"End of Mission Statement" 28 April 2023

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Japanese companies operating in Myanmar

In the absence of sanctions by the Government, Japanese businesses have, by and large, been left to decide whether to terminate or modify their operations in Myanmar. I met with officials from the Business and Human Rights Policy Office in the Ministry of Economy, Trade and Industry, who told me about the Government’s new Guidelines on Respecting Human Rights in Responsible Supply Chains. While a positive step, these Guidelines are non-binding and insufficient to guide companies through the difficult decisions companies must make in post-coup Myanmar.

I met with business leaders from seven Japanese companies while here in Japan that had invested in Myanmar prior to the coup. Some chose to leave following the coup, others remained but suspended their operations, others left because of economic reasons, aanother continues a partnership with a junta-controlled company.

What they all had in common was a failure to conduct a thorough assessment of human rights risks and impact prior to entering the Myanmar market.

I spoke with the leaders of companies that have made the difficult decision to exit the Myanmar market, a decision which had significant implications for their workers, partners, contractors, and their own capital investments. Some cited their own human rights policies as the reason for their decision. I laud business leaders who have acted on their convictions and, as they explained to me, learned from past mistakes.

It is imperative that companies exiting Myanmar do so in a responsible manner, minimizing human rights impacts and, to the extent possible, avoiding enriching the military. Creative solutions, including placing shares or property rights into trust or escrow, should be considered.

I am deeply concerned about corporations that remain in active partnership with military-controlled companies. I spoke with leaders of KDDI and Sumitomo, for example, Japanese corporations that are involved in a partnership with the junta-controlled Myanmar Posts and Telecommunications (MPT). MPT not only provides revenue for the junta’s military operations, it is directly involved in violating the human rights of Myanmar people. Leaders of these Japanese companies claimed that they had commissioned an independent human rights due diligence assessment since the coup. They said they could not share the report or its findings because of a confidentiality agreement and claimed to be unaware of reports that MPT is being used to conduct surveillance on its customers, to censor information, and to implement Internet shutdowns at the direction of the military. These shutdowns are known to often be precursors to attacks by junta forces, preventing vital information to get to villagers, including warnings of imminent attacks. If the leaders of these companies are unwilling to end a collaboration that is directly linked to atrocities, then the government of Japan must act.

I also spoke with leaders from ENEOS and JX Nippon Oil & Gas. Just two weeks ago, ENEOS announced that it had completed its withdrawal from a partnership with Myanma Oil & Gas Enterprise, a military-controlled company that has been identified as the junta's largest source of foreign-currency income. MOGE has been sanctioned by the European Union and I have been urging Member States to also sanction MOGE. Human rights organizations have raised concerns that the exit of these companies could enrich the military and create environmental risk by leaving MOGE solely responsible for closure of the oil field. The ENEOS and JX Nippon executives told me that they were barred by a confidentiality agreement from providing details about their withdrawal from the partnership and declined to offer any details except to say that their withdrawal was not a sale. They claimed, however that upon their exit, they requested that MOGE ensure that funds do not flow to the military. Given that MOGE is controlled by the junta, this assertion is frankly, absurd.

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