Myanmar textile factories forced to close as EU cancels orders

One textile factory after another is halting production in Myanmar as European Union (EU) countries, a major export market, cancelled orders last week amid the spread of the coronavirus pandemic, Myanmar Times reported.

“All operations of the factories that have accepted orders from the EU have stopped. I don’t know how we will deal with this issue,” Myint Soe, chairman of the Myanmar Garment Manufacturers Association, said, adding that the EU market accounted for 70 per cent of the country’s garment export.

The cancellations came only shortly after the supply of raw materials from China started to flow back into Myanmar and are now leaving the factories with huge inventory due to cancelled purchase orders. The shortage of raw garment material was a three months shutdown of production in China due to the virus outbreak.

“We have no more raw materials problem. But now, the EU no longer accepts our garment exports because, as the virus spreads in Europe, all shops closed there,” Myint Soe said.

Factories left with huge inventories

Among the affected companies are Global Apparel Textile Myanmar Co. Ltd, Lat War Co. Ltd. – which is stuck with 500,000 pieces of garments after a European buyer cancelled the order –, Gold Emperor, Hong Text and Myanmar Irrawaddy.

Even before the cancellation of orders from the EU, at least 20 out of the 500 garment factories in Myanmar have shut down due to the pandemic, leaving more than 10,000 workers unemployed, industry sources said.

The shutdowns have already led to labour unrest, including a strike at the Grand Enterprises Garment Co. Ltd in Yangon on March 26 as the company announced a layoff of thousands of workers.

Things will not get better soon, Myint Soe noted, saying that after the EU, the US market has also started cancelling its orders. So far, Japanese and Korean companies have not given any cancellation notices.



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One textile factory after another is halting production in Myanmar as European Union (EU) countries, a major export market, cancelled orders last week amid the spread of the coronavirus pandemic, Myanmar Times reported. “All operations of the factories that have accepted orders from the EU have stopped. I don’t know how we will deal with this issue,” Myint Soe, chairman of the Myanmar Garment Manufacturers Association, said, adding that the EU market accounted for 70 per cent of the country’s garment export. The cancellations came only shortly after the supply of raw materials from China started to flow back into...

One textile factory after another is halting production in Myanmar as European Union (EU) countries, a major export market, cancelled orders last week amid the spread of the coronavirus pandemic, Myanmar Times reported.

“All operations of the factories that have accepted orders from the EU have stopped. I don’t know how we will deal with this issue,” Myint Soe, chairman of the Myanmar Garment Manufacturers Association, said, adding that the EU market accounted for 70 per cent of the country’s garment export.

The cancellations came only shortly after the supply of raw materials from China started to flow back into Myanmar and are now leaving the factories with huge inventory due to cancelled purchase orders. The shortage of raw garment material was a three months shutdown of production in China due to the virus outbreak.

“We have no more raw materials problem. But now, the EU no longer accepts our garment exports because, as the virus spreads in Europe, all shops closed there,” Myint Soe said.

Factories left with huge inventories

Among the affected companies are Global Apparel Textile Myanmar Co. Ltd, Lat War Co. Ltd. – which is stuck with 500,000 pieces of garments after a European buyer cancelled the order –, Gold Emperor, Hong Text and Myanmar Irrawaddy.

Even before the cancellation of orders from the EU, at least 20 out of the 500 garment factories in Myanmar have shut down due to the pandemic, leaving more than 10,000 workers unemployed, industry sources said.

The shutdowns have already led to labour unrest, including a strike at the Grand Enterprises Garment Co. Ltd in Yangon on March 26 as the company announced a layoff of thousands of workers.

Things will not get better soon, Myint Soe noted, saying that after the EU, the US market has also started cancelling its orders. So far, Japanese and Korean companies have not given any cancellation notices.



Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

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Personal Info

Donation Total: $10.00

 

 

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