By Ma Moe Pya

 

MYANMAR began ex­porting garments in 1994, but the industry’s growth accelerated only after international sanctions were lift­ed in the 2010s. The European Union (EU) suspended its sanc­tions against Myanmar in 2012 and opened an office in Myanmar in 2013. This paved the way for Myanmar to gain duty-free access to the EU market under the Gen­eralized Scheme of Preferences (GSP) and the Everything But Arms (EBA) initiative in 2013.¹ Myanmar’s main exports to the EU are textiles, footwear, rice, and gems.²

 

EU as the Top Destination for Myanmar’s Garment Exports

 

According to the World Bank, the value of Myanmar’s garment exports surged from US$0.9 billion in 2010 to US$5.5 billion in 2022, a six-fold increase. A major turning point for the industry came in 2013 when the EU granted Myanmar under the GSP initiative. This preferential access proved high­ly beneficial, with EU countries receiving over half of Myanmar’s total garment exports. By 2022, garment exports accounted for one-third of Myanmar’s total ex­port value. The sector’s primary income, generated through CMP services, represented approxi­mately one-third of the total gar­ment export value, or about three per cent of Myanmar’s GDP.³

 

Since the mid-2010s, the EU has been the leading market for Myanmar’s garment exports. Currently, a significant 38 per cent of Myanmar’s garment factories rely on the EU as their primary market. In 2022, the EU received 52 per cent of My­anmar’s total garment exports. Other key markets included Ja­pan at 18%, the United Kingdom at 10 per cent, the United States at six per cent, and Korea at four per cent. This data highlights the EU’s crucial role in supporting and sustaining Myanmar’s gar­ment industry.

 

Supporting the State’s Core Policy of Job Creation and Income Generation⁴

 

Amidst different core policy areas of Myanmar, a core national policy has been to create employ­ment opportunities alongside in­come generation for its people. In this regard, Myanmar’s garment industry has proven to be the largest source of jobs, especially for young, migrant women from rural areas. Despite a decline in exports in 2020 and 2021 due to po­litical changes and the COVID-19 pandemic, the sector rebounded strongly. By 2022, export levels had exceeded those of 2019, with an average of 95 per cent of gar­ment factories resuming opera­tions at their previous capacity to produce exports.

 

According to World Bank data, as of January 2022, Myan­mar’s garment sector employed around 500,000 workers as a ma­jor source of employment. This represented 2.3 per cent of the country’s total employment and 23 per cent of all jobs within the manufacturing sector. By the end of 2022, the number of workers was estimated to have grown to 700,000, with current estimates now at around 800,000. Notably, 85 per cent of the workers are women in Myanmar’s garment sector.

 

In 2022, 34 per cent of gar­ment factories in Myanmar raised their wages, leading to a five per cent average wage in­crease across the manufacturing sector compared to the previous year. This positive trend was rein­forced by a national policy change, which increased the minimum wage from 4,800 to 5,800 Kyats in 2023. According to the World Bank, this enabled some factories, especially those that export to the EU, to boost their workers’ wages by an additional 10 per cent to 20 per cent in 2023.

 

Although the share of My­anmar’s garment sector in the global garment trade is small, local garment entrepreneurs be­lieve they can be competitive in the international market. They state that the main reasons for this are the abundant workforce and low wages.

 

Myanmar’s Policy for Con­necting with Migrant Work­ers Abroad

 

To ensure that workers going abroad for employment do so in a systematic and legal manner, the Overseas Employment Law was enacted, and efforts are underway to approve and enact an amend­ed law to align with the current situation. The Five-Year Nation­al-level Action Plan for the man­agement of labour migration to other countries has been drafted and implemented for the first and second times. To assist Myanmar workers abroad, labour attachés have been appointed in Korea, Thailand, Malaysia, and Japan. In countries where there are no labour attachés, the Myanmar embassies are collaborating to provide any assistance to Myan­mar workers.⁵

 

Trade Situation

 

