E-paper

Military coup puts Telenor’s future in Myanmar on line

— Since Myanmar’s military ordered telecoms operators to shut their networks in an effort to end protests against its February coup, Telenor’s business there has been in limbo.

As one of the few Western companies to bet on the South East Asian country after it emerged from military dictatorship a decade ago, the return to army rule led to a $783 million write-off this week for Norway’s Telenor.

The Norwegian state-controlled firm, one of the biggest foreign investors in Myanmar, must now decide whether to ride out the turmoil, or withdraw from a market which last year contributed 7 percent of its earnings.

“We are facing many dilemmas,” Telenor Chief Executive Sigve Brekke told Reuters this week, highlighting the stark problems facing international firms under increased scrutiny over their exposure in Myanmar, where hundreds have been killed in protests against the Feb. 1 coup.

While Telenor plans to stay for now, the future is uncertain, Brekke said in a video interview.

Although Telenor had won praise for supporting what at the time was a fledgling democracy, activist groups have long voiced concerns about business ties to the military, which have intensified since the army retook control of the country.

Chris Sidoti, a United Nations expert on Myanmar, said Telenor should avoid payments such as taxes or licence fees that could fund the military directly or indirectly, and that if it cannot be independently determined that Telenor is “doing more good than harm” in Myanmar, then it should withdraw.

However, Espen Barth Eide, who was Norway’s foreign minister at the time Telenor gained a licence in Myanmar in 2013, told Reuters that Telenor should stay and use its position as a well-established foreign firm to be a vocal critic of the military.

A spokeswoman for Norway’s Ministry of Trade, Industry and Fisheries, which represents the Norwegian government as a shareholder, said on Thursday that “under the current circumstances Telenor faces several dilemmas in Myanmar.”

“From a corporate governance perspective the investment in Myanmar is a responsibility of the company’s Board and Management. Within this framework the Ministry as a shareholder keep a good dialogue with Telenor regarding the situation,” the spokeswoman added in an emailed response to Reuters.

The Myanmar junta, which has said it seized power because its repeated complaints of fraud in last year’s election were ignored by the election commission, has blamed protesters and the former ruling party for instigating violence.

And it said on March 23 that it had no plans to lift network restrictions. It has not commented on the curbs since and did not answer Reuters calls on Thursday.

New market

Telenor is no stranger to operating under military rule in both Pakistan and Thailand, where it challenged the Thai junta over what it said was an order to block social media access.

At around the same time, Telenor was signing up its first customers in Myanmar.

Its then-CEO, Jon Fredrik Baksaas, told Reuters that Telenor had thought “a lot” about the risk that Myanmar’s experiment with democracy might not last.

“But we argued at that time that, when we get in a western company that delivers telecommunication in a country, we stand also with some responsibility, and a bit of a guarantee that things are done correctly,” Baksaas said.

Its position had support internationally at the time after Barack Obama became the first U.S. President to visit Myanmar in 2012, the year after a military junta was officially dissolved and a quasi-civilian government installed.

For its part, the Norwegian government, which owns a majority of Telenor, had long supported democracy in Myanmar, hosting radio and TV stations reporting on it under military rule. And in 1991, the Norwegian Nobel Committee gave the Nobel Peace Prize to Aung San Suu Kyi, who spent 15 years under house

arrest in Myanmar before leading a civilian government which retained power in last year’s election.

Suu Kyi was detained after the coup and charged with offences that her lawyers say are trumped up.

While Norway was supportive of Telenor’s Myanmar venture, the government also warned of the risks, Barth Eide, Norway’s foreign minister at the time, said.

Global Focus

en-kr

2021-05-12T07:00:00.0000000Z

2021-05-12T07:00:00.0000000Z

https://ktimes.pressreader.com/article/281827171646467

The Korea Times Co.