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Cambodia: A joint CSOs' report shows thousands of garment workers struggle to repay micro-finance debts during factory suspensions caused by COVID-19

Author: CATU, CENTRAL & LICADHO, Published on: 30 June 2020

"Worked to Debt: Over-Indebtedness in Cambodia's Garment Sector", 30 June 2020

Tens of thousands of garment workers in Cambodia will struggle to repay microfinance debts during work stoppages and factory suspensions caused by COVID-19, creating a mounting human rights crisis as they struggle to feed their families and hold onto their land under immense pressure from microfinance institutions (MFIs). Without immediate debt relief, many of these workers will resort to selling their land or their homes, eating less food or taking out even more loans to repay their debts.

In Worked to Debt, a joint briefing paper between the Cambodian Alliance of Trade Unions (CATU), the Center for Alliance of Labor and Human Rights (CENTRAL) and the Cambodian League for the Promotion and Defense of Human Rights (LICADHO), researchers surveyed more than 150 workers – most of them women – from three factories … to investigate how workers were coping with their debts as hundreds of factories suspended operations as a result of the global pandemic…

The research findings reflect a broken industry. Of the 162 workers surveyed, only four didn’t have any debts…

“Garment workers have worked tirelessly to provide food for their families. Now they can barely afford to feed themselves.", Yang Sophorn, CATU president …

We call for immediate debt relief programs from both MFIs and the international investors who have spent hundreds of millions of dollars to burden Cambodians with unmanageable debts.

We also encourage the government to expand their borrower protections and enact enforceable, sectorwide regulations, including the temporary suspension of loan repayments and the return of land titles used as collateral, …

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