covering burma and southeast asia
Wednesday, June 28, 2017
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CONTRIBUTOR

Corruption Scandal in Burma: The Canadian Connection


By TIN MAUNG HTOO Friday, March 23, 2012


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(Page 3 of 5)

According to Ford, MICCL has no plans to resume operations until the GOB allows Ivanhoe to divest.”

A January 2009 cable indicates that Ford was still receiving instructions from Ivanhoe Mines head office in Canada despite the firm’s claims to the contrary. The cable states: “According to Ford, Ivanhoe Headquarters instructed him to produce a small amount of copper every six months to prevent the one-year timeframe from elapsing.”

Ford’s statement to the US embassy representatives revealing that Ivanhoe’s stake in MICCL was going to be sold first to a Burmese state-owned enterprise before being re-sold to Norinco suggests that Ivanhoe willfully disregarded its supposed Burmese divestment policy.

When the blind trust was created in February 2007 Ivanhoe claimed its stake in MICCL would not be sold to “excluded persons” who the firm defined in repeated regulatory filings as “residents or entities controlled by citizens or residents of Myanmar (Burma) or the United States.”

Tom Albanese, the CEO of Rio Tinto that currently owns 51 percent stake in Ivanhoe, revealed at a Rio Tinto shareholders meeting held in 2011 that Ivanhoe’s blind trust was administered under Canadian law. Attempting to deflect a question about Ivanhoe’s controversial actions in Burma, Albanese claimed, “Since the Trust was administered under Canadian law, what it did was none of Rio Tinto's concern.” (This statement was recorded by Roger Moody, a long time critic of Robert Friedland and Rio Tinto who attends the Rio Tinto shareholders meeting every year. See here for a related report.)

How a “trust” administered under Canadian law would be allowed to sell Ivanhoe’s 50 percent stake in MICCL back to the Burmese regime’s state-owned mining enterprise is something that must be examined by the Canadian government. Under Canada’s present sanctions policy, it would be illegal for a Canadian firm to sell something like Ivanhoe’s 50 percent stake in MICCL to any entity controlled by the Ministry of Mines, UMEH, or a group controlled by Tay Za, who is also black-listed.

As longtime Ivanhoe shareholders, the publicly controlled Canadian Pension Plan and its Quebec equivalent the Caisse Depot have a fiduciary responsibility to look into what happened to Ivanhoe's Burmese assets. In particular, the Caisse, a publicly run entity controlled by the Province of Quebec, must examine what happened given the massive 5.8 percent stake the Caisse currently owns in Ivanhoe.

Back in 2009, CFOB issued a press release after we learned that Gerald Nugawela, a self-described former employee of Ivanhoe, had stated in an a US Securities and Exchange Commission filing for his new firm that he had taken part in the sale of Ivanhoe’s Burmese assets to the Chinese Aluminum Company (Chinalco is also referred to as Chalco in the US cables).

Following our press release, Ivanhoe posted an open letter to CFOB on its website attacking our organization’s credibility. The letter, dated April 2009, was written by Ivanhoe’s then President and Chief Executive Officer John Macken and not only denied that a sale had taken place but also that any Chinese aluminum firm was involved in any way in bidding for Ivanhoe’s stake in MICCL.

Ivanhoe’s open letter stated: “Ivanhoe Mines is assured that Gerald Nugawela is not, and never has been, involved in any way, shape or form with the Monywa Trust’s 2007 acquisition, and subsequent offer for sale, of the interest in MICCL that formerly was held by Ivanhoe Mines. Ivanhoe Mines also is assured that the Monywa Trust is not associated with any Chinese aluminum business.”

Macken instead chose to attack CFOB and claimed that our reporting on the matter was part of what he termed a “disinformation campaign.”

Contrary to Macken’s denial, the Wikileaks cables show that Ford told the US embassy that the Chinese Aluminum Corporation had in fact been involved in the consortium negotiating with Ivanhoe. Going by the information disclosed in the leaked cables, it's clear that Nugawela’s brokering of the sale to Chinalco and its partners was vetoed by the Burmese regime, which wanted ME-1 to get Ivanhoe’s MICCL stake.

Several of the cables mention a Chinese aluminum company’s involvement in the bidding for MICCL. It's clear that this is Chinalco, but even on the odd chance that it was some other Chinese aluminum company, Macken’s claim that no Chinese aluminum firm of any kind was involved in the bidding for Ivanhoe’s Burmese assets is also untrue.

According to the MICCL website which was available online until the end of 2011 but appears not to have been updated since 2010, Andrew Mitchell continued to serve as a board member of MICCL for at least three years after the so-called transfer of Ivanhoe’s Burmese assets to the “trust”.



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tocharian Wrote:
24/03/2012
See, sanctions didn't mean much for charlatans like Tayza. They knew how to get around it. Anyway Canada, like Burma is full of Chinese "agents".

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