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HUMAN RIGHTS & THE MNE. THE BURMA PIPELINE: GROUP 1 CASE. Yadana PipelineSlave Building the Pipe Line. UNOCAL’S STRATEGY. John Imle’s strategy for Unocal (a focus strategy) Does this strategy make sense?. HOW IMPORTANT IS YADANA? POSITIVE SIDE?.

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HUMAN RIGHTS & THE MNE

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Human rights the mne l.jpg

HUMAN RIGHTS & THE MNE


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THE BURMA PIPELINE: GROUP 1 CASE

Yadana PipelineSlave Building the Pipe Line


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UNOCAL’S STRATEGY

  • John Imle’s strategy for Unocal (a focus strategy)

  • Does this strategy make sense?


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HOW IMPORTANT IS YADANA? POSITIVE SIDE?

  • Burma is relatively uncontested territory for oil companies

  • Yadana is a proven, low-cost field

  • The risks of the project appear further allayed by the deal’s partnership structure

  • The project appears relatively inexpensive

  • The project also appears to be relatively lucrative.

  • Yadana seems a nearly perfect fit with Unocal’s focus strategy


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NEGATIVE ASPECTS

  • Burma is a high-profile country with a regime that is widely regarded as repressive & illegitimate

  • The pipeline corridor cuts through an area pockmarked with indigenous villages & known for ethnic violence

  • Insofar as the project entails partnering with MOGE, it puts Unocal into commercial alliance with the Burmese government

  • While the Yadana project promises to add considerably to Unocal’s total reserves of natural gas, its financial impact is not particularly large.


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IF YOU WERE JOHN IMLE, WOULD YOU HAVE AGREED TO THIS DEAL IN 1993?

Aung San Suu Kyi

Three Burmese Generals


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WHAT ACCUSATIONS HAVE BEEN MADE ABOUT UNOCAL’S INVOLVEMENT IN THE YADANA PIPELINE?

  • Responsibility for and complicity with human rights abuses

  • Use of slave labor

  • Responsibility for the Burmese military’s “ethnic cleansing” & forced relocation of local populations

  • Enabling the Burmese government to engage in rape, murder, & the laundering of drug money

  • Environmental degradation


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Children’s Drawing of the Genocide


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WHAT SHOULD IMLE DO?

  • He has already made the decision to participate in the pipeline project but Unocal has already been accused of being complacent

  • Withdraw?

  • Remain aloof from accusations?

  • Manage the situation?


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CONCLUSION

  • This case underscores the critical and often delicate relationship between foreign investment and a country’s political environment.

  • By investing in Burma, Unocal has thrust itself deeply into Burmese politics & into the political questions that cloud Burma’s position in the international arena

  • At a broader level, the case illustrates the growing importance of international pressure and activist groups

  • Unocal’s involvement in the country has undoubtedly helped to secure the position of Burma’s military regime.


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RECENT DEVELOPMENTS

  • Military abuse of human rights around the pipeline

    • Several human rights groups documented hundreds of cases of rape & sexual assault

    • Villagers forced to act as human mine sweepers

  • Two legal cases in 2004

    • California district court ruled that Unocal must face a jury over its subsidiaries’ role in Burma

    • Federal court (rests on the Alien Torts Claim Act – Supreme Court opened the way for the suit to continue) – Bush tried to prevent the law from being applied in this case

  • March 2005 – Unocal settled the case – amount kept secret

  • April 2005 – Chevron Texaco announced it was acquiring Unocal and will hold on to the Yadana investments


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CANADIAN INVOLVEMENT

  • TCPL – largest pipeline firm in Canada – is assisting in the construction of the Thai portion of the Yadhana gas pipeline (from Burma to Thailand)

  • Mitsubishi Canada – supplies material for the project

  • Canadian Helicopters International provides helicopter services to Total.

  • BC Gas signed a long-term contract to source gas from Unocal

  • Ridel Resources is in a separate joint venture with the Burmese state oil enterprise

  • Nortel Networks – selling a cellular phone system to Burma – aids military in tapping phone lines

  • Ivanhoe Mines – copper mine – also First Dynasty Mines – East Asia Gold – Palmer Resources

  • Sears Canada sourcing clothes from garment industry (most underpaid in Asia – 8 cents an hour – have to pay half of their wages to the military political party)

  • Canada – cut off aid but refuses to ban investment and trade.

  • US has cut off aid & prohibits any new investment (1997)


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ASSIGNMENT FOR 1/2/2007

  • TOPIC: Meanings & dimensions of culture

  • ASSIGNMENT: chapter 14

  • Prepare Euro-Disneyland, pp. 216-225


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