Myanmar garment industry slumping

Tuesday October 14, 7:45 am ET
Global financial crisis may lead to layoffs in Myanmar's vital garment industry, insider says


YANGON, Myanmar (AP) -- Myanmar's vital garment industry could suffer factory closures and layoffs because orders are sharply down due to the continuing global financial crisis, an industry executive has said.

"Since the financial crisis, orders for new consignments have reduced and we will see serious impact by the middle of December," Myint Soe, the chairman of the Myanmar Garment Manufacturers Association, told reporters Monday.

The success of the country's apparel industry is largely tied to global demand, so the fall in orders could lead to workers being dismissed and the closure of some production facilities, Myint Soe said.

Myanmar's textile industry experienced a downturn after the United States imposed economic sanctions in 2003, but rebounded two years later when the European Union imposed limits on imports from China, Myint Soe said. Those restrictions led to increased European textiles orders for Southeast Asian nations, including Myanmar, he said.

About 30 percent of Myanmar's garment exports go to Japan, another 30 percent to the EU and the rest to Latin America, Turkey, South Africa, Mexico and Argentina, Myint Soe said.

Myint Soe said the industry suffered a setback early this year when South Africa's biggest clothing retailer canceled orders, citing a military crackdown on massive anti-government protests in September last year.

That ban led to the closure of about 35 factories in Myanmar, he said. About 100 garment factories remain, employing between 80,000 to 100,000 workers, compared to more than 270 factories before 2003, he said.

According to official statistics, Myanmar earns $282 million from garment exports in the 2007-2008 fiscal year.http://biz.yahoo.com/ap/081014/as_myanmar_textile_downturn.html?.v=1