Foreign Investors in Myanmar Risk Human Rights Abuses, Must Take Precautions

Myanmar is attracting new waves of foreign investors, from building Special Economic Zones to strengthening power and transportation grids. As Myanmar opens its economy, many foreign businesses are becoming involved in human rights and environmental justice controversies. Investors must address these risks or expose themselves to accusations of complicity in rights abuses.

Despite recent political changes in Myanmar, ethnic armed conflict continues, domestic laws fall far below international standards and the constitution leaves the military with extremely broad powers. Existing laws are often neither implemented nor enforced due to capacity and corruption issues. Investors are exposed to high levels of risk, as these conditions continue to lead to widespread human rights abuses, a weak rule of law, and the exploitation of people and the environment.

New Guide Shows Investors How to Take Precautions, Mitigate Risk

Myanmar is still a difficult place to do business and manage social and environmental risks. EarthRights International’s (ERI) handbook, A Guide for Small and Medium-Sized Enterprises Doing Responsible Business in Myanmar: A Rights-Based Approach, is a tool for conducting business responsibly, aimed at small and medium-sized enterprises (SMEs) investing or doing business in Myanmar.

Investors need to take special precautions to reduce exposure to specific risks and do business with confidence. Private sector accountability in Myanmar is largely nonexistent. Businesses that fail to respect human and environmental rights leave themselves open to litigation, targeting from community or NGO campaigns, inadvertent involvement in bribery and corruption, administrative penalties and greater regulation, disruptive protests or labor disputes.

It is therefore important for SMEs investing in Myanmar to conduct their own due diligence, such as social and environmental risk assessments, and produce mitigation plans based on international standards and in compliance with Myanmar law.

Ongoing Rights Abuses Demonstrate Added Risk in Land Acquisitions and Energy Projects

Business activities carry even greater risk when they involve extractives, infrastructure, energy, and agriculture projects. These business ventures often involve militarization at project sites, can cause widespread displacement, and can lead to human rights abuses involving environmental degradation, physical threats, arbitrary detention and destruction of local livelihoods. Business people linked to the military are entrenched in the private sector and often benefit from new investment while breaking laws with impunity – including on drug trafficking and money laundering.

This guide focuses on investments involving land acquisition and the potential for environmental harm. It offers recommendations and analysis based on issues that ERI has encountered working in Myanmar. It does not offer a comprehensive guide to all the issues that a business may encounter in Myanmar and should address in order to fulfill its responsibility to respect human rights (such as labor conditions, supply chain management, and child labor). This guide identifies environmental and social risks inherent in investing in Myanmar and provides a starting point to address these risks with a rights-based approach. Further resources for businesses operating in Myanmar are included at the end.