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Myanmar’s ‘Deteroriating’ Labor-Rights Crisis Grows More Dire

Myanmar’s garment workers are growing increasingly desperate.

“Working conditions in Myanmar [are] getting worse day by day,” Khaing Zar Aung, the exiled president of the Industrial Workers Federation of Myanmar (IWFM), a trade union, tweeted earlier this week. “Forced labor is rampant in many factories.”

Before the military violently seized power in February, the Southeast Asian nation’s minimum daily wage had stagnated at 4,800 kyats ($2.70), barely enough for workers to survive on. Now, Khaing Zar Aung said, they’re lucky if they receive 3,600 kyats ($2.02), pushing them to the edge of starvation and destitution even as they grapple with the excessive force meted out by the junta as it tries to quell protests.

Others are in an even more fraught position: Amid the chaos and bloodshed, more than a third of Myanmar’s 600 garment factories have shuttered, wiping out at least 250,000 jobs in the first half of the year, according to the International Labour Organization. Labor campaigners are concerned that the ongoing crisis has rolled back hard-fought gains in worker rights, including freedom of association, with some factory owners colluding with the military to hunt down union organizers.

Workers are “being dragged out of their homes in the middle of the night to be arrested and those in military or police custody are being brutally tortured even to the point of death,” IndustriAll Global Union wrote to the European Commission. Soldiers have also been known to fire into crowds of unarmed protestors or displace entire villages through indiscriminate artillery strikes.

Trade unions, which have stood on the frontline of civilian demonstrations against security forces, have urged multinational brands and retailers to divest from Myanmar, despite future job losses. At the same time, workers remain fearful. In a recent survey of 400 workers by the Workers’ Solidarity League of Burma, 97 percent of respondents said they disagreed with the unions’ appeal for broader sanctions, including the stripping of European trade benefits, because of what it might mean for their crumbling incomes.

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But according to Khaing Zar Aung, this half-life isn’t a life at all, and a return to democracy is the only path forward. Yet many international brands, drawn to the country’s low-wage labor, continue to “exploit Myanmar workers by taking advantage [of] the political situation…without knowing what is happening to workers in the garment sector,” she said. “Or do they think workers deserve to become a slave to have a job? Where are their principle[s]? Shame on you all!”

Indeed, the unions have taken a “strong and unified position for the brands to divest and pull out as long as the prevailing situation remains the same,” David Welsh, Southeast Asia country director of the Solidarity Center, a labor nonprofit, told Sourcing Journal. “Trade unions are a crucial component of civil society in Myanmar and are facing systematic assault across the board. Garment sector brands in Myanmar include many of the industry’s most influential actors. They have a role to play and the unions on the ground have made it clear what they want that role to be.”

’The tide is turning’

Since the ouster of the civilian government, a handful of fashion companies, including Benetton Group and C&A have stopped placing orders with their Burmese suppliers, citing untenable conditions that undermine decent work and human dignity. More are still sourcing from Myanmar, however.

One notable holdout is H&M, which suspended orders at the onset of the coup only to “gradually” place new orders at its 56 supplier factories to stave off their “imminent risk” of closure. “We are of course deeply worried about the situation in Myanmar,” a spokesperson told Sourcing Journal. “At this point, we refrain from taking any immediate decision on future order placement and long-term presence in the country.”

Bestseller stopped orders, restarted them, then re-slammed the brakes following reports of Covid-19 outbreaks at some of its supplier factories. A representative from the Danish retailer told Sourcing Journal that it’s “currently in a bridging solution,” meaning it will keep production running with the goal of not laying off workers, as it awaits the results of an impact assessment, which it said will be a “significant and valuable basis for determining the right approach.”

Primark, too, is awaiting the results of an impact assessment before making a decision on whether to stop production. “The situation in Myanmar is very complex and we are conscious of the thousands of workers whose livelihoods depend on employment at our suppliers’ factories,” a spokesperson told Sourcing Journal. “In the meantime, we remain committed to all orders and our current suppliers. We continue to monitor for compliance with our code of conduct to support the safety and welfare of workers in Myanmar and have heightened our due diligence to give us confidence that none of our suppliers’ factories have links to the current regime.”

Western brands and retailers say the question of whether to stay or leave is a nuanced one. The European Chamber of Commerce warned in June, for instance, that Myanmar’s garment sector was “unlikely to recover for years” if brands cut and run. The same month, ACT (Action, Collaboration, Transformation), a multi-stakeholder initiative on living wages whose members Besteller, H&M and Primark, provided guidance on how to communicate with suppliers about letting go of workers responsibly.

ACT took a stronger stance earlier this month, however, saying that the organization has made the “difficult decision” to cease its activities in Myanmar because of the IWFM’s withdrawal from ACT operations as a consequence of no longer being able to “operate freely under the current circumstances.” ACT will “evaluate its potential future engagement if the situation in the country changes,” it added.

“The tide is turning against remaining in Myanmar,” Sofia Nazalya, senior human-rights analyst at Verisk Maplecroft, a risk-assessment firm, told Sourcing Journal. “While companies may be hesitant to leave garment workers in the lurch, recent calls by the trade unions to divest intensify pressure on companies to reexamine the role they play in the country.”

Given Myanmar’s small share of most companies’ sourcing networks, any disruptions arising out of decisions to relocate to elsewhere in the region are “likely be minimal,” she said.

The question for multinational companies now “goes beyond whether they can guarantee employment for workers, but how their presence may be perceived to lend support to a brutal dictatorship,” Nazalya added. “As it stands, companies are already increasingly unable to mitigate deteriorating labor conditions in Myanmar.”