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Mynamar factories stop operations as brand cancel orders

Myanmar Garment Manufacturers Association (MGMA) has revealed many garment factories stopped operations as countries in the European Union, a major export market, cancelled orders last week amid the spread of the COVID-19 pandemic. All operations of factories that have accepted orders from the EU have stopped.

The bad news came as the supply of raw materials from China re-started to flow back into the country after three months of stoppage due to the virus outbreak. Among the garment companies that suffered cancellations of orders are the Global Apparel Textile Myanmar, which no longer has problems with the supply of raw materials but left with huge inventory due to cancelled purchase orders.

Lat War is stuck with 500,000 pieces of garments after a European buyer cancelled the order. Other companies in the same predicaments are Gold Emperor, Hong Text, and Myanmar Irrawaddy.

The shutdown of more garment factories led to more labour unrest, including the strike at the Grand Enterprises Garment at Yangon’s East Dagon Industrial Zone as the company announced layoff of thousands of workers.

Before order cancellation from the EU, at least 20 out of the 500 factories in Myanmar had shut down due to the pandemic, leaving more than 10,000 workers unemployed, industry sources said. Since January, 38 cut-make-pack factories that includes the garment factories, have shut down, according to the Ministry of Labour, Immigration and Population. Among these were 22 garment factories. Others reduced the number of workers at their facilities.

 
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