US Renews Cambodian Textile Pact With Cambodia

The US government has agreed to renew its textile agreement with Cambodia for three more years, raising the base level of allowable exports by 6 percent annually and adding another 9 percent as a one-year bonus for improving working conditions.

That means Cambodia can export 15 percent more garments to the US than it did last year. But manufacturers are disappointed that the US didn’t raise the quota higher.

Labor activists hailed the deal as “an important agreement” that tells the world Cambodia is serious about providing good working conditions and respecting union rights.

Bruce Levine, first secretary at the US Embassy, said Wednesday the two countries signed a memorandum of understanding on textiles on Dec 31.

He said the US did not increase exports by the maximum amount because of ongoing concerns about union rights and the enforcement of labor law in the country’s 200 garment factories.

In other words, Cambodia must convince the US it will require factories to pay legal wages and overtime, and stop factories from retaliating against union activists.

Officials at the Ministry of Commerce said they wanted to further review the agreement before commenting. Van Sou Ieng, president of the Garment Manufacturers Association of Cambodia, said he was very disappointed in the deal.

“Nine percent [bonus] is not a worthwhile increase,” he said. “We have tried very hard to improve working conditions in Cambodia.” He said manufacturers had hoped for 30 percent.

Levine said the new quota deal includes several incentives for Cambodia, whose trade agreement with the US dates back to 1999.

In that first three-year garment deal, the US listed 12 categories of garments—for example, women’s shirts—and the quantities of each type that the US would accept.

In each subsequent year, that original number was automatically increased by 6 percent for each category.

In addition, every year labor negotiators reviewed working conditions in Cambodia. To reward improvement, they could add a “labor bonus” of up to 14 percent on top of the automatic 6 percent increase. Last year’s labor bonus was also 9 percent.

The new contract increases the potential labor bonus to 18 percent, as well as slightly increasing the knit cotton shirts quota and  creating a 13th category: women’s and girls’ woolen coats.

Levine said this year’s 9 percent labor bonus could be reconsidered, perhaps as early as May when the next round of  consultations is likely to be scheduled. “We are quite willing to revisit quotas for 2002, if we see a little more progress,” he said.

In November, an International Labor Organization survey of Cambodia’s factories found instances of forced overtime, incorrect pay and anti-union discrimination. It also found there had been illegal strikes by unions.

The ILO is expected to issue additional reports every three months. Levine said US negotiators pay close attention to the reports.

“No one expects a perfect record, but it does not appear that the law is being effectively enforced, particularly with regard to the freedom of association,” the right of workers to join unions without fear of retaliation, Levine said.

Levine said the 9 percent bonus reflects the fact that Cambodia has made progress in improving working conditions, though it failed to reach international standards. “We will continue to look at this,” he said.

Van Sou Ieng, however, said the agreement fell far short of manufacturers’ expectations. “Cambodia is not being treated well at all,” he said. “America is not giving us enough support.”

He said garment manufacturers had made “an immense effort to upgrade the working environment” and he had hoped Cambodia would be given the same hefty quota increases offered to countries who belong to the World Trade Organization.

“I challenge America to ask any WTO country to allow the same kind of independent access [to factories] we allowed the ILO,” he said. “Ask Vietnam, and see what you get. Only Cambodia has made this effort.”

Cambodian officials have said they hope to gain membership in the WTO by 2003, but the country must pass about 40 laws before that can happen.

Jason Judd, country representative for the American Center for International Labor Solidarity, said the renewal of the garment deal “is an important agreement. It would have been a shame to allow it to expire after only three years.”

He said by agreeing to continue to work on improving labor conditions, Cambodia is telling the world it takes the issue of workers’ rights seriously, and that will appeal to consumers.

“This distinguishes Cambodia from all other countries in the world,” he said, adding that the US insistence on seeing progress in union rights and labor law enforcement should help Cambodian unions consolidate their gains.

“The garment industry and the government have to accept the growth of the independent labor movement,” he said. “They haven’t, to date.”

 

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