Foreign investment in Burma increased by more than 34 percent in 2004, despite US and European sanctions imposed on the military-ruled country, according to government statistics published at the end of last week.

Investment rose to US $128.09 million last year from $95.32 million in 2003, said the Ministry of National Planning and Development in its annual report. South Korea, China and Thailand invested $112.25 million as part of seven oil and gas contracts, with the remainder going to manufacturing, mining, transport and the hotel sector, the report said. China alone invested more than $66 million in oil and gas, mining and manufacturing in 2004.

Since Burma introduced a more open market system in late 1988, the country has drawn more than $7 billion in foreign investment, more than half of which has come from Asean.

The US and the EU have imposed economic sanctions on Burma in recent years to pressure the military government to improve human rights and release detained pro-democracy leader Aung San Suu Kyi.

There was, however, bad news for business in Burma in what is usually a highly optimistic outlook by the junta, with statistics in the same report showing natural gas sales slipped 9 percent to $578 million in the same period. The figure was down from $636 million in 2003.

Gas constituted 23 percent of Burma’s total commodities export revenue in 2004, with neighboring Thailand being the primary market.

Burma has exported natural gas since 1998, when it began exports to Thailand from its two major offshore gas fields in the Gulf of Martaban.

Thailand receives gas from Burma through the Yadana pipeline, whose primary investors are Total of France and Unocal, now owned by Chevron.

Both parties received substantial criticism over their investments after locals and rights groups made allegations of forced labor and other human rights abuses by the Burmese military during the pipeline’s construction. Total and Unocal have denied the charges, although the latter reached an out-of-court settlement-thought to be around $20 million-this year with the plaintiffs.