May 14, 2009
A top Australian engineering company has been embarrassed by revelations that one of its subsidiaries has been doing business with a shadowy conglomerate closely tied to Burma's repressive military regime.
Downer EDI this month cancelled Singapore-based subsidiary CPG's contract with a company believed to be a subsidiary of Burmese conglomerate Asia World.
CPG was contracted to help design a new airport, which Asia World is to build, in Naypyidaw, Burma's remote new capital city.
Asia World has strong links to the ruling regime and at least two of its wealthy executives - founder Lo Hsing Han and his son, managing director Tun Myint Naing, also known as Steven Law - are blacklisted by Australian and US authorities.
Under federal government sanctions, transactions involving the transfer of funds or payments to the two men, along with 461 other Burmese figures, is strictly prohibited without the specific approval of the Reserve Bank of Australia (RBA).
Downer EDI, based in Sydney, said it knew nothing of the contract until it was contacted by an investigative reporter from the Asia Sentinel online magazine.
Downer EDI's corporate affairs manager Maryanne Graham said the company cancelled the contract because it contravened the company's stated policy of sustaining a "zero-harm environment".
"We take zero harm very seriously and while not insinuating anything against our direct client in Singapore, we believe this action to be in keeping with the intent of our policy," she told the Sentinel.
US authorities believe Lo Hsing Han is also one of the world's key heroin traffickers, dating back to the early 1970s.
"Steven Law joined his father's drug empire in the 1990s and has since become one of the wealthiest individuals in Burma," a 2008 US Treasury Department press release said.
Downer EDI failed to respond to AAP's repeated requests for more information, or for comment. Comment was also being sought from the RBA.
Human rights groups have accused the Burmese regime of using slave labor to build its new capital, in a remote region in the centre of the country.