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Federal Agencies Issue Business Advisory on Myanmar

The United States Departments of Commerce, Homeland Security, Labor, State, the Treasury and the Office of the U.S. Trade Representative (USTR) issued a business advisory on Burma, more commonly referred to as Myanmar, Wednesday to inform the public of the heightened risks associated with doing business there, and in particular with the military junta that is in control.

The agencies said last year’s coup that ousted the country’s democratically elected leader, Aung San Suu Kyi, has significantly damaged the economic and business environment in the country due to the military regime’s attacks on the rule of law, facilitation of corruption, illicit financial activity and serious human rights abuses. Businesses and individuals with potential exposure to or involvement in operations or supply chains tied to the military junta that do not conduct appropriate due diligence run the risk of engaging in conduct that may expose them to significant reputational, financial and legal risks, the departments warned.

“I am gravely concerned by the continued reports of the Burmese military’s brutal violence against the people of Burma, and Burma’s vibrant labor union movement, including arrests of Burmese labor leaders,” USTR Katherine Tai said. “I urge the U.S. private sector to ensure they are engaged in responsible business practices that uphold and protect internationally recognized worker rights and human rights, including eliminating forced labor and child labor, throughout their global supply chains.”

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The advisory, titled “Risks and Considerations for Businesses and Individuals with Exposure to Entities Responsible for Undermining Democratic Processes, Facilitating Corruption and Committing Human Rights Abuses in Burma (Myanmar)” follows USTR’s suspension on March 29 of all U.S. diplomatic engagement, meetings and cooperation with Myanmar under the U.S.-Burma Trade and Investment Framework Agreement in response to the coup by the country’s military and its oppression of its Burmese people.

This came after sanctions against a host of government and related people and entities were enacted but fell short of a ban on two-way trade. The United States and then-President Bill Clinton had suspended Burma’s Generalized System of Preferences (GSP) benefits in 1989 on worker rights grounds, following the violent suppression of pro-democracy demonstrations and strikes in 1988. The U.S. had banned imports from Burma in 2003 following a military coup but lifted restrictions in 2013 after democratic elections.

The agencies said the United States continues to support the people of Myanmar in their aspirations for democracy, freedom, peace and development.

In 2020, Myanmar was the United States’ 85th largest goods trading partner with $1.4 billion in total goods trade. U.S. goods exports totaled $339 million and imports were $1 billion. The U.S. goods trade deficit with Burma was $688 million in 2020.

For the year to date through November, U.S. textile and apparel imports from Myanmar were down 2.85 percent to 189.7 million square meter equivalents (SME), according to Office of Textiles & Apparel. The International Labor Organization reported that since the coup and continued protests that have been met by violence by the military regime, more than a third of Myanmar’s 600 garment factories have closed, with the loss of at least 250,000 jobs in the first half of 2021.