As the Burmese regime brutally increases its isolation of opposition leader Aung San Suu Kyi, the US and countries of the European Union remain steadfast in applying their pressure on the junta. US President Barack Obama formally extended his administration’s sanctions, while the EU is considering whether to step up its own measures.
Burma's stubborn, thuggish military leaders can shrug off Western pressure, however, knowing they can rely on support from such friendly and powerful neighbors as China and India. While neither Beijing nor New Delhi has officially commented on the latest moves against Suu Kyi, many Southeast Asian countries, some of whom have significant trade and investment links with Burma, are also inclined to follow a live-and-let-live policy towards the regime.
However, both camps—supporters of sanctions and proponents of engagement— acknowledge failure in their efforts to influence Burma’s military leaders. That is why US Secretary of State Hillary Clinton in February correctly said that sanctions applied by the US and the European Union, as well as the policy of constructive engagement by the Association of Southeast Asian Nations (Asean) and Burma’s neighbors, were not working.
So the question remains: who can influence the Burmese generals to listen to world opinion?
Many observers agree that a start could be made on at least ending ongoing human rights abuses if oil and gas companies operating in Burma use their influence with Burma's ruling junta, the State Peace and Development Council (SPDC).
Current investors in Burma’s oil and gas industry include companies from Australia, the British Virgin Islands, China, France, India, Japan, Malaysia, Singapore, South Korea, Thailand, Russia and the US.
Those companies are funding the Burmese dictatorship. At the height of the monk-led demonstrations in September 2007, Marco Simons, US legal director at EarthRights International, an environmental and human rights group with offices in Thailand and Washington, declared: "The oil and gas companies have been one of the major industries keeping the regime in power."
The concept of "corporate social responsibility" is often advanced by companies operating in Burma, although that’s usually just a shield behind which they campaign against international environmental and human rights regulations.
For instance, there have been documented abuses connected to the Yadana project operated by the French company Total and the US-based Unocal, including land confiscation, forced labor, rape, torture and killings within the communities along the pipeline. Compensation was paid to some victims after human rights groups filed legal actions against the companies before a federal court in the US.
Foreign investment in Burma’s oil and natural gas sector is significant. But there is no transparency in Burma about how much the government receives in oil and gas payments, nor clarity about how the funds are spent.
The military receives the largest share of the official budget and the Burmese regime allocates little to public sectors such as health and education. Instead, hundreds of millions of dollars disappear annually into the pockets of the ruling generals, their cronies and their pet projects, such as the new administrative capital, Naypyidaw, the cyber city, Yadanabon, and even a nuclear research reactor.
The latest action against Suu Kyi, following the regime’s criminal mismanagement of Cyclone Nargis relief and its crackdown on the September 2007 demonstrations should lead companies to search their consciences when contemplating deals with the regime.
ERI Project Coordinator Matthew Smith believes there are also business reasons to think twice about accepting Burma contracts. "Financing the Burmese regime in this way can only reflect poorly on a company’s reputation and that will ultimately affect their bottom line and ability to capitalize on deals in the future,” he says. “It’s simply bad business.”
Of course, good business must come with ethics, morality and responsibility. This is the time for shareholders of global and regional oil and gas companies operating in Burma not only to think about maximizing profits but also to face up to their responsibilities by evaluating the human rights impact and the criteria for continuing to invest there.