RPT-Singapore distancing itself from Myanmar -analysts

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By Ed Cropley

BANGKOK, Oct 30 (Reuters) - While opposing sanctions against Myanmar in public, Singapore's government and its banks in particular appear to be quietly distancing themselves from the ruling junta, analysts and bankers said on Tuesday.

Officially, Singapore has not deviated from the line given by Prime Minister Lee Hsien Loong a month ago, at the height of the junta's bloody crackdown on democracy protests, that sanctions would be unlikely to shunt Myanmar towards political reform.

But gradually, signs are emerging of institutions in the city-state pulling back from involvement with the generals, for whom Singapore is a top medical and leisure destination -- and widely believed to be home to their off-shore bank accounts.

"What's going on behind the scenes, particularly on the financial side, is de facto sanctions," said Sean Turnell, author of the Burma Economic Watch journal at Sydney's Macquarie University.

The latest indication of that is Air Bagan, a small Myanmar airline on a U.S. government blacklist that will suspend flights to Singapore from Nov. 5, travel agents say.

Singapore's Today newspaper said the final blow came when Singapore banks said they would "stop dealing with" the airline, owned by Htoo Trading, with close ties to the junta's top brass.

"That would seem to be an indication that Singapore either is lining up behind the sanctions, or that they have other financial concerns or issues with Air Bagan," said Victor Comras, architect of U.S. economic sanctions against Yugoslavia in the 1990s.