Sanctions lifting could revive Myanmar industry

By Todd Pitman

Associated Press

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

Still, he said the EU's suspension will have "a huge psychological impact."

The EU sanctions had removed Myanmar from the Europe's so-called General System of Preferences, or GSP, which entitled garments produced in Myanmar to be exempt from import duties. The loss of that status meant doing business in Myanmar cost more, which dramatically decreased trade ties.

Myint Soe said Myanmar's return to the GSP could yield as many as 25,000 new jobs in the textile industry alone in 2012.

An easing of U.S. sanctions could prove even more beneficial.

The garment industry here used to rely on the United States for about 75 percent of its business, and a wave of sanctions imposed by Washington in 2003 crushed the industry. Myint Soe said he was forced to fire about 400 of his 550 employees at the time.

"It was painful. Each one cried and asked 'why?'" he said in an interview. "The sanctions targeted the government, but it didn't affect them. It was the people, the workers, who really got hurt."

Since then, Myanmar's textile industry has rebounded as companies shifted to new markets in Asia, where trade is unrestricted. Myint Soe now employs about 300 people, and if he wins back old business in the West he could eventually emerge much stronger than before.

There has been debate over the value of sanctions, but many longtime opponents of the military regime say they have been effective and should only be relaxed slowly.

Hkun Tun Oo, a senior politician representing the ethnic Shan minority who was released from jail in a mass amnesty in January, said the EU's temporary suspension was the right move "because if things do not improve within a year, sanctions can be renewed."

For garment factory workers who make $120 per month or less, the eventual end of sanctions will be a big deal.

For Phyu Phyu Swe, 33, who was sewing a stack of uniforms bound for Japan, it will mean job security, and possibly more money in bonuses.

"I have family members depending on my income, and this is the only skill I know," she said. "So I always hope and dream that this industry will get back on its feet."

Associated Press writers Jan M. Olsen in Copenhagen and Edith M. Lederer at the United Nations contributed to this report.

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