17 Feb 2005

Myanmar's gas riches entice Asian investors

The lack of an 'open' society in a few countries in South East Asia, merely reinforces the rhetoric of other more extreme regimes. Companies and governments continue to ignore calls for an end to suppression of freedom and go after the oil and natural resources. This is nothing new and by no means unique to anyone particular country or company.

A number of 'western' companies have started to bend and allign their actions with the wishes of their informed shareholders. Shareholders who are politically aware, and try to be politically responsible.

Does this mean that shareholders in South East Asia, are uninformed or lack political conviction? Or is there another interpretation? TO look at the wider debate go to the BBC link to Burma.

Wed Feb 16, 2005 11:52 PM ET

By Chen Aizhu of Reuters

SINGAPORE (Reuters) - Politically and economically isolated for more than a decade, Myanmar is being thrown a lifeline by its Asian neighbours, which are jostling to spend billions of dollars to tap the country's energy resources.

Slightly smaller than the U.S. oil state Texas and bordering the Andaman Sea and the Bay of Bengal, little explored Myanmar is estimated to hold 13-15 trillion cubic feet (tcf) of natural gas, 7 percent of total proven reserves in Southeast Asia.

Aggressive state companies from China, India, Thailand, Malaysia and South Korea, undaunted by U.S. and European sanctions, are looking to invest their big cash piles to develop Myanmar's gas fields and build pipelines and hydropower dams.

"Non-western majors are now able to take significant positions than they might have a decade or more ago as they become more professional and have more financial muscle," said Andrew Symmons, research fellow at the Institute of Southeast Asian Studies in Singapore.

The influx of Asian players picked up steam in 2004 and threatens to eclipse long-standing investments by a handful of Western companies, predominantly France's Total SA and U.S. independent Unocal Corp.

Few Western firms have the stomach to invest in the country formerly known as Burma, worried by government and shareholder pressure to steer clear of the military-ruled nation shunned for its human rights record and suppression of political opponents.

Asian firms have no such qualms.

"Myanmar is cocooned by the support of regional powers that actually protect it from the sanctions the U.S. wants to apply," Derek Tonkin, former British ambassador to Thailand, Laos and Vietnam told Reuters.

Oil and gas is a key source of revenue and one of the few growth areas for Myanmar's economy. Decades of poor policies and more recently Western sanctions have left the once wealthy former British colony far behind prospering neighbours such as Thailand.

Myanmar supplies a quarter of Thailand's gas consumption with exports worth roughly $1 billion, or about 12 percent of gross domestic product.

"Growth is likely to come from the oil and gas sector as the global demand for energy increases. Additional gas reserves were found early in the year (2004), raising prospects for exports and increased foreign direct investment," the Asian Development Bank said in its 2004 Asia Economic Monitor.

1 comment:

Anonymous said...

Is it more than a zero-sum choice between, trade and social justice?