“Take, for instance, the involvement of Western oil corporations in the Yadana gas project. Though highly controversial, Western oil corporations have created well paid jobs, established microcredit schemes to boost indigenous entrepreneurship, and reached out to local communities. They have made considerable investments in education and health care, on a local and nation scale.”
Which makes me think he may be on crack, because, yes, he is referring to Total/Unocal, which was sued for human rights abuses by indigenous people from several countries. But nonetheless, both Zar Ni and Halliday have made similar statements regarding the need for a change in sanctions, and made similar criticisms regarding “The West’s” approach to Burma. There are two things here that I feel need to be addressed, first, the perception of the West’s (read - US) approach being only sanctions, and second, that economic investment would bring about liberalization in Burma.
“Sanctions and isolation only stymie the emergence of a viable civil society” (Zar Ni)
“Western commentators in liberal think tanks frequently insist that with just one more ratcheting up of sanctions, the junta will fall and a transition to democracy will ensue” (Halliday)
No one can deny that civil society within Burma has been stymied. I would argue that the arbitrary arrest and murder of political dissidents has done a lot more to stymie civil society than sanctions, but that’s a little beside the point here. And there probably are some people who think that tougher sanctions alone would lead to a regime change, but I’m not sure who’d they be. Boycotts and sanctions were a primary tool of activist groups like the FBC, but they aren’t the US’s sole strategy when it comes to Burma.
I myself have made similar accusations against the US, as Halliday, and I’m certainly not defending sanctions here, but if we’re all going to have an intelligent debate on the issue, than we need to be fully informed. Especially if we are going to be publishing articles about in the Wall Street Journal.
The fact is, the US government, (as well as several other countries, including Canada), has been investing millions in support of exiled civil society and democracy movements along the border regions of Burma. I haven’t been able to find the most recently updated reports, but in FY 2003 and 2004, the US earmarked 6.5 million dollars for this purpose. And the growth of ethnic civil society and the positive impact of ethnic civil society organizations in the border areas is undeniable. The organisations which have received and distributed the funds are: the National Endowment for Democracy, the International Relief Committee, World Education/World Learning Consortium, the American Center for International Labor Solidarity, International Organization for Migration, Open Society Institute, Internews, and Prospect Burma. The last three, in particular, are well-known and well respected among the activist community. I have never seen anything to indicate that the US is unduly influencing the agendas or direction of exiled CSO’s or the democracy movement.
This point is not insignificant, if we’re going to ‘reconsider our strategy’ , then we also need to consider what’s already been successful, and how, not just throw out accusations about what’s failed. Its easy to use Cuba as an example and point out how short-sighted the US is in its use of unilateral sanctions, but we can’t forget that the boycotts and sanctions maybe did do some good in the beginning - we can’t say that Burma would be better off now if those companies which pulled out, hadn’t, or if investment had continued unabated without any critical awareness or public accountability.
The debate now on sanctions needs to look at the present, and the future. Obviously, it hasn’t brought about a regime change. Something needs to be reconsidered. But ‘abandoning’ sanctions, as Halliday calls for, risks making the same mistakes of tunnel vision and simplicity as blindly enforcing sanctions does. We need to consider the alternative - will economic investment bring about political and social reform in Burma? That is the million dollar question.
Halliday certainly thinks so:
“Across much of Asia, it is businesses that are currently pushing the envelope of social development. In China, no more democratic than Burma - but generally held to be an acceptable venue for investment - worker terms, conditions and rights have been upgraded by inward investors who are responsible corporate citizens and monitor compliance down their supply chains. In the long run, it is only on these sorts of foundations that political reform and democratization will take place across the region.”
Apart from the fact that this is an incredibly sweeping statement, I find the notion that democratization can only take place on the back of economic development a little scary. I’m guessing that both Halliday and Zar Ni are taking China and Korea as examples of how economic development has brought about political reforms. But let’s consider for a moment that Burma isn’t China, and capitalism isn’t democracy. There’s a lot about the Chinese government that hasn’t changed due to economic development, and it doesn’t provide particularly strong evidence for the argument that an open economy will lead to a more open society or a more open democracy. Economic prosperity is easily manipulated to present the illusion of social or political ‘prosperity’.
