Work on global climate change crucial

Mon, 2009-10-19
By Quintus Perera
Asian Tribune

"In South East Asia in the first nine months of 2009, unemployment increased by roughly 10 per cent and labour productivity decreased by 2.5 per cent, a remarkable drop in such a short period of time. In Cambodia alone, a quarter of the garment sector factories have closed."

Colombo, 19 October, (Asiantribune.com): To coincide the meeting in Bangkok on Climate Change, Sachiko Yamamoto, Regional Director, ILO Regional Office for Asia and the Pacific indicated that progress towards a global climate deal is crucial for its development and its stability and indicated that Asia and the Pacific are very much exposed to the impact of climate change.

He indicated that such a global journey to a low carbon and climate resilient future will necessarily involve the world of work and those who will actually do the job.

Giving an example Mr Yamamoto indicated that Meena Thakur is aged around 36. She lives with her husband and three children in a farmers’ community in Jabalpur, Madhya Pradesh, India.

During the dry season she lives mainly by preparing cakes of cow dung and selling them as fuel to a nearby brick kiln. Managing and disposing of the dung produced by cows from the local dairy sector is a major issue for the surrounding communities as the dung is dumped widely and contaminates the local river. In addition it gives off methane gas.

It may seem obvious that climate change-related programmes and financial support - facilitating access to renewable energy and a wider range of ways of earning a living - would be welcomed by the farming community in Jabalpur.

But it may come as bad news to Meena and her friends in the dung cake business, cutting off their supply of dung. She and her family exist on about US$60 per month, and any change that threatens even a cent of that income threatens her. She does not view the issues of climate change in the same way as they do. Yet without her support and that of others like her, if the climate change challenge is not converted into opportunities for better livelihoods and jobs, they will not be able to turn negotiated agreements into concrete change.

He indicated that it is understandable that questions are being asked about whether mitigating climate change is feasible, whether, in current circumstances, they should not be committing resources to supporting livelihoods and the bottom line?

Although the financial crisis may be easing there is no doubt that the related social crisis continues for many of the most vulnerable countries in Asia and the Pacific, and beyond. In a region where one billion people are classified as working poor (living on less than US$2 per day), 100 million people were for the first time recorded as being without a job in 2009. In South East Asia in the first nine months of 2009, unemployment increased by roughly 10 per cent and labour productivity decreased by 2.5 per cent, a remarkable drop in such a short period of time. In Cambodia alone, a quarter of the garment sector factories have closed.

He indicated that this does not make an easy atmosphere for negotiations on reducing emissions, including those at the United Nations headquarters in Bangkok.

These concerns should be aired. But at the same time some myths need to be dispelled.

Mr Sumitomo indicated that the first myth is that action on the environment is bad news for jobs. Rather, past experience demonstrates that well-designed, environment-related investments are beneficial for employment overall, although there are shifts in the labour market structure. The so-called green sectors of the economy can be expected to create more jobs, directly and indirectly, than will be lost in other sectors. A recent HSBC survey found that, worldwide, businesses selling low carbon goods and services now generate more revenue than the aerospace and defence industries combined, making this sector one of the new linchpins of the global economy.

A second myth is that environmental measures only bring financial costs. Win-win options clearly exist. Examples include the introduction of energy efficient appliances and equipment, the sustainable management of resources such as water, and improvements in housekeeping practices. The widespread introduction of such measures could greatly reduce carbon emissions in developing countries and would bring ancillary benefits such as short return-on-investment periods, net productivity gains, better working conditions and little or no harm to employment.

To these two myths he indicated that he would add a third - which is that environmental issues such as climate change are the concern of specialists and can be solved by environmentalists and negotiators alone.

Whether they like it or not, climate change will revolutionize the way they produce, consume and earn a living. This historical transformation will affect all sectors of the economy, in all countries, and consequently all peoples.

Any commitment by governments will require support from all layers of society; young and old, male and female, poor and rich, urban and rural, workers and employers. When deals made in high level conference rooms do not have the grassroots support of people like Meena, they are hard to deliver on. Delivering on reduction targets starts with engaging those on the ground whose jobs and livelihoods will be the first to be affected. We need to anticipate and smooth the inevitable changes and manage a ‘just transition’ towards a sustainable, low-carbon path.

He indicated that the good news is that the world of work is ready to be part of the solution.

