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March, 01 2001 |  Download PDF |  Share

Propping up the Dictators in Burma

 
As the ILO calls for sanctions, the U.S. government grants unlimited access to sweatshop goods made in Burmese factories run by the brutal military regime
U.S. companies such as Jordache, Fila, Kasper, Arrow Golf, T.J. Maxx, Ames, Marshalls, Macy's increase imports from Burma by 118%!

Blowing the whistle on the Dictators


US Embassy Cable from Rangoon, Burma, July 2000
(excerpts)


"Garment factories in Burma are operating 24 hours a day, seven days a week."


"Consumer boycotts may have turned some US labels and retailers away, but others step in to take their place."


"The Burmese garment industry is booming — growing 45 percent in the last year. Factories in the northern outskirts of Rangoon are operating non-stop, producing winter clothes for the U.S. market."


"Most of the factories are joint ventures (JV's) between the Government of Burma (GOB) and Hong Kong, Korea and Taiwanese investors. Garment manufacturers in those countries subcontract orders to the Burmese factories that cannot be fulfilled under their own US import quotas."


"US quotas on Burmese garment imports are high enough that they have never been reached."

"Asked if the workers were organized into unions, the factory owners claimed that the GOB Ministry of Labor adequately protected the workers and that there was no need for unions in Burma. (Note: Labor unions and the right of assembly are prohibited by the ruling junta)."


"One local business group proposed to create a textile city to include cloth weaving and the production of other materials needed in garment production."

"As one of the few growing industrial sectors and the main Burmese export to the U.S. market, the Burmese garment sector warrants examination."

"It is our understanding that because the U.S. and Burma do not have a bilateral textile agreement, Burma's garment quotas are determined unilaterally by an interagency committee in Washington. Private sector operators have approached the Embassy in the past requesting the US to raise the U.S. garment quota for Burma. That said, the existing quotas are unmet."

"We understand that the GOB controls distribution of the current quota and reserves a large portion of it in government-related factories."


(The full U.S. Embassy cable "Burma's growing garment industry" (Rangoon / July 2000) is attached. After the NLC was made aware of the cable's existence, U.S. Senator Tom Harkin was able to obtain the cable, but only after a Freedom Of Information Act (FOIA) request that took four months to complete. Obviously, there were people who did not want this cable made public.)

 

 


 


The Apparel Industry in Burma

  • 1,000 garment factories
  • 500,000 workers
  • Most clothing factories are operated as joint ventures between the Burmese military dictatorship and investors from Hong Kong, Taiwan and Korea who are fleeing quota restrictions in their countries.
  • Factories are operating 24 hours a day, seven days a week, cranking out clothing for export to the lucrative U.S. apparel market. Surging apparel exports to the U.S. have become the key source of foreign exchange earnings for the Burmese military dictators.
  • Wages:

    Low End

    High End

    7 cents an hour

    22 ½ cents an hour

    $ 3.23 a week (6 days, 48 hours)

    $10.85 a week

    $14.00 a month

    $47.00 a month

    $168.00 a year

    $564.00 a year

 

  • Korean, Taiwanese and Hong Kong factory owners in Burma told U.S. Embassy officials that "the Government of Burma Ministry of Labor adequately protected the workers and that there was no need for unions in Burma." The U.S. Embassy officials note correctly that "Labor unions and the right of assembly are prohibited by the ruling Junta."

 


 

Which Companies are in Burma?


The following well-known labels and retailers appear either in the U.S. Embassy cable from Rangoon or in the most recent PIERS import shipments database.

Labels:


* Jordan

* Jordache

* Kenneth Cole (Kenneth Cole's general counsel told the NLC in December 2000 that the company would immediately pull out of Burma and remove all clothing made in Burma from its stores. However, a visit today, February 28, 2001, to Kenneth Cole's flagship store at Rockefeller Center in New York City found several styles of sweaters made in Burma still for sale.)

* Arrow Golf

* Fila

* Asphalt

* Columbia

* Tommy Hilfiger

* Nautica (Nautica issued a statement to the NLC in the summer of 2000 saying they have pulled out of Burma.)

* Police Uniforms for Montreal, Canada

* Kasper ASL, Ltd.


