Nov 6, 2007 (AFP), Flamboyant Burmese tycoon Tay Za Monday denounced US sanctions against his airline and other firms which he said would only hurt the people of the impoverished Southeast Asian nation.

US President George W. Bush last month ordered sanctions against seven companies with ties to Burma’s ruling junta.

Tay Za’s Air Bagan was among seven firms blacklisted to pile more pressure on the regime after its bloody suppression of pro-democracy protests in September which left 13 dead and thousands locked up.

"I hereby condemn the sanctions which were recklessly imposed and only hurt the people of Myanmar," Tay Za told officials, staff and businessmen in a speech for celebrations to mark Air Bagan’s third anniversary.

"The sanctions are misguided and unfair. Air Bagan Ltd is a legally constituted company with funds earned through 100 percent legitimate means," he said.

"No government officials or party outside Htoo Group of companies owns any shares in Air Bagan."

The charismatic tycoon, who was said to be close to members of the ruling junta, also denied he was the son-in-law of one of the ruling generals.

"There had been allegations that I am the son-in-law of one of the senior members of the state. It is totally untrue and I categorically and utterly refute these allegations," he said.

He also said his airline was not involved in any criminal activities.

"The capital of Air Bagan is not related in any way with such business as drug trafficking, arms sales and money laundering but comes from the earnings of Htoo Group of companies through our legitimate business," he said.

Tay Za however admitted that the airline was facing problems because of the sanctions.

"Air Bagan Ltd … is facing a myriad of problems because of wrongful sanctions imposed by the US administration. Due to restrictions on banking facilities, Air Bagan is encountering operational difficulties," he said.

"Under the circumstances, Air Bagan’s Singapore flights have been suspended."

Air Bagan had announced from November 4 it would suspend its Singapore service, which was only launched in September.

"It is apparent that the US sanctions will mainly impact on the working population," he said, adding that they would affect the 14,000 employees of Htoo Group companies and Air Bagan.

"We shall tackle the sanctions by fair and rightful means, carry on with our second five-year plan and forge ahead in the private sector for the economic development of Myanmar together with the state," he said.

Burma-watchers say Tay Za, 43, is also involved in tourism, infrastructure projects, mobile telephone services and was involved in the government’s purchase of helicopters from Russia.