Commerce Minister Cham Prasidh conducted Cambodia’s first round of bidding on US-imposed quotas for the garment industry Thursday and the event was proclaimed a success.
Iindustry and government representatives who participated in the daylong event were encouraged by the openness of the process.
“It was very transparent and extremely fair,” said Van Sou Ieng, chairman of the Garment Manufacturers Association of Cambodia. “There was no monkey business as people feared.”
Cham Prasidh also used the word transparent to describe the day’s events. “It went well. We did not encounter too many difficulties,” he said Thursday night. “Everything should be transparent, in my opinion.”
The day, which started at 8:30 am, kicked off with the verification of bidders, opening of the sealed envelopes and reading of the bids before a crowd of roughly 100 industry representatives. Recording the contents of the 99 envelopes, many of which contained bids for more than one of the 12 categories in the US quota, took up most of the day. To protect domestic manufacturers, the US imposes quotas to limit the amount of imports of some goods.
In 1998, approximately $360 million worth of garments made in Cambodia were exported, 75 percent of it to the US, according to the government.
Unofficial results were calculated at the end of work on Thursday, with Commerce staffers working into the night to prepare the official list of bid winners, due to be released this morning.
Because of their inexperience with the process, some factories bid quite high and therefore could see profits suffer. The range among the seven winners in the “jackets” category, for instance, was $5 per dozen to $21 per dozen. Factories were bidding on 10 percent of 1998 production, and no one bidder could win more than 20 percent of that total.
And although this was somewhat tedious for attendees, most people—including Cham Prasidh—managed to maintain their sense of humor, clapping and cheering for very low and very high bids.
“Most of [Cambodia’s garment industry] has no experience with a quota auction, and this was done fairly and honestly,” said Steven Walton, executive director of Wing Tai Garment International Ltd in Hong Kong.