CP Workers’ Woes Highlight Concerns about Big Agriculture in Burma

By William Boot 27 June 2013

The billionaire boss of the giant Thai conglomerate Charoen Pokphand Group (CP), Dhanin Chearavanont, is on record saying he runs his businesses on Buddhist principles. But Burmese migrant workers employed in his seafood-processing factories in Thailand might have reason to question those principles after their experiences at the hands of exploitative subcontractors CP has, until now, used as go-betweens in its dealings with non-Thai employees.

CP’s practices were thrust into the limelight this week after it fired 160 Burmese at a factory in Mahachai on the coast just south of Bangkok. The grounds for their dismissal were vague, as with other firings of Burmese in the past, and may have contravened Thai labor law. But this time the Burmese embassy in Bangkok intervened and CP has agreed to give the workers their jobs back, and to look into the subcontracting methods.

The treatment of Burmese workers in Thailand by CP does not bode well for the company’s declared plans to invest US $550 million in Burma, on large-scale rice and maize farms, milling plants and meat processing factories.

“Myanmar’s [Burma’s] economy is growing since the government has opened the door for foreign investors. We believe that it will create business opportunities for us,” CP Vice-Chairman Adirek Sripratak said last year.

The Thai giant has established some agricultural business in Burma but, according to some observers, the investment has brought mixed blessings.

“CP already has operations here in Myanmar growing, amongst other things, corn for animal feed. Issues around the CP model for corn production with high levels of inputs has drawn criticism and if this model is replicated across the country then negative consequences for production sustainability will likely result,” Tobias Jackson of the Food Security Working Group (FSWG) in Rangoon told The Irrawaddy on June 26.

“Agri-business investments across the Mekong region have a very mixed track record. Large-scale, monoculture, industrial agriculture plantation investments stand accused in many cases of land grabbing and displacing communities and farmers from their land and of increasing rather than reducing poverty,” said Jackson.

The FSWG is an umbrella organisation of Burmese and international NGOs working to improve farming and the lives of farming communities.

Bangkok-based CP has mushroomed from its original family seed supply business to become an international conglomerate ranging from processed packaged foods to telecommunications, motorbike manufacture and insurance.

CP today employs 280,000 people, many of them in China, and operates the world’s third-largest 7-Eleven stores chain franchise, according to Bloomberg business news agency.

Chairman Dhanin, whose hobbies include cock fighting, was listed by Bloomberg at the end of 2012 as having personal wealth of $6.1 billion.

CP was unable to comment for this report, or to provide any details of its proposed new investments in Burma which were outlined when Adirek visited Naypyidaw and had a one-to-one meeting with President Thein Sein.

“Generally, there are major concerns over the weaknesses in the land laws for farmers in Myanmar, including the absence of protection for traditional shifting cultivation practices, and there are consistent reports of powerful interests, including companies and Myanmar state agents confiscating land from farmers with no or little compensation for agribusiness projects,” Paul Donowitz of the US-based NGO EarthRights International told The Irrawaddy.

“While we have no direct information on CP, companies invested in, or considering investing in the agribusiness sector who have poor track records on labor and other core human rights issues are a serious concern, and their investments should be closely scrutinized.”

The Bangkok-based Burmese migrants right group Human Rights and Development Foundation said the 160 workers fired by CP at the Mahachai seafood factory had been told by one manager that their Thai language skills were not good enough. However, they had been campaigning to be paid part wages after their working week was reduced due to a fish shortage.

“[Agribusiness investments] also stand accused of negative environmental impacts and of illegal logging associated with concession development. Contract farming engagements between companies and farmers offer some potential for poverty reduction but are often implemented without sufficient respect for farmers’ rights and without farmers having sufficient knowledge, which results in exploitative contracts,” said Jackson

“CP employs both these production systems in their operations in the region and so one can infer that they will employ these systems in Myanmar with the potential associated negative consequences as described above,” he added.

Dhanin, whose family arrived in Thailand as poor Chinese migrants in the early 20th century, has top political connections in China where CP operates over 200 companies and employs more than 80,000 people.

The future may be brighter for Burmese farmers if Dhanin holds true to his Buddhist principles.

“People who feed the country shouldn’t be poor,” he was quoted by Bloomberg as saying last December when it listed his multi-billion dollar wealth.