Starbucks backtracks on Myanmar investment deal

The legendary pumpkin spice latte. Photo: Starbucks
The legendary pumpkin spice latte. Photo: Starbucks

Starbucks has backtracked on a major investment in Myanmar that would have brought its first outlet to the country, local news outlet 7Day reported today, citing a company spokesperson.

“Even though our company is avidly trying to break into the international market, we haven’t decided on establishing a business in Myanmar just yet,” the company’s Asia-Pacific public relations director Marianne Duong reportedly told 7Day.

However, another Starbucks representative has reached out to Coconuts to deny that Duong ever spoke to 7Day. The representative did not address the claim that Starbucks’s had changed its plan to invest in Myanmar.

Myanmar’s Directorate of Investment and Company Administration (DICA) approved a US$6 million investment from the company in May. Through its licensed partner Coffee Concepts (Myanmar) Limited, a subsidiary of Hong Kong’s Maxim’s Group, Starbucks had planned to open 20 outlets across Myanmar, starting with one in Yangon’s Sule Square shopping mall.

Starbucks’s plans to open in Myanmar were first hatched in 2013, when CEO Howard Schultz visited Thailand and said the company would expand to Myanmar “within the next couple of years”.

According to 7Day‘s report, Starbucks’s change of heart has been attributed to tedious bureaucratic requirements enforced by Myanmar’s investment regulators.

However, others speculate that it is a response by the American company to Myanmar’s human rights record. The country’s military leaders were recently accused of genocide against the Rohingya and other crimes against other ethnic minority groups by UN investigators.

Free Rohingya Coalition coordinator Nay San Lwin told Coconuts: “They shouldn’t invest in Myanmar, where genocide is ongoing. Now Myanmar will feel more that it is affecting their business.”

He added: “Coca-Cola, Pepsi, and many other global brands that have invested in Myanmar should also consider divesting.”

On Sept. 6, travel guide company announced that it would suspend its research on Myanmar in response to the sentencing of Reuters reporters Wa Lone and Kyaw Soe Oo to seven years in prison over their reporting on the crimes against the Rohingya.

The company also pledged to commit all of its revenue from Myanmar bookings to the families of the two reporters.

Meanwhile, American donut company Krispy Kreme will open its first Myanmar outlet on Sept. 16.

Editor’s Note: This story has been updated to reflect Starbucks’s position that Marianne Duong did not speak to 7Day.

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