Sunday, August 3, 2014

Democratic Voice of Burma

Democratic Voice of Burma

DVB talks to Vikram Kumar, IFC

Posted: 02 Aug 2014 10:29 PM PDT

Vikram Kumar, the Resident Representative for the International Finance Corporation (IFC) in Burma, spoke to DVB Interview International's Alex Bookbinder about IFC investments in Yoma Bank and Shangri-La hotels.

The IFC, which is part of the World Bank Group, are financing several major infrastructure projects in Burma. One major investment is US$75 million in funds to Yoma Strategic Holdings (YSH) and Hongkong and Shanghai Hotels (HSH), both companies linked to Burmese business tycoon Serge Pun.

The money will go towards financing the development of a five-star resort that will transform Rangoon's British Burma Railway Company into offices, a hotel and apartments. A further $30 million will go to Pun's Yoma Bank to fund a small and medium enterprises (SME) lending programme.

"Our engagement with Yoma Bank is extremely comprehensive. It's not just the investment support, it is comprehensive advisory because we honestly believe local banks need a huge amount of capacity building," Kumar said.

"If you compare the quality of banking service here in Myanmar [Burma] to any country in the world, it has a really long way to go."

The IFC has faced criticism over its investment in Yoma Bank, particularly from the US Campaign for Burma. They questioned why the IFC had categorised the project has 'Financial Intermediary 2' (FI2), which means it can forego environmental and social impact assessments and disclose certain information such as local partners.

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Kumar defended the categorisation, and said the IFC was providing more than just finance to the bank; an Environmental and Social Management System (ESMS) is in place, and the IFC has people working inside the bank in an advisory capacity.

"We have full visibility on Yoma Bank's lending operations because we are helping them develop their risk management system," he said.

"In no possible way are the reporting and supervisory requirements any different. What we expect from Yoma is, in fact, an ESMS which is water tight."

Another major IFC project is a $80 million investment for the expansion of the Sule Shangri-la hotel in downtown Rangoon and the construction of Shangri-La's luxury apartments. But the IFC has come under intense criticism in many cases around the world over its financing of high-end hotels and luxury apartments from those who question how this kind of investment fits within the IFC's commitment to poverty alleviation.

"We strongly believe hotels and tourism is fundamental to job creation," he said.

"When we talk about democracy dividend we are talking about people actually having jobs, people having enough money to feed their families. The job creation of hotels and tourism is unmatched," Kumar added. "I don't see the creation of 1,500 jobs as contributing to inequality in any way."

Kumar ended by saying that IFC operations in Burma are not just limited to real estate and the hotel and tourism sector. He disclosed that the IFC has a mandate for 12 transactions in the country across sectors including agriculture and energy.

In February, the IFC pledged funds to develop Rangoon's energy supplier, the Yangon Electricity Supply Board (YESB).

 
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The Irrawaddy Magazine

The Irrawaddy Magazine

Conditions Worsening in Burma, Urge Tougher US Policy: Lawmakers

Posted: 02 Aug 2014 10:01 PM PDT

Conditions Worsening in Burma

U.S Secretary of State John Kerry and the Burmese President Thein Sein at the Asean Summit in Brunei last year. (photo: Simon Roughneen / The Irrawaddy)

WASHINGTON – More than 70 U.S. lawmakers say conditions in Burma have taken a sharp turn for the worse and want Secretary of State John Kerry to warn its government that could seriously damage bilateral relations.

In a letter to Kerry obtained by The Associated Press on Friday, the House members, both Democrats and Republicans, say that sectarian violence has spread, and that President TheinSein’s government seems to be catering to and stoking anti-Muslim sentiment. They also voice concern about military abuses against ethnic minorities, the recent jailing of journalists, and the need for constitutional reform.

The Obama administration has counted its support for former pariah state Burma’s shift from direct military rule as one of its principal foreign policy achievements, but the letter reflects mounting congressional concern over the direction the Southeast Asian nation has taken after Washington suspended its toughest sanctions in 2012.

The lawmakers call on Kerry to sanction those complicit in abuses and atrocities, and not make further concessions to the reformist government unless there’s serious progress.

“Just as the beginning of the reform process required a calibrated reassessment of U.S. policy three years ago, recent disturbing developments call for a significant recalibration now,” the letter says.

Kerry is expected to visit Burma for the Association of Southeast Asian Nations Regional Forum being held in Naypyidaw on Aug. 10, and also hold bilateral meetings with Burmese officials.

The letter is dated Thursday. Signatories include Democrat Rep. Joe Crowley, a prominent congressional voice on Burma, and Republican Rep. Steve Chabot, who chairs a House panel that oversees policy toward Asia, and the top-ranking members of the House Foreign Affairs Committee.

Last week another key congressional voice, Republican Sen. Mitch McConnell, called for Burma to reform its constitution to allow opposition leader Aung San SuuKyi to run for president and for the military to submit to civilian rule. But he also supported U.S. engagement with Burma’s military.

The post Conditions Worsening in Burma, Urge Tougher US Policy: Lawmakers appeared first on The Irrawaddy Magazine.
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