It was not so long ago, in fact it was in our January 2020 issue, we featured the article names “A Roadmap of Myanmar”. It was a follow up of the first report about the country in our January 2015 issue and the intension was to alert the investor to set up factories for garment production there.

In our closing of the January 2020 article, we pointed out that the country is weak in controlling its corruption and the drug, methamphetamines, is the biggest social problem. It is also the high risk for political instability.

After we release the article, the world entered into the pandemic, Covid-19, in such a scale that we have never seen before. We found that the world is more challenging. But for Myanmar, it entered into a military junta in February and since then the country has entered into the chaos.

What happened lately and the country’s background
In the recent history, Myanmar was reconquered by the Allies from a very brief Japanese occupation between 1942 to 1946 during the Second World War, and was granted independence in 1948. But for most of the country’s independent years, it has been involved in rampant ethnic strife with its 135 distinct ethnic groups officially recognized by the Myanmar government, and they are grouped into eight “major national ethnic races. The country has been dragged into the world’s longest-running ongoing civil wars which has been the most unfortunate. During this time, the United Nations and several other organizations have reported consistent and systematic human rights violations in the country, but we know that the UN is practically useless in this respect.

In the 2015 election, Aung San Suu Kyi and her party, National League for Democracy, won the landslide in both houses, the military junta remained a powerful force in politics and maintained three seats. But in February 2021, the Tatmadaw, official name of armed forces of Myanmar, detained Aung San Suu Kyi and other high-ranking politicians after a contest election with dispute results and a state of emergency had been declared for one year. 

The Tatmadaw has been engaged in a bitter battle with ethnic insurgences since the country’s independence. It has been accused by the international organizations of human rights for offences including ethnic cleansing, sexual slavery, sexual torture, sexual assault and arbitrary killings of civilians.   

Myanmar has not seen such violence since August and September of 1988, when the military put down a pro-democracy uprising. It was estimated 3,000 dead in six weeks and 500 more in the final coup of September 18. 

Since the latest coup, more than 3,000 activists and civil society leaders have been detained, over 700 people have been killed by armed troops and police, but according to the military, it was only 248.

“A day of terror and dishonor” marked the country’s Armed Forces Day, originally marked as the start of Burmese resistance to Japanese occupation in World War Two, when 114 citizens were gunned down. 

Myanmar’s junta chief, Senior General Min Aung Hlaing was supposed to step down after his mandatory retirement due in July and was blocked from any chance of him to assume the presidency. He claimed fraud in the election and sprung his coup and put Aung San Suu Kyi under arrest and started to build up charges ranging from corruption to illegal ownership of walkie-talkies.

International Crisis Group’s senior adviser for Myanmar, Richard Horsey, briefed the UN Security Council on April, mentioned about the regime’s questionable behavior of moral conscience and its evilness. But normally this kind of complains would end up with no prevails.

As usual the international community has reacted predictably and stern condemning of Tatmadaw but so far has not made any result, least to say that it can prevent the matter to get worse. As usual, the administration of President Biden wants to reassert the US’s moral authority as leader of the free world, but it is not about to upset China as Myanmar is taken as the backyard of China.

Sam Zarifi, secretary-general of the International Commission of Jurist, already expressed that any meaningful action by the United Nations Security Council was extremely unlikely due to Russian and Chinese vetoes. As for the 10-member Association of Southeast Asian Nations, only Indonesia, Malaysia and Singapore have individually showed their deep concerns over the situation in Myanmar, but the other member states are constrained by a code of mutual noninterference that inhibits any meaningful response.

As the usual practice, the US and EU have so far sanctioned on individuals linked to the coup, including two conglomerates controlled by the military, and suspended all trade deals.

The Tatmadaw has been known for staying outside from any international alliance. Even in its earlier days, Burma refused to join the British Commonwealth and pursue its mission as supremacy and forging national unity.

The international business sector—The Myanmar Center for Responsible Business organized 68 foreign companies and 164 local registered companies to sign and collective statement to show their growing and deep concern. This has been followed by the Japanese Chamber of Commerce and Industry in Myanmar also followed. By end March, all foreign chambers of commerce representing Western businesses had publicly condemned the atrocities but no avail.

