Wednesday, 29 February 2012

Low wages and the garment sector

The Wall Street Journal reports on emerging businesses in Myanmar, with low wages serving as a potential magnet for foreign capital investment in the garment sector.

Myanmar's garment industry, which once employed 250,000 people, according to Mr. Myint Soe, has struggled under U.S. sanctions forbidding the import of most goods. Many workers fled across the border to Thailand to work in factories there.

But there are signs of a renaissance. Apparel exports to Japan and South Korea have more than tripled, to $530 million in 2011 from $162 million in 2008, according to trade data tracker Global Trade Information Services. The gradual easing of some sanctions by the European Union and the U.S. could bring back global clothing brands attracted by Myanmar's inexpensive labor force. Wages rival those in neighboring Bangladesh, considered among the lowest in the world.

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