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Motorola & Philips Electronics pull
- Subject: Motorola & Philips Electronics pull
- From: FreeBurma@xxxxxxx
- Date: Mon, 25 Nov 1996 04:38:00
Subject: Motorola & Philips Electronics pulled out
.c The Associated Press
By RICHARD LORANT
AP Business Writer
NEW YORK (AP) -- In a reprise of the movement that isolated white-ruled South
Africa, a growing number of state and local governments now penalize
companies that do business in Burma -- and the pressure appears to be
Motorola and Philips Electronics quietly have joined a corporate pullout from
Burma, a Southeast Asian nation where a military junta has crushed dissent.
Next week, Massachusetts steps up the public pressure by releasing a list of
companies that will be at a disadvantage when bidding for state contracts
because of ties to Burma, which calls itself Myanmar.
Activists say the recent corporate defections are signs of headway in the
budding economic protest against the Burmese government.
The Massachusetts law adopted in June is the first such state sanction
targeting Burma, but eight cities have approved similar measures -- two of
them last month. The movement resembles the attack on businesses dealing with
South Africa in the apartheid protests of the 1980s.
In the first high-profile case stemming from the latest ``selective
contracting'' laws, anti-Burma activists this week were trying to knock
Mitsubishi Heavy Industries out of contention for $136 million people-mover
project at San Francisco's city-owned airport. Mitsubishi has interests in a
``These laws are now hitting companies where it hurts -- in the bottom line
-- and they're beginning to respond,'' said Simon Billenness, senior analyst
for the Franklin Research and Development Group, a Boston-based firm that
manages investments it considers socially responsible.
But activists are far from declaring victory.
For one thing, many of the businesses that are leaving have little more than
a beachhead in Burma. Motorola has a single manager in Rangoon, who is to be
transferred by year's end.
For another, Burma's economy is relatively small. Its attraction is mostly to
oil companies. Burma's imports from the entire world totaled $1.6 billion in
1995; Indonesia, also criticized by human rights groups, bought twice as much
that year from the United States alone.
Also, some companies -- most notably, PepsiCo -- have been criticized for
jettisoning their Burmese holdings but continuing sales in Burma through
Philips, the Dutch electronics company, said it stopped limited direct sales
in Burma, but will continue to deal with importers serving the country.
In addition, it takes time to wage such protests.
``We know from our work on South Africa that this may be something that's in
process for 20 years or so,'' said Brenda Bateman, who directs the Burma
Project for the Investor Responsibility Research Center in Washington.
The IRRC was formed 20 years ago to track corporate affiliations in South
Africa. Its latest report lists 234 companies with ties to Burma, 58 of them
based in the United States.
The IRRC list is a major source for Massachusetts and the cities with Burma
laws: Ann Arbor, Mich., Carrboro, N.C., Madison, Wis., Tacoma Park, Md., and
Berkeley, Oakland, San Francisco and Santa Monica, Calif.
Massachusetts has advised companies listed by the IRRC about the law, which
assesses a 10 percent penalty on new bids from businesses with Burma links.
While companies currently doing business with Massachusetts are on the list,
none has a contract bid pending, said Philmore Anderson, the state's
purchasing agent. The businesses had until Friday to challenge being on the
state's bidding sanctions list, which is due out next week.
Companies are taking the law seriously.
``Their actions have not gone unnoticed,'' said an official at a company that
had received a letter from the state and spoke on condition of anonymity. ``I
think every company on that list is addressing the issue one way or
Schaumburg, Ill.-based Motorola says the Burma pullout is part of a series of
cutbacks forecast earlier this month.
``It's not a political decision. It's a cost-cutting decision,'' spokeswoman
Margot Brown said.
Philips cites the ``difficult situation and general uncertainties'' in Burma
as a reason for its move.
Companies that already had left Burma include Carlsberg, Heineken, London
Fog, Eddie Bauer, Levi Strauss, Petro-Canada, Amoco, Liz Claiborne and
Columbia Sportswear, Bateman said. Those resisting pressure include Unocal
Corp. and Total SA of France, both oil businesses.
Even when a law passes, there's no guarantee it will be carried out as
backers wish. In San Francisco, draft regulations appear to exempt
construction firms, like Mitsubishi.
``Now the struggle will be not to allow anyone to worm out of it,'' said city
Supervisor Tom Ammiano, one of the law's sponsors.
Copyright 1996 The Associated Press. The information contained in the AP
news report may not be published, broadcast, rewritten or otherwise
distributed without prior written authority of The Associated Press.