Global issues step on footwear exports
Global issues step on footwear exports
Exports of footwear and related items from Cambodia to international markets during the first 10 months of 2023 totalled nearly $1.1 billion. The figure represents a significant decrease of nearly 25% compared to the same period in 2022.
The exports constituted almost 6% of the country’s total exports, according to the General Department of Customs and Excise (GDCE).
The GDCE’s International Commodity Trade Statistics indicate that from January to October 2023, exports of goods categorised under the Harmonised System (HS) 2 Code 64, which includes footwear, gaiters and similar articles, amounted to $1.09 billion.
This represents a decrease of 24.6% from the $1.44 billion reported in the same period last year.
During the first 10 months of this year, exports under code 64 represented about 5.9% of the country’s total exports, which were valued at $18.59 billion. In contrast, during the same period last year, the value of exports under the grouping accounted for 7.8% of total exports, totalling $17.08 billion.
For October 2023, exports of footwear-related products, including parts, were valued at $97.4 million. This marks a decline of 19.4% from the $120.92 million recorded in October 2022, as stated by the GDCE.
Ly Khun Thai, president of the Cambodian Footwear Association (CFA), told The Post that the decrease in exports of code 64 articles over the past year was attributable to a reduction in orders, despite the country’s robust production capacity.
He suggested that the decline in orders might be due to the adverse political and economic conditions globally, leading people to reduce discretionary spending, such as on travel and new shoes.
“The Russia-Ukraine war and various global challenges have resulted in a decrease in orders for footwear … from Cambodia, while products ordered in 2022 are still in stock,” he said.
Khun Thai is optimistic that the country’s exports, including footwear products, will begin to recover towards the end of 2023. He anticipates that increased incomes will lead to more travel, subsequently boosting the demand for shoes.
He also noted that code 64 items made in-country are exported to major destinations such as the US, EU, UK, Canada and other regional countries. Cambodian footwear includes many renowned international brands, such as Adidas, Clarks and Timberland.
Hong Vannak, an economics researcher at the Royal Academy of Cambodia, noted that the Cambodian market for footwear is heavily reliant on international demand.
He suggested that a decline in global market interest would directly impact the country’s revenue.
He remains positive about the market’s recovery, highlighting the increasing number of shoe factories opening.
“The opening of more new factories indicates an increase in orders, as investors typically conduct thorough research and forecast the demand momentum before releasing capital,” he said.
In 2022, exports under HS 2 Code 64 totalled $1.74 billion, marking a 24.8% increase from $1.39 billion in 2021. The export value of products in the grouping represented approximately 7.7% of the Kingdom’s total exports in 2022, which amounted to $22.48 billion, as per the GDCE.
