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Made in Myanmar: What can brands and retailers do?

By Simone Preuss

Mar. 19, 2021

Business

Following the military coup in Myanmar on 1st February 2021, a state of emergency has been declared in the Southeast Asian country, which is an attractive sourcing location for the textile and garment industry. Tens of thousands of people are taking to the streets every day, demanding the release and reinstatement of head of government Aung San Suu Kyi. Their demands are met by the military junta with tear gas, rubber bullets and live ammunition. According to UN estimates, over 138 civilians have been killed and over 2,100 people arrested.

For the textile and garment industry, it is hard to know what to do at this moment. Without being on the ground, it is difficult to assess how serious the situation is throughout the country and how it will affect local production. Major clients such as H&M and Benetton have already announced that they will withdraw from the country for the time being and not place any new orders.

“Over the years, the Benetton Group has been a standard-bearer for fundamental values such as inclusiveness, integration, and non-violence. As a company, we cannot fail to contribute to the respect of these values and we intend to do our part. We will suspend orders to the country to send a strong and concrete signal,” commented Massimo Renon, CEO of the Benetton Group, in a press release.

“Our hope is that the situation return, as soon as possible, to one that guarantees the people’s fundamental rights and that our Group may once again resume its action of supporting the local populations, that also involves promoting work and dignity,” added Renon.

Apparel giant H&M, who has been sourcing in Myanmar since 2013 and opened its own office in Yangon in 2015, also acted fast: “Although we refrain from taking any immediate action regarding our long-term presence in the country, we have at this point paused placing new orders with our suppliers,” said Serkan Tanka, country manager Myanmar, in an email to Reuters last week.

“This is due to practical difficulties and an unpredictable situation limiting our ability to operate in the country, including challenges related to manufacturing and infrastructure, raw material imports and transport of finished goods,” stated Tanka further.

However, turning our backs on the country now in this difficult time - temporarily or for the longer term - is not a solution, because this hits those hardest who are already affected the most - the civilian population, which includes garment workers and suppliers.

If international buyers like Benetton want to send a “strong and concrete signal”, then withdrawing or suspending orders is not the way to go, because this hits the economy and not politics. What can they do instead?

What can buyers do?

Organisations like the Clean Clothes Campaign (CCC) are calling on all suppliers, brands and retailers that are active in Myanmar, to publicly condemn the military coup, call for the restoration of democracy and the rule of law, and to support the people’s protests and the Civil Disobedience Movement.

Brands and retailers also need to ensure that their business activities do not contribute to or aggravate human rights violations and are not directly linked to the military. “Brands and retailers sourcing in Myanmar need to exercise human rights due diligence with their suppliers and on their whole supply chain to ensure these principles are respected. Garment companies must continue to identify, document, address and remediate human rights abuses and risks in the garment sector in Myanmar,“ advises CCC.

In addition, they can protect and support the labour rights movement, including trade union federations, factory-level unions, labour rights organisations and workers in defending Myanmar democracy. “Brands and retailers must condemn the military’s announcement declaring illegal labour rights organisations and prohibiting them to continue their activities. They must also voice and show their support for freedom of association and ensure their direct and indirect suppliers respect these principles,” says CCC.

It is also important to protect and support workers who are exercising their fundamental rights of freedom of expression, peaceful assembly, freedom of association and right to strike. Otherwise, suppliers could punish workers, fire them or lock them up in the factory to hinder them from participating in public demonstrations.

The latter allegedly happened a few weeks ago at GY Sen, a Primark supplier that locked 1,000 workers inside the factory to prevent them from taking part in a protest march in Yangon on 18th February. The workers managed to free themselves after a few hours; however, some of them were fired on the grounds that they had missed work hours due to demonstrations. A GY Sen spokesperson denied the allegations.

There is much that brands and retailers can do, even remotely. In any case, they should maintain communication with their suppliers in Myanmar and find out what the current situation is, how it affects production and what can be done from the client side (staggering of orders, partial payments, advance planning and the like). In any case, a complete withdrawal - for however long - would send the wrong signal, namely that workers and suppliers are completely on their own.

Update:

As of 5th March, Primark has suspended the factory (GY Sen) and launched an investigation into the allegations: “These are very serious allegations that, if true, would be in breach of the strict Code of Conduct that Primark requires all suppliers and factories that make our garments to adhere to at all times. Our highest priority is to keep workers safe and well, and ensuring their rights and freedoms are respected,” stated a Primark spokesperson in an email to FashionUnited.

“Primark immediately launched an investigation into this factory on 5 March after a local labour organisation we know well alerted us to concerns. We have also suspended the factory, meaning that we will not place any further orders with this factory pending the outcome of that investigation.”

“Given the current situation in Myanmar, we anticipate that conducting the investigation may be more challenging than usual. We will work with our supplier and, where required, other trusted third parties. If the factory is found to have breached our Code, we will work with the supplier and factory to remediate any issues.”

“When breaches of our Code occur, we always work with our suppliers to address the issues and effectively remediate, with the aim of protecting the livelihoods of the people who work there. This factory employs more than 2,000 people and we have a longstanding and positive relationship with the supplier. We believe it is our responsibility to do all we can to support workers in our supply chain.”

Photo: FashionUnited