EU to launch withdrawal process of trade preferences in Cambodia over rights concerns & warns Myanmar of potential similar action
The EU is launching the process to end Cambodia's duty-free access to the European Market for exports, and is considering suspending similar trading privileges in Myanmar for human rights abuses in Rakhine state.
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Author: Sharon Waxman & Michael Posner, EU Observer
1 November 2018
… The EU's review focuses attention on the larger political picture in Cambodia and especially … But Cambodia's deteriorating respect for the rights of workers also will be an important part of the EU's review process.
… Lately, however, progress on workers' rights in Cambodia has slowed significantly…
A number of labour union and human rights leaders have been targeted for official harassment, and some have been arrested or criminally charged…
What should global apparel and footwear companies do? …
…, we participated in a delegation to Cambodia, led by the American Apparel & Footwear Association, an industry group, and the Fair Labor Association, a non-governmental organisation that brings together leading companies, universities and labour-rights organisations to improve workers' rights.
Among the delegates were American and European companies such as adidas, New Balance, Nike, Puma, Under Armour and VF.
The group met with Cambodian government officials to express concern about the shrinking space for independent trade unions and rights activists and communicated a desire to work with the officials to improve these conditions.
The group called on the government to drop the criminal charges in the cases of several labour leaders, ...
The delegation urged changes to the laws ... The companies also advocated for the independent funding and operation of the Cambodian Arbitration Council, …
Global brands, …, can demonstrate corporate leadership by publicly urging governments to protect the rights of workers and support meaningful reforms…
Myanmar: Labor orgs call on EU to reconsider trade privileges withdrawal; loss of jobs & factory shutdowns feared
Author: Kyaw Thu & Kyaw Htun Naing, Radio Free Asia
"Myanmar Labor Groups Urge EU Not to Drop Crucial Trade Preferences," 29 October 2018
Myanmar labor organizations urged visiting European Union delegates... to reconsider the possible withdrawal of trade preferences that allow the developing country tariff-free access to the bloc, under threat from Brussels in response to alleged ethnic cleansing of ethnic Rohingya during a 2017 military campaign.
The EU delegation met with representatives from the Confederation of Trade Unions in Myanmar (CTUM), the Myanmar Infrastructure, Craft and Service (MICS) organizations, and the Agriculture and Farmers Federation of Myanmar (AFFM) in the commercial hub Yangon to discuss the preferential trade arrangement.
The mission’s findings will help the EU determine whether to withdraw Myanmar’s Everything But Arms (EBA) status...
Myanmar labor groups appealed to the mission not to withdrawal the EBA arrangement.
“We told them we don’t agree with the EU’s [possible] withdrawal of trade preferences,” said Maung Maung, president of the Myanmar Confederation of Trade Unions. “It would reflect badly on Myanmar workers and would be a minus sign for development work in Myanmar.”
Naw Aung Aung, vice president of MICS, said that if the EU withdraws trade preferences from Myanmar, its support for the country’s democratic reform will be “fruitless.”
Tun Tun, a central executive committee member of the MGMA, said that the withdrawal of trade preferences would force factories to shut down and workers to lose their jobs.
Author: Frontier Myanmar
11 October 2018
The news that the European Union is considering revoking trade privileges for Myanmar due to alleged Tatmadaw atrocities in Rakhine State has provoked near-universal condemnation.
...Under the Everything But Arms programme...Myanmar has tariff-free access to the EU market. ...EBA has been a major boon for Myanmar's economy, particularly the garment sector.
...Trade and investment in manufacturing and agriculture directly benefit some of the poorest households in Myanmar. ...The presence of European buyers, who face more stringent due diligence requirements, has helped improved conditions for workers in Myanmar factories.
...Given the overwhelming evidence of abuses and the government's refusal to ensure accountability, withdrawing Myanmar's trade privileges could probably be justified.... But that could put hundreds of thousands of people out of work. It would be a textbook example of a misdirected sanction....
...[T]his is a risky and arguably reckless strategy, given the potential effect on vulnerable households....
...Even if the EU decides to maintain access, the review period is likely to dampen investment and trade, and could destabilise the economy....
The most important thing now is for both the EU and the Myanmar government to find a way forward that does not put hundreds of thousands of jobs at risk.
Remarks by High Representative/Vice-President Federica Mogherini at the press conference following the Europe-Asia Summit
Author: European Union External Service
… With Cambodia, we have taken the decision to start the process of temporary withdrawal of the EBA trade preferences. I have discussed with the Prime Minister … Hun Sen … what our expectations are for what should happen for this not to go on - in particular the improvement of the political, democratic climate. I would say that there is a lot of concern in Europe, but not only in Europe, about the dissolution … of the main opposition party and in general terms the narrowed democratic space for political opposition and civil society.
We discussed this. I cannot say that we found solutions to any of these issues but ...
We agreed that our teams would work together, starting in these days and in the weeks to come,…
Author: Fresh News
The chairmen of the international chambers of commerce, including the European Chamber of Commerce in Cambodia, the French Cambodian Chamber of Commerce and Industry (CCIFC), the German Companies Group in Cambodia (ADW ), North European Chamber of Commerce in Cambodia (NordCham), and Italian Business Association in Cambodia addressed a special letter to Cecilia Malmstrom, Commissioner for European Trade Commission, in the protest against the withdrawal of Everything But Arms (EBA) schemes from Cambodia.
