EU Delegates Encounter Broad Show of Opposition to Ending Trade Preferences

By Nan Lwin 31 October 2018

YANGON—A visiting EU delegation has encountered vocal opposition to the possible withdrawal of trade preferences in numerous meetings with a wide range of government officials, union leaders, businesspeople and garment workers as it starts its mission to examine human rights and labor conditions in Myanmar.

From Monday to Wednesday, the joint mission of the European Commission’s trade arm and the EU’s diplomatic service met with numerous officials from government ministries and labor organizations as part of its investigation of the crisis in Rakhine State, as well as labor rights and workplace conditions.

In Naypyitaw on Tuesday, EU delegation members met with high-level officials from 10 ministries: Home Affairs; Foreign Affairs; the Ministry of the State Counselor’s Office; Information; the Ministry of the Office of the Union Government; Labor, Immigration and Population; Industry; Commerce; Social Welfare, Relief and Resettlement; and Union Attorney General’s Office.

According to a government statement, Myanmar officials made a strong appeal to the delegation to consider the impact on ordinary working people if the EU were to withdraw Myanmar’s tariff-free import status, a move they said would leave more than 400,000 people jobless, mostly women working in the garment sector.

The arrival of the EU monitoring mission follows a statement by EU Trade Commissioner Cecilia Malmstrom on Oct. 5 warning that Myanmar could lose its Everything but Arms (EBA) status over human rights violations alleged in a UN fact-finding mission’s report. Part of the EU’s Generalized System of Preferences, the EBA scheme allows participating countries to export any goods except weapons to the EU tariff-free.

According to a statement from the Ministry of Information, U Thaung Tun, the minister of the Office of the Union Government, and Helena Konig, deputy director general of the EU’s Directorate General of Trade, held a separate meeting in Naypyitaw on Tuesday. They had an “open” discussion about the EBA scheme, the ministry statement said.

In separate meetings with the EU delegates, Myanmar government officials, lawmakers, labor policy experts, academic scholars and members of the business community have voiced strong disagreement with the idea of the EU withdrawing trade preferences.

According to the Myanmar Garment Manufacturers Association (MGMA), the EU is Myanmar’s largest partner in the garment sector. Brussels lifted duties on goods from Myanmar in 2013, and the EU now purchases more than 47 percent of the country’s garment products. The second-largest buyer is Japan, which purchased 27 percent of Myanmar’s garments in 2017.

The garment sector accounts for 71 percent of overall exports to the EU and employs more than 450,000 people, according to the MGMA. It is the most labor intensive of the country’s major industries.

Historian U Thant Myint-U attended a private meeting with the EU delegates in Yangon on Monday. U Thant Myint-U did not disclose to the media what was discussed at the meeting, but told The Irrawaddy the meeting was “a very open and engaging discussion on many aspects of the situation in Myanmar.”

“Revoking Myanmar’s GSP privileges would be an unmitigated disaster that must be avoided,” he said.

“Myanmar’s had its fair share of tragedies these past years; one of the few really good stories has been the growth of the garment sector, providing jobs to hundreds of thousands of otherwise impoverished young women,” he said.

“The EU has been a good friend of Myanmar and I understand why they are reviewing their relationship. But revoking the GSP would be a kind of collective punishment against some of the most vulnerable people in Myanmar society; young women who are finally able to help themselves and help their families,” he added.

EU delegates also met with representatives of the Myanmar Confederation of Trade Unions and the Myanmar Infrastructure, Craft and Service (MICS) organization at the EU’s office in Yangon on Monday. During the meeting, representatives of both organizations said targeting ordinary Myanmar people is not the right way to apply pressure over alleged human rights violations in the country.

MICS vice president U Naw Aung told EU mission officials that Myanmar’s workers had faced rights violations for many years. However, conditions had improved recently, he said. “We don’t want to see the current conditions devastated. If the EU withdraws trade preferences, its support for our country’s democratic reform would be fruitless,” he said.

U Naw Aung said he asked the EU officials, “Do you think withdrawal of the trade preferences is the only way to solve the problems in Rakhine and Kachin states?”

On the same day, the delegations held a meeting with garment factory owners and major exporters to the EU at the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI). The meeting was also attended by 22 garment workers, who were asked about their incomes and working and living conditions.

UMFCCI vice president U Mg Mg Lay told The Irrawaddy the federation opposes the EU’s possible withdrawal of trade preferences. He said, “I also object personally. It doesn’t support Myanmar’s transition to democracy.”

“The move will badly hurt ordinary women and also dent the confidence of foreign investors,” U Mg Mg Lay said.

“If the EU decides to withdraw trade preferences, it would be hard to believe that the EU supports Myanmar’s democratic transition in a positive way,” U Mg Mg Lay added.

Prominent lawmakers also warned that a halt to EU trade preferences would cause widespread harm by throwing Myanmar’s civilian government into another crisis as it attempts to implement economic reforms after more than six decades of international isolation under military dictatorship.

The EU officials told Myanmar that the decision-making process would take months, and promised they would carefully investigate human rights violations, and whether Myanmar had committed labor rights violations and followed international law and regulations.

In Naypyitaw, EU delegates also discussed accountability for human rights violations, promotion of collaboration with UN organizations, humanitarian aid to Kachin, Rakhine and Shan states, the repatriation process for Rohingya in Rakhine State, press freedom and the improvement of labor rights and protections, according to the Ministry of Information.

UMFICC joint secretary Daw Khine Khine Nwe said the organization welcomed the EU delegation’s visit, but added that, “After meeting with stakeholders here, I hope they will report back their findings with proper consideration.”