Hung out to dry: Exports of GTF dip 5.4% in the first half
Hung out to dry: Exports of GTF dip 5.4% in the first half
Cambodia exported $3.784 billion worth of garment, textile and footwear (GTF) products to the international market in the first half of this year, dipping 5.4 per cent from the same time last year, Ministry of Labour and Vocational Training spokesperson Heng Sour said on Wednesday.
He was speaking at a press conference on government Covid-19 response measures at the Ministry of Economy and Finance.
Sour said: “The root cause for the slump is the repercussions generated by Covid-19, resulting in orders incrementally drying up. This downturn not only affects the garment sector in Cambodia, but the whole world.”
In the first half of this year, 450 garment and footwear factories in Cambodia suspended work, while 83 factories closed, he said.
Of these, he said, 10 have turned to manufacturing face masks, which are currently in high demand in the international market.
“Without government measures to relieve the investment burden and uphold factories, closures will ramp up,” he said.
Notwithstanding the drop in GTF exports logged in the first half, finance ministry permanent secretary of state Vongsey Vissoth underscored the substantial growth in shipments of bicycles and milled rice seen during the period.
He told the conference: “Garment exports to European markets were down but those to the US have come roaring back, which is why our exports dropped a smidge.”
Data from the finance ministry’s General Department of Customs and Excise show that 876,612 locally-assembled bicycles worth $197 million pedalled into the international market in the first five months of this year.
This was up 26 per cent on a yearly basis, with European markets accounting for 60 per cent.
The Kingdom exported 495,341 bicycles worth $119 million to European markets and 223,912 bicycles worth $44 million to the US market.
Garment Manufacturers Association in Cambodia (GMAC) president Van Sou Ieng told The Post in May that the increase in GTF exports seen in the first four months was only temporary, and was buoyed by buyer orders made prior to the Covid-19 outbreak.
“There will be a drop in garment exports in the coming months. I believe that footwear exports will sink, while travel bags may either remain stable or fall.
“So far, there are no orders for the garment sector confirmed, save for certain preventative medical and healthcare products.
“The Covid-19 virus has resulted in major disruptions to human lives as well as the business environment and the global supply chain,” he said.
A National Bank of Cambodia (NBC) report released on March 4 said Cambodia’s trade deficit with the rest of the world continued to widen last year to $7.76 billion, a more than 31 per cent increase compared to the previous year.
The NBC figures revealed that the Kingdom imported some $22.34 billion worth of goods last year while it exported only $14.63 billion – causing some $7.76 billion in trade deficit.
The central bank’s figures showed that the year-on-year growth rate in imports was 18.6 per cent last year, while exports lagged at 12.7 per cent.
Cambodia’s major exports of textiles, shoes, rice and bicycles were overshadowed by imports in oil, vehicles, construction materials, food and beverage, and raw materials for the manufacturing sector, the report said.
