Kingdom, WTO call on US to drop tariffs

Wednesday, 09 November 2011
Don Weinland
The Phnom Penh Post

Both Cambodia and the World Trade Organisation this week called on the United States to follow China’s lead in promising zero-tariff treatment to Least Developed Countries.

Chinese President Hu Jintao, in a speech at the G20 summit in Cannes, France, on Friday, announced China would grant duty-free status to 97 per cent of its taxed imports from LDCs such as the Kingdom, provided they had diplomatic relations with China.

The move was designed to prompt among developed countries a similar agreement, which awaits the conclus-ion of the Doha Development Round of trade negotiations among WTO members, Hu said.

Cambodian officials responded positively to Hu’s sentiments, eager to lower trade barriers on the Kingdom’s narrow basket of exports.

The US will end tariff reduction on import of Cambodian garment

US Ambassador Carol Rodley gave an interview at the Meng Ieng garment factory on 28 January 2010 (Photo: Den Ayuthyea, RFA)

29 January 2010
By Den Ayuthyea
Radio Free Asia
Translated from Khmer by Heng Soy
Click here to read the article in Khmer

Carol Rodley, the US ambassador to Cambodia, indicated that, due to worldwide economic problems, the US will no longer reduce import tariff on garments manufactured in the Cambodia.

She made this statement during her visit to the Meng Ieng garment factory, a model factory with good work ethic located in Russei Keo district, Phnom Penh city, in the afternoon of 28 January.

Through a translator, Mrs. Rodley said: “The quota system does not exist anymore, therefore, US orders have dropped significantly. The US also faces severe economic problems, therefore, the US is also facing the same challenges and it is trying to tame these economic difficulties.”

Chea Mony, President of the Free Trade Union of Workers in the Kingdom of Cambodia (FTUWKC), said that if the US does not lower import tariff on garment made in Cambodia, then the Cambodian garment sector may face collapse.

He hopes that the US will take a second look to see if it has the ability to reduce import tariff on Cambodian-made garments, otherwise, this could seriously affect the livelihood of Cambodian factory workers as they may lose their job when the garment factories will be forced to close.

Chea Mony claimed: “The US will have to take a second look because if the US government does not exempt import of Cambodian-manufactured garments, and if it insists on imposing import tariff, then the US will destroy the Cambodian workers. Right now, Cambodian factory workers face severe hardship, and when the workers have no job, they will face danger and they will be forced to go find work in Thailand. Then, the Thai will shoot them, arrest them on a daily basis!”

Last week, Chea Mony sent a letter to the US Congress asking the US to exempt import tariff on Cambodian garments. Chea Mony claimed that if the US does not exempt the tariff, the Cambodian garment sector will face problems in 2010.

Nevertheless, Ambassador Rodley claimed that, in 2010, the reduction of import tariff on Cambodian garment will be eliminated. She indicated that the Cambodian garment sector will have to compete with those of her neighboring countries based on quality standards instead.

Union leader Chea Mony sends letter on tariffs to US

A vendor sews clothes at Phnom Penh’s Russian Market. Cambodian exports incur duties averaging 16 percent upon entering the United States, the Kingdom’s biggest overseas market. (Photo by: SOVAN PHILONG)

Wednesday, 13 January 2010
Sen David
The Phnom Penh Post

Free Trade Union of Workers of the Kingdom of Cambodia head calls on Capitol Hill to back bill abolishing duty on exports

THE President of the Free Trade Union of Workers of the Kingdom of Cambodia said Tuesday he had sent a letter to Speaker of the US House of Representatives Nancy Pelosi through the US Embassy in Phnom Penh as part of the latest effort to push for duty-free exports for the Kingdom.

Chea Mony, who sent the letter Monday to the speaker, said it was necessary given the huge decline in Cambodian exports to the US – mostly garments – following the onset of the economic crisis.

