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IDJ-ENGLISH Human Rights Need More Consideration by Japanese Companies



Human Rights Need More Consideration by Japanese Companies

-Japan’s “Public-Private Partnership” Investment is Stumbling in Myanmar
Five months have passed since the military coup in Myanmar on February 1. The military crackdown continues against civilians seeking to end violence and restore democratization, and there is no sign of improvement. On the other hand, some Japanese investment projects have been severely criticized for “benefitting the national army”. IDJ reports on the problems of Japanese investment in post-coup Myanmar. (Yukifumi Takeuchi)
Emphasizing practical business
Based in Yangon, Myanmar’s commercial capital, there is an international NGO that is promoting quiet signature movements among business communities. The Myanmar Centre for Responsible Business (MCRB) was originally established by the UK’s Institute for Human Rights and Business (IHRB). Since February 19th, the statement by “Concerned Businesses Operating in Myanmar” has been posted on its website.
”As investors, we inhabit a ‘shared space’ with the people of Myanmar, including civil society organizations, in which we all benefit from respect for human rights, democracy and fundamental freedoms – including freedom of expression and association – and the rule of law. The rule of law, respect for human rights, and the unrestricted flow of information all contribute to a stable business environment”.
“We remain committed to our employees and to the people of Myanmar. We hope to see a swift resolution of the current situation based on dialogue and reconciliation in accordance with the will and interests of the people of Myanmar.”
MCRB is asking foreign and Myanmar companies that are expanding into the country to sign the statement. They seem to be trying to avoid clashing head-on with the military, acting with a calm demeanor from the perspective of a “practical business” position, saying that “the law, democracy, and respect for human rights are essential for business.” As of early June, 233 companies have signed, according to a list posted on its website homepage. In addition to the food and beverage industries such as Coca-Cola, Nestlé, Carlsberg, Heinekens and KFC, well-known companies in the United States and Europe such as Unilever, H&M, and Facebook.
The Japanese companies have the names of local subsidiaries such as Denso Co., Ltd., Kubota Co., Ltd., H.I.S. Co., Ltd., and Nishimura & Asahi Myanmar Limited.
The head of MCRB is a former British diplomat who also served as ambassador to Myanmar (2002-06). She is fluent in Burmese and was a secretary at the embassy in the 1990s. MCRB mediated a dialogue between the Japan International Cooperation Agency (JICA) and the local residents of the Thilawa Special Economic Zone.
The statement also includes Japanese, Chinese, and Korean translations, and also asks Japanese, Chinese, and Korean companies to sign it. It might be Ms Bowman’s idea who is familiar with Japanese diplomacy and trends among Japanese companies.
However, an executive of a certain Japanese company is reluctant to respond to the MCRB movement. He cares about his company being glared at by the Myanmar military if his company signs it.
However, as enshrined in “the UN’s Guiding Principles on Business and Human Rights”, companies need to take steps to prevent human rights-related risks. It means that in Myanmar, business should not be involved with the military, which is clearly committing criminal acts that are serious human rights violations.
The eyes of the international community increasingly harsh against the military
After the coup, the investment risks held by Japanese companies became clear. A large complex building under construction near the Shwedagon Pagoda, a famous ancient temple in Yangon. It is “Y Complex”, already reported in the Myanmar Special Feature Stories of this magazine, IDJ, in May edition.
A major real estate development company, Tokyo Tatemono Co., Ltd., a general construction company, Fujita Co., Ltd., and Japanese government-based Japan Overseas Infrastructure Investment Corporation for Transport and Urban Development (JOIN) invested a total of approximately 36 billion yen. After completion, Japanese Hotel Okura, apartments and commercial facilities are supposed to move in. According to Justice for Myanmar, a local NGO, the land is where the military museum was previously located and owned by the military, and more than 200 million yen a year in rent for that real estate is paid to the Ministry of Defense under the Military.
The question that came to mind when I heard this, was whether there were any objections to this public-private partnership project in the process of making investment decisions, including from government agencies. In particular, the Japan Bank for International Cooperation (JBIC), Mizuho Financial Group, Inc., and Sumitomo Mitsui Financial Group, Inc. decided to co-financing a total of 16 billion yen in December, 2018.
The Rohingya refugee problem had already been highly controversial before this. Myanmar’s strong military was severely criticized by the international community, and the NLD government at the time was shaken. However, was no risk pointed out during the process of investment decision? Why was this business given the go-ahead?
The IDJ team of journalists requested explanations from the companies involved and received certain responses regarding this project; Tokyo Tatemono Co., Ltd., JOIN, JBIC, Mizuho Financial Group, Inc. and Sumitomo Mitsui Financial Group, Inc.
IDJ received responses from most of these companies. As the central position of this project, here we introduce written answers from Tokyo Tatemono and JOIN.
The details of the business decision could not be disclosed as “business confidentiality.” But “the local operating company has rented the site from a Myanmar joint venture company. The company has borrowed the land from the Ministry of Defense, an agency of the Myanmar government. But we recognize that the ultimate beneficiary is the Government of Myanmar, not the Ministry of Defense.” They also stressed that they strictly complied with laws and regulations, saying, “We also conducted studies about the country’s related laws and regulations, related permits, etc., concerning this project, as well as the U.S. Burmese Economic Sanctions Regulations concerning business partners and confirmation of various regulations under the Foreign Asset Management Act.”
There seems to be a point in the view that “the ultimate beneficiary is not the Ministry of Defense, but the government”. However, in Myanmar, the national defense budget is not obligated to disclose information under the constitutional provisions. The whereabouts of the funds paid is unclear.
“Japanese companies only emphasize the legal risks and are willing to do so if there are no legal issues. But they don’t think highly of stakeholder risks (such as business partners) ,” Bowman said.

During the former military rule of the State Law and Order Restoration Council (SLORC) in the 1990’s , I often saw Japanese expatriates playing golf with senior military officials at the military golf club in Yangon and building connections. Including other Asian countries, it was a show of the skill of the corporate warrior to deeply engage with the regime of the development dictatorship.
Now, however, the times have changed dramatically. The international community’s eyes are on the military rule and are becoming increasingly critical. Business with the military, which tramples on Myanmar’s hard-fought democracy and continues to crack down on human rights, will not work.
“International Development Journal”, July edition, 2021



ミャンマー つまずいた日本の“官民連携”投資


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