Federated Stores Latest to Join Myanmar Boycott

Federated Department Stores has become the latest retailer to cut its ties to Myanmar, handing human rights activists a victory in their fight to unseat the country’s military regime.

Armed with tales of forced labor and ethnic cleansing, activists have persuaded some of America’s leading retailers to quit buying apparel from Myanmar, formerly known as Burma. Federated, owner of Bloomingdale’s and Macy’s; Ross Stores Inc.; and Gart Sports Co., the nation’s second-largest sporting goods chain, joined 29 other retailers that have agreed not to sell products bearing the “Made in Myanmar” label, according to the Free Burma Coalition, the Washington-based nonprofit that organized the boycott campaign.

A Federated spokeswoman said last month’s decision to quit selling goods produced in Myanmar was made because “what is going on there is a violation of the philosophy and spirit of our vendor supplier code of conduct.”

Myanmar has become an international pariah since its military rulers seized the country in a bloody coup and refused to yield control to the opposition, National League for Democracy, after it won by a landslide in 1989.

El Segundo-based Unocal Corp. is one of the few U.S. firms still operating in what is now one of the world’s poorest countries. In a landmark case, a Los Angeles federal judge recently ruled that Unocal could be tried for human rights violations, including forced labor, that allegedly occurred during construction of its $1.2-billion natural gas pipeline in the Southeast Asian country.

The U.S. and other countries have imposed wide-ranging sanctions on Myanmar, including the cutoff of international aid, investment and diplomatic ties. Last month, the State Department called on the government of Myanmar to investigate a report accusing its military of using rape as a weapon to terrorize ethnic minorities.

Myanmar’s ruling State Peace and Development Council has strongly denied such accusations. Earlier this year, the cash-strapped military leaders hired DCI Associates, a Washington political consulting group, to lobby on the council’s behalf.

As its economy deteriorated, Myanmar’s leaders invested heavily in apparel production and exports to the U.S. jumped from $85 million in 1997 to $411 million in 2001. But the retail boycott and the slowing economy have taken a toll, with apparel exports to the U.S. falling 35% this year, according to U.S. government figures.

Southeast Asia experts said the tightening economic noose and a threat by Congress to impose an import ban were factors in the military junta’s recent decision to ease up on its political opposition.

In May, the government released opposition leader and Nobel laureate Aung San Suu Kyi from house arrest and freed more than 300 political prisoners.

Tom Malinowski, who worked on Myanmar issues for the Clinton administration and is now employed by Human Rights Watch Asia, a human rights advocacy group, said “there’s no question in my mind that [economic pressure] played a role” in Myanmar’s recent political opening.

But Malinowski and others urged the U.S. to maintain its investment ban and other tough sanctions until Myanmar’s government releases the estimated 1,000-plus political prisoners still behind bars and fulfills its promise to hold free and open elections.

In June, Matthew P. Daley, deputy assistant secretary of State, assured Congress that the Bush administration had “no plans at the present time to remove our existing sanctions on Burma” because the Myanmar government had taken only the “first step” toward democracy.

Legislation to ban imports from Myanmar is still “very much alive” in Congress, according to a spokesman for Rep. Tom Lantos (D-San Mateo), the sponsor of the Burma Freedom Act. David Steinberg, director of Asian studies at Georgetown University, said that measure has a good chance of passage if Myanmar’s leaders don’t take concrete steps toward political reform.

“If those expectations are not met there will be repercussions worse than before,” Steinberg said. “I think it’s encouraging that so many companies are willing to take action against forced labor.”