Textile industry: why fashion groups are withdrawing from Myanmar

Textile industry: why fashion groups are withdrawing from Myanmar

The Swedish fashion group H&M is investigating alleged cases of labor abuse in textile factories in Myanmar. As the Reuters news agency reports, the fashion giant is investigating 20 cases reported by the UK-based human rights organization Business and Human Rights Resource Center (BHRRC) in connection with the production of clothes for H&M.

Across the country, BHRRC uncovered 156 cases of alleged abuse of workers in garment factories in Myanmar between February 2022 and February 2023. The number of seamstresses affected by poor working conditions in Myanmar has risen rapidly since the military coup in 2021. According to the information provided by the NGO, workers are mainly affected by wage cuts and wage theft, but also by unfair dismissal, inhumane working conditions and forced overtime.

“Deeply concerned about the developments”

H&M now apparently wants to withdraw from Myanmar. “All cases raised in BHRRC’s report are being followed up and remedied where necessary by our local team on the ground and in close collaboration with relevant stakeholders,” H&M said in a statement.

We are “deeply concerned about the latest developments in Myanmar”. In addition, they feel obliged to “run business according to our standards and requirements” – in Myanmar this is “increasingly a challenge”, according to the Swedish group.

Zara mother has announced withdrawal

A good two years after the military coup in Myanmar, the Spanish fashion group Inditex had already announced its withdrawal from the Southeast Asian country, as had the clothing discounter Primark and the British retail group Marks & Spencer. Inditex, the parent company of the brands Zara, Massimo Dutti, Bershka and Pull & Bear, justified the withdrawal from Myanmar with “the call from IndustriALL”.

The global trade union IndustriALL is committed to fair working conditions worldwide and, according to its own statements, is fighting “for a different model of globalization and a new economic and social model”. After the military coup in Myanmar, working conditions in the factories deteriorated to such an extent that IndustriALL is now trying to persuade companies to stop investing in the country.

Inditex’s supplier factories also seem to be affected by the cases of abuse. BHRRC has uncovered 21 cases of alleged abuses involving Inditex suppliers in the two years since the military took power, Reuters reports. Inditex declined to comment on the report.

More local presence

Since the military junta took power in Myanmar and plunged the country into a political and humanitarian crisis, the BHRRC has been prosecuting allegations of workers’ rights abuses in garment factories. The organization says it uses sources such as union leaders, international and local media such as Myanmar Labor News to uncover the cases, and tries to verify reports by inquiring with brands and interviewing workers.

It is unclear exactly when the fashion groups will withdraw from Myanmar altogether. Primark expects to ship its final orders from suppliers in Myanmar later this year. “As we work towards our exit, we have doubled the size of our local Ethical Trade team, allowing us to visit the factories we still work with more regularly and give ourselves greater visibility,” Primark told Primark Reuters.

Other brands that have their clothing produced in Myanmar also want to increase the monitoring of suppliers and, above all, want to equip their own branch offices in the country with more staff. Danish fashion company Bestseller has increased its local workforce from three to 11 since the coup, the BHRRC found in a survey of brands.

Major employer in Myanmar

H&M and Bestseller are among 18 brands taking part in the European Union-funded MADE project, which aims to improve working conditions in Myanmar’s garment factories. The EU believes companies should continue to source garments from Myanmar. Because the industry with more than 500 factories that produce clothes and shoes for big brands is a major employer in Myanmar.

“If you as a company engage in discussions with local labor rights groups and unions about wages and working conditions, you can have an impact,” said Karina Ufert, executive director of the European Chamber of Commerce in Myanmar. “Once you leave the country, it’s hard to see how you can influence local conditions.”


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