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15 Feb 2022

Jasmin Malik Chua, Sourcing Journal

Myanmar: Tesco announces plan for 'responsible' exit from Myanmar amid continued labour rights violations

See all tags Allegations

"Tesco Exiting Myanmar Amid ‘Deep Violation’ of Labor Rights", 15 February 2022

Tesco...is in the process of exiting Myanmar “responsibly,” a spokesperson told Sourcing Journal...

The move follows reports that Gtig Eastar Garment (Myanmar) Co., a Chinese-owned garment factory in Wartayar Industrial Zone in the city of Yangon, has refused to compensate thousands of workers after announcing its closure in October, seven months after it was badly damaged in a fire.

Gtig Eastar, according to Myanmar Labor News, made leather jackets for Tesco’s F&F clothing label. Other brands that sourced garments from the factory included C&A, OVS and Zara, it said. Jiangsu Gtig Eastar, the supplier’s parent company, did not respond to a request for comment.

Tesco said it’s wrapping up its final orders with Gtig Eastar and will be pulling out of Myanmar, in line with advice from global unions...The spokesperson said the retailer does not tolerate underpayment of wages and will “always” investigate concerns “thoroughly.”

It did not clarify, however, whether it had made the decision before or after news of Gtig Eastar’s wage non-payment had emerged...

Neither C&A... nor Zara...responded to requests for comment about Gtig Eastar’s alleged severance theft. C&A previously told Sourcing Journal in May that it has not placed new orders in Myanmar since the coup and will not be doing so unless it sees “significant improvements within the country.” Zara owner Inditex has not publicly commented about its status in Myanmar...

OVS... said it has remained in Myanmar because it was concerned that withdrawing would result in greater negative consequences for workers. The company told Sourcing Journal that it worked with Gtig Eastar on orders that represented less than 5 percent of the factory’s capacity until 2020, after which it “stopped the cooperation” because the factory was unable to “provide the necessary guarantees to work in full transparency yet.” It maintained previous commitments, however, allowing the factory to complete shipments in early 2021.

“The factory in question has not been our supplier for a long time, but since we understand the criticality of the situation and have a consolidated relationship with the parent company, we will undertake to monitor the situation,” an OVS spokesperson said...

Workers who make underwear for Adore Me and Skims at Bogart Lingerie (Yangon) Limited, told Myanmar Labour News in December...that they were being pressed into overtime without additional pay, and if they failed to meet quotas, they received nothing. The Delta Bogart Group, the factory’s Hong Kong-based parent, did not respond to a request for comment, nor did Adore Me or Skims.

Similar labor-rights violations are unfolding all over the country, said Khaing Zar Aung, the exiled president of the Industrial Workers Federation of Myanmar, yet Western brands continue to “pretend” that they can protect workers’ rights...

Part of the following timelines

Myanmar: Clothing brands resume orders from Myanmar amid continued political instability & human rights violations

Myanmar: Trade unions & labour organisations call for economic sanctions against the military regime

Myanmar: Garment workers at GTIG Eastar factory supplying intl. brands denied compensation after factory closure; incl. co. responses