Ethical Performance
inside intelligence for responsible business


company payments to Burma ‘should be blocked by governments’

December 2007

New investment in Burma’s oil and gas fields should be banned by the United Nations Security Council and company payments that sustain the country’s military rule should be blocked, says a declaration from the pressure group Human Rights Watch.

Until any sanctions are imposed by the Security Council, says Human Rights Watch, economic ties that support the development of the oil and gas sector should be suspended by the Association of South-east Asian Nations, the European Union, and individual countries, including China, India and the United States.

At the same time the rights organization is calling for government financial sanctions on companies that are owned and controlled by the Burmese military or whose revenues substantially benefit the regime.

Arvind Ganesan, director of the organization’s business and human rights programme, said: ‘Burma’s generals act as if they are immune from worldwide condemnation because they’re still getting cash from foreign-financed oil and gas projects. It’s time to cut them off.’

In a detailed new report, the organization has named 27 companies based in 13 countries as having investment interests in Burma’s oil and gas fields. Thirteen of the companies are wholly or partly owned by foreign governments, and they have invested in 20 of the 30 projects now under way.

Burma’s 2006 gas revenues rose by $1billion (£483million), thanks partly to higher prices everywhere, and are likely to have risen further this year as prices continue to climb. More increases are expected when the huge offshore Shwe project comes on stream in 2010. The South Korean Daewoo International company led the consortium that developed the field, and China and India have asked to buy the gas. A Burmese government official has already confirmed that gas from the field is to be sold to China.

Human Rights Watch says investors in Burma’s oil and gas industry include companies from Australia, China, India, Japan, Malaysia, Singapore and Thailand, as well as South Korea.

Some companies involved in Burma have said it would be inappropriate to raise human rights issues or have claimed their involvement has brought benefits to the Burmese people. The French company Total, which leads a consortium for the Yadana gas project, said: ‘We are convinced that through our presence we are helping to improve the daily lives of tens of thousands of people who benefit from our social and economic initiatives.’ Nippon Oil, a Japanese partner in the Yetagun gas pipeline project, said: ‘We see the political situation and energy business as separate matters.’

Human Rights Watch, however, maintains few Burmese people see any tangible benefit from outside investment in the oil and gas industries. Many people lack electricity altogether and those in urban centres suffer frequent energy cuts while Burma’s natural gas powers cities in Thailand.


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