In June this year governments, employers’ and workers’ organizations from the ILO’s 183 member States adopted a Global Jobs Pact that supports a shift to a low-carbon, environmentally-friendly economy as a way to accelerate a jobs recovery. Green jobs (decent, environmentally-sound jobs that fuel the growing green economy), are important agents of change and as such can play a constructive role in the debate and ultimate agreement.

For Meena and her colleagues this means concrete, timely, technical and financial help to explore alternatives, giving her in the option of more value-added tasks like dairy processing.

Progress towards a low carbon future will necessarily involve the world of work, and convincing those who actually do the job. A win-win deal that supports economic recovery and emission reduction is ambitious, but possible. Employment and green jobs in particular, are part of the solution.

Cambodian garment workers face employment crisis

October 7, 2009
ABC Radio Australia

While economists are talking up a slow recovery from the global economic crisis, its effect continues to haunt developing countries.

New figures show more than 20,000 Cambodians lost their jobs in the garment industry this year alone. It's a huge blow to Cambodia's largest income earner - which provides 80 per cent of its foreign exchange earnings and employs an estimated 350,000 people a year. Most of these workers are women and the United Nations warns many might be forced into the sex industry.

Presenter: Anna Walker
Speakers: Ken Loo, secretary-general of Cambodia's Garment Manufacturers Association

Click here to listen to the audio program (Windows Media)

One million Cambodians will be affected by the 2009 economic crisis [-Is Hun Sen willing to admit that Cambodia is not spared by the economic crisis?]

13 Feb 2008
By Ky Soklim
Cambodge Soir Hebdo
Translated from French by Luc Sâr
Click here to read the article in French

The worldwide economic crisis will not spare Cambodia. According to a study recently published, the number of unemployment will increase in 2009 in the garment and construction sectors. On the other hand, the agriculture and the tourist sectors may be able to absorb some these workers.

A report by the Cambodia Institute of Development Study (CIDS), which was made public last week, shows that the Cambodian economic growth should slow down from 6% in 2008 to 5% in 2009. Exports would drop by 2.5%, causing the kingdom to lose a revenue of $75 million. The number of tourists, while still on the increase, should increase at a slower pace, by 5.5% rather than the 15.7% increase seen in 2008.

This new economic data will most likely affect social issues. It will lead to a return of the unemployed to the countryside, or it could push them to migrate to Thailand (to look for work). “When people do not have work, and their knowledge is very low, they will be pushed to commit violence,” a concerned Chea Mony, President of the Free Trade Union of Workers in the Kingdom of Cambodia (FTUWKC), said. He also accused the government of being indifferent to the plea of unemployed workers.

Cambodians Face Job Losses, Hardship [-How could that be? Our Hanoi PhD Strongman said that the economic crisis will not affect Cambodia]

Cambodian workers leave after their shift at a garment factory in Phnom Penh on July 5, 2008. (AFP)

2009-02-12
Radio Free Asia

Times are likely to get tougher for Cambodia’s already impoverished workers.

BANGKOK—Cambodia’s workers could face far tougher economic times ahead as the country’s garment factories—a major employer and exporter in this impoverished country—are forced to close in the face of a worldwide economic slump.

The garment industry accounts for some two-thirds of Cambodia's export revenues and employs nearly 360,000 people, mostly women making less than U.S. $100 a month.

Sok Thy, a garment worker in Cambodia’s capital Phnom Penh, said the Seng Yong garment factory where she works has been closed for 10 days, leaving her without money to pay for rent and her children’s schooling.

“If I am jobless I have nothing to depend on. My children are still small and I often fall sick. Sometimes I don’t have enough money for [rent] because my salary is only U.S. $50 a month. I still have to pay for my children’s schooling, utility bills, and other things,” she said.

“My house now is in disrepair. The roof is leaky. If it rains, we cannot sleep until the rain stops. I rent this house and the owners are also poor—they lease the house to earn money to repair it,” Sok Thy said.

Another garment worker, Noeun, said that since her factory’s closure she has been unable to find work and would likely have to return to her home village.

“I don’t know what to do because I used to have a job and a salary, and now that I am jobless I don’t have anything to feed my children. I plan to open an embroidering business myself, but I don’t have the skills to do so yet,” she said.

Lack of security

Other garment workers said they were also worried about their job security.

