The Irrawaddy News Magazine [Covering Burma and Southeast Asia]

JUNE, 2002 - VOLUME 10 NO.5

Investors Under Fire

A legal action against US oil giant Unocal cleared a major hurdle in June, when a Superior Court judge in Los Angeles refused to dismiss a lawsuit charging that the California-based company is liable for human rights abuses committed during the construction of the Yadana natural-gas pipeline in military-ruled Burma. The US $1.3 billion project is jointly owned by Unocal, Total SA of France, PTT Exploration and Production of Thailand and Burma’s state-owned Myanmar Oil and Gas Enterprise. The case is set to go to court in September.

This latest development in a lawsuit that was first filed in 1996 comes as there is renewed debate about US economic sanctions against Burma’s ruling junta. Although Unocal entered Burma before sanctions were imposed in 1997, and is therefore not subject to them, the case will highlight the sort of abuses that continue in ethnic areas despite the junta’s recent relaxation of restrictions on the country’s main opposition party. Already, a report released in July by Shan human rights groups, detailing the widespread use of rape by Burmese troops as a means of intimidating civilians, has greatly damaged the regime’s recent PR gains in Washington.

Another company that continues to face activist ire is Canada’s Ivanhoe Mines, which is a 50/50 joint-venture partner with the Burmese regime in the Myanmar Ivanhoe Copper Co, Ltd. Besides angry protests during its annual shareholders meeting in Vancouver, the company’s Burmese venture has come under pressure from its financier, Japanese trading company Marubeni, for falling behind on repayment of its $90 million debt.

Up in Smoke

Burma’s most lucrative industry experienced a billion-dollar setback in June, as the country’s rulers launched a publicity blitz to mark the United Nations’ International Day Against Drug Abuse and Illicit Trafficking. At a Rangoon ceremony attended by foreign diplomats and journalists, the junta said it burned 3,027 kg of opium, 240 kg of heroin, 434 kg of marijuana, 34.9 million amphetamine tablets, four million ephedrine tablets and 2,865 kg of powdered ephedrine, valued at an estimated $1.08 billion.

In a related development, the regime also introduced a new law to control money laundering, effective June 17. Col Tin Hlaing, who will head a new committee with wide-ranging powers, assured businessmen that the measure would not have an adverse effect on business activities.

Meanwhile, as part of its ongoing anti-Thai campaign, the Burmese regime also burned three tonnes of monosodium glutamate imported from Thailand and destroyed 67,200 cans of the Thai energy drink Krathing Daeng ("Red Bull"), worth about one million baht (US $23,000). Also as a result of recent bilateral tensions, Thailand said that it could not pay 4.5 billion baht ($105 million) it owed to Rangoon for the supply of gas from the Yadana gas field.


Hydropower Plant Put Into Service

A new 30-megawatt hydroelectric power plant in Kanbalu Township, Sagaing Division went into operation on June18. The US $20-million Thaphanseik hydropower plant, financed by the China Import and Export Bank, consists of three 10-megawatt hydro-turbine generators located on the Mu River. "The plant is part of a move to rack up more than 10 planned projects aimed at generating an extra 2,000 megawatts during the next five years," said U Aung Koe Shwe, the deputy director general of Burma’s Hydroelectric Power Department.

Japan-Burma Panel to Hold Final Meeting

A joint economic panel of Japanese and Burmese government officials and private-sector experts was scheduled to meet in July for the last in a series of discussions on ways to resolve structural problems that have hobbled Burma’s economic development. The panel will submit its policy recommendations to top leaders of the two countries by the end of the year. Tokyo has also extended the first installment of 3-3.5 billion yen (US $25-30 million) in grants-in-aid for the rehabilitation of the superannuated Baluchaung No 2 Hydropower Plant, the largest in Burma.

Tension Over Teak Plantation

A teak plantation created under instructions from Burma’s ruling junta has brought new tensions to the India-Burma border region. According to a report from the India-based Mizzima news group, local officials and businessmen in Moreh in Northeast India are strongly opposed to the plantation, which is located in a no-man’s-land between the two countries. The move follows another controversial decision by Burmese authorities to build a large market complex on disputed land near Moreh.

Burma-Bangladesh Talks

Bangladeshi Foreign Secretary Shamsher Mobin Chowdhury was in Rangoon on June 17 to meet with Burma’s Deputy Foreign Minister Khan Maung Win to discuss means of strengthening economic cooperation and other bilateral issues. At the meeting, the two sides agreed to facilitate trade by increasing infrastructure in the Bangladesh-Burma border area, including warehouses, a road network and a land port in Bangladesh’s Teknaf. Burma enjoys a large trade surplus with Bangladesh, exporting nearly $25 million worth of goods in 2000-01, against just one million dollars in imports.

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