MAC: Mines and Communities

Ivesting in Destruction: The impact of development projects and economic policies in Burma

Published by MAC on 2003-10-15

Ivesting in Destruction: The impact of development projects and economic policies in Burma

Burma Issues Newsletter - Volume 13, Number 10

October 2003

by R Sharples

The SPDC often portrays economic investment in Burma’s border areas as needed development and thus the SPDC is doing great favours for these previously economically deprived areas. They like to hold these examples of economic development up as proof that they are progressing forward on the road to democracy and national unity and that armed opposition in these areas no longer exists. At the 58th General Assembly of the United Nations, Burma’s Foreign Affairs Minister confirmed this viewpoint with a largely unsubstantiated statement. “At the outset, an olive branch was extended to the armed groups that have been fighting the government for decades. Following successful negotiations these groups returned to the legal fold. National unity was achieved. Peace now reigns in the entire country, providing an opportunity for long neglected border areas to develop quickly. The gap between urban and rural areas has narrowed. At the same time we have taken developmental initiatives to promote a better life for our peoples. We have worked tirelessly to provide better health care, education and housing for all our peoples”. 1

From the SPDC’s perspective any repercussions from this economic investment and development is seen as the necessary cost of progress. In reality peace does not reign in these rural areas, national unity is not in evidence and the people in the border areas continue to live amongst poverty and denial of basic necessities for survival. In Burma border development under the auspices of foreign investment is an excuse that allows the military to gain control over subversives in the border areas. Economic investment is not bettering the lives of the people, in fact it is being used as a means to suppress avenues of ensuring economic stability.

Burma’s weak and eroded economic system means significant negative impacts affect both people and infrastructure when development projects and ill-prepared economic policies are implemented. Burna has an atrocious track record that pays testament to where economic cooperation can lead and this is a timely reminder that further development and investment in Burma must consider the existence of these negative impacts. Focus must be placed upon responsible, accountable and participatory consultation on the benefits of economic growth. Without this, economic investment in Burma will continue to result in some of the following negative impacts:

Forced labour

Despite issuing Order No 1/99 in 1999 and Order supplementing order No 1/99 in 2000 detailing the abolition of forced labour, evidence continues to exist that this practice is far from over. Development projects, both domestic and international, consistently force people to work on their construction and maintenance. These projects range from road construction, dam and hydropower construction to domestic work on military bases and farming work on military plantations. One group of Karen villagers who fled to Thailand were forced to send one member of their family every day to work on military banana plantations in Tenesserim Division. They were paid no money for this work and if someone failed to turn up then the military charged them 1500 kyat per day of their absence.2

The continued use of forced labour highlights the economic inadequacies of the country where minimum payment is waived, at the same time denying people the ability to create an income from their own crops. Whilst people are forced to work on other projects their own crops suffer which in turn affects villagers’ ability to provide a sufficient livelihood for themselves and their families.

Security and human rights violations

Development projects predictably come with an increase of troop activity in the area of its construction. Often this is to clear the area in preparation for construction and then to ensure security of the project once construction has begun. The military will often plant landmines around development projects as a form of protection. This impacts surrounding villagers who are often not informed of this practice and are therefore unwitting victims to landmine injuries. Their animals also become unwitting victims. The presence of military personnel is also coupled with instances of human rights abuses.

Torture, rape, extrajudicial killing, portering, destruction of homes and land and forced labour are just some of the human rights abuses that are outcomes of the implementation of development projects and economic policies.


The disproportionate benefits that economic development provides to the people of Burma has created several healthcare issues. Displacement, poverty, insufficient livelihood and inadequate healthcare facilities has meant that many people in Burma suffer from usually treatable diseases. Malaria, TB and pneumonia will often kill the victims of these diseases. The economic windfall that development projects supposedly bring is never funneled through to the people who need it most. As a result the SPDC spend over 40% of their annual budget on the military and only 3% on health. Access to medicines and health care facilities is seriously hindered by the actions of the SPDC who fail to provide sufficient funding and development of basic necessities such as healthcare.


