THE BLOG

Myanmar's Garment Industry Holds Unique Opportunity

13/02/2017 16:37

Just as I return from visiting garment factories in Myanmar, a stream of press attention focuses on challenges facing this area. Although there are challenges, my trip has only made me believe in the unique opportunity this country represents to change the future of how our clothing is made. Amidst the media headlines there lies potential for real solutions on the ground that can work alongside these challenges and retailers.

On 25th January I landed in Yangon, capital of Myanmar. I'd spend the next week visiting 6 garment factories surrounding the area employing a total of 2,000+ workers.

Each of the factories were different in their own way, varying in their size and owners. Despite their differences, the factories share an important context, which makes up the story behind the 'Made in Myanmar' label. I wanted to find out what this story meant for myself.

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Photo credit: Author's own.

Before heading out, I read Impactt Limited's report on Myanmar's garment industry recently commissioned by the C&A Foundation, which you can also read for yourself here.

It's important to understand the current phase this country is in, it's citizens are emerging from decades of military rule and more than a quarter of people currently live in poverty.

This context is mentioned in the SOMO research report which was released on 5th February and sparked controversial headlines such as 'High street clothes made by children in Myanmar for 13p an hour' (The Guardian). But what does 'made by children' really mean in Myanmar, a Buddhist country where the minimum legal working age has recently increased to 14.

I mention Buddhism because 90% of people in the country are Buddhist. The most inspirational person I met during my visit was a female Burmese and Buddhist owner of a factory employing 200 workers. It's rare to meet a female owner of a garment factory anywhere in the world, never mind in a country where foreign investment means locally owned factories are quickly losing business. This lady described how she knew each of her workers and could tell if they were unhappy, since they all lived together in recently renovated housing on the site of the factory.

Before the minimum wage law came in, this lady had knowingly taken in a child worker to her factory. Many people in the country still believe that working in a factory is better for children than no work, which is an attitude often linked back to Buddhism. When the child labour regulation came in, pushed mostly by needing to meet the standards of international fashion brands, she understood she needed to stop employing the child. Though these attitudes will take time and understanding to change at scale. Workers between 14 and 16 are defined as 'child workers' in Myanmar and are prevented from carrying out any hazardous work or working more than a few hours a day. Though these laws may not meet all international expectations and it is still hard to verify age.

The purpose of our visits to these factories was to complete follow up studies with factories who had been a part of the BIF programme. The programme was set up to improve productivity and worker welfare, and is co-ordinated by BIF, Impactt Limited and Rajesh Bheda Consulting. As a result many of the factories had realised the links between worker welfare and productivity in innovative ways, giving some optimism to how change could happen in the industry.

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Photo credit: Author's own.

We also visited foreign owned factories. Chinese, Korean and Japanese factory owners have invested in the region, often bringing their buyers and high street names we recognise with them. I spoke to a General Manager, who told me about how the minimum wage had impacted his work. Engaging factory managers is of vital importance to the debate on worker standards, so that in the long term we can sustain these standards by aligning them with business efficiency and quality. Before the minimum wage, the factory paid their workers on piece rate and bonuses. With a set minimum wage, the factory lost a mechanism to motivate workers towards better quality. He kindly opened his current situation to me and we sat down for a couple hours looking through spreadsheets on his profits and loss over the past 24 months. The data showed how some workers had earned more before the minimum wage compared to after, given to the fact they were previously motivated towards bonuses. The loss in quality as a result meant the factory manager had excess stock which was worthless taking up valuable space in his factory, which could also lead to a waste of material.

Of course I agree the introduction of a minimum wage is vital and necessary, the reason I paint an alternative picture is because I believe the industry is ultimately looking for more than a minimum standard. Many workers in Myanmar still say the minimum wage is not enough to live on. We should be looking to pay workers worldwide in a way which means quality of life and work. We often see low wage worker salaries compared to Western CEO's salaries, who are being paid or motivated by a bonus in a way we can relate to.

At this moment in time, Myanmar sits at a turning point in it's history. From 2011 to 2015, export value of their garment industry grew from 583 million USD to 1,460 million USD, while the number of jobs and factories more than doubled (MGMA). Until 2020 the industry is set to grow even further, and is a key area for growth identified by the government. There is a sense of what the country can learn from neighbours such as Bangladesh when they faced a similar path, in order to develop in a more sustainable and ethical way.

I'm grateful that I've been able to understand the challenges and opportunities better by speaking with those on the ground who have kindly given me their time to talk.

Though the reason I had the depth of conversations I did, is I think because I was there to listen and learn how to create a solution.

This could be another 'race to the bottom' story, but Knowlabel will do everything to help consumers, workers and retailers make sure the ending to this story isn't the predictable one.

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