Myanmar is a poor country with serious financial problems.
The actual size of its economy is a controversial subject
owing to the paucity of official statistics, an artificial
exchange rate, imposed price controls for certain crops,
a large public sector, and a sizable parallel economy. Its
per capita purchasing power parity, an unreliable indicator,
seems to be one to five in relation to Thailand, and is 30%
to 40% lower than Vietnam's. These two countries have sharply
differing backgrounds, but both have superior growth rates
to Myanmar.
Nature is not responsible for the country's economic lag,
as Myanmar possesses abundant human,
agricultural, mineral and tourism resources. Rather, the situation
is attributable to a long legacy of controlled economic management
that shunned market economy principles and left many scars,
as well as the reluctance of foreign countries - except close
neighbors such as China and Thailand - to invest in a country
that is treated by certain others as an international pariah.
Contrary to the situation of Laos, Cambodia and Vietnam, international
assistance for Myanmar is restricted to humanitarian aid, to
the detriment of development. The country's voluntary isolation
and forced exclusion from the community of nations have prevented
it from participating in Southeast Asia's economic boom. The
signs of backwardness are striking and prevalent, as reflected
by short life expectancy, high infant mortality, a lack of
public infrastructure (especially in rural areas), insufficient
power-generating capability, limited industrialization, and
exports dominated by non-processed products.
Against
this backdrop, an investment such as the Yadana project should
be widely applauded, since it brings in capital and technology,
creates jobs and fosters strong economic ties
between Myanmar and Thailand. It further stimulates economic
progress through the introduction of modern management methods,
the production of gas and the supply of steady State revenues
Yadana will generate increasingly higher revenues for Myanmar
from MOGE's share of profit based on its 15% interest in
the investment, the state-owned company's equity gas from
the production-sharing agreements, and income and other taxes
related to the project.
The issue of how these revenues should be spent is common
to all countries with significant mineral resources. Civil
society is demanding greater transparency in this regard.
A "Publish What You Pay" initiative, has been launched by
160 NGOs. This concept has been developed, in a manner more
consistent
with contractual framework and with the principle of sovereignty
of Host States, by the EITI (Extractive Industry Transparency
Initiative)whose scheme was approved at the G8 Evian Summit
in 2003. Total is prepared to follow this recommendation
along the following terms:
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To be part of a global
process, involving all relevant oil players, that is
the Host States and the Corporations concerned, either
publicly listed, private or under State control. |
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To provide the information
about taxes and royalties paid to a reputable and independent
international organization, subject to the terms of the
agreed contracts. |
But it would constitute
interference if an oil company were to presume to dictate
how a country should spend its oil revenues but international
organizations such as the World Bank are well placed to
exert their influence and offer advice, which would be particularly
welcome in the case of Myanmar.
Total believes there are three ways
in which it can directly influence the economic development
of countries where it undertakes oil and gas projects:
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Develop
the reserves in line with the principles of sustainable
development by trying to obtain the highest possible
recovery rate within the overall confines of project
profitability and by adhering to strict environmental
standards, thereby helping the country make the most
efficient use of its resources. |
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Employ
local workers to the greatest extent possible, train
them and provide them with fair and satisfactory working
conditions and career prospects. |
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Strive
to provide direct socio-economic benefits to the people
living in the project area so that they enjoy real
improvements in their lives. |
In the case of the Yadana project, Total, in cooperation
with its co-investors, closely associated the actual gas
operations, the Socio-Economic Program for the area's inhabitants
and
the promotion of human rights in the region. Total is convinced
that by nurturing economic development and upholding human
values, it can - within its field of activity and via a concrete
industrial project - make a useful contribution to the progress
of Myanmar society. The Group welcomes all opportunities
for discussion and cooperation with the different national
and international stakeholders who care about the country's
future, in order to examine ways it can better serve Myanmar's
long-term interests.
Total and The United Nations Institute for Training and Research (UNITAR) have for a number of years been strategic partners in a global alliance designed to enhance national and local government. On March 8, 2006, Total and UNITAR signed a multi-year agreement under which Total agreed to finance a United Nations training program for Burmese diplomats and governement officials. The three-week program will familiarize participants with how international and regional organizations work, and will also include a module on international economic relations and discussion of ethics in financial and business transactions. The program will also highlight the role of civil society and the importance of dialogue in multilateral negotiations. Lastly, participants will also receive training in areas such as international humanitarian law, refugee law, human rights, international environmental law and the law of the sea. Total's involvement in these governance programs demonstrates our commitment to enabling Myanmar to take its place in the world community sooner rather than later.
