Monday, 29 October 2007

RBS Profits from Burma links

RBS ‘profits from Burma links’
By Rob Edwards, Environment Editor, Glasgow herald

Human rights groups claim stake in Chinese bank sees Scots company cash in on oil interests

ONE OF Scotland's premier international companies has been accused of "fuelling repression" by propping up the brutal military regime that rules Burma.

Campaigners allege the Royal Bank of Scotland (RBS), through its stake in the Bank of China, is collaborating with oil and gas firms run by the Burmese junta. As a result, they claim, RBS is reaping millions of pounds in profit from a regime that abuses human rights and pollutes the planet.

RBS controls 8.25% of the Bank of China, and its chief executive, Sir Fred Goodwin, is a director on the Chinese bank's board. The Bank of China is a key backer of two Chinese oil firms, Sinopec and PetroChina, which have been heavily criticised for co-operating with Burma's military rulers.

advertisementThe Bank of China, 70% owned by the Chinese government, is the world's sixth largest bank. In 2005 it arranged a $1.1 billion loan to Sinopec, and has pledged to underwrite a further $2.7bn worth of bonds for it next month.

Last month Sinopec began drilling an onshore oil well in a joint venture with the Burmese regime's Myanmar Oil and Gas Enterprise. The official launch of the venture on September 26 coincided with the first day of the violent crackdown on civil dissent led by Buddhist monks.

Earlier this year, Sinopec signed a $1bn (£480m) contract for an oil pipeline and, between them, PetroChina and Sinopec operate many projects jointly with the regime. In August, Burma confirmed the sale of gas to PetroChina.

Now a coalition of three environmental and human rights groups has attacked RBS for its links to oil and gas projects in Burma. They claim RBS gained a "substantial proportion" of the Bank of China's $5.5bn profit for 2006. As Sinopec and PetroChina repay their loans, RBS is "banking profits derived from Burmese crude", they say.

"RBS's holdings are fuelling repression by financing fossil fuels in Burma," said Mika Minio, of the Platform environmental group in London.

Platform, with the Burma Campaign UK and BankTrack, will be writing to RBS this week demanding it take "public steps" to persuade the Bank of China not to support repression and human rights abuses in Burma. Failing that, they will urge RBS to sell its stake in the bank.

RBS, the world's 12th largest bank, has previously argued that diplomatic engagement with China is the best way to influence the communist state.

"Bank of China is a highly respected international financial institution," an RBS spokesman told the Sunday Herald. "Bank of China sets out its policies in its published accounts and we are happy with these policies and the way in which they are applied."

No comments: