HOUSE OF THE WEEK
An abundance of space at FMI City
CERTAINLY, space is not a problem in this house – once you get there. Over the Hlaing River, 45 minutes from downtown, there is a large one-storey house in a big compound waiting for someone ready to trade time for space. ...moreGarment exports dip in 2009
FACING the continuing effects of sanctions and the global recession, Myanmar’s garment manufacturers are struggling to reach last year’s export total of US$385 million, industry sources say.
Garment exports to Europe have fallen sharply since their peak in 2004, though new orders from Japan and Korea have helped make up the difference, they say.
“Local manufacturers have been struggling since November 2008, when the recession started to bite. We’re just trying to maintain the status quo,” said U Myint Soe, president of Myanmar Garment Manufacturers Association (MGMA).
Despite the difficulties, the industry expects to export about $300 million worth of garments this year, of which about 60 percent is destined for European countries and the rest for Japan, Korea and other customers. Though $210 million worth of last year’s total of $385 of exported garments went to Europe, this is less than half the peak figure of $457 million worth of garments exported to Europe in 2004.
Until the imposition of sanctions in 2003, the garment industry rivalled natural gas as Myanmar’s top export earner, with 2001 sales figures topping $829 million, said U Myint Soe.
U Zaw Min Oo, managing director of Crocodile garment factory, told The Myanmar Times that garment orders from EU countries had declined. “Our factory mainly produces garments for EU countries like Germany, the United Kingdom and Spain, and for South Korea,” he said.
Nevertheless, rising demand from Japan and South Korea, on the lookout for a cheaper source of garment supply, has helped offset the loss of European markets.
Exports to Japan have more than doubled over the past three years, from more than $90 million in 2005 to $189.3 million in 2008, according to statistics released by the World Trade Atlas of Japan. And two Japanese-owned garment factories are applying to the Myanma Investment Commission (MIC) for a licence to operate in Myanmar.
Most garments made in Myanmar for the Japanese market are produced by Japanese-owned factories in order to ensure the necessary quality.
“That’s why local manufacturers find it hard to break into the Japanese market,” said U Zaw Min Oo.
“Even though the Japanese market is not a lucrative one for us, it is stable and good in the long run,” said U Myint Soe.
Myanmar has about 160 garment factories, mostly owned by local investors, employing more than 65,000 people.
