REPORTER: Ginny Stein

CROWD (Translation): We'll give our lives to protect your country! This is our country, our land, and it belongs to us! Our country, our land!

This amateur video, smuggled out of Burma, recorded the last public appearance by charismatic opposition leader Aung San Suu Kyi. In May last year, after she'd been released from house arrest, she went on the road to speak with her followers. It was a massive display of support for her party, the National League for Democracy.

AUNG SAN SUU KYI, BURMESE DEMOCRATE LEADER (Translation): If the people want to find out why democracy is important you should look at something that is quite obvious. The law treats everyone equally irrespective of who or what they are. If different groups are treated differently this shows that law and order are absent.

Shortly after giving this speech, Aung San Suu Kyi and her supporters were attacked and she was once again placed under house arrest. But it's another recent blow that poses an equally serious threat to her movement. Burma's only other significant opposition group has recently broken ranks with Aung San Suu Kyi by negotiating with the country's military rulers.

I'm on my way to meet what remains of one of the most formidable rebel armies in South-East Asia. To reach the Karen 202 Battalion camp I'm taken into Burma along the Moi River, which marks the border with Thailand.

Ethnic Karen have been fighting the Burmese government for more than 50 years and control strategic pockets of territory on the Thai border. Apart from crossing over from Thailand, there are only two ways into this camp and both of these are landmined. As night falls, more fighters emerge.

Next morning, it's target practice. We're 3km from the frontline, the last skirmish took place just days before I arrived within sight of this camp. Ksha Ka Lu is a major in the Karen National Liberation Army.

MAJOR KSHA KA LU, NATIONAL LIBERATION ARMY: Yeah one shot, here one, here one, here one and up here one.

Well, I consider myself I'm a freedom fighter because I need my place, I need my country, I want my people to be free. So I fight for my Karen people, so I consider that I'm a freedom fighter.

But after decades of war, Burma's generals have finally begun talking with their oldest foe. Last month, as part of its so-called road map to democracy, the regime invited the Karen to Rangoon to hold talks on a cease-fire agreement. Led by this man, General Bo Mya the talks represented an historic breakthrough in South-East Asia's longest-running civil war.

General Bo Mya has now returned from what was his first visit to Rangoon since 1947. Today he's the guest of honour at the 55th anniversary of the Karen's battle for independence. The Karen are the only armed ethnic group never to have surrendered or signed a permanent ceasefire with Burma's military rulers. His son, Colonel Ner Dah says the Karen have four key demands.

COLONEL NER DAH: Number one is surrender is out of the question. Number two, we will retain our arms. Number three, Karen State must be recognised, must be complete and number four, we will decide our own political destiny.

The Karen know they're doing a deal with the devil, but they are prepared to drop demands for full independence if Burma's generals leave them alone.

COLONEL NER DAH: We want a genuine federation system in Burma. It doesn't mean that we have to separate ourselves but we can have a self-governing in our state, we can also join hands with federal union, genuine, federal union.

20-year-old Maung Hla is one of thousands of ordinary Karen villagers who have long been caught in the middle of this conflict. After treading on a landmine, he travelled for two days to get to this clinic across the border in northern Thailand. What's left of his foot is about to be cut off.

REPORTER: So he's had an injection in his spine in simple terms, he's awake though?

DOCTOR: Yes.

REPORTER: He is going to know what's happening throughout?

DOCTOR: He won't be able to see what's happening. If he sits up we'll put him down again. He won't be able to see what's happening.

Feel that? Feel that? Here. No? Now? Good work.

Medical care is all but nonexistent inside Burma's frontline regions and even here, the conditions are pretty basic.

DOCTOR: Would you tell him that I'm sorry that we had to take his leg off.

Incredible as it sounds, Maung Hla knows that if he returns to Burma, he will have to pay the military for damaging government property.

MAUNG HLA, (Translation): When they plant a landmine, they charge you if you step on it.

Despite everything the Karen have suffered, they've never wavered in their resistance to the Burmese regime. Now for the first time, they're being offered a settlement that doesn't demand their surrender. But getting the Karen to sign onto a cease-fire would be a big victory for Burma's generals. Not just because it helps legitimise the regime, but also because it further isolates Burma's most popular opposition leader.

INTRODUCTION (Translation): General Secretary Daw Aung San Suu Kyi will give the speech.

AUNG SAN SUU KYI (Translation): True strength doesn't need violence. When I arrived here I heard people singing our national anthem and I was thinking about what these words mean to us. "It's our ancestral inheritance, we love our country." We are all... this country belongs to all of us.

When Aung San Suu Kyi addressed supporters last May her words resonated amongst a people desperate for change.

AUNG SAN SUU KYI (Translation): I believe that the more democracy is delayed, the more the country will suffer, therefore... to end our country's suffering it is important that democracy be restored as soon as possible.

