Due to the ongoing political dispute, illegal protests and tough competition, more than 70 garment and footwear factories in Cambodia have been closed down in the first eight months of this year. Garment Manufacturers Association in Cambodia (GMAC) operations manager, Ly Tek Heng says the political situation has affected business. Political issues, illegal demonstrations and competition from other garment and footwear exporting countries like Vietnam, Bangladesh and Myanmar had deterred investors from investing in Cambodia and made buyers reluctant to order from the country. In the first eight months this year, more than 70 factories have been shut down while only 20 new ones opened. This came as orders dropped by almost 30 per cent, forcing closures and slashing of working hours.
Contesting Heng’s claim, commerce ministry spokesperson Soeng Sophary downplayed the news saying closures did not mean the industry was under threat. She blamed global insecurity for the closures citing the upcoming presidential elections in the United States, the recent referendum in Britain, as well as the high price of electricity.
Contrary to GMAC's figure of a 30 per cent drop in buyer's orders suggesting trouble in the garment sector, recent figures released by the Commerce Ministry painted a far better picture. The ministry stated that total garment and footwear exports in the first quarter of this year increased by 39 per cent to $2 billion. The garment and footwear industry, which is the kingdom's biggest foreign currency earner, has some 1,000 factories employing 754,000 workers.
