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Exports to US Rise Over 9 Percent Last Year

May Kunmakara / Khmer Times Share:
Workers iron for export at a garment factory on the outskirts of Phnom Penh last week. Exports to the US rose more than 9 percent last year. KT/Chor Sokunthea

With the American economy expanding, Cambodia’s total export to the country increased  slightly more than 9 per cent last year over 2014, the latest US trade data shows.
 
Total exports to the United States were slightly more than $3 billion last year, compared to $2.771 billion in 2014 – a jump of more than 9 percent, according to US government data. 
 
Economist Srey Chanthy attributed the rise to an expansion of the US economy, saying it created more space for Cambodian goods despite rising competition from new rivals like Myanmar. 
 
“The US economy is doing well, with low unemployment, so I think this contributed to the increase in Cambodian exports to the US despite strong competition,” Mr. Chanthy said, adding that last year was relatively good for Cambodia except during the final two months when there was a spike in political and labor conflict. 
 
Mr. Chanthy warned, however, that Cambodia faces a tough, new competitor.
 
“Given progress on the democratic front in Myanmar, its strong and young labor force, its low wages, and its improved relations with the West, Cambodia has another tough competitor,” he said. 
 
The United States is one of Cambodia’s largest trading partners, with about one-third of all exports – primarily garment and footwear products – consumed by the country.  
 
Kaing Monika, deputy secretary general of the Garment Manufacturers Association of Cambodia, told Khmer Times in late December that the country’s garment industry had been seeing a slowdown in production due to falling orders from buyers last year as a result of rising wages here and an increase in strikes. 
 
“I think the rising of the minimum wage will definitely affect our production because it will push the prices of our products up and make it difficult to compete,” he said, adding that the industry faces a big threat from “militant” unions.  
 
He said that labor chaos was a bigger worry than rising minimum wages because it made buyers lose trust in Cambodia as a “safe” production base. He said he expected a slowdown in orders from the US market because Cambodian exports there did not receive the duty- and quota-free access they did in the European market. 
 
Mr. Chanthy also raised concerns about the US-led Trans Pacific Partnership (TPP), saying it could impact Cambodia’s exports to the US as other members of the TPP – which Cambodia is currently not a part of – will have an advantage exporting to the US when the TPP is enacted. Mr. Chanthy called for Cambodia to boost its competitiveness by improving the business environment, boosting productivity and ensuring labor relations are stable and democratic processes are strengthened.
 
Ros Seilava, under-secretary of state of Ministry of Economy and Finance said in mid-January that Cambodia is considering joining the TPP after discussions last year with trade representatives in Washington about the possibility.  He said officials were negotiating numerous trade deals but had yet to sign up for the TPP, which must be ratified by the governments of all 12 current members before it can take effect. Mr. Seilava expressed confidence that Cambodia would eventually become part of the TPP but also said it was likely the TPP – described as the largest free-trade deal of all time – would be altered after the next US election.
 
 

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