Myanmar's changing ties with China

Myanmar to get bigger slice of profits at China-backed copper mine

Revision of contract at the China-backed copper project is seen as a way of appeasing residents upset at huge seizure of land

PUBLISHED : Thursday, 03 October, 2013, 12:00am
UPDATED : Friday, 30 May, 2014, 8:22am

Myanmar has signed a revised contract that increases its share of the profits from a controversial Chinese-backed copper mine, the country's largest, officials said.

The revision is seen as an attempt by the government to appease public anger over the project by giving the country a bigger share of the profits, after protests last year that triggered a violent police crackdown.

The new terms give the government 51 per cent of the profits from the Letpadaung copper mine in Monywa, 760 kilometres north of Yangon, far more than its original 4 per cent share.

The mine's operators, Union of Myanmar Economic Holdings Ltd (UMEHL), which is owned by Myanmar's military, and Myanmar Wanbao, a unit of China North Industries Corporation, a Chinese weapons manufacturer, will get 19 per cent and 30 per cent respectively.

Under the original contract, the UMEHL got 45 per cent and Myanmar Wanbao got 51 per cent of the mine's profits.

Villagers protested for months last year against the project's expansion on what they said was thousands of hectares of illegally seized land.

The protest was a major test of the limits of reforms introduced under President Thein Sein's quasi-civilian government.

Buddhist monks joined the protest, saying the project had destroyed or damaged holy sites related to a famous Buddhist teacher who died in 1923.

The protest ended on November 29 when more than 100 people, including many monks, were injured when riot police raided camps set up by the protesting villagers, sparking outrage at the government's use of force.

The mine contract's new terms provide for US$3 million to be set aside for corporate social responsibility activities.

"We welcome the changes in the profit-sharing ratio and considerations for environmental protection and social responsibility," said Khin San Hlaing, a member of parliament from the National League for Democracy party of opposition leader Aung San Suu Kyi.

Nobel Peace Prize laureate Suu Kyi drew rare criticism from villagers in March after she defended a report by a panel she chaired backing the mine's expansion despite concern about its environmental impact and the land-grab accusations.

However, an activist said he doubted the revised contract and other provisions would end opposition to the project.

"Some villagers may be satisfied if they are compensated enough, but there are others who still want to see the whole project scrapped," said the activist, Aye Myint.

The original scenario at the Letpadaung mine is both common and controversial - a Chinese company exploits Myanmar's natural resources with local military help, while little if any of the profits go into public coffers.

As recently as a month ago, even after the new profit-sharing arrangement had been drawn up, entire villages in the region were still refusing compensation deals for the project, according to a report on Radio Free Asia.

At least one prominent activist, Naw Ohn Hla, was jailed for her role in protests against the mine, according to the RFA report, which said that she had been jailed for two years.



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