We are all watching with horror, frustration, and an uneasy sense of déjà vu as the military coup in Myanmar unfolds. Brands are nervously eyeing the exits while many governments proclaim the need for more sanctions to force the military junta to cede power and respect the 2020 election results.
These reactions are not surprising, but they raise a red flag about how precarious things are for Myanmar and its people—and the consequences of missteps.
I first visited Myanmar in September of 2012, after then-Secretary of State Hillary Clinton’s first trip and about two years before then-President Obama made his historic visit. At the time, Myanmar was facing serious sanctions, including a complete U.S. import ban in place for much of the previous decade. Over the following 10 years, many sanctions were gradually relaxed or eliminated as Aung San Suu Kyi made appeals in the U.S. and other world capitals. Some—such as those still imposed on Myanmar’s military leaders, their families, and their commercial interests—are still in place.
What I discovered in September 2012 was an apparel industry that had been hollowed out by the boycotts. To be clear, apparel production was occurring and there were factories all over the country; however, the level of corporate social responsibility (CSR) exhibited in those factories was practically non-existent.
I visited factories producing on a cut/make basis for markets in Japan, Korea, China, and Russia— in effect markets that did not require CSR. Factory after factory revealed operators who were required to work in firetraps, without safety equipment, and in some cases in very poor hygienic conditions. When asked about doing more CSR, many factory owners responded, “give me the orders and then I’ll do something.”
This changed drastically, overnight, when the U.S. revoked the embargo in 2013. International brands—already very familiar with CSR requirements—initiated entry to the country, asking vendors to open new factories and requiring CSR requirements with their orders.
The result? New economic opportunities, grounded in CSR, providing far-superior working conditions.
Existing domestic manufacturers saw competition for workers—who now had the option to work in a safe, clean environment—and many improved working conditions to maintain their workforce. Gains went beyond CSR. For example, women—who make up the bulk of the workforce in many factories—were empowered and introduced to a cash economy bringing significant improvements in their lives as well as those of their families and their communities.
As our industry has done around the world, we raised the living standards of people in Myanmar.
Sadly, these important gains are not irreversible.
The coup of Feb. 1, 2021—and the West’s reaction to it—will determine whether this economic progress continues. The West needs to respond with targeted sanctions against both the leaders of the coup and the industries known to have significant military ownership.
In doing so, the West focuses economic pain on those responsible for interrupting democratic progress in Myanmar, and avoids disrupting the economic model that has generated the immense CSR improvements, as a larger embargo or removal of trade preferences would.
People in Myanmar recognize that the Tatmadaw—the military junta—is benefitting from the silence of Beijing. As a result, the coup has made many citizens more pro-western. By focusing sanction-pain on the Tatmadaw, Western governments convey a key message. They convey sensitivity to the plight of the Myanmar people. Deploying those sanctions where the people of Myanmar also feel pain only enhances China’s influence in the country, while undermining support for the West.
As an industry, we have the ability to influence the outcome if we continue on a path of principled engagement. We need to ensure our operations continue to model the right behavior—respecting workers, ensuring safe conditions, avoiding retaliation—while we create economic opportunities that directly benefit the people of Myanmar.
Western governments must also keep their focus targeted on those who are creating the pain in Myanmar.
An unwritten story over the past decade in Myanmar has been how the resumption of trade ties has led to the reintroduction of CSR and a process of continuous improvement in this area. Our government has the ability to help us shape the next chapter in that story, one that involves economic opportunity and democratic values, but only if they take actions targeting the perpetrator—not the victims.
Reversing the damaging actions of the coup plotters is paramount. Let’s do this without reversing the economic gains of the people of Myanmar.
Steve Mostofsky is president & CEO of TTI Global Resources, a major developer and manufacturer of hosiery and related apparel. He has a 50-year career in the apparel industry.