Although revenues have been dwindling, the junta still has an iron grip on the country’s lucrative gas production. Offshore gas sales are a crucial source of foreign exchange for Myanmar. The business was worth $3.3 billion in 2020 and it was about 20% of Myanmar’s exports, and out of this $1.8 billion went to Thailand and $1.5 billion for China.

During the Armed Forces Day, eight countries were presented: Russia, Bangladesh, China, India, Laos, Pakistan, Thailand and Vietnam.

Tatmadaw has been spending money on weaponry, and it was willingly taken up by key friends—India, China and Russia.

Russia has been continuously supplying Myanmar for MiG-29 jets, Yak-130 jet trainers, Mi-24 and Mi-35P helicopters, and Pechora-2M anti-aircraft missile systems, guns and ammunitions, and armored personnel carriers. In this respect, Russia is ruthless and ignore any objections from the US and the United Nations.

Over the years, 6,000 Tatmadaw officers received science and engineering degrees in Russia. This has reduced the dependence on arms from China, although it is a big supplier. But China was found to have armed some of the ethnics, including Kachin and the Wa. Chinese weapons were found with quality issues.    

Before the coup, Myanmar was already the fifth-largest source of refugees globally, with over one million listed by the UN High Commissioner for Refugees in January among the existing 1.9 million “persons of concern”. This include mostly the Rohingya, a persecuted Muslim minority. There are already 840,000 of them in Bangladesh, most arrived in 2017 after a brutal counterinsurgency sweep by the Tatmadaw. There are still 600,000 Rohingya remain in Rakhine state, and 142,000 of them are internally displaced. In Malaysia, there are 153,000 of them. In Thailand there are 93,000 refugees from other ethnic minorities.

Talks about indicting top Tatmadaw figures using universal jurisdiction for their crimes against humanity, war crimes and even genocide. But right now the target sanction by freezing their bank accounts are more realistic.    

What effect does it bring to the Myanmar’s garment industry
The garment industry is located in the country’s commercial capital. Yangon, the sector hires one million workers although some said that it was only half a million. Export sale amount it was $6 billion annually. But the violence as enforced by the military and the police have caused a serious damage in the industrial zones and factories were burnt. Many of the factory operators chose to close the factories to protect from fear of being destroy.

The protestors are confronting the military and have caused the fighting to continue relentlessly. Some Chinese-owned garment and textile plants have closed as their workers have associated China with the coup, have boycotted Chinese factories. But a lot of workers choose to return to their homes in rural areas to stay away from zones of unrest. And in this period of disruption, its local currency, the Myanmar Kyat, depreciated more than 5%.

At this time of the pandemic, the trade logistic is already being disrupted, but more severe in the country like Myanmar where the country is unsafe and for export this is a major concern.

The border crossing to China from Shan State, was closed as the Chinese government cited concerns over Covid-19. Other crossings with India in Sagaing Region and Thailand at Kayin State were closed because of the political instability.

What is remaining is its seaport, the Myanmar Port Authority, but the transportation of containers to and from port by inland trucking is still difficult.

The Tatmadaw has been very militant and put several townships, which are in textile clothing operations—Hlaing Tharyar, Shwepyitha and South Dagon, North Okkalapa, North Dagon and Dagon Seikkan under martial law.

Moreover, it was since mid-March, the military has periodically cut the mobile internet service in an attempt to put the protestors out of communication, and has also shutdown telecommunications for eight hours every night. This is also to prevent the journalists and bloggers to report yhr junta’s violence and shedding lights on the political situation.

Garment, footwear and accessories are the three largest export sectors for Myanmar, accounting for one-third of its total exports. The business has more than tripled between 2016 and 2019 to $5.8 billion. There are nearly 600 factories in the country that employ around 500,000 workers.

So far all the fashion orders been honored in order to protect jobs, but H&M and the Benetton Group have suspended all new orders as violence continues across the country.

This situation has been very difficult for the factory operators in Myanmar.