satellite dish and TVs; and all homes had access to 
electricity. 
 
More Money for Education and Health 
----------------------------------- 
 
¶8.  (SBU) The vast economic disparity among the various villages 
translates into varying availability of education and health 
services.  While each village has a primary school, only the 
wealthiest communities (several farming and trading villages) have 
high schools and monasteries where children could continue their 
education past the fifth year.  Locals told us that children from 
fishing communities often stop attending school at the age of 11, 
when they start working to provide additional income for their 
families. 
 
¶9.  (SBU)  Poorer villages also have very limited access to health 
 
RANGOON 00000138  003.2 OF 003 
 
 
care.  Locals told us that people must often travel to larger, 
wealthier villages for medical treatment.  Many medium-sized farming 
villages have medical clinics with a midwife or a nurse, while 
wealthier villages may have clinics staffed by a doctor or even a 
small hospital.  Pharmacies are only located in wealthy communities. 
 
 
Fuel Costs Affect All 
--------------------- 
 
¶10.  (SBU)  Regardless of wealth, the August fuel price hikes (Ref 
B) affected all residents of Inle Lake, locals told us.  Immediately 
after the August price increases, fares for water taxis and boat 
"buses" to the main jetty doubled from 7,500 kyat to 15,000 kyat and 
from 750 kyat to 1,500 kyat a person, respectively.  While prices 
have since fallen - taxis now cost 10,000 kyat to go to the jetty 
and boat buses cost 1,000 kyat per person, they are still 
approximately 45 percent higher than pre-August prices. 
 
¶11.  (SBU) The cost of food and supplies also increased this year, 
due primarily to higher transportation charges.  A carpenter told us 
that it takes longer and is more costly to obtain teak from Southern 
Shan State to make boats.  As a result, the price of motorboats 
increased from 700,000 kyat in 2006 to 800,000 kyat in 2007. 
Despite higher prices, most incomes remain the same, making it even 
more difficult for people to purchase basic necessities. 
 
Comment 
------- 
 
¶12.  (SBU)  The economic disparities between Inle Lake's different 
social groups were shockingly clear, and the vast majority of people 
falling into the lowest economic levels.  The rest of Burma is much 
the same: less than ten percent of the population, mostly the 
military, controls more than 90 percent of Burma's wealth.  While it 
is possible for businessmen to make a decent living in Burma, those 
with close ties to the regime earn the big bucks while the rest of 
the population struggles to make ends meet.  Burma's socioeconomic 
dynamics are not likely to change while the military continues to 
rule - it is much easier to control the people if they are poor and 
hungry. 
 
VILLAROSA