British businesses head to Burma for trade delegation

British businesses, including the oil giants BP and Shell, will arrive in Burma tomorrow for the first government sponsored trade delegation to the south east Asian nation in nearly two decades, the Independent has learned.

The mission – described by insiders as an “exploratory visit” – is the first time Britain has sent a trade delegation to Burma since the mid-1990s and comes amid a feverish rush to strike commercial deals there after European and American sanctions were lifted earlier this year.

Rich with untapped natural resources and sandwiched between India and China, Burma is seen as a potential gold mine by foreign investors. But human rights groups have expressed concerns that country’s authoritarian government is being rewarded too quickly for limited reforms.

After years of brutal military dictatorship, Burma’s generals have given up some of their power and handed authority over to a civilian government led by Thein Sein, a reformist bureaucrat who is keen to attract foreign investment. Although the military’s official party still dominates the political scene some reforms have been made including the release of some opposition figures and recent elections for a handful of parliamentary seats.

Relations between Naypyidaw and London have warmed considerably following a recent visit by former jailed opposition leader Aung San Suu Kyi.

During her stay in Britain last month, Suu Kyi expressed cautious support for foreign investments but warned that it should benefit Burma and not be exploitative.

There is considerable anger in Burma that the government's relationship with China, until recently Burma's only major trading partner, has largely centred around exploiting the country's natural resources whilst making little tangible investment to improve the lot of ordinary Burmese - 70 percent of whom still have no access to electricity.

The Independent understands that BP and Shell are two of the major corporations looking to make investments in Burma.

Energy companies are already marching a steal on BP and Shell. Total and Chevron already have a footprint in the country running a key off-shore  gas pipeline alongside Thai and Malaysian energy companies.

Those with knowledge of the British trade visit have stressed that no-one expects any deals to be struck yet given the ongoing concerns about corruption in Burma. “It’s a fact finding trip to listen and learn,” said one source. “We won’t come back with signed contracts.”

Businesses have flocked en-masse to Burma’s commercial capital Rangoon in recent months, with spare rooms in the city’s limited hotels as hard to come by as ATMs and reliable internet. “There’s a real buzz,” says one European expat. “It feels like the wild west, there’s the chance to make a lot of money here.”

However Burma’s regime is still flexing its authoritarian muscles. Over the weekend more than 20 opposition leaders were temporarily arrested as they tried to mark the 50th anniversary of Burma’s student protest movement.

BP and Shell declined to confirm whether the would send staff on the delegation.

A Shell spokesman said: “Shell is always looking at global growth opportunities, in line with our business strategy. Shell is not currently involved in Burma, and is in full compliance with the requirements of various governments. We have an ongoing dialogue with a wide variety of stakeholders to better understand the current economic, political and business environment in the region.”