EU companies voice concern over impact of possible EBA withdrawal

Content image - Phnom Penh Post
EU Ambassador to Cambodia George Edgar emphasises the positive contribution of EU businesses in the Kingdom and expresses hope that the EBA scheme will not be removed. Photo supplied

European companies operating in Cambodia voiced concern over the potential repercussions of removing the Kingdom’s Everything But Arms (EBA) preferential scheme, as the EU Ambassador to Cambodia, George Edgar, led an EU-organised media trip this week.

Speaking in Siem Reap province as part of the three-day trip, Edgar emphasised the positive contribution of EU businesses in the Kingdom and expressed hope that the EBA scheme would not be removed.

 

“Economic exchanges are a driver for growth. EU businesses create jobs in Cambodia . . . they have a long-term perspective, stimulate innovation and promote socially responsible and environmentally friendly practices."

“EBA is still under discussion, but I hope that the withdrawal of EBA will not happen in Cambodia,” he said.

 

The EU recently launched a six-month review of Cambodia’s duty-free access citing concerns over human rights and press freedom.

If the Kingdom is removed from the list of EBA approved nations, its garments, sugar and other exports would be subject to increased tariffs within a year.

 

The media trip was intended to offer journalists an opportunity to interact with European investors and business owners operating in Cambodia, in order to discuss job creation, skills development, innovation, social responsibility, and environmentally friendly practices.

Edgar said there are currently more than 300 European-backed companies operating in Cambodia, four of which – Artisans Angkor, Pactics, Vinci and Total – had representatives speaking with journalists about their business experiences in the Kingdom.

Pierre Andre Romano is CEO of Artisans Angkor which was established in 1992 and has provided training to thousands of artisans in Cambodia. It sells more than 300,000 items of handmade products each year and attracts more than half a million international tourists to its 48 workshops across Siem Reap province.

“We promote the revitalisation of traditional Khmer arts and craft by proving training skills to locals and inviting international tourists to visit our workshop community,” Romano said.

But now, Artisans Angkor – which according to Romano has created 1,200 jobs in Cambodia to date – is concerned that the removal of EBA privileges will smother his business.

“Our products are handmade, which means they are a little expensive compared to neighbouring markets. Therefore we are concerned that if EBA is withdrawn, it will negatively impact our business by adding additional cost and lowering our competitiveness in the market,” he said.

Arjen Laan is CEO of Pactics – a producer of clothes, glasses and travel and luggage products that exports to the EU, US and China.

He expressed similar concerns over the impact of Cambodia losing its EBA status. With a factory operating in Siem Reap province, Laan is worried about the company’s more than 600 workers and hopes that the EBA will not be withdrawn.

“It will immediately impact us, especially the workers here. Without EBA, it will be hard for us to compete [in the market],” he said.