Myanmar earned USD $ 4.8 billion from garment exports during 2019 fiscal year which is increased when compared to the same period of last fiscal year

30 ตุลาคม 2562

Myanmar exported a total of $4.8 billion worth of garments during the 2019 Fiscal Year. This was an increase of $1.2 billion over FY 2018, according the data from the Ministry of Commerce. 

The “Manufacture Products” category is the largest category of Myanmar’s listed sectors. Garments fall into that category, and is the biggest sub-sector of any category, even beating out oil and gas, according to U Khin Maung Lwin, Deputy Permanent Secretary of the Ministry of Commerce.

Myanmar exports finished garment products to Germany, UK, Spain, France, Denmark, Italy, the Netherlands, Japan, and Korea.

The Deputy Permanent Secretary added: “We have GSP benefits for our garment exports, which helps push the volume of garment exports. The sector’s volume of trade took off after the 2016 Fiscal Year.”

In 2013, the European Union granted a Generalized System of Preferences (GSP) for Myanmar in order to help improve the garment sector. Myanmar also enjoys similar GSP benefits from the United States.

Companies slowly took advantage of the change. In FY 2016, Myanmar earned only $900 million from garment exports, while FY 2019 reaped a windfall of revenue totaling approximately $4.8 billion. 

This is only the beginning, and the sector could grow much larger. 

Due to an upward trend in the garment sector, the Myanmar Garment Manufacturers Association (MGMA) estimates that Myanmar will earn up to $10 billion a year in 2024. But we ask: “Is that estimate high enough?” Let me explain. 

With the ongoing trade war between the two economic powerhouses, U.S.A and China, many companies are looking to move out of China. Myanmar Business Todayhighlighted this fact in past articles, and how Myanmar can take advantage of the situation in a way that benefits all parties involved. The last article that we published to cover the trade war was in May 2019, but a lot has happened since then. 

To get us up to speed, we spoke to Brock Silvers, he is a multi-asset strategist and founder of Kaiyuan Capital based out of Hong Kong. He’s also a regular guest on: BBC’s Asia Business Report and other media outlets, as well as Myanmar Business Today.

Silvers said: “Both the trade war and Hong Kong’s social instability continue to have an impact, and conditions actually seem likely to worsen. The Trump Administration just alerted the world that it may block Chinese companies from its capital markets, and the passage of China’s National Day may leave Beijing less constrained in responding to ongoing demonstrations. This environment can only increase enthusiasm for supply chain relocation, and it’s no surprise that US companies are looking at Myanmar.”

If Myanmar can entice more Western companies and investors to move to this strategically important country, then we predict that MGMA’s estimate that Myanmar will earn up to $10 billion a year in 2024 is too low.

What does Myanmar need to focus on in order to attract more investment from Western companies and investors?

Silvers explained: “Authorities should be doing all they can to attract investors to Myanmar’s lower costs, available workforce, central location, & growth trajectory. Myanmar has a wonderful story to tell. But human rights concerns also temper Western enthusiasm, and officials are often less than fully effective at explaining Myanmar’s policies & concerns. Asia’s economic reorganization represents a generational opportunity for Myanmar, but Western investors will require greater degrees of economic support & political comfort. Is Naypyidaw up to the challenge?” 

Be sure to check out our previous article in this series titled, “Double Dipping on a U.S.-Sino Trade War” to read what Aryani Manring, the U.S. Embassy spokesperson, had to say on this topic. 

Andrew Johnson was the Senior Editor for Myanmar Business Today from October 2017 to October 2019. With experience in construction, electrical engineering, as well as a passion for computers, world news and all things technology, he is well positioned to opine on a wide variety of subjects. This article marks his final piece for MBT’s journal, but he still lives in Myanmar and can be reached on Twitter @eastcoastpunk 

 

J. Kent Layton is a well-known maritime historian, and has authored numerous books on the subject of the great ocean liners of the past. He is a tech nut, an avid photographer and page-layout artist, and is working on a contract basis as copy editor at Myanmar Business Today. His works are available on Amazon, and he can be reached on Twitter @jkentlayton

 

(Myanmar Business Today: https://www.mmbiztoday.com/articles/myanmar-earns-billions-garment-exports-only-beginning )