Raw materials import by CMP businesses plunge into $1.2 bln nearly ten months

 

IMPORTS of raw materials by CMP (cut-make-pack) businesses have sunk to US$1.24 billion as of 23 July in current financial year 2020-2021 since October 2020, which reflects a decrease of $558.26 million compared with the year-ago period, according to the Ministry of Commerce.

The figures plunged from $1.79 billion registered last FY2019-2020, the Commerce Ministry’s data indicated.

Myanmar’s garment exports witnessed a decline of over 20 per cent in the past eight months (Oct-May) of the current financial year 2020-2021 compared with a-year ago period on the back of slump in demand by European Union market. The raw materials import by the CMP businesses fell simultaneously, the Ministry of Commerce stated.

Exports of garments manufactured under the cut-makepack (CMP) system were valued at US$2.2 billion between 1 October and 28 May in the current FY, according to data from the Ministry of Commerce.

The figures plunged from $2.7 billion in the corresponding period of last FY 2019-2020.

The garment industry is facing cancellation of order and slump in output, new orders. However, The Swedish fashion retailer H&M is gradually placing orders from Myanmar again after it paused in March. Then, more international fashion retailers such as Primark and Bestseller start to resume new orders. Additionally, Germany will also continue its support for Myanmar garment businesses so that Myanmar women can continue their livings, Germany Embassy Yangon’s Facebook posted. Nonetheless, the COVID-19 infections are spiking in the country and all the CMP factories are temporarily closed down during the official public holidays (17-25 July).

The garment sector is among the prioritized sectors driving up exports. The CMP garment industry emerged as a promising one, with preferential trade from Western countries. Nevertheless, we cannot still expect normalcy for now due to the possible disruption in logistics and supply sector and other serious consequences amid the COVID-19 impacts, traders stressed.

Myanmar’s manufacturing sector is largely concentrated in garment and textiles produced on the Cutting, Making, and Packaging basis, and it contributes to the country’s GDP to a certain extent.

Myanmar mainly exports CMP garments to markets in Japan and Europe, along with the Republic of Korea, China, and the US.

The export value of CMP garments was only $850 million in the 2015-2016 FY, but it has tripled over the past two FYs. In the 2016-2017 FY, about $2 billion was earned from exports of CMP garments. The figure increased to an estimated $2.5 billion in the 2017-2018 FY and $2.2 billion in the 2018 mini-budget period (from April to September). It tremendously grew to $4.6 billion in the 2018-2019 FY and $4.8 billion in the 2019-2020 FY, according to the Commerce Ministry.

Htet Myat/GNLM

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