The Cambodian Union Federation appealed to Prime Minister Hun Sen in a letter Monday to help lower the prices of goods as garment factories are seeing their employees flee under the pressure of inflation.
Higher prices, particularly of food, have pushed workers to leave their factory jobs to return to farms in provincial areas or take positions with better pay and free meals in restaurants, beer gardens and karaoke parlors, the letter states.
“If the government doesn’t take urgent measures to make the price of goods go down, the garment factories face shutting down because there are no workers,” CUF President Chuon Mum Thol said by telephone Thursday.
Small factories are losing up to 30 workers a month, and large factories between 300 and 500, and they are being forced to hire new workers every day, he added.
Workers used to be able to buy lunch from street vendors outside their factories for 1,000 to 1,500 riel, but now they must spend 3,000 to 5,000 riel, Chuon Mum Thol said.
Even if factories increased salaries from $55 a month to $100, that would still not cover the higher cost of living in Phnom Penh, and factories cannot retain their workforce, he added.
The consumer price index rose 18.12 percent from October 2007 to October 2008, according to government statistics.
Minister of Information and government spokesman Khieu Kanharith said the government had already done a lot to soften inflation by controlling energy prices.
Economic problems cannot be solved as fast as one might like, the minister said, adding that if the government forced a decrease of agricultural prices, farmers would be the next sector to protest.
Ministry of Labor Secretary of State Oum Mean said he had not heard of the CUF’s complaint, but that the main concern for now was to get garment orders from abroad despite the global crisis.
Other labor and industry leaders did not echo the CUF’s concerns.
“I see people leaving factories because there is no work in factories, not because of inflation,” said Van Sou Ieng, president of the Garment Manufacturers Association of Cambodia.
“I don’t think that [CUF] comment is correct,” he added.
(Additional reporting by Isabelle Roughol)