Japanese fast-fashion chain plans third garment factory in Myanmar – Sourcing Journal

Brands are under pressure to sell Myanmar production. A Japanese retailer, on the other hand, decided to double down.

This month, Honeys Holdings will invest 1.5 billion yen ($11.3 million) in a 16,000 square meter factory in Mingaladon Industrial Park outside Yangon city, Nikkei reported. Asia last week. Scheduled to open in May 2024, the establishment will be the fast fashion chain’s third in the troubled country, which has been engulfed in chaos and bloodshed since the military seized power more than a thousand years ago. a year.

“We can manufacture in our factories in Myanmar cheaper than anywhere else,” Chairman Eisuke Ejiri told the outlet. “It’s our greatest strength.” Honeys, which did not respond to a request for comment, sources about 90% of its products from Southeast Asia, with 44% coming from Myanmar alone.

Honeys, which also owns the Rapeseed, Cinema Club and Glacier brands, said it was audited by SGS Group, an international certification company that checks factories for violations such as child labor and forced labour, occupational health and safety and freedom of association. “We were told there were no problems,” Ejiri said.

But union activists say due diligence in Myanmar is virtually impossible. The Association for Assistance to Political Prisoners estimates that more than 2,170 civilians have been killed and nearly 15,100 arrested since the start of the coup. The crackdown on civil disobedience protests was swift and violent, with some reports indicating that at least 55 labor activists were killed and 301 members of the labor movement put behind bars.

A study released by the Business & Human Rights Resource Center last month found more than 100 cases of human rights abuses against at least 60,800 garment workers nationwide. More than half of them (55) concerned wage theft, while others concerned abusive working rates and forced overtime (35 cases) and attacks on freedom of association (31 cases) . The non-profit organization also recorded the killing of seven garment workers by armed security forces and the arbitrary arrests and detentions of 15 others.

“It is outrageous to hear that while persecuted unions on the ground in Myanmar are calling on brands to put workers’ lives ahead of profit maximization and to offer humanitarian aid rather than profiteering from the misery of a countries, brands like Honeys are completely ignoring these calls and continuing to invest,” Jay Kerr, an activist at No Sweat and coordinator of the grassroots group’s Myanmar Military: Never in Fashion initiative, told The Sourcing Journal.

“While many brands set great store by their ethical credentials and codes of conduct intended to protect freedom of association, it is becoming increasingly clear that the opportunity to increase profit margins far exceeds any commitment to workers’ rights,” Kerr said. .

Honeys’ two existing factories, which are also located in the Mingaladon Industrial Park, faced allegations of worker abuse even before the army takeover. A 2019 investigation by the Worker Rights Consortium (WRC) identified a litany of violations of Burmese law and international labor conventions, such as excessive overtime, sub-minimum wages, illegal wage deductions, employment of minors, verbal abuse and profanity, improper supervision of workers and an unsafe workplace. conditions.

To punish workers for a strike in June 2017, the company massively fired nearly 450 union leaders and members, a “serious violation of workers’ fundamental labor rights” and a clear act of retaliation, the WRC said. .

“Honeys is the only factory in Myanmar that has laid off massively without paying any grievance compensation,” Myo Myo Aye, the leader of the Myanmar Solidarity Trade Union, told The Sourcing Journal.

Myo Myo Aye helped organize workers at Honeys, who later filed a civil and later criminal complaint accusing him of defamation. Before being arrested by the junta last April, she appeared in court more than 40 times to answer Honeys’ charges. From September until her release in October, Myo Myo Aye was held in solitary confinement without cause. She was summoned to court in November, when the case was dropped because a Honeys representative failed to show up.

Honeys does not “respect labor rights and labor laws,” she said. “If they operate a new factory, they will continue to violate labor rights and laws. The targets are beyond what a [person] can actually produce. It is an act of forced labor. They are overly rushed to work. And they contravene freedom of association and freedom of expression.

Although Honeys told Nikkei Asia that the company had “no relationship” with the military, Myo Myo Aye said the company would continue to oppress workers “in favor of the regime”. Honeys management knows it can “enslave the workers here in Myanmar and they can do whatever they want no matter what,” she said. “Therefore, we don’t want to see the emergence of another Honeys factory in Myanmar.”

Brands such as Besteller, H&M and Primark say they chose to stay in Myanmar because they fear the withdrawal could crater Myanmar’s economy, leaving workers in worse shape than they already are. Several of them are awaiting the results of an evaluation by the Ethical Trading Initiative, scheduled for this month, before deciding on their next steps.

But the coup and Covid-19 have already taken their toll on the country, the International Labor Organization (ILO) said earlier this month. Over a million fewer women and men are employed in Myanmar today compared to 2020. The quality of jobs is also deteriorating with what she described as “serious labor rights violations”. Data from the garment sector, in particular, suggests an increase in casual or daily work, irregular working hours and piecework wages.

“Eighteen months after the military coup, the employment situation in Myanmar remains very difficult. Although there are limited signs of job growth, the continued erosion of working conditions and declining job quality are deeply concerning,” said Donglin Li, ILO Liaison Officer at Myanmar.

Kerr is disheartened by the number of brands that continue to operate in Myanmar or, in the case of Honeys, expand their investments, despite warnings from federal agencies about the regime’s attacks on the rule of law, the facilitation of corruption, illicit financial activities and serious human rights violations. The Ethical Trading Initiative has also asked its members to reassess their presence in Myanmar as an “urgent matter”.

“We even see brands that have positive ratings on transparency, like Italian brand OVS, which received the highest score in the Fashion Transparency Index 2022, sourcing from a country heading towards civil war; where pro-democracy activists are executed; and where at least 55 trade unionists were killed,” he said.

OVS said its Burmese suppliers made up no more than 1% of its base and after the coup it decided to audit these companies more frequently “so as not to support the army and at the same time not to leave workers unemployed.”

“We periodically assess our permanence in the country [based] on the ability of our suppliers to meet our minimum requirements,” a spokesperson told The Sourcing Journal. “However, as we know the situation is uncertain, we are ready to move our production elsewhere in the event that conditions in the country deteriorate further. We are in contact with NGOs, observatories and the Italian Embassy to be ready to quickly identify the right measures.

Fashion Revolution, the advocacy group that publishes the index each year, said it will also speak with OVS to better understand what is going on. Not everyone is convinced, however.

“It is impossible for brands to uphold their own ethical commitments when sourcing from Myanmar, and we call on them to put people before profit and harness their enormous economic power to restore democracy” , Kerr said.

Michael O. Stutler