South Korean businessmen from eight companies will discuss opportunities in the clothing and textile sectors with their Burmese counterparts in Rangoon on Wednesday. The garment sector has been badly hit by sanctions and the downturn in the world economy.
The business delegation is interested in exploring opportunities in sectors including textile, garment, dying, printing and raw materials.
The meeting will be held in the Kandawgyi Palace Hotel, said the Korea Trade-Investment Promotion Agency.
Korean is in the process of boosting its trade ties with Burma. In April, a South Korea delegation of 120 South Korean businessmen from 86 private companies met with 260 Burmese businessmen in Naypyitaw to expore joint ventures and other opportunities.
Bilateral trade between Myanmar and South Korea reached US$ 970 million in 2011, according to South Korean statistics.
Of the total, South Korea's exports to Burma totaled $660 million, while its imports totaled $300 million.
South Korea said it mainly imports garment, textile, forestry products, and agriculture and marine products while exporting construction materials, machines, iron and steel.
South Korea's investment in Burma totaled $2.9 billion as of January 2012 in 48 projects since Burma opened to foreign investment in late 1988, according to Burmese government statistics.
On June 14, Mizzima reported that the world economic decline has caused the value of Burma’s clothing exports to drop around 30 per cent since 2008, according to the Myanmar Clothing Manufacturers Association (MCMA).
Compounding the fall is Europe’s tariff on clothing imports from Burma when Bangladesh, Cambodia and Vietnam receive exemptions, said Myint Soe, the MCMA chairman.
Also, “the dollar is weak and the kyat is strong,” he said. “Our business are not good in both 2011 and 2012. Sometimes we suffered financial losses and sometimes we broke even, and sometimes we got a little profit. That’s the way we operate. Our businesses cannot grow,” Myint Soe told Mizzima.
Myint Soe said that Burma’s clothing industry needed to attract more market share, increase productivity and hope for a stronger dollar. “We should get a tariff exemption also,” he said. However, news reports said last week that a bipartisan group of U.S. lawmakers have introduced a bill in Congress to extend the current ban on importing Burmese clothing and textiles. Critics of the ban say it hurts the average worker in Burma, while supporters say the U.S. wants to keep pressure on the Burmese government to continue reforms.
Another factor that pressures productivity is electricity supply, said Myint Soe. “Sometimes we get [government] electricity and sometimes we get electricity from diesels [own generator],” he said. He said a worker in Vietnam can produce 20 shirts per day while a Burmese worker produces 10 shirts.
He said most contracts come from Japan, Korea, Europe and South America. Raw materials are bought mainly from China and some Asian countries.