Garment sector sees robust growth despite wage increase

Cambodia’s garment sector growth remained healthy despite increased wages for workers, Minister of Labor Ith Sam Heng said at an event commemorating International Labor Day yesterday. According to the minister, the sector employs 750,000 workers and pays $2bn in salaries annually, with the minimum wage increasing by nearly 10% to $153 a month. Last year, total exports grew 9% YoY, slightly lower than the 10% average annual growth over the past several years, according to the Garment Manufacturers Association of Cambodia (GMAC). Van Sou Ieng, GMAC president, said the sector is still growing despite tougher competition, mainly from Myanmar and Bangladesh. The value of exports in 1Q17 grew 4% compared to the same period in 2016, he added. However, he expected growth for the sector will begin to increase with the expansion of travel good exports to the US receiving duty-free privileges last July. There are now 27 registered travel goods manufacturers in Cambodia, he explained. Soeng Sophary, spokesperson for the Ministry of Commerce, said yesterday that emerging competitors like Myanmar and Bangladesh pose a challenge for Cambodia, though it remains manageable. She predicts that the country will maintain healthy growth for garments and footwear in the medium term, thanks to the withdrawal of the US from the Trans-Pacific Partnership, which benefited competitors like Vietnam. (Source: Phnom Penh Post)