Garment Exports Dropped 9 Percent Last Year: Factories Association

2 min read
Workers keep watch over the Dignity Knitter factory in Kandal province on October 27, 2020. (Tran Techseng/VOD)

Garments exports dropped 9 percent last year, the manufacturers association estimated this week, amid a brutal year for the industry in which the Labor Ministry says more than 70,000 jobs were lost.

The global Covid-19 pandemic — which has killed more than 2 million people worldwide — led to several international brands canceling orders amid a consumer slump, with knock-on effects felt across Cambodian factories.

Garment Manufacturers Association in Cambodia secretary-general Ken Loo said this week that exports in garments and textiles had dropped 9 percent by value last year, according to the association’s export data.

He would not say how many member factories had shut down, but Labor Ministry spokesperson Heng Sour was quoted in local media as saying that 129 factories had shuttered in 2020, with about 71,000 jobs lost. Sour did not respond to questions from VOD.

The closures and job losses amount to between 8 and 12 percent of Cambodia’s 1,096 total garment and footwear factories and their 923,000 employees as of 2019, according to ministry figures.

Khun Tharo, program manager at labor rights group Central, estimated that the total number of affected workers was “much higher,” with those on short-term contracts not having their contracts renewed and the widespread layoffs across the industry leading to cases of illegal termination.

“Vulnerabilities experienced by the majority of garment workers as a consequence of their employment on short-term fixed-duration contracts has been exposed,” Tharo said, adding that pregnant workers and night-shift workers were disproportionately affected.

The E.U.’s preferential “Everything But Arms” deal was partially suspended in August last year due to Cambodia’s alleged human rights violations, while the U.S.’s Generalized System of Preferences tariff relief scheme expired at the end of the year and has yet to be renewed.

Challenges for clothing brands due to the pandemic have yet to dissipate, with Dutch retailer Hema telling local newspaper Trouw this month that it was losing 10 million euro a week and was canceling all orders till at least mid-April.

Chan Bony, a 42-year-old former garment factory worker, said she was now unemployed for about a year after 23 years in the industry, with few new opportunities available.

“Many factories are cutting down the number of workers from their workplaces instead of hiring new workers,” she said.

Cambodia recorded its first case of Covid-19 exactly a year ago with a Chinese visitor who traveled from Wuhan, where the disease originated, to Sihanoukville.

The country has since recorded 460 cases with 423 recoveries and no official deaths as of Wednesday.

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