Curbing Vulture Capitalism and Protecting Workers Rights Should Follow Myanmar's First Democratic Steps

Industrial background - crusher rock stone crushing machine at open pit mining and processing plant for crushed stone, sand a
Industrial background - crusher rock stone crushing machine at open pit mining and processing plant for crushed stone, sand and gravel

Myanmar has taken its first steps away from decades of brutal military rule with the election of Aung San Suu Kyi's democratic party.

The Nobel Peace Prize winner claimed a sweeping victory for her National League for Democracy (NLD) opposition, after the first quasi-democratic elections for more than 60 years.

The elections were not without controversy, with Suu Kyi saying the polls were not entirely fair but "largely free" with claims of intimidation and problems with the ballot process.

Despite these problems, the election result represents an historic first step for a country forced to endure more than 50 years of military rule.

Democracy is rarely easy, nor swift.

Yet the rush to capitalize on Myanmar's resources has already begun, with its reserves of oil and gas, gemstones, timber, agriculture, fish and the nation's workforce itself all positioned geographically between the two economic powerhouses of China and India.

Since the current ruling party came to power in the rigged elections of 2010 -- and the subsequent lifting of sanctions introduced in the late '90s -- multinationals and big business have scrambled for the country's resources.

The ITUC report on the issue, Foreign direct investment in Myanmar: What impact on human rights, has results which are eye-opening to say the least.

To really get a sense of this boom, consider this: from 1988 to 2012, there were only 477 foreign companies investing in Myanmar, for a total direct investment of US$4.1 billion.

In the past year alone those figures have doubled. During the last financial year, foreign direct investment reached a record $8 billion from almost 900 companies.

Big-name foreign companies have recently set up supply chains in the country, including: Germany's Adidas, American clothing retailer Gap, Swedish-based H&M, UK-based Marks and Spencer and Primark, as well as Norwegian and Qatari telecom companies.

Yet the biggest international players are from the oil and gas sector, worth about US$3.2 billion alone last year, with the UK's BG Group, the USA's Chevron, Eni from Italy and Royal Dutch Shell among 141 foreign companies new to expanding in Myanmar.

France's Total continues to operate the Yadana gas fields, the pipeline of which remains deeply controversial due to evidence of state soldiers forcing villagers to work on the pipeline with claims of beatings, torture and death the result.

In Myanmar's era of sanctions, foreign companies such as Total, Chevron, and their Thai and Burmese partners were mired in a scandal involving such forced labour, land seizures, rape, torture and murder.

During the unprecedented boom companies have targeted Myanmar for unencumbered profits without the impediment of a robust rule of law.

Given the country's workers earning among the lowest wages in Asia, it is labour in Myanmar that has borne the brunt of vulture capitalism, with fragile reforms and weak human and rights legislation providing insufficient protection.

The fact the fledgling trade union movement is growing in Myanmar is significant but the challenge to stop the widespread exploitation of workers is immense.

Welcoming foreign investment feted so highly, human rights, environmental standards and an independent judiciary are not pursued as high priorities.

Child labour is common with UNICEF reports of almost one in five children aged between 10 and 14 engaged in work.

Myanmar has yet to become a party to most of the international human rights conventions, including those upholding civil and political rights and the convention against torture. Just three International Labour Organisation (ILO) standards have been ratified, leaving a vulnerable legal framework for worker protection.

Collective bargaining and resolving workplace disputes remain fraught propositions, as ILO chief adviser Christopher Land-Kazlauskas states.

Retaliation against union leaders in both the severity and frequency; we are seeing is a huge obstacle to industrial peace... If the government can't make this illegal or put in place penalties that will keep employers from doing that, what is going to make a worker want to negotiate?

U.S. multinationals doing business in Myanmar have limited due diligence reporting obligations under U.S. regulations, though the European Union has failed to set any requirements for EU based corporations.

There is scant official reporting from big business' regarding working conditions and health and safety records across their own or their supply chains operating locally.

Caterpillar, Chevron and Hilton are three high-profile companies doing new business in Myanmar but none of them have submitted proper reports under U.S. reporting protocols about their local operations, nor have they provided an explanation why not, despite investor activism urging them to comply.

A new EU investment treaty being negotiated with Myanmar. The EU must use this opportunity to include enforceable human rights obligations and due diligence and transparency. Workers in Myanmar must have an effective remedy when their rights are violated.

The responsibility to protect human rights, including those of workers, ultimately sits with the new government.

However, the legacy of 50 years of military rule and continued internal conflict have made this difficult.

The government's failure to fulfill its human rights obligations does not absolve multinational companies from their duty, and that of the governments where they are based, to abide by international labour laws protecting workers rights. First and foremost a new government in Myanmar should:

  • Ratify international human rights, labour and environmental treaties, including the remaining ILO conventions, the International Covenant on Civil and Political Rights and ensure its domestic legislation is consistent;
  • Develop labour laws in line with international labour standards;
  • Repeal repressive laws undermining freedom of expression and association;
  • Strengthen administrative and judicial reforms to strengthen Myanmar's rule of law and ensure independent and impartial investigations;
  • End land acquisitions that do not offer compensation to affected communities;
  • Work with other governments to ensure implementation of the UN Guiding Principles and the OECD Guidelines; and,
  • Ensure domestic laws enshrining people's land rights, upholding protection of forests and fisheries, and enacting transparency in environmental and societal impacts of businesses.

Workers and their unions have a hard road ahead to strengthen Myanmar's weak legal framework in the face of the rapacious vulture capitalism of big foreign business interests.

But the unique moment in history unlocked by the election victory of Aung San Suu Kyi can spur the motivation to build a solid democracy with better human and workers rights as a foundation.