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Cambodia's garment exports fall by 5.4% in 1st half 2020

Jul '20
Pic: Shutterstock
Pic: Shutterstock
Exports in Cambodia’s garment sector dropped by 5.4 per cent to around $3.78 billion in the first half of this year from more than $4 billion in the same period in 2019, according to the ministry of labour and vocational training, whose spokesman Heng Sour recently attributed the drop to the impact of the COVID-19 pandemic and a global drop in purchasing.

Ken Loo, secretary-general of the Garment Manufacturers Association in Cambodia (GMAC), said the general decline was because of the suspension of factories and fewer purchasing orders.

The ministry of labour said as of June, 450 factories suspended production in the garment, footwear and travelling bag sector and 83 factories were formally closed compared with 2019, when 75 factories closed. A ministry spokesperson said in the absence of any effective government measures and policies to support the private sector, more factories will be closed, according to Cambodian media reports.

More than 10 factories have sought permission to transform their production chain to produce face masks. Currently there are two factories producing face masks in Cambodia.

However, permanent secretary of state at the ministry of economy and finance Vongsey Vissoth said Cambodia’s total exports in the first five months remained positive despite a fall in garment exports.

Imports dropped by 5 per cent because of a drop of imported raw materials in the garment sector fell by 15 per cent.

Meanwhile, the government has allocated $1.16 billion dollars to address the economic and social impact of the pandemic, economy and finance ministry secretary of state Vongsey Vissoth said. The stimulus package did not include tax breaks granted to affected companies, especially to those in garment and tourism industries, he said.

Fibre2Fashion News Desk (DS)

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July 2020

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