The push for economic growth has also seen an increase in displacement of people living in the areas where economic policies are forcibly implemented. The construction of major development projects like the Yadana Gas Pipeline and the Bongti-Tavoy Highway has seen the Burmese Army forcibly remove villagers from the areas surrounding these projects. The Burmese Army has commonly used this land for the construction of military bases to secure the area and to strip the area of other natural resources. The impact of displacement is no longer a domestic issue only. The effects of displacement are also felt by neighbouring countries who often bare the responsibility of housing refugees and illegal migrants and also the international community who must deal with transnational issues like human trafficking.
The most common outcomes for those displaced are to become: Internally Displaced People, Refugees and Illegal migrants or to be forcibly moved to relocation sites and satellite towns.

Human and Drug trafficking

An increasingly common issue for the international community to find solutions to are the dangers of economic depravation to human trafficking, prostitution and drug trafficking. Burma has found itself at the forefront of these issues, in no small part due to its economic situation. Burma is currently rated the second largest producer of illicit opium in the world despite assurances that they are curtailing drug production, which has decreased over the past six years. Burma is also a major player in the regional trafficking of methamphetamines, producing hundreds of millions of tablets annually. The US State Department rates Burma in its lowest tier (Tier 3 – Countries whose governments do not fully comply with the minimum standards and are not making significant efforts to do so.) in its efforts to combat human trafficking. Burma is classified as a source country for both labour and sexual exploitation of persons. The existence of human and drug trafficking is undeniably linked to corruption and depreciated economic systems. The state of Burma’s economy and the daily struggle to survive has pushed the people of Burma to the periphery where they are vulnerable to be being exploited by human traffickers.

Environmental impact

Since 1988 Burma has escalated its development of natural resources at such a rate that it is now in danger of destroying beyond its ability to repair. In the past 15 years deforestation has more than doubled and the proliferation of dam construction has caused soil erosion and sedimentation of river beds. This destruction has happened largely unchecked due to Burma’s lax environmental regulations. Social and environmental impact assessments go virtually unrecognized and studies undertaken prior to construction are rare, as in the case of the Shwe Gin River dam in Karen State. Construction has already begun on this project with studies showing that construction of roads, military barracks and a helicopter pad have also been established.

It is estimated that if the Lower Salween Dam project (Da-kwin) were to go ahead thousands of acres of farmland would be flooded, affecting not only people and their livelihoods but also the Salween National Park and its various ecosystems. At the Maw Chi Mine in Karenni State the Mine’s Manager admitted to disposing of waste chemicals from the mine straight into local water sources causing them to run a black oily colour. Unfortunately cases like this are not uncommon. Burma’s environment has endured systematic destruction and exploitation at the hands of the Burmese military.


The culture of ethnic groups is suffering a gradual disintegration at the hands of development, progress and economic gain. Agricultural practices and the religious and cultural ceremonies that are an integral part of land, food and seasonal practices are being lost, partially due to the treatment received from the Burmese Army. Land is destroyed, villagers are forced to flee their homes and crops, in many cases this has been directly linked to the construction of development projects. In these circumstances villagers are no longer able to practice their culture traditions. In other cases the Burmese Army directly denies them the practice of their culture, for example ethnic languages are banned from being taught in schools and many villagers are persecuted based on their alternative religions to the state determined national religion, Buddhism. Displacement, human rights abuses, oppression and the daily struggle to survive, all determine villager’s inability to practice and maintain their culture and identity. These cultures have already disintegrated at an alarming rate and, if such Burmese Army practices continue in the name of economic development, are in danger of being lost completely.

Who benefits?

Not the local people, who face human rights abuses, land confiscation and displacement because of these projects. The income generated from these development projects is usually funneled back into consolidating the strength of the military. The resulting commodity from these projects, for example electricity from a hydro-electric project, is usually rerouted into urban areas, leaving the local population to bear the brunt of its construction and little of its benefit. The Law Pi Ta electric station in Karenni state is such an example. The local people endured destruction of their land, relocation and landmine fatalities. The power station used a lot of the water from Be Loo River, the main water source for the farming community. As a result farmers lacked enough water to grow their rice paddies. The electricity that this power station generated was directed to Mandalay and other central areas of Burma.

The SPDC have yet to show their competence in making effective decisions dealing with economic growth and prosperity in Burma. They have done little to ensure confidence in the stability of Burma’s economic potential. The impacts of their decisions to date have created mostly negative outcomes. Economic prosperity for the people of Burma is of course the desired outcome but future investment and economic development in Burma will only be effective if a committed and competent power is running the country. Currently it is not. Future international investors, both governments and private companies, must take responsibility for ensuring their investments create positive economic benefits for all the people of Burma.

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