A worker at the Sinh Yong garment factory in Phnom Penh’s Dankao district said management has made increasing cuts to employee hours and compensation in an effort to stay afloat.

In December, the owner assigned workers rotating shifts and stopped offering overtime.


But in January employees were allowed to work only 10 days or fewer because of a lack of orders.

Sinh Yong’s management most recently reduced one week of its workers’ salaries by 50 percent to keep workers on until Feb. 10, when they said the factory would resume normal operations.

A woman in her 40s, who declined to be named but said she works at the Tak Fan factory in Phnom Penh’s Chak Angre Leu commune, said her workplace would close in the next two months.

Six months pregnant, she said she was worried about where she would get the money to pay for her medical services when she gives birth.

“I am concerned because I won’t have any money if the factory is closed. Sometimes I borrow money when I am sick and do not have money to pay my hospital expenses. I want to find work at a grocery story after the factory is closed,” she said.

A worker at Tak Fan who asked not to be named called on factory owners to provide severance pay for workers to start new businesses if they are laid off.

“We want [the government] to help workers so that if the factory is closed we won’t be left empty-handed,” the worker said.

Decline in growth

Secretary of State for the Ministry of Labor Um Mean said the downturn in the global economy is reducing demand in Cambodia’s major garment export markets, including the United States and European Union, as consumers spend less on clothing.

Um Mean said 73 factories in Phnom Penh were closed in 2008, putting 224,000 people out of work.

In 2007, Cambodia enjoyed exceptional economic growth on the back of a thriving garment industry.

But just one year later, more than 30 garment factories were closed, leaving thousands jobless. Five factories shut down in Jan. 2009 alone, according to leaders of garment worker unions.

President of the Free Trade Union of Workers of the Kingdom of Cambodia Chea Mony said the closures will continue.

“More [garment] factories will be closed,” he said.

President of the Cambodian Confederation of Trade Unions Chuon Momthol said two more large garment factories will close in March after January closures left 60,000 workers without jobs.

He confirmed that factories Wan Lida and Seng Yong, where Sok Thy is currently employed, “would also be closed in March.”

But Chuon Momthol called on trade unions and their workers to show solidarity in rescuing the garment industry and asked them not to hold demonstrations, disrupting production.

Debt cycle

Even with jobs, Cambodia’s garment workers often struggle to afford rice, and many say they don't know how to survive if their factories shut down.

“I cannot support myself alone these days. On payday I just have enough money to repay my debts, but then I have to borrow money again,” said one worker, who declined to be identified.

“When I get sick, I have to borrow money. The salary is not enough to support myself, so we have to borrow money at the end of each month. When we get paid, we spend all of our money repaying debts, and then borrow more.”

“That will be a serious problem [if the factory closes]. At my age, I don’t know where I could find another job,” the worker said.

Growth under strain

The International Monetary Fund has said Cambodia’s economic growth will be hard to maintain in the midst of the global slowdown.

“Cambodia’s exceptional growth performance…is coming under increasing strain from the global financial crisis and weakening external demand,” the report said, adding that the country’s economy is at risk due to its “narrow production base, concentration of exports by product and destination, and dependence on external inflows.”

The report went on to say that garment export growth has fallen due to weak retail sales in the U.S. and that jobs in the sector were also declining, down 6 percent in July 2008 from a year earlier.

“Near-term prospects for the sector are poor from both an output and employment perspective, because of demand concentration in the U.S. and competition 0abroad,” the report said.

Original reporting by Seang Sophorn and Ouk Savborey for RFA's Khmer service. Khmer service director: Sos Kem. Translated by Sothea Thai. Written for the Web in English by Joshua Lipes. Edited by Sarah Jackson-Han.

Cambodian Garment Workers Face Poor Prospects [-Will Samdach "Hanoi PhD" keep on denying this looming economic crisis?]

The Whtex Garments factory in Phnom Penh, Cambodia, employs about 1,300 workers and mainly makes underwear. More than 90 percent of its products goes to the U.S. But orders are off about 30 percent in the past few months as U.S. buyers scale back, and that has workers worried. (Michael Sullivan/NPR)

February 10, 2009
By Michael Sullivan
National Public Radio (USA)

Click here to listen to the audio program in English

The impoverished Southeast Asian nation of Cambodia is another victim of the global economic slowdown.

