In the Wartayar Industrial Zone in Yangon, Myanmar, five brand new workshops are standing on both sides of the road, where 3,600 local operators are busy working. Here is Guotai Myanmar Garment Industrial Park, which was opened at the end of 2017. It is also one of the largest garment industrial parks in Myanmar so far.
Promoted by the Belt and Road Initiative, a large number of Chinese clothing enterprises have come to invest in Myanmar since 2014. Currently, 60 percent of Myanmar’s clothing enterprises are foreign-funded companies, in which Chinese-invested enterprises account for 60 percent. An average of 80 percent of newly established clothing companies every month are Chinese-funded, Khine Khine Nwe, secretary general of Myanmar Garment Manufacturers’ Association told China Daily.
Top-level design creates massive opportunities
In fact, Myanmar’s clothing industry was well-developed before 2004, but the sanction imposed by Western countries led to the long-term depression of Myanmar’s clothing industry until 2014, said Shi Kun, executive vice-chairman of Myanmar China Textile and Garment Association. Myanmar issued Foreign Investment Law and formulated the investment rules for garment industry in 2012 to encourage the development of foreign funded clothing industry, and Chinese clothing companies flooded into Myanmar with such above changes in Myanmar’s domestic and international situations.
Yan Qiuhong was the general manager of Handa (Yangon) Garment Co., Ltd. Her factory was established in Yangon in June 2014 and quickly expanded to two plants with over 2,600 Burmese workers. She told the reporter that the country’s relatively low labor cost and local government’s tax incentives attracted the company to settle down in Myanmar. “We plan to build a 10,000-employee plant in future to seize the golden opportunities of investment in Myanmar", said Yan.
As a latecomer, however, Guotai Myanmar Garment Industrial Park has much deeper considerations. Zhao Kai, head of the Administrative Committee of the Industrial Park told the reporter that besides the history of experienced high-end textile products manufacturing, Myanmar is entitled to EU’s Generalized System of Preference Treatment, and also enjoys duty exemption on exports to countries like Japan. This garment industrial park in Myanmar serves as an important expansion and supplement to Guotai’s current supply bases in China, as well as Guotai’s model plant and billing center, Zhao said.
Liang Xiaohui, chief researcher at the Social Responsibility Office of China National Textile and Apparel Council, believes that the top-level design such as the Belt and Road Initiative and China-Myanmar economic corridor will bring significant development opportunities for the cooperation on clothing industry between China and Myanmar.
There are about 300 Chinese enterprises investing in textile and clothing industry in Myanmar, hiring close to 300,000 local employees, according to the preliminary statistics by the Economic and Commercial Office of the Chinese Embassy in Myanmar. While expanding business, Chinese-funded clothing enterprises have made notable contribution to Myanmar’s tax revenue, as well as improving the skills and quality of local workforce.
Promote transformation of local industrialization and urbanization
In December of 2017, China Chamber of Commerce for Import and Export of Textile and Apparel and the Department of Commerce of Zhejiang Province co-hosted 2017 Myanmar International Textile Expo in Yangon, with participation of 150 Chinese enterprises. In three days, the Expo attracted over 10,000 visitors and the letters of intention valuing more than 50 million U.S. dollars were signed at the Expo.
It is a golden age to invest in Myanmar, commented Wudo Minang, permanent secretary of the Ministry of Commerce of Myanmar. He hoped that the advanced technology, textile products and textile machinery could be introduced to Myanmar from China to promote the further development of textile industry of both countries.
The arrival and healthy growth of Chinese-invested companies led to the increase of Myanmar's garment exports year by year. Data from Myanmar Garment Manufacturer Association shows that the annual growth rate of Myanmar's garment exports has been over 20 percent since 2014, and the gross value of clothing products exported to major countries and regions reached some 1.95 billion U.S. dollars in 2016.
In the near future, Chinese companies are going to set up Myanmar’s first bonded warehouse project in Yangon. With this platform, fabric and accessories produced in China will be warehoused in Myanmar in a bonded way, thus the clothing industry in Myanmar will be qualified to be upgraded from material processing to FOB mode, according to Shi. (Edited by Niu Huizhe, niuhuizhe@xinhua.org)
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