Contact: Roland Watson, roland@dictatorwatch.org


September 29, 2012

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The United States has now ended its economic sanctions on Burma. The Embassy in Rangoon is open for business - literally! This means American companies will accelerate their push to get into the country, alongside their competitors from China, Thailand, Japan, Singapore and Europe.

This is terrible news. Economically, it means that the best business opportunities in Burma will be stolen, from the people of the country, and divided between the corporate raiders and regime cronies. The only crumbs that will be left will be to work as disenfranchised wage slaves, and in a devastated natural environment.

Even more worrying, Burma is in no way ready for economic development. What the country requires is (1) political development, including ending the attacks by the Burma Army against the Kachin and other ethnic groups, and the freeing of ALL political prisoners; and (2) social development, to address the devastating shortage that exists in satisfying the people's basic human needs.

These are infinitely higher priorities than the quest for corporate profits, and which many people, including 88 Generation leader Min Ko Naing, and Karen National Union General Secretary Naw Zipporah Sein, fully understand. However, the only Burmese voice that has any currency at all with the international community, Aung San Suu Kyi, does not see it this way. After consultations with Hillary Clinton and Derek Mitchell, she apparently was persuaded to reverse her support for the sanctions and to embrace commercial development openly.

Suu Kyi made a mistake, but given her lack of experience with international business and trade, it is not that surprising. She has been under house arrest. She does not understand how the world really works.

All major economic developments in Burma will begin with one commodity, land. Whatever a multinational company wants to do, be it build a factory, or an electrical transmission line, or dig a mine, it will need land. But, there is no land law in Burma. The people do not even have title to land that their families have owned for generations. This means that there is no proper mechanism by which to transfer land, including judicial procedures through which to resolve disputes.

Burma, economically, is a corrupt and savage place. International companies are being courted by the regime, which promises to supply the land. The regime is also using incentives - bribes - to pervert ethnic leaders that have influence in the minority homelands. Reports of inducements to such leaders (e.g., Karen traitor Mutu Say Poe) are widespread, for example from Myanmar Egress and Dawei Princess for the multi-billion dollar Tavoy Port development. In summary, a terrible corporate rape appears primed and ready to go.

While Suu Kyi may support this, it doesn't have to happen. The people have a number of ways that they can block the economic and ecological destruction of their country.

The first of these is to protest. When the regime, through the Burma Army or other security apparatus, attempts to steal villagers' land, the people should launch massive local and even nation-wide protests. For example, this is exactly what is being done at the Letpadaung expansion for the Chinese Monywa copper mine, where 8,000 acres of land was stolen. The regime is finding it exceedingly difficult to control these protests. While Suu Kyi will never participate in or even support them, they are a rallying cry for many groups, from the affected villagers to political groups such as 88 Generation and also ethnic nationality organizations. This creates a strong alliance, which the regime is afraid to confront.

Therefore, in the face of new land seizures, similar protests should be launched. Furthermore, if the land is being stolen for a Western company, the protestors should rage against it. When the international business press learns that local people are protesting, the companies, to save face, will have to reverse course (witness Apple's travails with Foxconn in China). Protest alone will stop most if not all major land thefts, and through this halt the corporate juggernaut in its tracks.

Secondly, many likely projects involve resource extraction in ethnic areas that are at least partially under the control of ethnic resistance forces. In these cases, one example right now is the Shwe gas pipeline to China, the land theft is always conducted by the Burma Army and accompanied by gross human rights abuses. Just as the Kachin and the Shan have been fighting the Army in and beyond the pipeline route, so too should all of Burma's two dozen or so ethnic forces defend other economically strategic areas from regime offensives and land thefts.

Lastly, there is the problem alluded to above of confronting ethnic leaders who have been persuaded to turn against their people and to back land theft and exploitation. Said another way, this is the ongoing challenge of maintaining allegiance to the goal of real freedom in the face of an exceedingly long struggle, and with an aggressor which has great resources at its disposal with which to offer bribes, and which has also proved adept at using the tactic of divide and conquer. In such cases, leaders who remain true to their people can bolster their support by encouraging the people, and most importantly their revolutionary soldiers, to continue the fight until real freedom is achieved, and not to settle for surrender and a false peace.

Through working on all three of these approaches, the people of Burma, and the leaders who have their best interests at heart - who are not just out to make a quick buck - can provide level after level of resistance such that the corporate executive fantasies of Burma treasure soon evaporate.

One thing that Aung San Suu Kyi definitely does not understand is as follows:

The business opportunities in Burma will require huge amounts of what are known as capital expenditures. Mines, factories and the like need investments of tens of millions, hundreds of millions, and even billions of dollars.

Corporations do not make such expenditures unless they expect a reasonable return, which they further attempt to forecast using sophisticated computer models and such measures as the internal rate of return and net present value. This return, in addition to being large, must also be secure. Companies are unwilling to accept little in the way of uncertainty.

A capital project is evaluated over its term, and for large projects this will usually extend to twenty or even more years (think of the lifetime of a building). What no one has commented on publicly, although the corporations are unquestioningly thinking about it, is that Burma does not provide certainty as an investment home over this long a period. It is very risky to assume that the country will be stable even three to five years into the future.

The only exceptions to this are for offshore natural gas production, which operations the companies generally can control, even in the face of a local revolution, and projects such as Monywa and the Shwe pipeline, where the Burma Army is guaranteeing (or attempting to guarantee) security and the end of the local resistance.

There are many identifiable, upcoming events, though which Burma's facade of peace may shatter, and which would spell the loss of all such investments. These include:

- An expansion of the Kachin conflict, including with the possible participation of other ethnic armies, if they renounce the ceasefires that they have and which the regime is already breaking, which expansion may not only unsettle the entire country but actually lead to the dictatorship's collapse.

- The possibility that Aung San Suu Kyi will not only not succeed with her "negotiation," but that she may in some way become incapacitated or unable to contribute. Burma without her will instantly become more unstable. (If she continues to deny the regime's crimes, Burma will also become more unstable.)

- This risk also includes the scenario where she is denied a larger role in the 2015 election, which election on its own may become a trigger for unrest.

- And, the fact that a national census has to be conducted in advance of the election. The military regime falsified the last census in 1983 by registering Buddhists as Burmans, even when they were members of ethnic minority groups. The new census will be hyper-sensitive, and any similar fraud will certainly be met with strong resistance.

No matter how rosy you try to portray it, even in the near term the prospects for Burma are full of uncertainty, and to many if not most hard-nosed executives contemplating spending huge sums of money, this will prove to be too great a risk to take. After all, when Suu Kyi is no longer around, and Burma truly is free, the people may decide to nationalize all extant multinational operations, as punishment for their support of the regime's tyranny. And, in the world of international law, such companies will have no standing on which to protest. They took a gamble working with the dictatorship, and lost.