Manufacturing exports slide to $5.63 bln in current fiscal

LOCAL NEWS

Exports of finished industrial goods slightly fell to US$5.634 billion between 1 October and 1 May in the current fiscal year 2019-2020, a decrease of $36 million compared with the corresponding period of the previous financial year, according to the Ministry of Commerce.
As per figures provided by the ministry, the exports of finished industrial goods totalled $5.67 billion during the same period in the 2018-2019FY.
Additionally, the manufacturing sector has attracted the foreign investments of $432.74 million in the H1 of current fiscal, according to the Directorate of Investment and Company Administration (DICA).
Myanmar’s manufacturing sector is largely concentrated in garment and textiles produced on the Cutting, Making, and Packing basis, and it contributes to the country’s GDP to a certain extent.
At present, some CMP garment factories have shut down on the reason for the lack of raw materials due to the coronavirus negative impacts, leaving thousands of workers unemployed. Even worse, some foreign entrepreneurs are also running away from their businesses. Those factories without official notification of closure will be inspected by a ground field inspection team. And, the factory operators can face legal actions under the Myanmar Investment Law (MIL) if they fail to comply with notification requirements for the closure of factories, said DICA Director-General U Thant Sin Lwin.
The labour-intensive enterprises are badly battered by the coronavirus pandemic, he added.
To deal with the shortage of raw materials for the CMP garment factories in Myanmar, the Ministry of Commerce, Myanmar Garment Manufacturers Association and Chinese Embassy in Myanmar, China Enterprise Chamber of Commerce in Myanmar (CECCM) have jointly imported raw materials through border trade channels and airlines.
However, import values of raw materials by CMP businesses dropped by $54.9 million compared with a year-ago period.
The CMP garment sector which contributes to 30 per cent of Myanmar’s export sector is struggling because of the cancellation of order from the European countries and suspension of the trade by western countries. It can harm the export sector to a certain extent, the businesspersons pointed out.
The CMP industry has emerged as very promising in the export sector. The value of CMP exports was just $850 million in the 2015-2016 fiscal year, but it tripled within two years to reach $2.5 billion in the 2017-2018FY. During the last fiscal year 2018-2019, incomes from garment exports were over $1 billion higher than the previous fiscal year, according to the Ministry’s data.
Since an outbreak like coronavirus infection might happen in the future it is necessary to prepare for a sufficient supply of raw materials. The public and private sectors will cooperate in setting up the supply chain on our own sources, including weaving, knitting, dyeing, and sewing factories.
Japan is the largest market for Myanmar apparel, followed by the European Union.
The MGMA has more than 500 members, and garment factories in Myanmar, employing more than 500,000 workers. Investors prefer to invest in countries with inexpensive labour, such as Myanmar. —Ko Htet (Translated by Ei Myat Mon)

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