Garment Factories Close amid Political Uncertainty

Political uncertainty in Cambodia has forced the garment and footwear industry to look to alternative countries to meet production needs, forcing more than 70 factories to close and a sharp drop in orders, a senior official from the Garment Manufacturers Association in Cambodia (GMAC) said yesterday. Speaking at a press conference before the 6th Cambodia International Textile and Garment Industry Exhibition and Machinery Industry Fair in Phnom Penh yesterday, Ly Tek Heng, the operations manager at GMAC, painted a worrying picture of the first eight months of the year.
 

“I think the political situation has affected business, both businessmen and investors. When one country has instability in politics, it is difficult to make investments and there are concerns, especially from buyers,” he said. “The political issues, illegal demonstrations and competition from the other garment and footwear exporting countries such Vietnam, Bangladesh and Myanmar has deterred investors from investing in Cambodia and has made buyers reluctant to order products from Cambodia.”
 

He said that in the first eight months of this year, more than 70 factories had been shuttered, while only 20 new ones had opened. This came as orders from buyers for footwear and clothing made in Cambodia dropped by almost 30 percent, forcing not only closures, but the slashing of hours for workers. The decline in orders has had a knock-on effect within the industry, leawding to a decline in orders for machinery used to make clothing and footwear, warned Akai Lin from Chan Chao International, which organized the fair.  

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