“It is a message to show that we want to help Cambodian workers because nowadays there are so many workers that have lost their jobs,” he said, adding that although the US donates a lot to the Kingdom, excessive corruption means that much of it does not reach the people.

“If the US wishes to help Cambodia, the US will pass duty-free access for Cambodian exports,” said Chea Mony.

While almost all garment-producing countries suffered a decline in exports last year, Cambodia suffered more than others due mostly to structural weakness in the sector and high tariffs.

In the first eight months of last year, the Kingdom’s exports to the US fell 23.31 percent compared to an average 14.3 percent slide, according to US Office of Textiles and Apparel statistics. Vietnam, where total manufacturing costs are about 20 percent lower than Cambodia, saw garment exports fall just 1.2 percent over the same period.

At the same time the Kingdom is severely hampered by US tariffs – 30 out of 49 least-industrialised countries in Asia enjoy duty-free, quota-free access to the US, whereas Cambodia is subject to an average 16 percent tariff, a fact that many – including Chea Mony – deem unfair.

The US is Cambodia’s biggest export market. In 2008, official figures showed 65 percent of the Kingdom’s exports were garments, of which three-quarters went to the US.

US Embassy Spokesman John Johnson confirmed Tuesday that the letter had been received and would be passed on to Washington.

It comes after a Cambodian delegation – including Commerce Minister Cham Prasidh – went to the US capital in November to lobby for the passage of a bill that would grant duty-free access for Cambodian garments.

Cheat Kemra, a senior official of the Garment Manufacturers Association of Cambodia (GMAC), said Tuesday that garment producers would focus more on Asia and the European Union as the US continues to struggle to recover from the economic downturn.

Also working against the Kingdom, he said, was the fact that Cambodian exports make up 3 percent of the total imports into the US – typically Washington does not grant duty-free access to exporting nations representing above 2 percent of the total.

“It is an obstacle, but we believe that the US will favour … Cambodian garment exports,” said Cheat Kemra.

Clothing sector finds benefactor in US Congressmen

January 09, 2010
Fibre2Fashion

Three visiting American Congressmen have promised to lobby for free-trade access for clothing exports to the US markets from Cambodia. This was revealed by them after a meeting with the Prime Minister of Cambodia.

Joseph Cao of Louisiana, Eni Faleomavaega, a non-voting Congressional delegate from American Samoa, and Mike Honda from California after their tour of Vietnam touched the shores of Cambodia.

Cambodian officials have also requested the US for a cancellation of a US $300 million in debt accrued during the Lon Nol period. Reacting to the request, Honda said, “It is possible to deal with the request by the three of us in Congress.”

US economic woe could sink Cambodia's garment industry

High U.S. tariffs hurt Cambodian garment sector

PHNOM PENH, Oct. 7 (Xinhua) -- High U.S. tariffs are hurting Cambodia's garment sector, with the industry complaining that high import costs and a slowing U.S. economy could sink the Kingdom's key industry, state media reported Tuesday.

In 2007, Cambodia paid 419 million U.S. dollars in tariffs on 2.46 billion U.S. dollars worth of exported goods, meaning the industry is paying an average 17 percent tariff, the Phnom Penh Post said, citing a new report by the Progressive Policy Institute, a centrist U.S. think tank.

The average U.S. tax on imports is 1.3 percent, while Saudi Arabia pays only 0.1 percent on the goods it exports to the U.S., the Post said.

Cambodia has already seen a 500 million U.S. dollars drop in exports to the U.S. in the first eight months of this year compared to the same period last year, said Kaing Monika, external affairs manager at the Garment Manufacturers Association of Cambodia (GMAC).

He added that the sector has suffered a loss of about 20,000 workers.

Garments have been hard hit by the U.S. slowdown, with clothing sales down in 2008.

Cambodia sells about 70 percent of its clothing to the U.S. market, making it highly vulnerable to fluctuations in the U.S. economy and Washington's trade policies.