U.S. officials said in May that
they would suspend sanctions against Myanmar after its government launched
overhauls to end decades of military rule, and U.S. companies have been
awaiting details before they go in.
Some companies had grown
frustrated with the delay, saying U.S. companies would lose access to the
country's oil fields if the restrictions weren't lifted, and other countries,
including from Europe, moved in.
But some observers worry that the
U.S. is loosening its rules too quickly, particularly regarding the state-owned
oil company, Myanmar Oil & Gas Enterprise. As in many other countries,
Western oil firms are expected to partner with the state firm when investing in
major new projects. But Myanmar opposition leader Aung San Suu Kyi has raised
concerns about the company's transparency and accountability, leading to calls
in Washington and elsewhere to prevent foreign energy players from partnering
with the firm.
White House officials said on
Wednesday they had worked to strike the right balance. New rules allow
investment to move ahead, but require new disclosures by U.S. companies that do
business in Myanmar, which is also known as Burma. The U.S. will continue to
bar investment in military-owned entities, and the Obama administration
expanded existing sanctions to include those who undermine the reform process
under way.
"Easing sanctions is a
strong signal of our support for reform, and will provide immediate incentives
for reformers and significant benefits to the people of Burma," President
Barack Obama said in a statement on Wednesday.
A new government that took over
last year in Myanmar has surprised observers with a number of reforms following
five decades of military control. Myanmar officials eased some media
restrictions, expanded Internet access and gave dissidents, including Ms. Suu
Kyi, more freedom to express their views.
The administration said U.S. companies
with more than $500,000 in aggregate new investment will be asked to file an
annual report disclosing their procedures on human rights, land acquisitions,
the environment and payments to Myanmar government entities, the Associated
Press reported. In addition, companies have to notify the U.S. government
within 60 days of investing with Myanmar Oil & Gas Enterprise.
The president of the advocacy
group United to End Genocide, Tom Andrews, called the administration's move on
Wednesday "grossly irresponsible."
"Instead of listening to
Burmese voices, the interests of industry lobbyists clamoring for access to
Burma's rich natural resources have been prioritized," he said.
Tommy Vietor, a spokesman for the
White House National Security Council, said the administration shares the
concerns raised about the oil company, known as MOGE, but believes that the
conditions attached to the new openness will provide needed checks.
"While we share these
concerns we believe that there will be benefits both to the people of Burma and
to U.S. investors in allowing U.S. companies, in a careful, calibrated and
responsible manner, to engage with MOGE," he said. "As a broader
matter, we believe our economic engagement can be an agent of positive
change."
American companies have grown
increasingly impatient over what they say is the slow pace at which U.S.
officials have acted to remove sanctions on the country. Frustration boiled
over in late June, when officials at a Senate Foreign Relations Committee
hearing including Democratic Sen. Jim Webb called on the Obama administration
to speed up the process.
Sen. Webb praised the latest
moves on Wednesday. "The steps taken today will incentivize positive
conduct, while ensuring that so-called 'bad actors' from the previous military
junta or those who resist reforms will not benefit from economic relations with
the United States," he said. "It is essential that the United States
continue to use executive authorities to ease all economic sanctions on Burma,
such as suspending the ban on imports."
U.S. Secretary of State Hillary
Clinton is expected to provide further details about the latest U.S. steps
later this week during her weeklong tour of Asia.
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