The lure of gas reserves in Burma has led to a growth in the number of
natural resources companies operating there over the past year, despite
the reputational and financial risks of doing business with the
country’s military government.
Nineteen companies ended their involvement in Burma in the past 12
months, but 26 have begun working in the country, according to a ‘dirty
list’ released last month by Burma Campaign UK. It says one of the main
reasons for the overall rise is ‘an influx of new investment in Burma’s
gas sector’.
Among companies to have entered Burma in the period are ChevronTexaco
(as a result of its takeover of Unocal), Daewoo, and the Indian company
Gail. They are among 23 oil and gas companies on the 101-strong list,
making the sector the second biggest after tourism, which accounts for
37 companies operating tours to Burma or promoting tourism there in
printed guides.
The reputational and financial risks associated with working in the
country were demonstrated shortly before Christmas when French-owned
Total, the fourth largest oil company in the world, announced that it
would be paying €5.2million (£3.5m) in an out-of-court settlement
reached with eight Burmese villages suing the company over allegations
that it was complicit in the use of forced labour during building of
the Yadana gas pipeline in Burma. Total will channel the money to the
plaintiffs through the French Sherpa Association, a human rights
organization that represented them in legal proceedings initiated in
2002.
While Total upheld its ‘categorical denial’ of any involvement in
forced labour, which it acknowledged exists in Burma, its statement on
the settlement referred to the €5.2m as ‘compensation’. Much of the
money will be spent on housing, health, educational and other
‘humanitarian measures’ in Burma. Last year, another oil and gas
company, Unocal, agreed an out-of-court settlement over allegations
that it used forced labour in Burma, although the amount in that case
was not disclosed. Both settlements draw a line under the lawsuits in
question, but William Bourdon, a lawyer and president of the French
Sherpa Association, said he expected further lawsuits against others
operating in the country.
Yvette Mahon, director of the Burma Campaign UK, added that the Total
settlement would have no impact on the worldwide campaign to get Total
to withdraw from Burma. ‘If they think this agreement will help take
the pressure off, they are making a big mistake,’ she said. More than
150 MPs recently signed an early day motion in the UK parliament
demanding that Total withdraw completely from Burma.
Insurance giant Aon, Austrian Airlines, Eastravel, and Frommers guides
are among companies to have ended their involvement in Burma in the
past year. The latest company to have done so is the outdoor and marine
clothing specialist Gill Clothing. Siemens and Swiss Re are among
companies that have moved into Burma, according to the list.
