China has maintained its position as the top supplier of raw materials to Cambodia’s garment industry, according to Prime Minister Hun Sen. As the industry continues to grow, Cambodia has become increasingly dependent on imported raw materials, with China accounting for the majority of these imports. While the two countries have a strong trade relationship, some experts have raised concerns about the potential risks of this heavy reliance on a single supplier. In this article, we delve deeper into the reasons behind China’s dominance in Cambodia’s garment industry and assess the potential consequences of this close trade relationship.
Cambodian Prime Minister Samdech Techo Hun Sen recently announced that China remains the biggest supplier of raw materials to the kingdom’s garment industry. Speaking at a graduation ceremony of around 4,700 students at the Vanda Institute in Phnom Penh, Hun Sen praised China for its contribution to the Cambodian economy, particularly in terms of the garment industry.
The Cambodian garment industry heavily relies on China for raw materials, with the country importing more than 80 percent of its fabrics from China. This enables Cambodia to produce clothes in the country and export finished products to other countries. It is worth noting that the garment industry is Cambodia’s largest foreign exchange earner, generating hundreds of thousands of jobs for local people, mostly women.
According to a report from the General Department of Customs and Excise, Cambodia exported garment products worth 9.03 billion U.S. dollars in 2022, accounting for 40.1 percent of the kingdom’s total export of 22.48 billion dollars. This highlights the significance of the garment industry to Cambodia’s economy.
In his speech, Hun Sen expressed his gratitude to China for supplying raw materials to Cambodia during the COVID-19 pandemic era. He noted that the close relationship between the two countries is a significant factor in China’s unwavering support for Cambodia’s garment industry.
The strong partnership between Cambodia and China is rooted in history. The two countries have maintained good bilateral relations since they established diplomatic ties in 1958. Over the years, China has been instrumental in supporting Cambodia’s economic development by providing financial aid, investing in infrastructure, and creating jobs.
China has also played a critical role in helping Cambodia achieve economic stability amid the COVID-19 pandemic. In August 2020, China provided Cambodia with more than one million doses of COVID-19 vaccines. This was a significant boost to the country’s vaccination campaign, which had been struggling to gain momentum.
Furthermore, China has been a vital ally to Cambodia in its efforts to strengthen its position in the international arena. China has consistently supported Cambodia’s claims on the South China Sea issue, including its opposition to the Permanent Court of Arbitration’s ruling in 2016 that invalidated China’s territorial claims in the disputed waters.
Cambodia has reciprocated China’s support by endorsing China’s Belt and Road Initiative (BRI), a global infrastructure development campaign. Cambodia is one of the countries that have benefited from the BRI, with China investing heavily in the country’s infrastructure projects such as bridges, highways, railways, and seaports.
The Cambodian government has also taken steps to attract more Chinese investment by offering incentives such as tax breaks, free land, and simplified regulations. This has resulted in a surge of Chinese investment in Cambodia, particularly in the real estate, energy, and tourism sectors.
In conclusion, China’s contribution to Cambodia’s garment industry is a testament to the strong bilateral relations between the two countries. Cambodia values China’s unwavering support and regards the partnership as a significant factor in its economic development. The garment industry remains a crucial sector of Cambodia’s economy, and China’s role in supplying raw materials to the industry remains essential. Cambodia and China’s partnership is expected to continue bearing fruit for both countries in the future.