Boston, MA 06/13/2014 (wallstreetpr) – The Gap Inc. (NYSE:GPS), the apparel retailer is seeking to expand to Myanmar, the former Burma, as it commissions two facilities Yangon, the capital city of the country.
Gap Inc., the parent company of several apparel brands including Old Navy, Banana Republic, Piperlime, Athleta and Gap, is planning to produce apparels at its newly established factories in Myanmar. With this, it will become the U.S. first apparel retailer to enter the country’s clothes industry after Western authorizations were banned a couple of years ago. No American retailer has stepped into the country post its declaration as a democratic country three years back.
The San Francisco based apparel manufacturer has already made a sourcing agreement with two South Korean owned facilities in Myanmar. The factories will be producing outerwear and jackets for two of its brands- the Banana Republic and Old Navy. The company expects to begin shipments to the U.S. malls this summer.
The Gap Inc. (NYSE:GPS), which has facilities in over 40 countries, did not share the exact figures it is investing in the Myanmar factories but said that it anticipates that the project will create around 700 jobs in South Korea which will be concerned with fulfilling orders. In addition, it said, the project would create as many as 4,000 indirect jobs in the whole of Myanmar, which is seen as the biggest U.S. commitment in the country in three years.
Strict International Standards
Myanmar’s garment industry employed more than 300,000 people in the early 2000s, as the government records show. However, the industry faced a harsh down- track because of the U.S. trade restriction which was imposed in the year 2003. In 2012, the Obama administration sought to ease those sanctions after the country’s newly formed democratic government brought in a range of political and economic reforms in Myanmar. Analysts are however still skeptical regarding the corporate interests of the country as Western companies continue to face stricter regulations.