According to the official EU website⁶ for Myanmar, over 90 per cent of Myanmar’s exports were shipped to the EU, with preferential tariff rates under the EBA scheme in 2023. This shows that Myanmar is signifi­cantly benefiting from the EU’s EBA scheme. In 2023, Myanmar’s total exports to the EU under the EBA preferential system were valued at approximately €3.4 bil­lion (US$3.7 billion) while imports reached €3.0 billion (US$3.2 bil­lion).^{7 8}

 

In 2024, the EU stood as Myanmar’s 4th largest trading partner, accounting for 10.3 per cent of the total trade in goods. Conversely, Myanmar ranked as the EU’s 75th largest trading partner, making up 0.1 per cent of the EU’s total trade in goods. Sim­ilarly, total trade volume between the EU and Myanmar amounted to €3.6 billion (US$3.9 billion) in 2024, while the EU’s imports from Myanmar were primarily textiles, valued at €3.1 billion (US$3.4 billion). Meanwhile, the EU’s exports to Myanmar main­ly consisted of transport equip­ment, accounting for €458 million (US$495.60 million). Additionally, volume of trade services in 2023 reached €346 million (US$374.41 million) between them.

 

Investment Situation

 

According to the official EU website for Myanmar, the volume of EU investment in Myanmar reached €251 million (US$271.61 million) in 2023. In the same year, Myanmar’s FDI in the EU amounted to €7 million (US$7.57 million).

 

Code of Conduct for European Union Delegation Staff Serv­ing Abroad

 

As members of the EU Dele­gation serving abroad, staff must primarily adhere to the following principles:

 

(a) Adherence to the EU’s Laws⁹. All actions of the delega­tion must strictly comply with the Treaty on European Union (TEU), the Treaty on the Functioning of the European Union (TFEU), and their subsequent laws, regula­tions, directives, and decisions. Furthermore, they must act in accordance with the EU’s exter­nal action policies, including the Common Foreign and Security Policy (CFSP), trade policy, and development cooperation. For in­stance, when managing aid pro­jects, the delegation must strictly follow the EU’s procurement and financial regulations.

 

(b) International Law. Staff of the EU delegations must re­spect international diplomatic law, particularly the provisions of the Vienna Convention on Dip­lomatic Relations (1961)¹⁰. Spe­cifically, under Article 41, while delegates have privileges and immunities, they are obligated to respect the laws of the host country. Failure to comply with these laws can lead to the host country declaring the diplomat or delegate “persona non grata”, which is the most severe penalty for a diplomatic representative. This results in sending them back to the home country or terminat­ing their functions. Additionally, under Article 31, their immunity does not exempt them from the jurisdiction of their home state. In cases of serious crimes, if the host country formally requests that the EU waive its diplomatic immunity to allow for prosecution, the EU may choose to waive immunity to demonstrate its commitment to justice and maintain good re­lations with the host country.

 

(c) Adherence to Financial Regulations¹¹. A core responsi­bility of the EU Delegation is to manage projects funded by the EU. This includes ensuring that contracts are awarded through fair and transparent processes (tendering and procurement) and that funds are used for their intended official purpose. The delegation that acts fraudulently or mismanagement is subject to financial audits and must take the necessary actions. All financial operations must be fully compli­ant with the EU’s Financial Reg­ulation to ensure accountability.

 

In short, the EU Delegation’s legal and professional responsi­bilities are a blend of diplomatic duties. They must respect and adhere to the legal systems of the European Union, international law, and relevant laws of the host country. This mission involves a combination of upholding EU val­ues like democracy, the rule of law, and human rights, providing development aid and fostering cooperation, engaging in public diplomacy and communication, and managing trade and econom­ic relations.

 

As a result, the assistance provided by the EU delegation to Myanmar – in order to maintain the Myanmar-EU economic rela­tionship – is an expression of “un­derstanding Myanmar”. Specifi­cally, providing duty-free access for Myanmar’s garment exports under the EBA (Everything But Arms) scheme helps support the livelihoods and regular incomes of approximately 800,000 workers, 85 per cent of whom are women.