The uncertainties in the US presidential race, rising exports from Vietnam and emergence of new market Myanmar resulted in 7 per cent decline in Cambodia’s total exports to the United States to US $ 2.8 billion in 2016 compared to more than US $ 3 billion in 2015.
Seung Sophary, Spokesperson, Ministry of Commerce said, “The American people were tightening their belts to brace for the worse in the race between the two candidates. There was high uncertainty and this affected their desire to buy imported goods. Now that the election is over, things hopefully will return to normal. The American people have got a new president.”
Also Read – Brexit to impact Cambodian apparel export sector
Cambodian’s garment exports to the US are also facing stiff competition from Vietnam and Myanmar. The wage levels are on par with Cambodia which makes it difficult for the Cambodian exporters to compete in terms of cost, as per Kaing Monika, Deputy Director General, Garment Manufacturers Association of Cambodia (GMAC).
It may be mentioned here that the new minimum monthly wage for Cambodian garment workers this year is US $ 153, up from US $ 140 last year. However, the US’ withdrawal from TPP has given a ray of hope to Cambodia. The TPP would have eliminated most tariffs in the garment sector and the country would have lost to Vietnam. Myanmar is the “dark horse” in garment trade as it has come out strong with an aggressive and concrete master plan.
According to the Myanmar Garment Manufacturers Association (MGMA), the Myanmar apparel industry operating under the cut-make-pack system exported more than US $ 1 billion worth of clothing last year as against US $ 408 million in 2015, noting a massive increase of 145 per cent.