Cambodia has more garment workers today than it did a year ago, a turn of events that almost no one predicted in 2004, when it was widely believed the end of worldwide quotas in the garment industry would force Cambodia’s largest industry to its knees.
Commerce Ministry Secretary of State Mao Thura said Wednesday that new data shows that as of November there were 279,000 Cambodians employed as garment workers, compared to 270,000 in November 2004.
The announcement comes during a week when 12 of the top foreign buyers of Cambodian garments, who together purchase $1 billion of the nation’s $1.9 billion in exports, met with government officials, unions and factory owners.
Several buyers interviewed strongly praised increasing labor standards here. But some said that threats to human rights and political freedoms may make them rethink their commitment to Cambodia.
“From the beginning of the year through October, there has been a 16.6-percent increase in the value of exports to the US,” Mao Thura said, adding that the market in EU countries had not increased.
He said 43 new factories have opened so far this year, and wages have remained constant at about $72 a month on average.
“Most of the factories export garments to the USA, because we have confidence from the buyers,” he said.
The Multi-Fiber Agreement that limited the number of garments China, India and other major producers could export to the US and Europe expired on Jan 1.
With the expiration of the agreement, employment in Cambodia’s garment sector fell to 247,000 by March and 22 factories closed, said Ros Harvey, director of the International Labor Organization’s Better Factories monitoring program.
But the US, under pressure from domestic garment factories, began re-imposing limits on the amount of clothing imports from China that month, a move that boosted the Cambodian garment sector.
But the recent imprisonment and threatened imprisonment of government critics, including union leaders, may jeopardize the all-important trade relationship with the US, buyers said Wednesday.
A buyers’ conference in Phnom Penh, in which representatives of Adidas, H&M, Levi Strauss, Sears, Wal-Mart, Nike, Reebok and other major retailers discussed forming a buyers’ council to increase their involvement in labor standards monitoring, was kicked off Monday with strong words on human rights from US Ambassador Joseph Mussomeli.
In his prepared speech, he noted that many buyers are excited about a bill in the US Congress that would eliminate import duties on Cambodian exports. But that bill could fail, Mussomeli warned, due to a recent crackdown on dissent by Cambodian authorities.
“The US takes threats to freedom of expression very seriously. In the wake of the recent political crackdown, any elimination of tariffs is likely to be conditional on a marked improvement in the treatment of the opposition and political activism,” he said.
Laura Rubbo, senior manager at The Walt Disney Company, said Disney is considering whether to permanently end a nine-year-old ban on buying Cambodian garments. The ban was initially prompted by factory working conditions, but 10 months ago Disney began limited production here, largely because it was impressed by the International Labor Organization’s Better Factories’ monitoring program.
“Having the ILO here just gives buyers a lot of confidence…we also look at the corruption index by Transparency International and we look at the evaluation by the US State Department. Broader human rights are a concern of Disney,” she added.
Rubbo said that increases in political repression could affect their decision in June on whether to end the ban.
“There has been so much progress here, we just don’t want to see things set back for other reasons,” she said.
Naurin Muzaffar, manager of global partnerships at Gap Inc, which is Cambodia’s largest buyer with 18 percent to 20 percent of the market, said Gap is concerned about possible deterioration of human rights.
Last month Beehive Radio station owner Mam Sonando and teachers’ union president Rong Chhun were jailed for allegedly defaming Prime Minister Hun Sen by criticizing a new treaty with Vietnam.
“We have expressed this to the government. We realize it is an internal matter and very sensitive but it is related to overall human rights,” she said.
Ian Spaulding, who represents the Sears and Kmart chains, said Sears would only consider pulling out of Cambodia if the political situation threatened stability.
Sears, which now relies on ILO monitoring exclusively, is very impressed with the Cambodian government, Spaulding said.
“The [factory] safeguards do pay a role,” he said. “But the Cambodian government is way ahead of other governments in terms of making our industry a priority and listening to our concerns.”
He said that if Sears, the number five buyer with $150 million in purchases this year, leaves Cambodia, it will be due to internal decisions about its ability to maintain overseas quality control offices, rather than because of the business environment here.
(Additional reporting by Van Roeun)