Two-thirds of Cambodia's export earnings come from the garment industry, which employs about 360,000 people — almost all of them women. Most earn less than $100 a month. But in a country as poor as Cambodia, every little bit helps.

Now, even that little bit is under threat.

Even makers of such seemingly recession-proof garments as underwear are feeling the pinch.

Take, for instance, Whtex Garments in Phnom Penh. Six months ago, the factory had more than 500 workers in the packing department alone, manager David Teo says. Now, there are fewer than 300.

Whtex Garments supplies underwear for Wal-Mart, Kmart and Disney, among others. Teo says more than 90 percent of his production goes to the U.S. But orders in the last few months, he says, are down 30 percent.

Six months ago, the factory packed more than 100,000 pieces a day.

"Now, we hardly pack 60,000, 70,000 a day," he says. As for the future, Teo says that he doesn't know what will happen next month — and everyone is worried.

It's repetitive, mind-numbing work. And it doesn't pay much, either. Workers here bring home between $70 and $100 a month — with overtime. Nobody pretends to like the job, but many are grateful for it.

Pou Chan Thon, 28, has been working at the Whtex factory for three years and says she is worried about losing her job. Her parents are farmers, and she sends them about $30 a month. Without that money, she says, they literally couldn't survive.

A few miles away, Sin Sary, 23, irons and folds track suits at Global Apparels. There are more than 3,000 workers at this factory, which manufactures sports clothes for Adidas and Puma.

I'm worried, the young woman says, because there are rumors going around that the factory will be closed or suspend production for a time. She says she doesn't know what she or her family will do if she's laid off.

But she better start thinking fast. Management hasn't told the workers yet, but about 800 are to be furloughed for the next two months, maybe longer. And these two factories aren't isolated examples.

Van Sou Ieng, chairman of the Cambodian Garment Manufacturers Association, says factories are losing orders from a host of U.S. companies — among them, Gap, Levi's, Wal-Mart and Nike. "Everywhere, actually," he says.

He says about 90 factories have already closed or curtailed production in the past few months, and he predicts another 30 will close by the end of March.

But union leader Chea Mony is skeptical. He says unscrupulous manufacturers are using the crisis as an excuse to close factories and move them elsewhere — without compensating workers.

Van Sou Ieng admits a handful of manufacturers have done just that — but only a handful, he says.

Meanwhile, economist Kang Chan Dararot worries about what will happen next. The Cambodian economy, he says, simply can't absorb those now being laid off from the country's two biggest industries.

"Poor families [are] very deeply involved in these two sectors — construction and garment industry. And now, so many people have been laid off. There [are] very grave prospects for … 2009," he says.

It's a future that may involve risky choices for laid-off workers desperate for cash.

Some out-of-work garment workers are already finding their way into karaoke parlors and go-go bars.

On a recent night, two young women working at a go-go bar in Phnom Penh say they were laid off last month. They haven't told their parents — and don't plan to, either. They are hoping to make enough working at the bar to continue sending money back home.

Many in Cambodia believe there will be more women in the same situation if garment orders are reduced further. Some worry the entire industry may be at risk if buyers — and manufacturers — decide to go elsewhere, like Bangladesh, where prices and wages are lower and labor standards weaker.

Garment sector riding rough seas

(Photo: DR, Cambodge Soir Hebdo)

20 Jan 2009
By Ky Soklim
Cambodge Soir Hebdo
Translated from Khmer by Luc Sâr
Click here to read the article in French

Factory closures, financial problems, these are some of the concerns faced the GMAC boss.

The President Garment Manufacturers Association of Cambodia (GMAC) is worried, Van Sou Ieng told unions and government representatives during a crisis summit held on Tuesday 20 January.

In 2008, textile exports rose only by 1 to 2% as opposed to 10 to 15% in the years before, and 25,000 factory workers were fired from their jobs.

The beginning of 2009 does not look rosy either. “During the first trimester of 2009, we will surely see a drop in production and other factories will be closing,” Van Sou Ieng predicted.

The culprit? “Buyers are no longer buying, and orders are less than before,” he indicated. Furthermore, buyers also demand a lowering of the cost by about 10% as well. They asked to maintain a credit line for their purchases and this situation leads to a cash flow problem for factories.

Should there be an interruption of orders between April and May, Van Sou Ieng estimated that 50 to 60,000 additional workers will be laid off.

