Labor Practices Draw Fresh Fire

A month after the United Nations’ International Labor Organization issued an ultimatum to Burma’s ruling junta to end its use of forced labor within five months or face expulsion, the country’s dismal labor record has come under renewed scrutiny on other fronts.

On July 12, a group of at least forty activists from the independent Sejahtera (Prosperity) labor union gathered in front of the Burmese embassy in Jakarta to demand a "dialogue" with Burmese officials over the use of forced labor and other labor-related issues. Embassy personnel refused to meet with the protestors, who dispersed after 40 minutes.

Although not explicitly mentioned by the group, one of their concerns may have been the fact that even paid workers in Burma earn far less than their Indonesian counterparts. According to the New York-based National Labor Committee, workers in Burma’s lucrative clothing export industry make as little as 4 cents an hour, or just one-fifth the going rate in Indonesia. With much of the sweatshop investment in Burma coming from Hong Kong, one US activist described businessmen from area as "the lowest of the low as far as the international garment industry is concerned."

But the Canadian arm of Wal-Mart, the world’s largest retailing company, has also come under fire after it was learned that it had received at least six shipments of garments from Burma since last June, despite a company policy that forbids sourcing from the country. The supplier of the consignments was a company owned by Lo Hsing-han, a former drug lord suspected of continuing involvement in the narcotics trade.

Mitsubishi to Invest $70 Million in Yetagun

Japanese trading company Mitsubishi Corporation has announced that it will provide US $70 million to build a floating storage offloading (FSO) facility for the Yetagun offshore oil and natural gas project in Burma by the end of July. The FSO facility, which will have a 625,000-barrel per day (bpd) handling capacity, is to be leased to Premier Oil of Britain, the operator of the Yetagun project. Initial production at the field started in late June, at a rate of 200 million cubic feet per day of natural gas and 6,500 bpd of condensate.

Meanwhile, Canadian company Ivanhoe Mines and Burma’s state-owned No.1 Mining Enterprise are looking for Asian partners to finance excavation of a copper deposit located near their already operating S&K Mine at Monywa, Upper Burma. The proposed mine site is expected to cost US$ 389 million to develop. The S&K Mine went into full production in 1999, and was financed by the Japanese trading houses Marubeni and Nissho Iwai.

BUSINESS DIGEST

Thais make headway on planned highway

Former Thai army chief Gen Chettha Thanajaro, in Rangoon recently as head of a delegation of Thai industrialists, said that an agreement had been reached with Burma’s military government on a proposed 130-km highway linking the Thai border province of Kanchanaburi with the Burmese port city of Tavoy. Local Thai businessmen, who offered to front 70% of the construction costs, have been pushing the plan for six years. The latest meeting went well, said the retired army chief, thanks to his close personal friendship with members of Burma’s ruling junta.

Yasuda, Myanma Insurance team up

Three years after signing a Memorandum of Understanding under the 1996 Insurance Business Law, Yasuda Fire and Marine Insurance Company of Japan has become the first foreign insurance provider to enter into a joint venture with Burma’s state-owned Myanma Insurance Company. The 1996 law entitles local and foreign private investors to provide life, fire, cash-in-safe and fidelity insurance. However, under the country’s Foreign Investment Law, all foreign firms operating in Burma are obliged to buy their insurance policies from Myanma Insurance.

CD pirates using drug routes

Burma, along with Macau and Hong Kong, are now the main sources of pirated CDs in China, according to the director of Beijing’s National Copyright Administration. Chinese officials said that despite the success of a crackdown on domestic producers, about 70% of bootleg music and video CDs now available in the country have been smuggled in from neighboring countries. They added that CD smugglers plying southwestern China’s border with Burma were using the same routes and methods as drug traffickers.

Best Western latest to leave Burma

Best Western International, the world’s largest hotel chain, announced from its headquarters in Phoenix, Arizona that it would no longer operate Rangoon’s Kandawgyi Palace Hotel or any other hotel in Burma after coming under sustained pressure from US-based activists to withdraw from the military-ruled country. "We are pleased to see that yet another US corporation has acted conscionably and withdrawn its operations from Burma," read a statement issued by activists.