Myanmar minister promises minimum wages by June-end

24 Jun '15

3 min read

Myanmar’s labour minister U Aye Myint has promised to determine a proposed minimum wage for garment factory workers by the end of this month, despite strong opposition from employers, the Myanmarese media has reported.

Factory owners would be given two months to lodge their complaints against the proposed amount, the minister said in Yangon on June 23. The long-running process of reaching an agreement for one of Myanmar’s most vital export sectors has been punctuated by strikes and protests that have dented investors’ confidence.

The minister was speaking at a minimum wage workshop bringing together the labour ministry, employers and trade union representatives organised by the Union of Myanmar Federation of Chambers of Commerce (UMFCCI).

A meeting in Nay Pyi Taw of a national committee responsible for setting minimum wages said on June 17 that manufacturing sector factory owners were willing to agree on a minimum wage, likely to be 4000 kyat ($3.60) a day. But garment factory owners in the cutting, manufacturing and packaging (CMP) export sector were strongly opposed, arguing they could not gain market share at such rates.

A member of the national committee on setting minimum wages said it appeared possible that the CMP sector might obtain a different minimum wage from other industries.

Views expressed at the workshop reflected the battle lines that have hardened during months of controversial debate, and efforts by the government to reach a compromise.

U Myint Soe, chair of the Myanmar Garment Entrepreneurs Association, said garment factories using the CMP system would have to change their method of production to meet the costs of the proposed minimum wage.

“We need to know how the government will support us, what will be the strategy for us to develop the garment sector,” he said. “It depends on the business community and the government.”

The labour ministry had been widely criticised for failing to set a minimum wage sooner. In January 2014 it promised to set the minimum wage by the end of the year, but missed the deadline.

U Win Aung, UMFCCI chair, said fixing minimum wages should be carried out rationally, and that factory owners would have to think about changing their business practices if they could not pay fixed wages.

U Naw Aung, a labour representative and national committee member, said other industries expected CMP factories to agree to K4000 as the average minimum wage.

U Zaw Oo, economic adviser to the president’s Office, said the minimum wage could be set between those earned in Cambodia and Bangladesh, two of Myanmar’s main competitors in attracting foreign investors away from China.

He suggested from K3200 to K4000 a day was a “fair” amount to start with and that all would have to overcome difficulties together.

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