It is dangerous to compare Burma to other countries in ‘the region’ in an effort to transplant strategies. The one thing which makes Burma so different from China and Korea is the one thing which forces us to reconsider the ‘investment for political reform strategy’. Which is that Burma is one of the most ethnically diverse countries in Asia, with approximately 40% of its population being ethnic minorities. This is comparable only to Malaysia - where the 40% is comprised of non-indigenous ethnic groups. The ethnic homogeneity of East Asian nations has played a significant role in their political and economic development. It is a defining characteristic of those nations in many ways. In the same way, Burma’s diversity is key in both understanding its problems and in developing viable solutions.
Zar Ni points this out in his own commentary, “Burma’s problems include pre-colonial ethnic and political divisions institutionalised and exacerbated by 100 plus years of Britain's colonial policy”. I also agree with Zar Ni that the West is too focused on the 1990 elections and the NLD’s rights to leadership. Even with democracy, Burma faces an uphill battle with national reconciliation. But what Zar Ni doesn’t point out, is that these ethnic tensions have been as exacerbated by what is perceived among the non-Burman groups as the ‘Burmanization’ policies of the central leadership, as well as a perception that ethnic Burman’s have consistently overlooked the needs and rights of the ethnic minorities.
It is exactly this reason that the West’s approach has been inadequate, it is the reason why we can’t compare Burma to other Asian nations in developing certain strategies, and it is also the reason why sanctions can’t be lifted as blithely as Halliday seems to suggest.
Of course, the ethnic Burmans are also indigenous to Burma, and if this issue were limited to those regions, I probably wouldn’t be debating it. But in the ethnic states, the central government has taken on the role of the colonialists, and they are systematically destroying the cultures of the ethnic groups that live there. Kachin state is a shining example of how the junta has used economic development to further their own agenda of cultural destruction and domination. Of course the KIA is not innocent in this situation, but essentially, they chose the junta’s carrot of economic development over a continuing armed struggle. What they got were policies which favored Chinese over local investment, rampant environmental destruction and loss of livelihood. Perhaps ‘Western’ corporations would behave more ethically than the Chinese, perhaps they would reinvest revenue into the communities, but in the absence of any accountability or incentive to do so, I have little faith. Few multinational corporations possess either the knowledge or the ethics necessary to create more than profits in such a complex situation.
The issue of how development and investment (i.e. the lifting of sanctions) will impact on the ethnic minorities and the ethnic states should be key to the debate. Corporations and development come into conflict with indigenous people even in first world countries, so it’s a reasonable assumption that this will also happen in Burma. The ethnic conflict is one of the central challenges facing Burma - if foreign investment continues to have the kinds of negative impacts in the ethnic states as it has already, it will only breed more resentment and hinder the reconciliation process.
If investment is going to be considered as a means for change, then we must consider what would happen if sanctions were lifted. Who is going to invest in Burma?
Presently, the majority of the foreign investment is coming from China, as well as a few other Asian nations. Chinese businesses are well acquainted with the process of doing business through special ‘connections’ and ‘fees’. But even compared to China, the situation in Burma is extreme. There aren’t even informal rules governing who should be paid, when, or how much. Officials change positions like musical chairs, and the rules change to suit whoever is in charge. Businesses from Hong Kong and Singapore have pulled out of the country citing the difficulties and expense of keeping up with the quixotic buearacracy. Who is going to invest, given this situation? What are the odds of profiting from a business there?
