Sanctions lifting could revive Myanmar industry

By Todd Pitman

Associated Press

Published: Monday, April 23 2012 12:00 a.m. MDT

In this April 21, 2012 photo, young workers use sewing machines at a garment factory in Yangon, Myanmar. The European Union confirmed Monday, April 23, 2012, that it was suspending most of its sanctions against Myanmar to reward the country's recent wave of political reform. The suspension of trade sanctions could help revive the nation's industries, restoring some of the 80,000 garment industry jobs lost here over the past 10 years.

Sakchai Lalit, Associated Press

Enlarge photo»

YANGON, Myanmar — Looking across a sea of young workers perched behind rows of buzzing sewing machines, factory owner Myint Soe has one main hope for Monday's suspension of European sanctions on Myanmar — the restoration of some of the 80,000 garment industry jobs lost here over the past 10 years.

A complex web of Western trade embargoes imposed on the Southeast Asian nation since the late 1990s was supposed to punish its iron-fisted former military rulers for years of misrule and human rights abuses. But the poorest unskilled laborers suffered far more than the regime, and many lost crucial jobs that could sustain entire families.

On Monday, the European Union confirmed it was suspending most of its sanctions to reward Myanmar's recent wave of political reforms. The announcement is the biggest rollback yet, and many here are hoping rekindled trade ties with the West will yield badly needed growth.

"For us, it's simple. This means new job opportunities for our people," said Myint Soe, who also chairs Myanmar's Garment Manufacturers Association. "We're hoping for new contracts, new orders ... we're hoping to open more factories."

U.N. Secretary-General Ban Ki-moon, who announced Monday that he will visit Myanmar this weekend at President Thein Sein's invitation, said there is "an unprecedented opportunity" to help promote its transition to democracy.

"We must make the most of this moment," Ban told reporters. "We need to see more such progress, more international support for Myanmar's efforts to bring about democratic change."

The sanctions ostracized Myanmar's former army rulers and drastically diminished lucrative investment and trade with the United States and Europe. Bans on international financial transactions were so strict that even today, top international hotels in Yangon can only accept cash, not credit cards.

In recent months, though, the West has begun rewarding Myanmar's new government for widely praised progress toward democratic rule. The government has freed political prisoners, signed truces with rebel groups and organized April 1 by-elections deemed free and fair that were overwhelmingly won by opposition leader Aung San Suu Kyi's party.

The process has not been glitch-free. Suu Kyi's party refused to take its new seats in the parliament Monday because part of the oath of office pledges to "safeguard" the constitution — which they want to change.

They would prefer it said "respect" the constitution. Thein Sein said he was open to the possibility of revising the wording, and members of Suu Kyi's party said they believe the matter will be resolved soon.

So far, some nations have eased travel bans against top government officials, while Washington has relaxed financial restrictions to enable U.S.-based groups to do charity work in the impoverished country. The U.S. may also ease restrictions on American investment and financial services.

In Luxembourg on Monday, the EU announced the suspension of most sanctions except an arms embargo against Myanmar for one year while it assesses the country's progress. The restrictions had targeted more than 800 companies and nearly 500 people, and halted some development aid.

"Myanmar is making progress in terms of elections, in terms of opening their system and we're encouraging that," European Commission President Jose Manuel Barroso said in Copenhagen. "We have to keep our efforts to support all the reforms in Myanmar for Myanmar to live in freedom."

Alfredo Perdiguero, a senior economist at the Asian Development Bank in Bangkok, said the EU move would spur investment and create new markets for Myanmar. But he said its overall effect would be limited because the country's economy is already growing and the nation has been boosting economic ties with its neighbors, including China and Thailand.

Try out the new DeseretNews.com design!
try beta learn more
Get The Deseret News Everywhere