Despite years of house arrest and the continued detention and torture of the leaders of her party, Aung San Suu Kyi's support seems stronger than ever. But the brutality that followed was evidence that the military regime shows no sign of tolerating dissent. The government was closely monitoring the ever-increasing crowds and on the night of May the 30th, in the small town of Depayin, the triumphant tour came to a violent end.

CROWD (Translation): Long live Daw Aung San Suu Kyi!
The government says that as night fell, four people were killed in a clash between Aung San Suu Kyi's supporters and other opposition groups. But eyewitnesses say that pro-government thugs murdered up to 100 people and jailed countless more. Aung San Suu Kyi herself was returned to house arrest. The National League for Democracy calls the events of that night the Depayin massacre.

MORTEN PEDERSEN, AUSTRALIAN NATIONAL UNIVERSITY: I think there is no doubt that the purpose of what took place on 30th May was to stop it, you know, before it grew any bigger.
Burma-based academic Morten Pedersen from the Australian National University, says what took place was entirely predictable.

MORTEN PEDERSEN: Yes, I think they were getting worried that she was on a sort of a long march and, you know, she would travel back to Yangon with thousands and thousands of people sort of coming along and then maybe having similar crowds.

Win Win, not his real name, was present when the attack occurred. He was part of Aung San Suu Kyi's security team. He has since fled to Thailand and in his first-ever television interview, he says the attack was premeditated.

WIN WIN, (Translation): As Daw Suu's car approached people were shouting "Kill the traitor!" Kill! Kill!" Then started attacking the people and smashing up the cars.
Daw Thuya, whose name has also been changed for her family's safety, was another eyewitness. She was standing next to Aung San Suu Kyi's car when the attackers struck.

DAW THUYA, (Translation): The colour of our uniform is called pini. That's what we were wearing. It's for both men for women. Our attackers didn't like it. They tore the uniforms off us, both men and women. They came at us from the side and beat us with sticks. When they beat us like that... if we screamed they beat us more.

WIN WIN, (Translation): When Aung San Suu Kyi's car drove away, an order was given to fire and I heard 10 to 15 gun shots. While the shooting was going on, the supporters who remained were beaten up.

DAW THUYA, (Translation): When we checked, no-one moved. There was no sound, they were soaked in blood.

But the regime didn't stop there. Those arrested were forced to sign a statement saying they would remain silent about what had happened.

WIN WIN, (Translation): Yes, I did. Don't even tell your family about it. No-one. If I'm found out, they'll take action again. They'll take action again for sure. That's what it said on the paper I signed.

That threat was also extended to those considered most likely to try to spread the word to the outside world. That's why 73-year-old Daw San San also fled Burma to Thailand. She is a leading member of Aung San Suu Kyi's party, the National League for Democracy.

DAW SAN SAN: Because I was detained for one day after the Depayin massacre, so the blanket of fear always covering me. I'm afraid of that sound of the knocking on the door at midnight, so I heard the footsteps near my door.

Daw San San has good reason to fear the midnight knock on her door. 14 years ago she was voted into parliament as a member of the National League for Democracy, but when Burma's generals refused to hand over power, she and hundreds of other MPs were sent to prison. When she was released, she had to sign a form acknowledging she still had 10 years to serve.

DAW SAN SAN: I'm 73 years old now.

REPORTER: And if you did - had to go back and serve another 10 years?

DAW SAN SAN: Another 10 years I would die in a prison, that's for sure.

Aung San Suu Kyi remains under house arrest, the military impervious to international calls for her release. The recent talks between the Karen and the Burmese regime are a serious blow to her cause. Colonel Ner Dah says the Karen and Aung San Suu Kyi want the same thing, but there is one reality that can no longer be ignored.

REPORTER: Up until now you've held out on negotiating with them, why go now, why start now when she's locked up?

COLONEL NER DAH: She has been locked up for 10 years already and there has to be a change. She cannot do much so we have to find many ways, we have to use new tactics to achieve our goal.

MORTEN PEDERSEN: There is also, you know, I think a case for taking a more pragmatic view on the situation here and everywhere else. If you cannot get what you want, should you perhaps not accept 80%, 70%, 60%, 50%? Where does the line go? That's up to the individual.

The Karen believe there are two issues at stake in this conflict. One is democracy, the other, the rights of Burma's ethnic groups. The Colonel refuses to concede that the Karen have sidelined Aung San Suu Kyi by deciding to deal directly with the regime.

REPORTER: If you were Aung San Suu Kyi would you be upset?

COLONEL NER DAH: If I were her I wouldn't be upset with the Karen.

REPORTER: But haven't you basically sold her out by dealing directly with the military?

COLONEL NER DAH: No, even in the past we - she's a symbol for democracy but she's not our leader. Our leader - we have our Karen leader who is trying to achieve the freedom and democracy, freedom and self-determination of rights for the equality for the Karen people. We have listen to our leader.

Burma has long been considered a pariah state. The military regime has now accelerated its campaign to sign up ethnic groups to a so-called peace process. And for many governments, this will lessen the pressure to talk tough with Burma. But for ordinary Burmese, there's no sign of improvement on the horizon.
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