Author: Meas Sokchea, The Phnom Penh Post
In an effort to defuse tensions, a senior government official said Cambodia is negotiating with the European Union (EU) on the Everything But Arms (EBA) trade deal, which allows the Kingdom to export goods to the 28-member bloc tariff-free.
… Government spokesman Phay Siphan said … that because the trading scheme involves multiple fronts, including human rights, the Cambodian negotiating team is comprised of the ministries of foreign affairs, interior, justice and commerce.
Also included in the agenda are workers’ rights and land conflicts, among others.
… He said the government maintains its position to protect workers’ interests and Cambodia’s sovereignty as an independent country throughout the talks.
Political analyst Meas Nee said the government’s willingness to turn to negotiations with the EU is a positive sign that could pave the way for a political compromise.
... “If there is a negotiation, there must be a solution. …,” he said…
Author: Amy Sawitta Lefevre, Channel News Asia
Cambodia's foreign ministry ... said a decision by the European Union to ramp up trade pressure on Cambodia over human rights concerns was an "extreme injustice", adding it risked destroying decades of development progress in the country.
… "The Cambodian government can only take this decision as an extreme injustice when the EU blatantly disregards the considerable progress made by the country, despite its recent tragic past," Cambodia's Ministry of Foreign Affairs said ...
"By implementing these withdrawal measures, the European Commission risks negating twenty year's worth of development efforts," it added.
… Over the past two decades it has been the world's sixth fastest-growing economy, with average GDP growth rate of 7.6 percent, according to the World Bank, largely due to its garment exports which are mostly bound for the EU and the United States.
Cambodia's exports to the European Union were worth 5 billion euros (4.37 billion pounds) last year, according to EU data,...
EU launches process for withdrawal of EBA preference for Cambodia & plans to send EU mission to Myanmar
Author: Cecilia Malmstrom, European Commission
"On Myanmar and Cambodia," 5 Oct 2018
... In Myanmar, we have seen a deeply worrying and worsening situation for the Rohingya minority. A recent report from a United Nations fact-finding mission calls for the prosecution of top military leaders for genocide and crimes against humanity... The country's leadership has repeatedly disregarded calls from the EU and the international community to put a stop to this... In Cambodia, meanwhile, we are seeing very troubling developments with a clear deterioration of human rights and labour rights, without convincing improvements in sight. Our recent EU mission to the country demonstrated serious and systemic violations of, for instance, freedom of expression, labour rights and freedom of association. This comes on top of longstanding issues as regards workers’ rights and land-grabbing.
... Both Cambodia and Myanmar benefit from the Everything But Arms arrangement, or EBA, which guarantees completely tariff-free access to the European market for all exports except for weapons and ammunition... [which] comes with a responsibility to uphold and respect the values enshrined in 15 fundamental conventions of the United Nations and the International Labour Organisation... [T]he European Commission and the European External Action Service will notify the Myanmar authorities of our intention to send an emergency, high-level EU mission to the country... to assess the situation... Today, High Representative Federica Mogherini and I have therefore notified Cambodia that we are launching the process for the withdrawal of their Everything But Arms preferences. Without clear and evident improvements on the ground, this will lead to the suspending of the trade preferences that they currently enjoy.
Author: Prak Chan Thul, Reuters
Cambodia’s Prime Minister Hun Sen has taken a defiant stance following a European Union announcement last week that it would ramp up trade pressure on Cambodia over human rights concerns. The European Union... told Cambodia on Friday it will lose its special access to the world’s largest trading bloc, and said it was considering similar trade sanctions for Myanmar, adding that it was ready to punish human rights abuses in both countries...Hun Sen said Cambodia must defend its sovereignty. Hun Sen has held power for three decades....The EU warned Cambodia in July that it could lose its special trade status after a general election that month returned Prime Minister Hun Sen to power. Rights groups said the election was not fair because of the lack of a credible opposition, among other reasons...Cambodia’s exports to the European Union were worth 5 billion euros ($5.8 billion) last year, according to EU data, up from negligible levels less than a decade ago. Cambodia’s textile, garments and footwear industry are vital to its economy. Around 40 percent of its GDP comes from garment exports.The garments sector employs more than 800,000 workers. The EU and U.S. are the country’s primary markets for exports, according to the International Labour Organization (ILO).
Author: David Hutt, Asia Times
Months after Cambodia held what many observers saw as a badly rigged election, the European Union is ramping up trade pressure in punitive response to the move away from rights and democracy... The EU announced on October 5 that Cambodia would lose its special access to European markets under the so-called Everything But Arms (EBA) preferential trade scheme after it conducts a six-month review of its duty-free status launched last week... The economic repercussions of higher tariffs on Cambodia-produced goods could be immense... The process for removing Cambodia from the EBA scheme is lengthy and incremental, and is not expected to fully begin for another six-months... By starting that process, the EU has laid down what it considers the “red line” the Cambodian government crossed last year when a compliant Supreme Court forcibly dissolved the nation’s only viable opposition party, the Cambodia National Rescue Party (CNRP). Additionally, the EU has criticized the government’s attacks on independent media and nongovernmental organizations, and its alleged widespread disregard for human rights... To avoid being removed from the EU’s EBA scheme, the CPP-led government must show clear improvement on rights and democracy.
... EU-imposed tariffs will necessarily make Cambodia’s garment exports less competitive vis-a-vis its manufacturing rivals... Considering that most manufacturing workers contribute part of their salaries to family members, any one person laid off work will impact the finances of at least another two or three people, analysts say... A letter sent to the EU this year by five Cambodian trade unions claimed that imposing tariffs would directly affect as many as three million Cambodians.