The Cambodian Footwear Association (CFA) has appealed to the European Commission to postpone partial withdrawal of its Everything but Arms (EBA) trade benefits. As per CFA, the withdrawal will cause economic damage well beyond what has been foreseen when the European Council undertook its assessment in 2019 and issued its Cambodia EBA decision in early February 2020.

COVID-19 has already resulted in the loss of 30,000-40,000 jobs in the country’s footwear sector. According to a recent membership survey by CFA, footwear production volumes in the first half of 2020 declined on an average 20-40 per cent per factory compared to 2019, and sectoral employment reductions led to loss of 30,000-40,000 jobs.

The survey forecasts worse outlook for the second half of 2020. There is not a single member factory that reported an increase in orders compared to the first half of the year, with most factories forecasting a further drop in production for an overall decline of 40-60 per cent for full year 2020 compared to 2019.

Based upon existing order volumes for the second half of 2020, 70 per cent of member factories are preparing to cut jobs or suspend production. Most of the remaining 30 per cent have already reduced employment and forecast production only at already reduced levels.