Cambodia's footwear and travel goods exports increased in the first nine months of this year, thanks to tariff privileges they received from the US under its Generalised System of Preferences (GSP).
An amendment to the GSP that went into effect in July 2016 removed US customs tariffs on Cambodian-made travel products such as luggage, backpacks, handbags and wallets.
The items, which previously faced tariffs of between 4.5 and 20 per cent, now enter the US duty-free under the expanded programme.
Under the programme, approximately 5,000 products from 122 beneficiary developing countries and territories – including 43 least-developed countries – are eligible for duty-free export to the US.
The US’ and the EU’s preferential trade schemes have been very beneficial to the Kingdom’s footwear and travel goods exports, Ministry of Commerce secretary of state Sam Sereirath said in Phnom Penh on Friday.
He was speaking at The First Ever International Technology Tradeshow on Machinery, Components, Chemicals, Accessories & Leather for Footwear and Travel Goods Sector.
Cambodia’s footwear and travel goods export reached some 4.723 billion units – worth $385 million – in the first nine months of this year, up 88 per cent compared to the same period last year, Sereirath said.
“By November, we had attracted some 98 factories in the footwear and travel goods industry. This is a very good contribution to the country’s economic growth,” he said.
Cambodia Footwear Association chairman Ly Khunthay said the footwear and travel goods exhibition, which had representatives from 50 factories in attendance, will serve as a new platform for the industry and attract more investment – especially foreign suppliers.
Garment Manufacturers Association in Cambodia chairman Van Sou Ieng told reporters: “There has been a large increase in investment flow into the travel goods sector now since we obtained market access under the GSP to the US – this is a good sign.”
In 2016, Cambodian goods exported under the GSP scheme amounted to $50 million. Last year, the figure went up dramatically to $400 million, data from the Ministry of Economy and Finance said.
The Kingdom remained among the top 10 footwear exporters, with its exports valued at more than $1 billion last year, a 19 per cent increase from 2017, data from the International Labour Organisation released in August said.
Cambodia’s main export markets for shoes are the EU (46 per cent), the US (17 per cent), Japan (12 per cent) and Canada (five per cent), it said. The UK, Germany and France are the main importers of the Kingdom’s footwear in the EU.