Although Cambodia’s 2023 GDP forecasts fell in need of expectations, there may be positive news from the country’s garment industry. Cambodia is now emerging as considered one of the world’s largest apparel exporters, marking significant growth nationally. Cambodia currently ranks eighth in apparel exports, up from eleventh in 2021, accounting for 1.6% of the worldwide market share, in line with the World Trade Organization.
Cambodia’s presence within the clothing industry has caused a reshuffle in the highest ten clothing exporting countries. China stays the leader with a major market share (31.7%), followed by the European Union (27.1%) and Bangladesh (7.9%). Meanwhile, Cambodia (1.6%) overtook Pakistan (1.5%). Other Southeast Asian countries in the highest ten include Vietnam (4th with 6.1%) and Indonesia (seventh with 1.7%).
Overall, Southeast Asian production still accounts for less than 1 / 4 of China’s total exports. China’s $182.4 billion global market share makes it the dominant player. Meanwhile, on this region, Cambodia’s apparel exports reach $9.1 billion, just under Indonesia’s $10.1 billion and well below Vietnam’s remarkable achievement of $35.3 billion. According to the Khmer Times, Cambodia remains to be attempting to meet up with its peers in Southeast Asia.
In January 2022, exports of clothing, footwear and travel goods (GFT) increased by 15% year-on-year, accounting for 56.2% of total exports. It is due to this fact not surprising that the GFT sector is becoming considered one of the pillars of the country’s export industry.
Recognizing the expansion and importance of this industry, the Government of Cambodia has modified the main focus of its Textiles and Apparel Transformation Map (ITM T&A) strategy 2023-2027. The strategy goals to enhance working conditions and the investment climate within the industry, which could have a positive impact on the country’s economy.
Chy Sotharith of the Cambodian Ministry of Trade told the WTO that recent EU rules have helped Cambodian clothing manufacturers. Previously, EU rules on origin of products presented challenges for Cambodian manufacturers as a consequence of national fabric requirements. However, because of this of Generalized System of Preferences (GSP) reforms, imports from least developed countries (LDCs) are duty-free and quota-free, allowing the usage of imported fabrics. As a result, Cambodian clothing exports to the EU have stabilized.
With an optimistic growth outlook, the Cambodian government expects the apparel manufacturing sector to grow by 8% in 2024. Despite the decline in 2023, the sector is predicted to see a promising recovery within the country’s economy.
