US to Support World Bank, IMF in Burma | The Irrawaddy Magazine

US to Support World Bank, IMF in Burma | The Irrawaddy Magazine
LALIT K JHA / THE IRRAWADDY, October 8, 2012

WASHINGTON—US President Barack Obama has signed into law a bill that will allow his administration to support the assistance being provided to Burma by international financial institutions like World Bank and the International Monetary Fund (IMF).

Obama signed the legislation (H R 6431) into law, days after Burma’s President Thein Sein and the country’s opposition leader, Aung San Suu Kyi, left the United States after their historic visits to the country.

“In enacting this bill, the President and Congress have demonstrated strong US support for the critical role of the International Financial Institutions (IFIs) in helping promote stronger institutions to ensure sound economic policy and good governance in Burma,” the Deputy Treasury Secretary, Neal S. Wolin, said.

Noting that this will support inclusive development in Burma and help reintegrate the country into the international economic community, he said the law provides the Obama administration with the flexibility to determine, in the national interest, whether to support, abstain on or vote against IFI financial assistance for Burma.

“Implementation of this law will provide the United States with the ability to shape the policies and activities of these institutions in a way that advances reform, good governance, transparency, and accountability in Burma,” Wolin said.

In a related development, a group of nearly 18 human rights groups has expressed concern over what they allege the “weak reporting requirements” for US companies considering investing in Burma.

In a letter to the State Department, organizations including Earth Rights International, Freedom House, Physicians for Human Rights, US Campaign for Burma, and United to End Genocide said that they continue to be deeply concerned by the US government’s decision to lift all remaining sanctions, and allow corporations unrestricted investment access to Burma despite widespread corruption, ongoing human rights violations, and a total lack of rule of law.

“Although US companies will be required to report on their investments, the current requirements lack specificity about enforcement and consequences for non-compliance. Further, existing loopholes enable companies to designate information as ‘confidential’ as a way to avoid public scrutiny,” they said, demanding that the US government take immediate steps to ensure that there is a strong regulatory framework that can effectively promote accountability and transparency.

Observing that evidence shows that there is a direct correlation between foreign investment and human rights abuse in Burma, particularly in the resource-rich ethnic minority areas, these rights bodies said as investment floods unfettered into the country, there are real risks that American companies will find themselves complicit in rights violations unless the US government enforces regulations that mitigate some of the negative impacts of investment.

“There is already growing concern about increasing land grabs, authorized by the Burmese government for the purpose of creating industrial zones to entice foreign investment, which have displaced farmers and local communities throughout Burma,” they said in their submission to the US State Department.

“Companies that are poised to be the first in the country are keen to invest in Burma’s extractive resource sector, which lacks transparency and suffers from pervasive corruption. Profits generated by the sector are known to have funded military operations in ethnic areas and contributed to the exacerbation of these conflicts,” they said.

“We strongly urge the US government to implement the recommendations outlined in the comment submitted by our organizations and others, which are designed to strengthen accountability and transparency of US corporations investing in Burma,” these organizations said.

Meanwhile, the Rohingya Muslims in a letter on Sunday to the Organization of Islamic Corporation (OIC) Secretary-General Ekmeleddin Ihsanoglu, thanked him for his effort in taking up their case. In his letter, Wakar Uddin, the director-general of the Arakan Rohingya Union, conveyed the profound gratitude of Muslims for the OIC efforts at various international levels in order to reach a final and deep-rooted solution to the plight of Burma’s Rohingya Muslims.