CMP businesses import raw materials worth $900 mln as of mid-Feb

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Imports of raw materials by CMP businesses have been valued at US$909 million for the four-and-a-half month period beginning in October in the 2019-2020 fiscal year, an increase of $29.5 million compared with the year-ago period, according to the Ministry of Commerce.
However, some CMP enterprises import raw materials, mainly from China. These businesses might face shortages of raw materials in the coming months, owing to the current impact of the coronavirus. Further, they might find themselves battling against other importer countries for CMP raw materials. These businesses can grind to a halt due to the lack of raw materials and there can be layoffs in factories, according to Myanmar Garment Manufacturers Association (MGMA) officials, speaking at a press conference held on 21 February at the UMFCCI office.
In the first four months of the current financial year 2019-2020, exports of clothing produced under the cut-make-pack (CMP) system reached over $1.6 billion, an increase of $170 million from the same period in the 2018-2019FY, according to data from the Ministry of Commerce.
The exports of garments under the CMP system brought in over $1.4 billion during the year-ago period.
Myanmar’s manufacturing sector is largely concentrated in garment and textiles produced on the cutting, making, and packaging (CMP) basis, and it contributes to the country’s GDP, to a certain extent.
The CMP industry has emerged as very promising in the export sector. The value of CMP exports was just $850 million in the 2015-2016 fiscal year, but it tripled within two years to reach $2.5 billion in the 2017-2018FY. During the last fiscal year, incomes from garment exports were over $1 billion higher than the previous fiscal year, according to the Ministry’s data.
Japan is the largest market for Myanmar apparel, followed by the European Union.
The MGMA has more than 500 members, and garment factories in Myanmar, employing more than 500,000 workers. Investors prefer to invest in countries with inexpensive labor, such as Myanmar. —Ko Khant (Translated by Ei Myat Mon)

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