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Foreign Investors in Burma Under Pressure

A case brought by Burmese villagers against U.S. oil company Unocal was settled out of court in late March. The company was accused of allowing human rights abuses – including murder, rape and forced labor – to occur during construction of the Yadana oil pipeline in rural Burma (Myanmar) during the 1990s.

The settlement came less than a month after the Burma Campaign released a report claiming that France’s Total Oil – a major partner in the building of the Yadana pipeline – supports the Burmese military junta through investment and political intervention. The closely timed events may increase international scrutiny of the role played by foreign investors in Burma.

The French government has challenged efforts within the European Union to ban new investment in Burma. Activists say France’s reluctance to impose significant sanctions stems from its desire to protect the interests of French companies like Total, the world’s fourth-largest oil company. Total, citing job creation and its efforts to promote social and economic development, claims that positive effects from its investments in Burma outweigh negative consequences.

Foreign investment can directly or indirectly supply much-needed revenue to Burma’s military junta. Reports of widespread forced labor for infrastructure projects, such as tourism facilities, have led to calls for sanctions and boycotts. The International Labor Organization, the U.N. agency for the promotion of labor rights, recently warned of renewed U.N. sanctions against the country for large-scale labor rights abuses.

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