EU all set to withdraw the trade preferences to Cambodia

by Textile Quotient News Desk
12 Feb 2019

The European Commission, which coordinates trade policy for the 28-member EU, has initiated the countdown which might run until August 2020, to apply suspension of Cambodia’s duty-free trade access. Cambodia benefits from the EU’s ‘Everything but Arms’ (EBA) trade regime, which allows the world’s poorest countries to sell any goods, except weapons, tariff-free into the bloc. The EU warned Cambodia last year that it could lose this special status.

The EU is Cambodia’s largest trading partner, accounting for 45 percent of its exports in 2018. The garmenting sector has large share of exports to the EU worth some 4.9 billion euros. Cambodia is the second largest user of EBA preferences, behind only Bangladesh. Last month the garment industry and the trade unions urged the European Union not to withdraw the preferences, as would harm millions of workers and their families. The garmenting factories in Cambodia employ around 700,000 workers.

According to the European Commission the withdrawal of preferences only a last resort as its motive is to ensure Cambodia improves the condition of its people. The EU foreign affairs chief Federica Mogherini said that the EU is not denying that the Cambodian authorities have taken positive steps in recent months, however, without more conclusive action from the government, the situation on the ground calls Cambodia’s participation in the EBA scheme into question.

Any withdrawal would take effect after six months as there will be monitoring and talks with the Cambodian authorities followed by another half-year period for the Commission to produce a report to take a decision on whether or not to withdraw the trade preferences.

The garmenting factories in Cambodia employ around 700,000 workers
Combodia News Region

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