The European Union may suspend trade privileges for its imports from Cambodia. Right now Cambodian exports to the EU are duty-free. The EU had announced in October last year that Cambodia could lose its special trade access to European markets under the EBA preferences, citing concerns over human rights and labor rights issues in the country.

The process consists of a six-month period of intensive monitoring and engagement with the Cambodian authorities, followed by another three-month period for the EU to produce a report based on the findings.

After 12 twelve months, the European Commission will conclude the procedure with a final decision on whether or not to withdraw tariff preferences. Any withdrawal would come into effect after a further six-month period.

The EU is a major trading partner of Cambodia, especially for the textile and footwear sector. As a Least Developed Country, Cambodia has enjoyed duty free exports of products, except arms and ammunition, to European markets for decades. Cambodia exported products to the EU bloc worth €4.9 billion in 2018. Over 46 per cent of Cambodia's total exports of apparel and footwear are to the EU.