Foreign investment in Burma 'costly for companies'

Apr 29, 2009 (DVB), Foreign investments in Burma's oil and gas sector pose a risk to companies and lead directly to human rights abuses against civilians, including rape and torture, says a human rights watchdog.

Speaking at a conference in Jakarta, Inodnesia, attended by leading figures from the region's oil industry, EarthRights International said that foreign businesses partnering with Burmese companies carried significant risks.

"Due to the reputation and material risks posed by doing business in Burma's extractive sectors, it may actually cost a company more to go into Burma than to stay away from it," said Matthew Smith, Project Coordinator at ERI's Burma Project.

Furthermore, incidences such as French oil company Total's investment in the Yadana pipeline in the 1990's implicates them in severe human rights abuses.

"Documented abuses connected to the Yadana project include land confiscation, forced labour, rape, torture, and killings," say ERI.

Yesterday the EU announced it would be renewing its package of sanctions against the ruling State Peace and Development Council.

The EU sanctions package does not however include a ban on European companies investing in Burma vast oil and natural gas reserves.

A number of domestic and international human rights groups have called for a complete stop to foreign business investments in Burma.

Stephen Frost, director of Corporate Social Responsibility in Asia, suggested however that targeted investments in Burma should be considered in light of the failure of sanctions.

"For every Western firm pressured to divest, or forced not to invest in the first place, there are numerous others in Asia that are under no such pressure," he said.

"Talking of lifting sanctions is tantamount to support for the generals in some circles, but it’s not as if European Union companies don’t invest in places with bad human rights records."

Dr Khin Mg Kyi, a Singapore-based Burmese economist, argued that banning foreign investment from certain countries and not others leads to monopolization.

"We are committed to a superpower like China; it's a very powerful country," he said.

"We are giving them all our resources. Why should we let China monopolize us?"

Reporting by Rosalie Smith

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