Yangon: Hardliners in Myanmar’s military junta consolidated control of the country Wednesday after ousting the prime minister, amid gloomy prospects for the release of detained opposition leader Aung San Suu Kyi.

Pro-democracy activists expressed dismay at the replacement for premier General Khin Nyunt, who was sacked Tuesday and put under house arrest for alleged corruption following a power struggle in the top ranks of the
junta.

Myanmar state media said Tuesday Khin Nyunt had retired for “health reasons” — despite being the only one of the junta’s top three leaders without health problems — to be replaced by Lieutenant General Soe Win, who has publicly stated his opposition to talks with Aung San Suu Kyi’s
party.

Soe Win was viewed by pro-democracy activists as an organiser behind a violent clash between her supporters and a pro-junta mob in May last year that heralded the Nobel peace laureate’s latest period of house arrest.

As the US expressed concerns that marginal hopes for reforms had dwindled, representatives of ethnic groups vital to the stuttering democratic process were gathering in Yangon after being summoned by the military, according to sources in Myanmar.

The deposed premier was seen as responsible for persuading nearly 20 ethnic groups opposed to the regime to sign up to ceasefire agreements.

Their cooperation is seen as vital to any success for the junta’s seven-point democracy roadmap with its eventual goal of national elections — although western observers have dismissed the plan as a sham.

Aung San Suu Kyi’s National League for Democracy (NLD) party reacted cautiously to the appointment of Soe Win, an ally of the hardline head of the junta Than Shwe.

“We must wait and see. It does not depend so much on Soe Win but on the number one (Than Shwe),” party spokesman U Lwin told AFP.

But Zin Linn, spokesman for the National Coalition Government of the Union of Burma, a group of elected Myanmar parliamentarians in exile, said the rise of Soe Win was a blow to the opposition.

He said he was the “main culprit” behind the attack on the Aung San Suu Kyi motorcade at Depayin in May 2003. “Even Khin Nyunt was shocked by what he did at Depayin and the two have been in conflict ever since,” he said.

Indonesia and Malaysia expressed concerns over the future democratic process in Myanmar and the US said the leadership changes were a blow to marginal hopes the leadership might begin talks again with Aung San Suu Kyi.

The capital Yangon remained calm on Wednesday with the military keeping a low-profile after the upheavals among the country’s leadership.

Because of looting fears, jewellery shops and cinemas were closed during the swirl of speculation before the job switch was confirmed late Tuesday.

Barbed wire was laid out in front of the roads to the homes of senior military leaders in the capital but security overall remained low-key, according to witnesses.

Fifteen military trucks were spotted outside a 25-storey building still under construction in Yangon near the US embassy and city hall. A large number of soldiers were inside the building keeping a watching brief, according to witnesses.

Groups of people gathered Wednesday to find state-run newspapers carrying the official announcement with vendors selling out within hours, despite some trebling the price to cash in on the interest.

Others huddled around shortwave radios to try to glean news from abroad, according to an AFP correspondent.

The price of gold in shops was reported up on Tuesday as people sought to convert their cash into safer forms of wealth during the political uncertainty.

However, the correspondent reported the situation more stable Wednesday with shops that had been closed reopening.

“We are a little bit concerned that in the future it will be more
difficult for our businesses until things become clearer,” a businessman in Yangon told AFP. “We will just have to wait and see.”

The military has controlled Myanmar since a coup in 1962. The NLD won national elections by a landslide in 1990 but was not allowed to rule.