Branded apparel companies sourcing in Cambodia are united in pointing out the imminent threat facing Cambodia's garment sector from a growing list of strong competitors, among them Myanmar, India, and Ethiopia.
They are urging the Cambodian government to draw up a clear, concrete plan of action to keep up or watch the economy’s star performer fade away.
The garment sector’s growth since 1999 is clear. Cambodia now hosts more than 600 exporting garment factories that put some 700,000 people to work—the vast majority of them young women—and topped $6 billion in exports last year. The sector accounts for a third of the country’s GDP.
Ambassador Heidt warned that buyers were growing nervous about Cambodia’s ability to keep pace with the competition.
“Many new suppliers have emerged. Some of these are larger than Cambodia and could be very strong competitors, and some are much poorer and therefore receive a lot of international support in their own right. All of them want a slice of the global apparel trade.”
What worries Cambodia’s industry watchers most is the Trans-Pacific Partnership, a pending free trade deal between the U.S. and several Asian countries including Vietnam—a main competitor—but not Cambodia. Vietnam is also on the verge of a free trade deal with the E.U., threatening to diminish the benefits of Cambodia’s existing deal with its main export market.