Garment sector booms amid rising orders from Japan, EU

The apparel industry is enjoying strong growth with garment exports earning US$940 million (about K1.2 trillion) in the year to mid-October, up from $409 million in the same period last year, media reports said.

The increase was mainly due to a rise in orders from Japan and the European Union, the ASEAN edition of the Asia Weekly magazine, published by state-run China Daily, reported on November 4.

It said Japan accounted for about a third of exports, the EU – especially Germany – and South Korea about 25 percent each, and the United States and China, 2.4 percent each.

Trade with the EU has grown steadily since 2013 when it lifted economic sanctions on Myanmar and restored trade privileges suspended in 1997 over the junta’s human rights record.

Exports to the EU rose from €345 million (about K492 billion) in 2013 to €548 million (about K782 billion) in 2015, show European Commission figures.

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The industry is also expected to benefit from the US decision in September to lift sanctions and restore trade privileges granted to Myanmar under its Generalized System of Preferences for developing countries.

Myanmar Garment Manufacturers Association chair U Myint Soe told the Myanmar Times in September that the US sanctions move was a boon for the industry because it would make American garment buyers more confident about doing business with Myanmar.

However, Myint Soe added that unlike the EU decision to restore trade privileges, there would be no immediate benefit from the US move because garments were not among the 5,000 products on its GSP.

He said that in 2001 the US accounted for 65 percent of total garment exports valued at $817 million.

“If we can get that kind of market back this time, garment exports will reach up to $3 billion in 2017,” Myint Soe told the daily.

MGMA figures show the industry employs more than 300,000 workers at 389 factories, of which 171 are Myanmar owned, 196 are foreign owned and the rest are joint ventures.

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