European Union revokes preferential trade status for Cambodia

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The European Union on the 12th annual EU-Association of Southeast Asian Nations Summit that took place in Brussels on October 18-19 temporarily revoked its “Everything But Arms” (EBA) trade preferences pact with Cambodia until the Southeast Asian nation’s political situation and human records improve.

“With Cambodia, we have made a decision to start the process of temporarily withdrawing the EBA’s trade preferences as there is a lot of concern in the EU about the dissolution in November of last year of the (country’s) main opposition party and internal terms that narrow the democratic space for political opposition and civil society,” European Union’s High Representative for Foreign Affairs and Security Policy Federica Mogherini said.

“We discussed the issue with Prime Minister Hun Sen, and I cannot say that we found a solution to these problems,” she added.

In June, Human Rights Watch published a report accusing the ruling Cambodian People’s Party and Hun Sen, a Cambodia’s long-time autocratic leader, of motivated prosecution, repressive laws and numerous human rights abuses.

According to ratings agency Moody’s, the withdrawal of a duty-free trading access by the European Union for Cambodia as a result of Phnom Penh’s human rights record would have a negative effect on European investments in the country as the EU is Cambodia’s biggest export market.

Moody’s said other countries such as Australia and Canada, which have previously voiced concerns over political and human rights in Cambodia, could follow the EU in reviewing their trade agreements, compounding the effect on exports.

In turn, Cambodia’s textile manufacturing industry is expected to feel the heat from the frozen agreement. Cambodian plants supply global brands such as Gap Inc, H&M, Puma and Adidas. Its exports to the European Union were worth €5 billion in 2017.

A defiant Hun Sen accused the EU of waging “psychological warfare” against his government, saying, “I would like to tell all compatriots: did you lose jobs or income yet? Nothing has been lost but they issue this review as a psychological war attack.”

Meanwhile, Cambodia and Turkey agreed to increase bilateral trade to $1 billion “in the near future” and also boost textile trade. The withdrawal from the EBA will have “no impact” on Cambodia, Huns Sen insisted.

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Reading Time: 2 minutes

The European Union on the 12th annual EU-Association of Southeast Asian Nations Summit that took place in Brussels on October 18-19 temporarily revoked its “Everything But Arms” (EBA) trade preferences pact with Cambodia until the Southeast Asian nation’s political situation and human records improve.

Reading Time: 2 minutes

The European Union on the 12th annual EU-Association of Southeast Asian Nations Summit that took place in Brussels on October 18-19 temporarily revoked its “Everything But Arms” (EBA) trade preferences pact with Cambodia until the Southeast Asian nation’s political situation and human records improve.

“With Cambodia, we have made a decision to start the process of temporarily withdrawing the EBA’s trade preferences as there is a lot of concern in the EU about the dissolution in November of last year of the (country’s) main opposition party and internal terms that narrow the democratic space for political opposition and civil society,” European Union’s High Representative for Foreign Affairs and Security Policy Federica Mogherini said.

“We discussed the issue with Prime Minister Hun Sen, and I cannot say that we found a solution to these problems,” she added.

In June, Human Rights Watch published a report accusing the ruling Cambodian People’s Party and Hun Sen, a Cambodia’s long-time autocratic leader, of motivated prosecution, repressive laws and numerous human rights abuses.

According to ratings agency Moody’s, the withdrawal of a duty-free trading access by the European Union for Cambodia as a result of Phnom Penh’s human rights record would have a negative effect on European investments in the country as the EU is Cambodia’s biggest export market.

Moody’s said other countries such as Australia and Canada, which have previously voiced concerns over political and human rights in Cambodia, could follow the EU in reviewing their trade agreements, compounding the effect on exports.

In turn, Cambodia’s textile manufacturing industry is expected to feel the heat from the frozen agreement. Cambodian plants supply global brands such as Gap Inc, H&M, Puma and Adidas. Its exports to the European Union were worth €5 billion in 2017.

A defiant Hun Sen accused the EU of waging “psychological warfare” against his government, saying, “I would like to tell all compatriots: did you lose jobs or income yet? Nothing has been lost but they issue this review as a psychological war attack.”

Meanwhile, Cambodia and Turkey agreed to increase bilateral trade to $1 billion “in the near future” and also boost textile trade. The withdrawal from the EBA will have “no impact” on Cambodia, Huns Sen insisted.

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