Retailers:

* Kmart

* Wal-Mart (Wal-Mart Canada issued a statement in the summer of 2000 saying they had pulled out of Burma. At the time, Wal-Mart clothing was being produced in a joint venture with a Burmese drug lord.)

* T.J. Maxx

* Marshalls Department Stores

* Williams-Sonoma, Inc.

* Family Dollar

* Ames

 


 


What Sanctions? Apparel Imports from Burma Soar!


· In the year 2000, apparel imports form Burma soared 118 percent over the previous year, surging from $185 million in 1999 to $403.7 million in 2000--an increase of $218.6 million.

· Following the May 1997 U.S. sanctions on Burma, apparel imports from Burma actually grew by 372 percent, rising from $85.6 million in 1997 to $403.7 million in 2000--a 4.7- fold increase.

· In 1998, apparel imports from Burma were up 50 percent, rising from $85.6 million in 1997 to $128 million. In 1999, apparel imports from Burma were up another 45 percent, growing to $185 million.


· In the aftermath of the brutal repression in 1988, when the current military regime came to power after murdering thousands of people, U.S. apparel imports from Burma have actually increased by an astounding 5,576 percent over the 11 years that followed, rising from $7.1 million in 1989 to $403.7 million in 2000 -- a 57-fold increase.

 

Apparel Imports from Burma Soar

1989:

$7,054,777

1990:

$9,101,912

1991:

$11,474,261

1992:

$27,333,278

1993:

$29,736,204

1994:

$46,635,173

1995:

$64,354,372

1996:

$83,303,722

1997:

$85,569,912

1998:

$127,971,629

1999:

$185,113,236

2000:

$403,720,000

 

 


 


How did Burma's dictators get Cart Blanche access to the lucrative U.S. apparel market?


While on one hand the U.S. government was calling for sanctions against the brutal military regime in Burma, on the other a deputy assistant secretary in the Commerce Department refused to limit Burma's apparel exports to the U.S.

In fact, less than five percent of Burma's apparel imports to the U.S. are even covered under import quota restrictions. Burma, the most brutal military regime in the world, has been afforded some of the most lax quota restrictions anywhere in the world by the U.S. Government! In effect, Burma has been granted unlimited access to the U.S. market. And the U.S. Government did this unilaterally, since there are no bilateral trade agreements with Burma.

 

 


 


What went wrong here? Who is setting policy?


There is no bilateral U.S. trade agreement with Burma. The U.S. Government unilaterally establishes apparel import quotas through the Committee for the Implementation of Textile Agreements.


This interagency committee is comprised of the Departments of Commerce, State, Labor and Treasury and the Office of the U.S. Trade Representative.


The Committee is chaired by the Commerce Department's Deputy Assistant Secretary for Textiles, Apparel and Consumer Goods Industries, Mr. Mike Hutchinson. The Committee's last meeting was in December of 2000.

Michael D. Hutchinson


Acting Deputy Assistant Secretary For Textiles, Apparel, and Consumer Goods Industries
International Trade Administration
U.S. Department of Commerce
Room 3015
1401 Constitution Avenue, NW
Washington, DC 20230
Phone: 202-482-3737
Fax: 202-482-2331
E-mail: Mike_Hutchinson@ita.doc.gov

 


The U.S. Commerce Department's office of Textiles and Apparel has established a category system breaking clothing types into 86 categories. Of the possible 86 categories, the U.S. government has set import quotas for Burma regulating only 12 categories.

Not only are there no quotas whatsoever for outerwear, jackets, knit shirts, sweaters, dresses, underwear, etc, but the 12 quotas established for Burma were set so high that manufacturers there, working around the clock, have been able to fill only five of those quotas.

(In 2000, only $18.891 million of Burma's $403.7 million-worth of apparel exports to the U.S. was covered under any quota restriction--less than five percent. The other 95 percent came in with completely free access.)

 

No Quotas for the Burmese Generals

  • Women and girls knit blouses (Category 339), which comprises the single greatest import from Burma, has no quota restrictions. In 2000, the imports of knit blouses to the U.S. were up 184 percent, to $113,530,000.
  • Imports of wool sweaters (Category 446) were up 16,500 percent.
  • Imports of men's and boy's knit shirts (Category 38) were up 72 percent, to $63,123,000.
  • Imports of cotton underwear (Category 352) were up 183 percent, to $13,232,000.
  • Imports of men's and women's coats (Category 634 and 635) were up respectively 70 percent to $52,955,000 and 63 percent to $17,656,000.

