Weekly Business Roundup (September 19, 2009)

Singapore Banks Deny Holding Junta Gas Cash Stash

The two Singapore banks named in a report on Burma's missing gas money have denied holding billions of dollars for the military junta.

The DBS Bank and the Overseas Chinese Banking Corporation (OCBC) were identified by an EarthRights International (ERI) report as between them holding US $4.83 billion siphoned off the national budget.

ERI alleged that the money was the bulk of payments for gas produced over the last nine years by oil giants Total of France and the US’s Chevron from the Yadana field in the Andaman Sea.

DBS Bank, which is partly owned by the Singaporean government, says “ERI's report is categorically untrue and without basis.”

The OCBC also issued a statement denying it is holding money for the junta.

In its report—“The Human Rights, Environmental, and Financial Impacts of Total and Chevron’s Yadana Gas Project in Military-Ruled Burma”—ERI says it has reliable information that the junta leadership is “hiding billions of dollars of the people’s revenue in Singapore while the country needlessly suffers under the lowest social spending in Asia.”

ERI estimates that Total, Chevron and third partner PTTEP of Thailand have earned a combined $1.3 billion since commercial production started at Yadana in 2000. The field provides 60 percent of Thailand’s annual gas consumption.

Multimillion Dollar Drug Haul in Burma as US Renews Blacklist

The United States government has renewed Burma’s name on a blacklist of countries that produce or distribute illegal drugs.

The list includes 20 countries, but Burma is one of three singled out as having “failed demonstrably” to tackle the drug problem, said a report by the US State Department.

The renewed blacklisting—which means continued sanctions—came as it was reported that a big cache of amphetamine pills with a street value of more than US $6 million had been found inside Burma.

The pills cache was discovered in a cave in Shan State, according to a report in the state-controlled New Light of Myanmar newspaper.

It follows several similar drug hauls reported inside Burma this year, including 1,000 kg of heroin seized in Tachilek, near the border with Thailand, in July.

Indian Government to Finance Burma Dam Study

The Indian government is reportedly spending at least US $1.5 million to finance feasibility studies for two potential hydroelectric dams in western Burma.

Indian media reports say the money will be used by the Indian state-linked engineering firm National Hydroelectric Power Corporation (NHPC) to conduct tests on the River Chindwin at Tamanti, the site of a stalled dam project.

NHPC managing director S.K. Garg is quoted by the Mint newspaper as saying the money would be provided by India’s Ministry of External Affairs as “part of India’s efforts to improve diplomatic and economic ties with its eastern neighbor and counter China’s growing influence.”

Burma’s military government signed a memorandum of understanding with NHPC in 2004 to develop a dam at Tamanti, but nothing much has happened since.

The dam, earmarked to have a 1,200-megawatt electricity generating capacity, would cost $3 billion and 80 percent of the power generated would be pumped into India, says the Burma Rivers Network, an environmental protection NGO.

China’s Pro-Junta Polices Risk Backfiring, Warns Study

The fighting in northern Burma which sent thousands of people fleeing into China—many of them ethnic Chinese with small business interests—“illustrates China’s dilemma in supporting the military junta,” says a new report by the International Crisis Group (ICG).

“[China’s] policies pose political, social and economic risks,” says the report.

“Because Chinese investments and economic assistance are largely based on the extraction and export of natural resources, they have not promoted wider economic development,” the report notes.

“Chinese companies with little incentive to pay attention to the sustainability of [Burma’s] export commodities or their environmental impact are being held responsible for widespread environmental and ecological destruction as well as forced relocation and human rights abuses carried out by the Burmese military.”

ICG is an independent analysis agency advising governments and intergovernmental bodies such as the UN, European Union and World Bank on the prevention and resolution of deadly conflict.