Apparel giant Gap has become the first leading US retailer to source garments produced in Myanmar. Myanmar now expects more international investments to follow. The San Francisco-based company placed an order earlier this year for jackets and vests to be made at two factories in Yangon, for its Old Navy and Banana Republic Factory brands. The range will be shipped to the United States in June and available for sale in stores later this summer.
After consulting with US Customs and conducting two focus groups, the garments manufactured in Yangon region will carry ‘Made in Myanmar (Burma)’ tags. Though the American company has not directly invested in Myanmar, it will source from factories owned by a South Korean company. The company is keen to pursue its sourcing needs as the manufacturing industry in Myanmar matures.
Gap is the first high-profile entry into Myanmar’s garment industry since reforms under taken by President U Thein Sein encouraged the US and the EU to ease sanctions. Through the 1990s and early 2000s the garment industry was one of the Myanmar’s fastest-growing sectors and one of the major employment generation industries. From 1990 to 2001 garment exports grew 69-fold and by 2000 accounted for 39.5 per cent of Myanmar’s total exports, up from just 2.5pc a decade earlier.
In 2013 export revenues hit nearly $1 billion, according to the Myanmar Garment Manufacturers Association (MGMA), the industry’s largest trade organisation and employment in the industry has jumped from 80,000 people to 250,000 over the past three to four years. The number of garment factories has also grown to more than 200, up from 181 in November 2012, according to MGMA numbers. The group has forecast that exports for the 2013-14 fiscal year could hit 1.5 billion dollars.