Japan’s Kirin Holdings is now undecided on its future in Myanmar beer business after an inconclusive 3rd party probe into its local partner connections with the military junta.
Kirin had hired Deloitte Tohmatsu Financial Advisory to investigate after the UN identified owners of its local partner, Myanmar Economic Holdings Public Company (MEHL), as members of the Myanmar military which has been accused of genocide and other war crimes against the Rohingya.
Myanmar however denies genocide, saying its military was carrying out legitimate operations against Rohingya insurgents who attacked police posts.
Deloitte was unable to access sufficient information to make a conclusive report on its findings, however major human rights groups like Amnesty International have already called on Kirin to severe ties with MEHL.
In respond to the allegations, Kirin has already suspended its payments to MEHL until a solution can be found.
Kirin acquired a majority stake in Myanmar Brewery in 2015 when Myanmar gained partial lifting on international sanctions which resulted in massive inflows of investments into the country. However, in recent years, foreign investors are increasingly concerned on the country’s stalled political reforms and the persecution of minorities including the Rohingyas, although the market offers strong potential.
William Nee, Business & Human Rights Advisor at Amnesty International said, “It is certainly possible to do business in Myanmar without enriching the military, and companies should engage in human rights due diligence to ensure that they do not enter into a business relationship with MEHL or any other Myanmar military entity.”
Myanmar accounted for less than 5% of Kirin’s global beer sales, however it is one of the bright spots for Kirin as its domestic market (Japan) continues to shrink.