A Snapshot of Myanmar’s Apparel Industry and Export

See updated data: What’s Happening with Myanmar’s Apparel Exports (Updated August 2022)

First, the textile and apparel industry plays a significant role in Myanmar’s economy, particularly the export sector. Data from the UNComtrade shows that textile and apparel accounted for nearly 30% of Myanmar’s total merchandise exports in 2019, followed by footwear and luggage. Industry data also indicates that the textile, apparel, and footwear industry employed more than 1.1 million workers in Myanmar in 2018, up from only 0.3 million in 2016.

On the other hand, as a developing country, Myanmar highly depends on the imported textile raw material. As of 2019, nearly 83% of Myanmar’s textile imports came from China.

Second, since the United States lifted the import ban on Myanmar and the EU reinstated the Everything But Arms (EBA) trade preferences for the country in 2013, Myanmar has been one of the most popular emerging apparel sourcing bases among fashion companies.  From 2015 to 2019, Myanmar’s apparel exports to the world enjoyed an impressive 57% annual growth. Myanmar’s apparel exports to the EU (97% annual growth) and the United States (78% annual growth) have been growing particularly fast.

From 2019 to 2020, some of the top fashion brands that carry apparel items “Made in Myanmar” include United Colors of Benetton, Next, Only, Guess, Jack & Jones, and Mango.

Second, the reasons why fashion companies source apparel from Myanmar are multiple:

  • Thanks to foreign investment (e.g., nearly half of Myanmar’s garment factories are foreign-owned), Myanmar specializes in making relatively higher-quality functional/technical clothing (i.e., outwear like jackets and coats). This is different from many other apparel exporting countries like Bangladesh, Vietnam, and Cambodia, mostly exporting low-cost tops and bottoms.
  • Myanmar’s apparel exports were able to enjoy duty-free market access in the EU, Japan, and South Korea. Myanmar was also a beneficiary of the US Generalized System of Preferences (GSP) program. This explains why Myanmar’s apparel exports mostly go to the EU (56%), Japan and South Korea (30%), and the US (5.5%).
  • Relatively low production cost—garment workers earn around $85/month in 2019.

However, Myanmar still accounts for a tiny share in fashion companies’ total sourcing portfolio because of the size effect. For example, as of 2019, less than 0.1% of US and EU countries’ apparel imports came from Myanmar.

Third, western fashion brands could reevaluate their sourcing strategy from Myanmar because of its recent coup. Notably, in a new study, we find that apparel sourcing is not merely about “competing on price.” Instead, fashion companies give substantial weight to the factors of “political stability” and “financial stability” in their sourcing decisions—reputation risk matters. The country’s latest political instability will hurt Myanmar’s attractiveness as an apparel sourcing base, given many other alternatives out there.

Further, the international community, including the US and the EU, is considering new sanctions against Myanmar. Should Myanmar lose its EU’s EBA eligibility or no longer enjoy duty-free access to its key apparel export markets, the country’s apparel exports could be among the biggest losers. Notably, it could be challenging for Myanmar to find an alternative apparel export market during the pandemic. (for example, only 1.3% of Myanmar’s apparel exports went to China in 2019).

By Sheng Lu

Further reading:

Author: Sheng Lu

Professor @ University of Delaware

14 thoughts on “A Snapshot of Myanmar’s Apparel Industry and Export”

  1. Hi Dr. Lu, Thank you for this snapshot. Given that the U.S. produces a large amount of its technical textiles and apparel due to the capital, technology, and skilled labor that provides a high barrier to entry, do you foresee this industry in the U.S. being threatened by Myanmars ability to compete?

    1. so glad to hear from you, Kendall! I don’t think Myanmar will be a concern to US companies–1) apparel labeled “Made in Myanmar” relies on imported textiles. Even they export technical textiles, very limited “added value” is created in Myanmar. 2) The benchmark I use in this blog post is Cambodia and Bangladesh. There is no chance that any apparel company in Mynamar can challenge industry leaders like UA and Nike…:-)

  2. This blog post was very eye-opening about Myanmar. I actually was not aware of how productive Myanmar is in terms of fashion and production. Myanmar’s export sector is something we can all look out for and watch grow in the future. Considering that so many regions are pulling away from China as a market due to the COVID-19 pandemic, I am curious to see if those regions will turn to Myanmar and work closer with their fashion and trade. Also, since Myanmar is an emerging apparel sourcing base, do you think they stand a chance competing against other countries that are known for apparel sourcing?

  3. I found this blog post to be very informative about Myanmar’s T&A industry. I found it very intriguing that they are a developing country but specialize in producing higher quality technical clothing. It is interesting because most often these high tech apparel are more capital intensive goods, something difficult for a developing country to produce. What I found to be even more shocking is that apparel sourcing is not determined by price as much as it is determined by political and financial stability within that country. Could this be the reason that apparel sourcing is beginning to move away from China? COVID-19 has had a major impact on China as a whole.