 



Does this make sense?


Right now, there are essentially no restrictions on rising apparel imports from Burma and the growing flow of foreign exchange earnings pouring into the pockets of the military dictators.

Could this change? Yes, with the unilateral stroke of a pen, if the Interagency Committee for the Implementation of Textile Agreements had the will. There is no law, no reason, no sense, and absolutely no benefit to the U.S. to go on rewarding and propping up the dictators in Burma by granting them unlimited access to the U.S. market.

The status quo we have now allows factory owners in Hong Kong, Taiwan and South Korea to relocate to Burma where they can escape U.S. apparel import quota restrictions in their own countries, thereby gaining unlimited access to the U.S. market, while at the same time accessing the 7 cent an hour wages of workers in Burma who are totally stripped of their rights. Who is this benefiting?

Note on US Military Production in Burma


The Army and Air Force Exchange Service (AAFES) is one of the largest retailers in the world. After it was revealed by the NLC along with Representative Cynthia McKinney and Sherrod Brown, that in October 2000 AAFES had imported $138,290 worth of clothing made in Burma, two days later, on December 21, AAFES pulled out of Burma. This was an important victory in that AAFES was at that very moment involved in significantly increasing its production in Burma. The just released Piers shipping documents show AAFES importing $279,500 worth of clothing from Burma in December 2000. This was more than double their imports in October. The US military's AAFES was stopped just in time.

 

 

U.S. Embassy Cable

 

 

 

 

 

 

 

 

 

 

 


 

 


U.S. Companies Still Sourcing Production in Burma

(March 2001)

Retailers: The following retailers are among those sourcing production for their own private labels or selling goods manufactured by contractors in Burma.


May Department Stores Company
Eugene Kahn, President and CEO
611 Olive Street
St. Louis, MO 63101
Phone: (314) 342-6300
Fax: (314) 342-4470

Federated Department Stores
James Zimmerman, Chairman, CEO
151 West 34th Street
New York, NY 10001
Phone: (212) 494-1602
Fax: (212) 494-1838

KMart
Charles Conaway
CEO
3100 West Big Beaver Rd.
Troy, MI 48084
Phone: (248) 463-5787
Fax: (248) 614 1970

Family Dollar Stores, Inc.
Executive Address:
Howard Levine
CEO and President
Family Dollar Stores, Inc.
10401 Old Monroe Road
Matthews, North Carolina 28105

Mailing Address:
Family Dollar Stores, Inc.
P. O. Box 1017
Charlotte, North Carolina 28201-1017
Phone: (704) 847-6961
Fax: (704) 841-1401

T.J. Maxx
Edmond English
CEO
The TJX Companies, Inc.
770 Cochituate Road
Framingham, MA 01701
Phone: (508)390-1000
Fax: (508) 390-2130

Williams Sonoma, Inc.
W. Howard Lester
Chairman and CEO
3250 Van Ness Avenue
SAN FRANCISCO, CA 94109
Phone: (415) 421-7900
Fax: 415-616-8359

Ames Department Stores, Inc.
Mr. Joe Ettore
CEO
Ames Department Stores, Inc.
2418 Main Street
Rocky Hill, Connecticut 06067
Phone: (860) 257-2000
Fax: (860) 563-8560

The Dress Barn, Inc.
Elliot S. Jaffe
Chairman of the Board, Chief Executive Officer and Director
The Dress Barn, Inc.
30 Dunnigan Drive
Suffern, New York 10901
Phone: (845) 369-4500
Fax: (845) 369 4595

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Manufacturers: The following manufacturers are among those sourcing production in Burma.

