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Pepsi's Burma withdrawal could spar (r)
Subject: Pepsi's Burma withdrawal could spark more pullouts (The Asian Age, 30/1/97)
Pepsi's Burma withdrawal could spark more pullouts
The Asian Age (New Delhi), 30/1/97.
Bangkok, Jan. 29: Pepsi's complete withdrawal from Burma could spark
further pullouts by other multinationals doing business in the
military-ruled country as companies bow to growing shareholder pressure,
analysts said on Wednesday.
PepsiCo Incorporated, which last year its 40-per cent stake in a Burmese
venture after growing pressure from human rights groups, on Tuesday said
it had severed the last of its ties with Burma. The US soft drinks giant
said it had ended an agreement to sell syrup to its former franchise
bottler in Rangoon.
Human rights activists have been lobbying for years, through a consumer
boycott campaign, to convince Pepsi to withdraw from Burma, citing human
rights abuses by the military government, which took power in 1988 after.
violently suppressing nationwide pro-democracy protests. Opposition
leader and Nobel Peace laureate Aung San Suu Kyi has also repeatedly
urged foreign businesses not to invest in Burma until the situation improved.
"This is the biggest company yet to pull out, and it is clearly because
of the grass roots campaign," said Mr Simon Billenness, senior analyst at
Franklin Research and Development in Boston. Several major companies,
including Liz Claiborne, Spiegel Incorporated unit Eddie Bauer and
beermakers Heineken NV and Carisberg have pulled out of investments or
stopped sourcing products in Burma since last year. "Pepsi's withdrawal
isolates other US companies there. It's sort of a wake-up sign to other
companies," said Mr Billenness, whose investment firm is active in
various human rights issues.
Mr Peter Brimble, president of the Brooker Group, a Bangkok consulting
firm that advises on investment in Burma. said the impact would most
likely be felt by companies who must answer to shareholders.
"Shareholders have an impact on companies. If shareholders are up in arms
about the situation in Burma the company has to do something," he said.
"Private investment firm with no shareholders can look at it differently."
Activists plan next to target major oil companies, such as Unocal, Total,
Atlantic Richfield Company and Texaco -- which are trying to exploit
Burma's plentiful oil and gas reserves. "The next focus is certainly the
oil companies." said Mr Larry Dohrs, spokesman for the Free Burma
Coalition, heading the campaign to stop investment in Burma. (Reuter)