Feedback Here

fbook  tweeter  linkin YouTube
Global contents also translated in Chinese

Cambodia’s garment exports to US, EU slows down

A report released by the National Bank of Cambodia, Cambodia’s shows garment exports grew slower than expected by about 4 per cent in the first half of the year compared with 9 per cent in the same period last year while foreign investment in the sector fell by 30 per cent.

The US and the EU are the top two destinations for Cambodia’s garments and the NBC report pointed out that in the first half of the year total US-EU garment exports was 67 per cent of the kingdom’s total exports, down from 75 per cent in the same period last year. The report also stated investment in the garment sector fell due to investors realising Cambodia, in the next three years, would no longer enjoy preferential tax treatment from the EU as it moves up the ranks from a lower income country to a lower middle income nation.

Cambodia will face tough competition in the global market in the short, medium and long term due to Vietnam, Cambodia’s main competitor in garment sector, getting preferential tax treatment in 2018 on its exports to the EU under the Free Trade Agreement, says Chea Serey, NBC’s DG. Increasing minimum wages will also put pressure on Cambodia’s competitiveness, she added. Cambodia is a highly dollarised economy, it must be careful to align minimum wage adjustments with productivity increases to keep wage costs in check and stay competitive as a manufacturer for export markets.

Meanwhile, NBC governor Chea Chanto stated that Cambodia’s GDP is estimated to grow 7 per cent in 2017. The garment sector continues to be a major contributor to the GDP, despite its slower growth rate, while the construction and tourism sectors continue to grow, says Chanto.

The uncertainty about the effect of British withdrawal from the EU on Cambodian exports to the UK is also a cause for concern, he added.

 
LATEST TOP NEWS
 


 
MOST POPULAR NEWS
VF Logo