By Hnin Yadana Zaw
NAYPYITAW (Reuters) - The mood of goodwill evident in early talks between Aung San Suu Kyi and Myanmar's military over the country's transition to democratic government has soured, as tensions rise over how to divide up power and deal with the legacy of junta rule.
The apparent stalemate has forced Suu Kyi's National League for Democracy (NLD) to push back the election by parliament of a new president to March 17, cutting close to the April 1 deadline when the new government is supposed to start its term.
While negotiations have been conducted amid tight secrecy, lawmakers say divisions emerged after the military put forward its list of demands to the incoming government last month.
The appointment of ex-general Shwe Mann, now a key Suu Kyi ally, to a powerful advisory panel has also stoked mistrust, some say, because his insider knowledge could enable Myanmar's new rulers to delve into the actions of the outgoing government.
"It seems like all of the members of the previous government are now panicking, so they try to use the military's weight to protect themselves," said a former senior lawmaker from the army-linked Union Solidarity and Development Party (USDP).
Suu Kyi's NLD won a landslide in Myanmar's first democratic election in a quarter of a century in November, kicking off a lengthy transition from the semi-civilian government that in 2011 replaced a junta that had run the country for 49 years.
That transition began with mutual handshakes and speeches about "national reconciliation", but as the talks drag on the tone of public debate - and that of legislators speaking privately - has changed.
In recent days, the NLD and the military have bickered via the media over whether Myanmar's junta-drafted constitution, which bars Suu Kyi from becoming president, should be amended to let her take the highest office.
Ye Htut, the outgoing Minister of Information and presidential spokesman, said Suu Kyi should respect the military as, essentially, the country's second biggest party, and urged her administration not to dwell on the issue of the presidency, instead focusing on economic reform.
LOOKING FORWARD, OR BACK?
Last week the NLD appointed Shwe Mann, a former speaker of the lower house who was purged from the USDP last year, as the head of the Legal Affairs and Examination of Special Matters Commission, a powerful panel that advises on legislation.
This choice, some MPs say, could be problematic for former members of outgoing President Thein Sein's government if the NLD decided to use the commission's expertise to try to amend laws or revisit contracts approved by his administration.
The issue of not raking over the past has been crucial in efforts to establish a working relationship between Suu Kyi and her former foes in the military, which under the constitution retains a bloc of seats in parliament and control of key parts of the state apparatus.
When Suu Kyi met former junta leader Than Shwe in December she gave him assurances that the NLD would not focus on the past. In return, Than Shwe endorsed her as the future "leader" of the country.
Days before disbanding at the end of January, the parliament dominated by Thein Sein's USDP passed a bill granting life-long immunity from prosecution to the president for actions taken in office, sparking protests from human rights organizations.
"That law only protects the president, but not his ministers," said the former USDP lawmaker, who is also a member of Shwe Mann's panel. He said the commission would look into recent budgets.
The military is demanding the positions of chief minister in Rakhine, Shan and Kachin states and, crucially, Yangon, where the bulk of foreign investment is likely to concentrate as Myanmar's economy grows at a rapid pace, two people briefed on the details of the talks said.
Both Shan and Kachin states are home to powerful ethnic armed groups involved in illicit activities ranging from drug production and smuggling to illegal jade mining.
Control over these states, which also include Special Regions - semi-autonomous fiefdoms with their own administrations and armies - is key for Suu Kyi, who has made a ceasefire with ethnic armed groups her top priority.
China, which has important economic and strategic interests in Myanmar, is also anxious to protect its influence, Win Htein, one of the top NLD leaders involved in transition talks said.
"Chinese government representatives and business associations are coming to us all the damn time to talk about the president and business deals," said Win Htein.
(Reporting by Hnin Yadana Zaw; Writing by Antoni Slodkowski; Editing by Alex Richardson)