A global research company says the US and EU are unlikely to revoke the preferential trade agreements that underpin Cambodia’s garment sector, a prediction supported by nearly every analyst The Post interviewed in recent months.
Fitch BMI said in a report on Tuesday that the EU and the US "appear reluctant to remove preferential trade access for Cambodia’s crucial garment exports,” according to Reuters.
The report comes amid a crackdown on independent media and political opposition in Cambodia, including the widely criticised dissolution of the Cambodia National Rescue Party (CNRP), the only viable opposition party, in November.
The US and EU have been urged by rights groups to reconsider Cambodia's preferential trade access to their markets, but analysts have previously said that targeted sanctions are more likely than a complete reworking of trade agreements.
The Reuters article quotes Raphael Mok, a senior analyst at BMI Research, as saying, “At this stage, it appears that the US and the EU will likely refrain from undertaking such punitive actions against Cambodia in the near-term.”
More than 60 percent of Cambodia’s garments are exported to the US and EU markets under favourable trade agreements, and the sector employs more than 800,000 people.
The agreements are so critical to the economy that even former members of the CNRP have thus far refrained from urging the international community to revoke them.