Myanmar: brands and NGOs back Myanmar's minimum wage proposal

By

Matthieu Guinebault

Published
Jul 21, 2015

Several manufacturers are threatening to move their factories outside of Myanmar if the textile industry is not exempt from the recently introduced minimum wage. Two internatinal labour organisations, backed by some major brands, are calling on the government to not back down.

GAP, Adidas, H&M, Tesco, Patagonia and twelve other major players ae supporting the appeal, begun on 15 July with the open letter sent to the local authorities on 15 July by the Fair Labor Association and the Ethical Trading Initiative.

"We wish to counter the claims of Myanmar’s garment manufacturers and employers associations that higher wages will dissuade foreign investors," said Ethical Trade. "A minimum wage that has been negotiated by all parties will attract rather than deter international companies from buying garments from Myanmar, particularly companies such as ETI members that have committed to upholding international labour rights standards in their global supply chains."

"We all wish to see the ready-made garment and footwear sectors flourish in Myanmar, so we urge the government to create investment and growth based on decent employment conditions and fair compensation for workers," pointed out the FLA for its part.

In mid-June, some 30 Chinese-held factories and 60 Korean-held factories threatened to transfer their operations to another country if the minimum wage is approved. It took a year of discussions between trade unions, management representatives and the government to establish a minimum wage of 3,600 kyat ($3) per day.

In the first quarter, Myanmar thus made its entrance into the top 20 list of suppliers to the European Union in terms of apparel, taking 18th place with 82 million euros in goods. An extremely impressive increase of 74% compared to the first quarter of 2014.