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Cambodia hiked the monthly minimum wage for garment workers by $12 on Friday to $182, from the current $170 following a election promise by premier Hun Sen, reports BSS/AFP.
The country’s $7 billion apparel industry is fuelled by more than 740,000 garment workers, who strongman Hun Sen attempted to woo before July’s widely-criticised elections.
The poll was derided internationally after the only credible opposition party was disbanded before the vote, handing the premier’s ruling party all 125 seats.
Union representatives stopped short of welcoming the wage increase, which they say is not enough to address rising inflation and living expenses.
“It does not satisfy us yet. We were demanding an increase of at least $15 a month,” Ath Thorn of the Coalition of Cambodia Apparel Workers Democratic Union told AFP.
But Kaing Monika from GMAC — an association representing the owners of exporting factories — said the increase would test Cambodia’s competitiveness against neighbouring Vietnam.
“Our electricity and water bill is still higher than Vietnam,” Kaing Monika said. “So next year will be a test for Cambodia on whether we are able to compete.”
Hun Sen, who has been in power for more than 33 years, came under fire last month in the European Parliament for his authoritarian chokehold on opponents and dissent.
The bloc warned on Friday said a “procedure of withdrawal” would begin for Cambodia to leave the “Everything But Arms” trade scheme, which allows tariff-free exports to the EU bloc.
EU trade commissioner Cecilia Malmstrom warned: “Without clear and evident improvements on the ground, this will lead to the suspending of the trade preferences that they currently enjoy.”
If fully revoked, it would deal a blow to the country’s apparel industry.
Cambodia currently exports about $5.7 billion worth of goods to the EU — the majority of which are apparel and footwear exports.