Monday World Business News

Cambodian RMG workers worried Agence Francxe-Presse . Phnom Penh
Sath Vanny sits anxiously at the door to her tiny one-room hut in the factory district of Cambodia’s capital. She left her hometown in the southern province of Takeo seven years ago to work at a women’s shirt factory, sending most of her earnings back to help the family farm. But a slowdown in orders has the 25-year-old worried about her job. Overtime work has fallen off as Cambodia’s textile sector, the country’s biggest industrial employer, struggles against stiffer global competition and slowing demand. More than 10 Chinese-owned factories have moved to cheaper markets, leaving hundreds of thousands of garment workers — mostly young women like Vanny who support their impoverished families — facing destitution. ‘I was told that we didn’t have as many orders as we used to, but with the basic wage I don’t have money to send to my parents,’ says Vanny, who now earns less than 60 dollars per month. ‘I can’t imagine living without a factory job. I am so worried about my family,’ she adds, wiping away tears. The garment industry earns 80 per cent of Cambodia’s foreign exchange earnings and employs an estimated 350,000 people in more than 300 factories. The industry thrived after a unique labour-friendly deal with the United States in the 1990s. Under the deal, Cambodia passed new labour laws, encouraged labour unions and allowed the International Labour Organisation to inspect factories and publish its findings. In turn, the United States cut tariffs on Cambodian garment exports, buying 70 per cent of all of the country’s textiles. Cambodia maintained its higher working conditions after the deal expired in 2005, and garment-making has made the economy one of the fastest growing in the region. But it does not look built to last. The industry grew only 8.0 per cent last year after suffering a dismal fourth quarter that saw orders plummet by nearly half, according to the World Bank. It previously enjoyed growth of up to 20 per cent. Apparel exports have declined since October, mainly due to the US economic slowdown, according to Cambodia’s commerce ministry. Exports to the United States slipped 1.44 per cent in the first quarter, compared with the same period last year, to some 500 million dollars, it added. Meanwhile factory owners are looking abroad for greater productivity and lower costs, says Cambodia’s Free Trade Union. Sok Vannak, who has been working at a factory for almost 10 years, says her Chinese bosses often threaten to move the factory to Vietnam, where costs are cheaper.