Myanmar-based Olympus Asia Group has signed a MoU with Korea’s Panko Corporation and now they are looking for a land in Yangon, Bago or Ayeywarwady to set up textile units. Giving details, Olympus Asia Group CEO U Okkar Zaw Naing said that the factories would operate under the FOB model and focus on creating jobs for local people. The project will include an international-standard wastewater treatment plant; generate its own electricity and include dormitories for employees. The companies will produce their own cotton and buttons in Myanmar as well as produce clothes for export.
The project will start within one year and take three years to build the required infrastructure, said Naing. This timeframe is based on the time it took for Panko Corporation to build a similar zone in Vietnam, which was launched in 2013 and completed this year, he said. According to the Myanmar Garment Manufacturers Association, the vast majority of Myanmar’s garment factories operate under the cut-make-pack (CMP) system.
Under the CMP model, a foreign buyer with financial backing and technical expertise will contract a garment factory usually in an emerging market to carry out their labour-intensive work. On the other hand, foreign retailers place orders from well-financed factories with technical expertise under the FOB system. Most factories in Myanmar lack access to financing and do not have enough skilled workers to operate under the more profitable FOB model.
