Burma’s Resource Curse The case for revenue transparency in the oil and gas sector (English) | Land Portal

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Date of publication: 
March 2012
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"Burma is rich in natural resources, particularly natural gas and oil.
Yet instead of using these resources for the country’s development
through industry and job growth, military leaders have been exporting
them for over a decade. This has generated huge revenue flows, but
a lack of transparency and mismanagement of these revenues has left
Burma with some of the worse development indicators in the world,
creating a resource curse.
Sales revenues of natural gas exports alone amounted to US$ 2.5 billion
in 2010-11. It is estimated that this amount will increase by over 60%
to US$ 4.1 billion starting from 2013 as three additional production
blocks come on line. Further revenues will be generated from over 40
additional oil and gas blocks that are currently under exploration.
Despite this enormous wealth, Burma remains extremely poor and its
people live with chronic energy shortages. It is a country crippled by
corruption, with its major businesses controlled by military companies
and cronies. Burma is censured for major human rights violations, and
continues to suffer from a decades-old civil war between the ruling
government and ethnic peoples. Due to Burma’s lack of protection
laws, projects which extract and export natural resources have directly
led to human rights abuses such as forced labor, land confiscation,
rape and displacement, as well as severe environmental degradation.
The projects also fuel armed conflict as government and ethnic troops
clash in order to access and control project areas. The revenues from
resource extraction projects have in turn helped prop up authoritarian
rule and enrich top military generals.
The report analyzes the previous Than Shwe regime and new
military-dominated government’s lack of transparency around oil

and gas revenues, lack of an accountable system to manage revenue,
corruption, and a lack of equitable benefit sharing of resource
revenues. Although a new “civilian” government is now in place, under
Burma’s new constitution, the military remains firmly outside the law
and beyond civilian control. The role of military companies in Burma’s
economy and in accessing and managing Burma’s massive oil and gas
revenues remain unknown and unregulated. The government does not
disclose how much it receives in gas revenues, or how those revenues
are managed or spent. Foreign oil companies engaging in Burma’s oil
and gas sector also refuse to publish how much and how they pay the
military regime.
There is therefore an urgent need for Burma to manage oil and gas
revenues with greater transparency and accountability as well as to
reform its military-dominated economy to ensure that the benefits of
the country’s resources are shared more equitably among its people
and for the country’s sustainable development. If Burma prioritizes the
protection of peoples and the environment in extraction projects and
manages the revenues from the sale of its resources transparently, the
country’s non-renewable resources can be used sustainably for the
benefit of current and future generations, decreasing the pace and
need to extract resources from additional areas.
Mechanisms and systems for public disclosure of money flows,
independent revenue management and auditing, civil society input,
and equal benefit sharing currently exist in international standards of
revenue transparency and are put into practice in oil and gas producing
countries around the world. This report provides key lessons from
these countries that Burma can draw on to improve the management
of its oil and gas revenues and work toward ending its resource curse.

Authors and Publishers


Arakan Oil Watch (AOW) is an independent non-governmental community based organization. AOW aims to protect and promote human rights and environmental abuses that result from multinational oil and gas companies in Arakan State and other parts of Burma.

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