The government this week reiterated that the EU was interfering in domestic affairs after the bloc announced a partial suspension of duty-free trade with Cambodia over political and human rights concerns.
Cambodian exporters face increased tariffs in August after the EU on Wednesday announced its decision to withdraw some duty-free trade with the country due to “serious and systematic” human rights violations.
Garment factory workers are facing this week’s EU decision on trade sanctions with trepidation: Most are in debt; they are being squeezed by new government policies to reduce costs for employers; and business at their factories seems to be slowing.
The Foreign Affairs Ministry said on Thursday that Cambodia had responded to the European Union’s preliminary report on suspending trade preferences, giving “comprehensive” explanations about what it had done to improve political participation, land rights, freedom of expression and freedom of association.
Banks say they are prepared for the potential loss of duty-free trade with the EU under the “Everything But Arms” scheme, with some downplaying the likely economic impact while others say they are ready to activate contingency plans in case of economic slowdown.