Global slowdown tatters Cambodian garment industry

Another 53 factories suspended operations in the January to September period but roughly half have since reopened, according to a report from the Ministry of Labor obtained Monday by The Associated Press.

Cambodia's garment industry is the main foreign exchange earner for the poor Southeast Asian country. Garment exports from Cambodia in 2008 were worth about US$2.8 billion, with 70 percent of shipments going to retailers in the United States. The European Union is the second-biggest market.

"The closing of garment factories in Cambodia is mainly due to declining purchase orders from countries affected by the global financial crisis," said Oum Mean, deputy labor minister.

The Asian Development Bank said last month it expects Cambodia's economy to shrink 1.5 percent this year.

Ken Loo, secretary-general of the Garment Manufacturers Association of Cambodia, said the association was trying to make Cambodian factories more competitive by reducing bureaucracy, the number of illegal strikes and the costs involved in exports.

There are about 520 garment factories operating in Cambodia, which employ some 360,000 workers, mostly women.

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