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Virus outbreak in EU may affect Myanmar's garment exports

Mar '20
Pic: Shutterstock
Pic: Shutterstock
The spread of the novel coronavirus COVID-19 to some European Union (EU) countries may affect demand for garments manufactured by companies in Myanmar even as the supply of Chinese raw materials involved in the process becomes less volatile, according to Daw Khine Khine Nwe, secretary general of the Myanmar Garment Manufacturers Association.

Italy, Germany, the United Kingdom, France and Spain have reported COVID-19 cases.

More than 70 per cent of Myanmar’s garment products are exported to the EU. The reliance is still quite high on the EU even though the country exports to Japan, Korea, Canada, the United States, China and some other countries.

The outbreak in the EU could hurt export demand and deal another blow to Myanmar just as the garment export sector is facing a raw materials shortage as a result of a slowdown in Chinese production, according to a report in a Myanmarese newspaper.

Around 90 per cent of all raw materials used to manufacture garments comes from China and disruptions to supply has led to harsh consequences. Last week, 13 garment factories in Myanmar, including three being built, closed down operations.

The next batch of raw materials from China is expected to arrive in late April, but factories may not have enough buyers once the goods are complete if demand does not recover by then, Khine Nwe said.

It is getting difficult for factories to predict demand over the next few months, she added.

Fibre2Fashion News Desk (DS)

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March 2020

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