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US challenged on quota

US challenged on quota

Cambodia has demanded the US raise its garment quota by 28 percent rather than the

9 percent increase offered so far. Failing that, said Minister of Commerce Cham Prasidh,

the US should cut the link between labor reforms and quota increases.

Garments are Cambodia's most important export, and the trade agreement between the

two countries is scheduled for renewal later this month.

"We have come out with a lot of bruises [in complying with conditions] to eliminate

child labour, to ensure the garments are not manufactured in sweat shops and that

workers' rights are protected," Prasidh told the Post December 6. No other country

had accepted linking trade and labor issues, he said.

Prasidh said Cambodia had demonstrated its commitment by complying with stringent

labor conditions; it now needed a deal that would help the economy grow.

During the first round of negotiations with the US trade delegation on renewal of

the Agreement on Textile and Apparel that concluded December 4, Prasidh said the

quota should be increased by 28 percent. The initial promise was 14 percent, although

the final increase was only 9 percent.

"When we agreed to the condition [in 1999], we had not forseen the difficulties

that we would face in implementing it," he said. "The risks the government

has taken should be commensurate with the rewards. Or else we could also demand delinking

of the labour issue from the trade agreement."

He added that the previous three year agreement period was marked by violent demonstrations

and strikes which had deterred expansion by existing investors and scared off investors.

Bruce Levine, first secretary at the US Embassy, said the outcome of the negotiations

was inconclusive. "[The objective] is to extend the agreement with some modification,"

he said. "But we would not like to comment on the direction [of the talks] or

speculate on the outcome."

The second round of negotiations begins within a few days, with the US keen to maintain

the status quo and the Cambodian government wanting a better deal. Once Cambodia

joins the World Trade Organization, the quota system will end.

The first three-year agreement was signed January 1999 and set export quotas for

garment exports.

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