Fila USA, Inc.
Mr. John Epstein
CEO and President
Fila USA, Inc.
1 Fila Way
Sparks, MD 21152
Phone: (410) 773-3000
Fax: (410) 773-4973

Tommy Hilfiger Corp.
Joel Horowitz
CEO
Tommy Hilfiger Corp.
6/F, Precious Industrial Centre
18 Cheung Yue Street
Cheung Sha Wan
Kowloon, Hong Kong
Phone: (852) 2745-7798

Karl Kani
Karl Kani, CEO
500 South Molino Street, Suite 215
Los Angeles, CA 30013
Phone: (213) 626-6076
Fax: (213) 626-8434

Jordache Ltd. Inc.
Mr. Joseph Nakash
CEO
1411 Broadway, 33rd Floor
New York 10018
Phone: (212) 944-1330
Fax: (212) 768 -5721

Columbia Sportswear
Timothy P. Boyle
President and CEO
P.O. Box 83239
Portland, OR 97283-0239
Phone: (503) 286-3676
Fax: (503) 289-6602

Kasper A.S.L.
Arthur S. Levine
Chairman and CEO
77 Metro Way
Secaucus, New Jersey 07094
Phone: (201) 864-0328
Fax: (201)583-8860

Perry Ellis International
George Feldenkreis
Chairman and CEO
3000 NW 107th Ave.
Miami, FL 33172
Phone: (305) 592-2830

By Design LLC

By Design LLC is a major company, with well over $300 million in annual sales to J.C. Penney, Sears, May Co. Federated, Dress Barn and Casual Corner. By Design would be very much worth investigating as the company also imported 2,313,948 pounds of clothing made in Burma in the last year. By Design also has factories in Vietnam, China and Cambodia.

Mr. Jay Lee Choi
President
By Design LLC
1411 Broadway, 28th floor
New York, NY 10018
Phone: 212-221-2255
Fax: 212-302-4556

Cherry Stix Ltd.
Mr. Charles Gammal
President
Cherry Stix LTD
1407 Broadway, Suite 1503
New York, NY 10018
Phone: (212) 221-5100
Fax: (212) 221-6551

Stretch O Rama, Inc.
100 W. 33rd St.
New York, NY
Phone: (212) 947-4090
Fax: (212) 967-2420

Fashion Trend
Mr. Albert Cohen
CEO and President
Fashion Trend
1407 Broadway, Suite 1020
New York, NY 10018
Phone: (212) 575-6556
Fax: 354-5934

Hampton Industries, Inc.
In 2000, North Carolina lost 13,000 textile and apparel jobs and 2,200 furniture jobs. (NYT 2/23/01)
Mr. David Fuchs
CEO and President
Hampton Industries, Inc.
15 W. 34th St., 8th floor
P.O. Box 3060
New York, NY 10001
Phone: (212) 563-1010
Fax: (212) 760-0995
Hampton Industries, Inc.
2000 Greenville Hwy, P.O. Box 614
Kingston, NC 28502-0614
Phone: (252) 527-8011

One Step Up, Ltd.
Ms. Sandy Gewercman
CEO
One Step Up, Ltd.
1407 Broadway, #3205
New York, NY 10018
Phone: (212) 398-1110
Fax: (212) 719-4903

E.S. Sutton Inc.
Mr. Joe Sutton
CEO
E.S. Sutton Inc.
1411 Broadway, 19th floor
New York, NY 10018
Phone: (212) 944-9494
Fax: (212) 944-8409

Sutton Creations, Inc.
1407 Broadway, Suite 920
New York, NY 10018
Phone: 212-997-1234
Fax: 212-997-0606

Miss Erika, Inc.
Mr. Stewart Bergman
CEO
Miss Erika, Inc.
1407 Broadway # 405
New York, NY 10018
Phone: (212) 391-1776
Fax: (212) 921-8471

Parigi Group Ltd.
Mr. Harvey Schermer
CEO
Parigi Group Ltd.
112 W. 34th St., Room 836
New York, NY 11220
Phone: (212) 736-0688
Fax: (212) 239-1886

Hampton Industries, Inc.
David Fuchs
Chairman and Director
2000 Greenville Hwy.,
P.O. Box 614, Kinston, NC 28502-0614
Phone: (252)527-8011

Asphalt

Arrow Golf
Bryan P. Marsal
President and CEO
Cluett, Peabody & Co.
48 West 38th Street
New York, NY 10018
Phone: (212) 984-8900
Fax: (212) 984-8585

 

 


 

A Statement from Charles Kernaghan

Director, National Labor Committee

 


-- U.S. Burma Policy --

What Was the U.S. Government Thinking?