Garment Orders Plummet as Factories Close

By Sok Khemara, VOA Khmer
Washington
10 December 2008

Click here to listen to the Khmer audio program

The global economic downturn has led to a drop in orders for Cambodia’s garment industry by nearly a third, a worrying statistic, industry leaders said Monday.

The economic downturn, which has hit the US—Cambodia’s top purchases of garments—as well as the EU and Asia, resulted in the fall of orders by 30 percent, along with lower bids for the orders that do come in, said Cheat Khemara, a representative of the Garment Manufacturers Association of Cambodia, as a guest on “Hello VOA.”

The $2.6 billion industry is one of Cambodia’s main economic engines, employing more than 300,000 workers.

Chea Mony, president of the Free Trade Union, said Monday that at least 10 factories have closed down and six or seven have suspended operations in the wake of the downturn, which began in earnest in September.

“Until today, we do not know what is the real problem of these closures or suspensions, the crisis, or no buyers?” he said, also as a guest on “Hello VOA.”

Economic growth to drop to 7 percent: International Monetary Fund

Monday, 09 June 2008
Neth Pheaktra
The Mekong Times

Cambodian economic performance remains robust though the pace of growth is expected to ease to around 7 percent in 2008, down from over 10 percent last year according to an International Monetary Fund (IMF) statement released Friday.

An IMF staff mission led by Luis Valdivieso, visited Cambodia from May 28 - June 5, to hold discussions with senior Cambodian government officials on macroeconomic developments and policies. The mission also met representatives from the business community and development partners.

The IMF said the drop in economic growth to around 7 percent this year mirrors slowing growth in the garment sector. Garment exports are under pressure because of a decrease in international demand and intensified regional competition, the IMF explained.

Cambodia’s garment industry is a major contributor to the gross domestic product (GDP) with 301 factories and over 340,000 workers exporting US$2.9 billion worth of garments last year.

“Tourism continues to expand at a healthy pace,” the IMF stated, with the Tourism Ministry reporting around two million tourists visiting Cambodia last year generating a total revenue of US$1.4 billion. Cambodia’s tourism industry accounts for 15 percent of GDP and employs tens of thousands, indirectly benefiting many more.

Cambodia, as a net rice exporter, should benefit from higher rice prices, the IMF said, but it warned higher food prices will adversely affect the most vulnerable, particularly the urban poor and the landless.

Inflation, running at 18.7 percent in January, was a major IMF concern.

The IMF welcomed measures to deal with inflation – a temporary ban on rice exports and the provision of subsidies – announced by Prime Minister Hun Sen Apr 23.

The IMF emphasized that maintaining a “prudent fiscal stance is key to moderating inflation pressures,” while recommending “efforts be made to limit the overall budget deficit to around one percent of the GDP in 2008, so as to continue building up government deposits of 2 percent of the GDP in the National Bank to help contain inflation pressures.”

The IMF mission also lauded the government’s “ongoing efforts to safeguard the financial system.”

Cambodian Garment Sector Under Threat

02.05.08
Associated Press

PHNOM PENH, Cambodia - Cambodia's garment industry expects to see a decline of orders from American retailers amid fear of a slowdown in the U.S. economy, a Cabinet minister said Tuesday, as he warned the country's top export sector by value faces tough times.

"I am concerned that our garment sector would face some problems," Commerce Minister Cham Prasidh said. "Now that the U.S. economy may head into a decline, purchasing orders from U.S. retailers may also decrease."

He said last year's garment exports to the U.S. were worth more than US$1.9 billion (euro1.3 billion). The figure represents about two-thirds of Cambodia's total exports of clothing products in 2007, Cham Prasidh said.

Anti-dumping measures the U.S. has imposed on the import of Chinese goods have so far helped sustain Cambodia's garment export industry.

But at the end of 2008, the U.S. will phase out the measures against China as well as a monitoring mechanism on imports from Vietnam, another competitor, compounding pressure on the Cambodian garment industry, Cham Prasidh said at a press conference Tuesday.

"Competing for that market has not been an easy task," he said.

Ken Loo, secretary-general of the Garment Manufacturers Association in Cambodia, agreed that the industry is facing "a very difficult" time and "stiffer competition" ahead.

Cambodia currently has 300 garment factories that employ 355,000 workers.

Cambodia ranks 12th among the 25 top countries from which the U.S. imports textile products, according the U.S. Census Bureau.