A national textile policy is being formulated for the development of the Myanmar textile and garment industry, with technical assistance from the German Society for International Cooperation (GIZ) and advice from concerned associations, according to the Ministry of Planning, Finance and Industry.
The policy will focus on the entire supply chain in the industry and help attract more foreign investments.
In the first four months of the current financial year, exports of clothes produced on a cut-makepack (CMP) basis topped $1.6 billion, an increase of $170 million from the corresponding period in the 2018-2019FY, according to data from the Ministry of Commerce.
Exports of garments produced under the CMP system fetched over $1.4 billion in the year-ago period.
Myanmar’s manufacturing sector is largely concentrated in CMP garments and textiles, which contribute to the country’s GDP to some extent.
The garment sector is among the prioritized sectors driving up exports in the country. The CMP garment industry has emerged as a promising one, and enjoys preferential trade with Western nations.
The majority of Myanmar’s garment factories operate under the CMP system, and those engaged in the industry are striving to transform CMP into a free-on-board (FOB) system, according to the Myanmar Garment Manufacturers Association.
Myanmar expects income from CMP garment exports to cross $5 billion in the current fiscal and intends to reach the export target of $10 billion set for the garment industry, according to the Commerce Ministry.
The value of CMP garment exports was just $850 million in the 2015-2016 FY, but tripled over the next two FYs. In the 2016-2017FY, exports of CMP garments were pegged at about $2 billion. The figure increased to an estimated $2.5 billion in the 2017-2018FY, and stood at $2.2 billion in the 2018 mini-budget period (from April to September), according to the ministry.
Myanmar mainly exports CMP garments to markets in Japan and Europe, along with the Republic of Korea, China, and the US. With demand from foreign trade partners growing, imports of CMP raw materials are rising year by year.
The Myanmar Garment Manufacturers Association has more than 500 members.
Garment factories in Myanmar employ more than 500,000 workers. Investors prefer to invest in cheap-labor countries like Myanmar. — Ko Htet
(Translated by Ei Myat Mon)