Pressure mounts on Okura Prestige

TOKYO 16 July 2021: Japanese business entities should stop participation in a commercial real estate project involving Myanmar’s military junta, Human Rights Now, Human Rights Watch, Japan International Volunteer Center, Justice For Myanmar, and Mekong Watch stated in a joint release on Thursday.

They are targeting Yangon’s Y-Complex, where a 399-room Okura Prestige Yangon is due to open in  2022.

Justice for Myanmar alleges that foreign investment is involved in the construction and management of the Y-Complex project that funds land lease fees to the country’s armed forces known as the ‘Tatmadaw’.

One participating company, Tokyo Tatemono, stated that they had suspended operations at the Y-Complex since the coup. However, project participants, including publicly-funded Japan Bank for International Cooperation (JBIC), Japan Overseas Infrastructure Investment Corporation for Transport and Urban Development (JOIN), Fujita Corporation, and Tokyo Tatemono, have not publicly disclosed the duration of the suspension or the conditions for resuming operations.

“The Japanese government and businesses failed to appropriately assess the risk associated with doing business in Myanmar,” said Human Rights Now Vice Secretary-General Ryutaro Ogawa. “They should admit their own shortcomings and act responsibly; otherwise, they will risk financing the military.”

The Y-Complex, which includes a shopping mall, hotel, and office rental space, is being built on “military-owned Military Museum land” leased by Myanmar’s Quartermaster General’s office, according to a copy of the “Build, Operate, Transfer (BOT) Land Lease Agreement” dated 15 October 2013, according to Justice for Myanmar.

“The agreement states that upon termination or expiry of the BOT agreement, the land, including buildings and fixtures, developed on the land should be transferred to the “lessor.” Therefore, companies involved in Y-Complex risk creating immoveable long-term assets for the military, which can continue to yield income after the agreement is terminated. On 22 June 2020, a Myanmar military spokesperson confirmed that the military owns the land, and the Ministry of Defense receives rental payments for the Y-Complex development.

“On 5 March 2021, in response to an inquiry by Mekong Watch, JBIC said that Myanmar’s Defense Ministry received all payments for the land rent. JBIC also asserted that the rental payments are ultimately included in the government’s national budget, under the National Budget Law, but did not disclose the basis for this claim. JBIC said it was coordinating with the involved business entities as well as the Japanese embassy in Myanmar to confirm such details with the Myanmar government after outside “stakeholders” raised concerns, but it has yet to do so publicly.

“Even before the coup, we were raising concerns to the Japanese government and businesses about the dangers of money flowing into the military, but they did not take necessary measures,” said Mekong Watch Executive Director Yuka Kiguchi. “We strongly condemn the fact that Japan’s public funds likely ended up in the hands of the Tatmadaw.”

“Japanese companies and the government knew that they were dealing with a military responsible for countless atrocities over many years, not a civilian-controlled defence ministry,” said  Human Rights Watch Asia programme officer Teppei Kasai. “The Japanese government and companies should make it clear that they do not intend to resume commercial projects with the Tatmadaw.”

“It is deplorable that the companies involved in the Y-Complex have not clarified the status of the project following Myanmar’s attempted coup and the military’s widening campaign of terror,” said Justice For Myanmar spokesperson, Yadanar Maung.

“There is no justification for leasing land from the office of the quartermaster general, the very office that purchases weapons that the military uses to commit crimes against humanity. The Japanese government and businesses must end their complicity in the Myanmar military’s atrocities.”

On 12 May 2021, the UN Working Group on Business and Human Rights and the Special Rapporteur on the situation of human rights in Myanmar called on businesses to “uphold their human rights responsibilities and put pressure on the military junta to halt grave human rights violations;” while adding that companies should act in line with the Guiding Principles to “avoid contributing to human rights violations, or becoming complicit in crimes if they continue to operate in Myanmar.”

On its website, Hotel Okura Company confirms it will open the hotel in 2022 two years behind the original schedule.  Press statements back in 2020 said the hotel project involved Fujita Corporation, Tokyo Tatemono Co Ltd, Japan Overseas Infrastructure Investment Corporation for Transport & Urban Development and Yangon Technical & Trading Co Ltd a subsidiary of Ayeyar Hinthar Holdings Co Ltd.

The Okura Prestige Yangon is located close to the city’s downtown district, a short walk from Yangon Central Railway Station and a 2 km drive from the historic Shwedagon Pagoda. The property is part of a mix-use commercial complex, including office buildings and retail facilities on the site of the former Defense Services Museum.

Hotel Okura Co Ltd president Toshihiro Ogita at the time of the launch ceremony, said: “It is a true honour for Hotel Okura to take part in this large development project, the first investment permit under the new Myanmar Investment Law, thanks to a coordinated effort by Japan’s public and private sectors, as well as the local partner…. We are keen to add three to five more hotels in Myanmar in the next five years.”