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Oxfam: $70 a month factory pay could push workers back into poverty

Harrison White / Khmer Times No Comments Share:
Factory workers are bearing the brunt of the economic fallout of the COVID-19. Many could be forced to live on just $70 a month. KT/Siv Channa

The announcement by Prime Minister Hun Sen this week that suspended factory workers would only be receiving a total of $70 per month could potentially push hundreds of thousands of garment workers and their families back below the poverty line, according to Oxfam.

The $70 monthly payment, which equates to $2.33 a day for a normal 30-day calendar month, is 43 cents a day above the World Bank’s 2015 definition of absolute or extreme poverty (considered to be $2.16 a day now after adjusting for inflation).

Solinn Lim, Cambodia Country Director of Oxfam said that Cambodia has lifted a lot of people out of extreme poverty. However, the country now needs to careful that during these unprecedented times people could fall back into poverty. This is especially true of the informal economy sector.

“While Cambodia has been very successful in lifting people out of extreme poverty, this virus could make those that have escaped poverty at risk of falling back into it. We also have observed serious implications on the livelihoods of the most vulnerable groups we work with across the country…amid the potential impacts on marginalised groups these informal economy workers have also lost their jobs and income,” Solinn said.

Oxfam also said they will be working with the government and relevant stakeholders to assist those with urgent needs and promote public campaigns for appropriate hygiene.

“We are finalising our [COVID-19] response plan
this week as we assess what are priority needs for at risk people. We will also be procuring and distributing hygiene and sanitation material through the development of a two-sided digital campaign to collate and relay official information on COVID-19 prevention measures to the public.”

The government had previously agreed that suspended workers would be eligible for a 20 percent subsidy from the government and a 40 percent subsidy from factory owners. From the $190 minimum wage this would have equated to $114 a month or $3.80 a day, but this was changed due to factory owners stating an inability to pay. A compulsory training session to be attended by those suspended factory workers has also been cut.

According to the World Bank report, Cambodia’s poverty rates fell from 53 percent in 2004 to 20.5percent in 2011 and 13.5 percent in 2014. However, according to the same report, around 4.5 million people or just under a third of the population remain near-poor, vulnerable to falling back into poverty when exposed to economic and other external shocks.

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