 

Something is seriously wrong with U.S. Government policy toward Burma's military dictators. On one hand, the U.S. government calls for sanctions prohibiting new U.S. investments in Burma in order to put pressure on one of the world's most brutal and vicious regimes, while on the other, it grants Burma some of the most lax import quotas available anywhere in the world, throwing the U.S. market wide open to sweatshop goods made in factories controlled by the Burmese military. The U.S. government is giving the dictators exactly what they need most to cling to power, namely, growing foreign exchange earnings: hard currency.

The U.S. government does this unilaterally. We have no bilateral trade agreement with Burma. This is all in the hands of the administrators in Washington, D.C., at the Commerce, State, Labor and Treasury Departments, and at the Office of the U.S. Trade Representative. This is their policy.

Who does it help? Certainly not the 48 million people imprisoned in their own country and stripped of their rights by a brutal military regime which rules through torture, rape, ethnic cleansing, child and forced labor. In the last two months we have lost 121,000 apparel and manufacturing jobs in the U.S., yet factories in Burma are running 24 hours a day, 7 days a week. Who gains? The U.S. government's Burma policy encourages wealthy manufacturers in Hong Kong, South Korea and Taiwan to relocate their factories to Burma, where they can not only avoid U.S. import restrictions and quotas in place in their own countries--thus gaining unlimited access to the lucrative U.S. market--but also access the 7-cent-an-hour wages in Burma, where all human and worker rights efforts are immediately crushed through imprisonment and torture.

Unscrupulous U.S. companies including Jordache, Jordan, Fila, Arrow Golf, Macy's, T.J.Maxx, Marshall's, Kasper and others saw the opening provided by the U.S. government policy and they took advantage, racing to increase their imports from Burma by 118 percent last year!

Could things have been different? Just imagine if a few years ago U.S. government officials had looked the Burmese military dictators in the eye and told them that their import quotas to the U.S. would be cut by 25 percent each year until the people of Burma were free, democracy restored and respect for human and worker rights guaranteed. It is shocking when you think that 48 million people in Burma could now perhaps be free, if only the U.S. government had taken this very simple step. Instead, U.S. government officials chose a policy which allowed $403.7 million worth of apparel made in Burma to enter the U.S. last year, meaning tens and tens of millions of dollars flowed into the pockets of the dictators, who run those factories as joint ventures with their partners from Hong Kong, Taiwan and Korea.

Could things change now? Certainly! Just as this is a unilateral policy instituted at the will of the U.S. government, it could change tomorrow. Senator Tom Harkin's bill prohibiting the import of apparel made in Burma could be adopted. Maybe, if there is enough pressure, that is what will happen.

Politicians decry the growing apathy or even cynicism toward government on the part of the American people, especially the young. Much of this is being driven by government/corporate duplicity--saying one thing to please some people, while doing another. Burma is a good case in point. While talking about sanctions to help restore democracy and freedom in Burma, the U.S. government was in fact acting very differently, throwing open our country to goods made in sweatshops run by the Burmese military. The names we called the dictators could not hurt too much, while the hard currency they earned running these sweatshops allowed them to maintain their ruthless grip on power. One can almost hear the U.S. retailers lobbying the government behind closed doors, '"Say whatever you want, but do not curtail our sourcing there"' And as the U.S. government rattled its words of pressure at the Burmese dictators, the U.S. Military, through the Army and Airforce Exchange Service (AAFES), one of the world's largest retailers, actually itself began sourcing clothing production in Burma. In October and December 2000, AAFES imported $418,000 worth of clothing made in Burma. It was a cozy relationship, military to military, and again, more money went into the pockets of the Burmese dictators.

When the NLC, along with U.S. Representatives Cynthia McKinney and Sherrod Brown, exposed AAFES production in Burma, two days later--after huffing and puffing that they had really done nothing wrong--AAFES pulled out of Burma.

So, where there is social pressure, there is some hope. Companies do not like to be exposed and dragged out into the light of day. Neither do U.S. government policymakers.

We have work to do.

 


 

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