Last year, garments and footwear exports from Cambodia were up 24 per cent from 2017. The garment industry is Cambodia’s largest employer. The value of exports in the garment sector continued to grow at about 10 per cent for the past three years. Much credit goes to the growth in the travel goods sector, while the footwear industry is also a major contributor. Growth in garment exports has been relatively stable but it may decline this year. The main concerns are next year’s wage increase and the EBA issue.

Cambodia has benefited from its EBA status in the European Union since 2001. Under the EBA, all Cambodian goods, except arms, enter the bloc tariff and quota-free. However, the European Union is now reviewing the deal following concerns regarding democratic setbacks in Cambodia. Massive job losses are feared from the second quarter of 2020 should the trade preferences be revoked. The EU bloc is Cambodia’s largest trading partner, accounting for 45 per cent of its exports.

Around 17 garment factories have been established in Cambodia in the last two years, generating 11,502 jobs in the sector. The investors are from Hong Kong, Japan, Singapore, China, and Australia. The factories produce handbags, wallets, sportswear, T-shirts and jackets.