Minimum Wage in Myanmar Supports More Sustainable Labour Practices

01-10-2015

Myanmar’s garment sector has experienced a significant growth in the last years, becoming an alternative for companies to diversify their sourcing base from giant producers like China, Bangladesh and India. Even though it is still a minor sourcing country, the interest of European retailers in strengthening trade ties is significant, due to its business dynamism and many economic assets.

Despite this positive outlook, Myanmar still needs to overcome many challenges related to labour and human rights violations, and weak governance levels, main reasons why BSCI still considers it a risk country and requests its participants to take robust due diligence measures and develop the necessary systems to prevent any adverse impacts in their supply chain.

Recently, Myanmar has taken steps towards achieving concrete improvements, the last of them being the establishment of a minimum wage. The Myanmese government set the minimum pay set at 3,600 kyat (2.50 Euro approx.) for an eight-hour work day, applicable as of 1 September 2015.

In support of these and wider reforms, the European Union has recently joined the Initiative to Promote Fundamental Labour Rights and Practices in Myanmar, launched in November 2014 by the International Labour Organisation (ILO), the Government of Myanmar, the United States, Japan and Denmark. This project builds on similar previous experiences, like the Sustainability Compact for Bangladesh in place since 2013, and is designed to support the implementation and development of the labour reform plan and the promotion of international labour standards.

FTA is a strong advocate of closer business links with this promising market and of creating the proper framework for a sustainable development that respects labour rights. We have followed closely developments in the country, sharing our recommendations for improved trade relations with Myanmar and participating at different debates at European level to discuss economic and political developments. Ensuring protection of human rights, strengthening institutions and increasing transparency are necessary elements to encourage European distribution companies to safely operate in the country and FTA will continue to play an active role in fostering responsible business practices and advancing Myanmar’s sustainable development.

Add new comment