GENEVA — The takeoff in apparel exports that helped war-ravaged Cambodia rebuild its economy could be in jeopardy if authorities don’t put a stop to the recent escalation in labor abuses, an industry report warned Tuesday.
The spate of repression that followed the Jan. 1 lifting of apparel and textile quotas “risks tarnishing the country’s good reputation in the eyes of foreign investors,” wrote the International Confederation of Free Trade Unions.
The report noted that Cambodian industry has blamed the change on the fierce competitive climate following the dropping of quotas by the nations of the World Trade Organization, which has resulted in the loss of 15,000 jobs in the member nation’s garment sector.
Cambodia and the U.S. in 1999 signed a trade accord that linked the growth in the Southeast Asian nation’s export quotas to it demonstrating better labor standards in the sector. The accord was overseen by inspectors from the International Labor Organization. Since that agreement was reached, Cambodian trade authorities have marketed the country as dedicated to complying with international labor standards.
The report, which draws on interviews from a trip in February and March, warned that Cambodia’s respect for labor rights, “which had provided it with a reputation as a high-quality producer…is threatened by growing repression of freedom of association, a development that has now been clear for several months.”
Apparel exports from the nation rose to $1.9 billion in 2004 from $26 million in 1995, with two-thirds going to the U.S. and most of the remainder to the EU. New investment from Hong Kong, Taiwan, China, the U.S. and U.K. poured into the country to develop this capacity.
Last year, U.S. imports of Cambodian textiles and apparel were up 15.2 percent to $1.44 billion. Through the first two months of this year, they rose 10.6 percent.
This story first appeared in the April 20, 2005 issue of WWD. Subscribe Today.