Cambodia, political instability hits textile sector: down 30%
The alarm raised by Ly Tek Heng head of the Textile Manufacturing Association in Cambodia (GMAC). Since early this year 70 companies have closed. Investors smuggle capital to Vietnam, Myanmar and Bangladesh. The Ministry of Trade reassures: "In 2016, exports rose by 39%".
Phnom Penh (AsiaNews / Agencies) - The Cambodian textile industry is in crisis due to the instability of the country's politics, which drives foreign investors to look for other States for production. This was the warning from Ly Tek Heng head of the Textile Manufacturing Association in Cambodia (GMAC), who spoke yesterday on the sidelines of the Sixth International Exhibition of textile industry in Phnom Penh.
Ly Tek Heng explained that, although in recent years the industry has grown a lot, 2016 saw a sharp drop in activity. According to the latest data, from the beginning of the year, 70 textile companies have closed down, compared with 20 new openings. This is caused by a drop in demand of about 30%.
"I think - the manager explains - that the political situation is hurting the business, both entrepreneurs and investors. The political problems, illegal demonstrations and competition from other textile exporters such as Vietnam, Bangladesh and Myanmar, have discouraged investors from Cambodia and buyers from ordering the country's "products.
Sophary Soeng, spokesperson for the Trade Minister, replied stating that the closure of the companies does not mean a threat to the sector. The spokesman indicates the roots of the difficulties in the global events, rather than in the situation of Cambodian politics:
"Cambodia - he said - is a small country that depends on exports of clothes, and is therefore affected by foreign problems, since our export destinations are the European Union and the United States”. Sophary concluded by saying that the recent referendum on Brexit and the high price of electricity may have decreased the demand of the European countries.
Gmac data show a 30% drop in orders from abroad, but despite this the Ministry of Commerce said that the total exports rose two billion dollars (+ 39%) in the first eight months of 2016.
The manufacturing industry is one of the most flourishing and productive activities in Cambodia, with at least 700 thousand people employed in the industry and export volume in 2015 of about $ 6.3 billion. At least 700 factories scattered throughout the country, which produce goods for renowned international brands such as Gap, Nike and H & M. In 2014 the companies were 73.
The European Union is the most flourishing market for Cambodian exports (717.8 million dollars a year), followed by the US (419 million).
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06/10/2018 16:15
12/08/2020 16:50
