Cambodia and paradoxes of EBA

Chan Khunthiny / Khmer Times 1 Comment Share:
European Trade Commissioner Cecilia Malmstrom attends a panel discussion at the United Nations in Geneva, Switzerland, June 4, 2018. Reuters

It is unfair for Cambodia – whose government did not come to power through a military coup and its state apparatus is non-communist – to suffer unnecessary economic sanctions from the EU in the form of withdrawal of its trade preferences under the Everything but Arms scheme, writes Chan Khunthiny.

On October 5, European Commissioner for Trade Cecilia Malmstrom wrote on The Commissioners’ blog post that, “Today, High Representative Federica Mogherini and I have therefore notified Cambodia that we are launching the process for the withdrawal of their Everything but Arms preferences.”

As if to undergo damage control, on October 7, the European Union Delegation to the Kingdom of Cambodia issued a media statement to clarify that the temporary withdrawal is a time-consuming process and the EU “will keep the channels of dialogue with Cambodia open.”

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For Cambodia, the discussion on withdrawal of EBA constitutes the paradoxes of interaction between capitalism, perfect human rights idealism and pragmatism of the livelihood of developing countries.

Fair trade has never existed. While people in the advanced economies enjoy cheap consumer products, the so-called “sweat-shop” factories are being targeted by the advanced countries’ high standard of human rights idealism.

Adhering to pragmatism, developing countries are struggling against dual challenges: one is their ceaseless efforts to create jobs which might face immediate shutdown due to capitalist owners who seek low wage labour. The other is maintaining access to the markets of advanced economies. To this end, they have to swallow the bitter pill by accepting every human rights condition that can’t be implemented even in the buyer countries just to meet the conditions of advanced countries’ market access.

They have to accept foreign interference and toe the line in the so-called high order political agenda to save their people’s jobs. But no one is really sure when the so-called “foot-loose” garment industry which is dominated by foreigners, Chinese mainly, will be here to stay amid wage hikes, low productivity, low skills, and low labour supply.

Capitalism does not ensure human rights. Perfect human rights do not ensure jobs and the actual livelihood of workers. On several occasions, developing countries only have choices between having jobs and having none at all – from a capitalist perspective.

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Developing countries don’t have the luxury of choice; otherwise, how could developed countries enjoy the comfort of capitalism with an abundance of cheap products?

At the last end, you don’t know what you are protecting: capitalism, human rights idealism or pragmatism of peoples’ livelihoods?

One thing for sure is that humanity and the livelihood of people are the end victims of these conflicting paradoxes. The job killer is considered as the champion of human rights idealism receiving all international praise. The job creators and capitalists are considered as human rights abusers.

If humanity truly exists, those who are happy to see sanctions imposed on Cambodia should be ashamed of themselves and they should stop bragging as being representatives of the people. They can be protagonists of human rights but they will never understand that they are in fact the enemy of humanity.

Now, let us shift from a contextual to more practical discussion.

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Political and economic sanctions have many forms. Regionally, Cambodia can observe three cases: Thailand, Vietnam and the Philippines.

Thailand’s military junta came to power through a military coup. Uncertainties of the upcoming election have become daily news. Yet Thailand still enjoys political legitimacy from the EU. What is the motive behind this?

Economic interest explains such motive. In 2015, total bilateral trade between the EU and Thailand amounted to 32.9 billion euros ($38 billion), while bilateral trade with Cambodia was merely around 5 billion euros ($5.7 billion) in 2017. Thailand is the EU’s third-largest trading partner in Asean. Last year, the EU exported goods to Thailand worth 13.4 billion euros ($15.4 billion). Moreover, the EU is the second-largest investor in Thailand after Japan.

In June 2018, Thai Prime Minister General Prayut Chan-o-cha visited France and inked an agreement to buy an observation satellite, reportedly worth $215 million from French manufacturer Airbus.

While Cambodia is being threatened by the EU on the removal of Everything but Arms (EBA) scheme, on October 10, the European Parliament’s Committee on International Trade held an open hearing on the Free Trade Agreement (FTA) and the Investment Protection Agreement (IPA) between Vietnam and the European Union.

Vietnam is single-party state with a communist system. Human rights and democracy are not applicable concepts in the country. Nevertheless, Helena Konig, chief negotiator and deputy director-general for European Trade, highlighted the importance of FTA and IPA between the EU and Vietnam, and affirmed Vietnam’s attractiveness, with its growing economic strength and a market of 95 million people.

Another case relates to the Philippines. In October 2017, President Rodrigo Duterte said he would no longer accept new grants from the European Union as it insults the country’s sovereignty. “What we are telling other countries – we want friendship with you, we want to build a relationship with you, friends to all but enemies to none. But if you are going to use the money to dictate something upon us or criticize unfairly on what is happening here… then let’s not exchange money…rather than just blame and demand payment,” said Foreign Affairs Secretary Alan Peter Cayetano.

For Cambodia, the preferred choice is in between the extreme cases of Thailand and Vietnam, and the Philippines – that is to retain EBA while maintaining the country’s sovereignty and independence. However, this seems to be impossible for some hard-headed European parliamentarians who think that Cambodian democracy should be equal to regime change.

To put it bluntly, it is obviously unfair for Cambodia – whose government did not come to power through a military coup and its state apparatus is non-communist – to suffer unnecessary economic sanctions from the EU.

If democracy and human rights are the values that the EU claims it strictly adheres to, specifically vis-à-vis Cambodia, from the above regional cases, the EU should start to find other more convincing arguments. With the current arguments, it sounds like the EU is reciting the tale by Hans Christian Andersen, “The Emperor’s New Clothes”.

Chan Kunthiny is Cambodian analyst based in Phnom Penh.

 

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