Cambodia’s Garment and Footwear Exports Register Robust Mid-Year Growth
According to a report recently released by the National Bank of Cambodia (NBC), the country’s garment and footwear exports rose to US$ 4 billion in the first six months of 2018. This was an increase of 11 percent and almost doubled the 6.9 percent rise recorded in the same period of the previous year.
While the NBC has not outlined any specific factors that led to this double-digit growth, industry insiders opine that the robust growth could have been sparked by strong sales in the US market. Manufacturers have also attributed the strong growth to favorable global economic conditions, particularly in the US and the European Union (EU), the main destinations for Cambodia’s garment and footwear exports.
In a related development, Cambodia’s exports of travel goods to the US increased from US$ 50 million annually to US$ 160 million in the first six months of 2018. Previously, the US had earlier this year reinstated its Generalised System of Preferences program for Cambodian travel goods. However, the growth rate of travel goods to the EU have remained flat.
The EU has criticised the Cambodian government’s human rights record, and have stated that it is reconsidering its Everything But Arms (EBA) program for Cambodia. An EU fact finding mission that had recently visited Cambodia is expected to submit its report in the coming days. Cambodian trade officials have discounted fears of possible repercussions for the country’s garment and footwear industry in the event that the EU scales back the preferential trade scheme for Cambodia.
On the other hand, government officials have stressed on increasing exports to other markets such as Canada, Japan and China to cushion any adverse impact from a potential roll back of the EBA program in the coming months.