  4. I am not surprised to hear that the textile and apparel industry plays a large role in Myanmar’s economy as it is a developing country with an abundance of labor. It was however a pleasant surprise to hear that the textile, apparel, and footwear industry’s employment rate increased from 0.3 million in 2016 to more than 1.1 million in 2018. This gives me hope that the T&A industry is actually contributing to the country’s economic growth and motivating people to get jobs in order to support themselves and their families. I think the idea that Myanmar specializes in making relatively higher-quality functional/technical clothing is extremely smart because manufacturers are basically differentiating themselves from other competitors, the same way a corporate business would. This is also a sector that is becoming increasingly popular. I think Myanmar can take this time as an opportunity to “brand” itself in a certain light to retailers. I am curious why Myanmar chooses to import majority of its textile inputs from China, when they have such a good export relationship with the EU, Japan, and US, all countries that specialize in capital intensive products? Given COVID-19 and the RCEP, can Myanmar also compete with manufacturers in more well-known countries like Vietnam, Cambodia, etc.?

    1. great thought!
      OK, the background of this blog post is how the international community should respond to the recent coup in Myanmar. Will economic sanctions (like trade restrictions) have an impact? Personally, it seems the US side has limited leverage over Myanmar.

      Nevertheless, the US fashion industry is watching closely :1) whether factories are still open? 2) whether ports are open? 3) whether garment workers are fairly treated (eg receiving payment).

  5. I found this blog post very interesting! I was intrigued to find out that Myanmar specializes in making technical clothing like winter jackets. I wonder what skills workers need in order to create more technical gear compared to basic cotton tops and pants. Are there more regulations on these factories assuming more chemicals would be needed for treatments like water-proofing fabric? It’s upsetting to see again how wages are around $85 a month. This low cost appeals to big competitors, resulting in exploited labor, that most likely will cause over working of these small factories and its workers.

  6. Given the recent events in Myanmar and with the change of control in government, it is difficult to say what will happen with respect to the T&A industry. I am not familiar enough with what happens to a country during a coup. However, from reading the news and listening to the absence of any response from China, I believe the results will be unknown because of the military dictatorship now in place in Myanmar. However, Myanmar has been a closed society before and within the last 20 years. If nothing else, I do believe that it would be worthy to measure the T&A industry in Myanmar and possibly revisit the results when the government is “normalized” again, if at all.
    In conclusion, I believe that the future prospects for the T&A industry in Myanmar is uncertain. Yet, I do not believe that we will find credible news that comes out of the country until a more open form of government is again established.

    1. Glad to see you have been following the news! Agree totally.
      Meanwhile, just put yourself in the shoes of those fashion companies currently sourcing from Myanmar–what should they respond to the situation? should they adjust their sourcing plan? Stay or leave the country? Sourcing managers often have to make some very tough decisions…

  7. I enjoyed reading this blog post because I found Myanmar’s T&A industry very insightful. Given they are a developing country that is heavily labor intensive it is understandable that their economy relies heavily on the T&A industry. It is comforting to hear that the import ban was lifted by the US and the EU reinstated the EBA which has allowed Myanmar’s economy to begin to prosper. Despite these bands, I was surprised to read that Myanmar is at an advantage over other developing countries like Bangladesh, Vietnam, and Cambodia. Because they are a developing country I would not expect them to make high-quality functional/technical clothing. With this in mind, I wonder how long until other developing countries will be able to become producers of high-functioning clothing as well?

  8. After reading this article, I can understand that in Myanmar, the economy of the textile and clothing industry also plays a very important role. Textiles and clothing account for nearly 30% of Myanmar’s total exports. Myanmar is also a country that cannot provide clothing raw materials by itself and needs to rely heavily on imports. Nearly 83% of their textiles come from China. The United States and the European Union also like to purchase clothing in Myanmar, which is interestingly different from Bangladesh, Vietnam and Cambodia. Myanmar mainly produces some high-quality or high-tech clothing. The reason may be due to the large number of foreign-invested enterprises in the local area, low production costs and low labor costs. Myanmar can not only enjoy the general preferential system of the United States, but also tax-free access to the Korean and Japanese markets. These superior conditions can allow Myanmar’s clothing to be exported to these countries in large quantities.

  9. This article is very interesting and sheds light on Myanmar’s apparel industry. This is a location that is not often spoken about, however, the country is very interesting to learn about. The country is rising quickly with workers for the textile and apparel industry. They are growing with over 50% from major importers across the world making them a huge fashion exporter in recent years. This has been one of my favorite countries to learn about as I feel like all the information within the text was new to me and not common knowledge. I am very interested to know the extent of how Covid-19 has affected their fashion industry and how the economy is doing due to this in recent months.

  10. I found this article very interesting as I didn’t know too much about Myanmar and their economy beforehand. It was interesting to see that nearly 30% of Myanmar’s total merchandise exports came from textile and apparel in 2019 while there are more than 1 million of employees working within this industry there. I knew so little about international sourcing and trade when it comes to the apparel industry that I wasn’t even aware there was a ban on Myanmar, as the article states the U.S. lifted this import ban in 2013 as it has been one of the most popular emerging apparel sourcing bases among fashion companies.

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