The only way to earn a reasonable profit from this situation is if a business’s revenue and profit are significant enough to cover the cost of fees and taxes. Natural resource extraction and mining are first and foremost the most lucrative business ventures in the country, because absurd revenues and profits can be made, often in partnership with the government, which likely minimizes the red tape that has to be cut through. Second, is labor intensive manufacturing. I think it’s safe to assume that current manufacturers manage to balance those additional expenses by the ridiculously low wages paid to their workers. But, why would a factory that plans on paying fair wages choose to open in Burma, when Thailand, Cambodia, and Vietnam have better accountability and transparency with minimum wage rates comparable to what Ian Halliday claims Total was paying as a fair wage in Burma?
Without creating more transparency in Burma, few ‘ethical’ businesses will voluntarily invest there. The currency is unstable and the government is unpredictable. Who will invest there are mining, oil/gas, and logging companies, eager to get a piece of Burma’s incredible natural resources. And this brings us back to the first problem - the majority of these natural resources lie within the ethnic states. So as long as the central government is making decisions and policies regarding such investment and development, the problems for ethnic minorities and the environment will only be compounded. No where in the world do these industries provide as much benefit to the local people as they do to the government and the company itself.
This raises a host of questions that would have to be addressed and debated, such as: If non-destructive industries like manufacturing do grow with a lifting of sanctions, will the government allow investment in those areas currently closed to foreigners? Will there be any way to guarantee and protect indigenous land rights in the ethnic states? How do we ensure the government doesn’t continue to manipulate foreign investment and businesses to suit its own political agenda (and colonization)? These are bigger issues than individual businesses would be able to address solely through their own business practices.
Halliday and Zar Ni make valid points in saying sanctions should be reconsidered, I’m not disagreeing with that. But, if we are going to lift sanctions to help the people, then we need to give serious consideration to the realities of Burma, and how the people will be impacted by further investment. So let’s move beyond theoretical musings about ‘pushing the envelope of social development’ or opening society through economic growth, because there’s little to no hard evidence that either of those positions is valid. Let’s get on to serious questions about how we can use the lifting, or partial lifting, of sanctions to actually promote change in Burma, based on what we know about Burma.
Can we use the lifting of sanctions to entice the junta to the negotiating table to develop a strategy for improving transparency? Or, could we use it to persuade them to negotiate the formation of an independent body to oversee reforms in the country, as some people have suggested? Could we use the promise of greater transparency to get China to come to the negotiating table?
If sanctions are lifted, how do we ensure that there is real accountability for Western companies there? There must be measures taken to ensure that the ethnic states get more than token representation in any process resulting from development, and that indigenous landholders get a real and fair say in any development on their land. Can Western investment be used to pave the way for International NGOs and humanitarian organizations that are currently unable to work there?
If Western investment brought an increase in accountability and balanced the negative impact of Chinese development there, then of course that would be a positive. But that won’t necessarily happen with a laissez-faire attitude to the whole thing. Without appropriate safeguards and measures, a lifting of sanctions could also have a negative impact.
In the end, we also have to consider that any influence or power the US has to effect change in Burma is limited. The problems in Burma run much deeper than the US’s recent involvement. As outsiders, we must always be thinking of what we can do to help, but ultimately, sustainable change will only come from within Burma and from the people. Sanctions have had little impact on the regime because their pockets are lined with Chinese money. Everyone knows this. But, sanctions from the US are not the only thing stopping Western investment there. Massive corruption and red tape aren’t usually put in the ‘plus’ column when deciding which country to do business with. The junta has done little to show they care about the welfare of their people, and lifting of sanctions may not be any incentive to them at all to change their ways. There’s little reason to think they’ll allow anything that doesn’t protect their position in power or promote their own agenda.
I certainly don’t have the answers as to how to address sanctions, its a complex issue that deserves a complex debate based on practical and real facts, and within the context of the challenges Burma is facing. After reading Zar Ni’s editorial, I found a letter he had written from Burma to his friends and colleagues. He writes, ”I look forward to the day when Burma debates are less orthodox, less polarized and more constructive and intelligent.” So do I.
Link: Does Growth Lead to Liberalization?