May 30
By Lokethar
Investors from many countries try to move their production activities, particularly those relating to labour intensive manufacturing, to places where the cost of labour is the least so that they have a competitive edge in the global market for their products. The countries with the “cheapest labour cost” are mostly the developing countries of the world. This has led to the “moving” of production facilities in the countries they have been located in, to countries with “cheaper” labour. Besides most of the investors from foreign countries prefer their manufacturing facilities to be located in the large cities in view of better transportation facilities as well as in big cities with seaports from where the manufactured goods would be easier and less costly to export to other countries.
Labour intensive industries in the cities are a “pull factor” in the movement of labour from mostly rural areas of the country side. Low incomes in the rural areas are the “push factor” that drive people in the rural areas to “migrate” to the cities in search of higher incomes. Many of them borrow money from the money lenders (who are in fact also the “pwe sars” that get them the jobs) and leave the village to work in the cities. However there is the problem of accommodation for the workers which the factory owners usually don’t provide. So the migrant workers hire rooms in “halls” (asaungs) near the place of employment or within easy travelling distance. They live “jam packed” in small rooms. In this time of the Corona Virus 19 Pandemic it is a situation which could lead to the fast spread of infection by the virus if any of the resident of the “asaungs” has the virus. This is all the more a possible scenario as there may be residents who are “asymptomatic”, that is they do not display the signs of infection by the virus. Hence promoting CMP industries at this juncture would not be a “wise” decision. Are we then to disregard the employment generation advantage of the CMP industry? Well perhaps we should conduct a study of the advantages and disadvantages of the CMP industry in terms of the benefits accrued versus the “cost” to society.
The benefits of the labour intensive manufacturing industries, vis a vis the “investor” is that it is of comparatively a low investment and high employment generating industry. however up on closer examination the “manufacturer” in Myanmar only gets the “making charges”. No doubt there is considerable “value added” in converting the raw materials (fabric, packing material etc.) into the finished product but it is enjoyed by the “seller” of the products and not those who are involved in the “manufacturing” only. As for the local owners of the land (and in some cases the buildings), if they are not themselves the “investors”, they stand to benefit only from the rentals they get from the Investors whether local or foreign. The “revenue” earned by the State are through taxes on the exported products which is not much. The state may benefit from the “making charges”,( which is also not much), being accumulated in foreign currency. If alternatively the “land” could be used for more “high value added” industries it would benefit the State , the investor and the land owner much more. Also the “supply chain” would not clutter up the logistic and transport situation as now.
The CMP industry being a “labour intensive industry” does provide “jobs” for many, especially female workers. But can the work they perform be classified as “decent work”? Isn’t there too much of “overtime work” with surges in demand for the products? Are all the workers fairly paid including for the overtime work they perform? Are they given the legal “minimum wage”? Will not long working hours affect their health in the long run? can living in cramped quarters and eating “street food “ daily because they don’t have time or place to cook, affect their health in the long term? Are they able to meet unreasonably high production targets? Are the workplaces safe? Do they have enough washing and sanitary facilities? These are some questions that need satisfactory answers. With charity to all and malice to none.
