Both Cambodia and Myanmar heavily depend on the European Union's duty and quota free trade agreement. But the European bloc believes it is time that these countries address human rights abuses. Ate Hoekstra reports.
Already saddled with debt, Cambodian textile worker Chul Sreymom fears she will lose her job if the EU drops Cambodia's preferential trade status. "If I lose my job, I would be forced to sell my cows and my land. In that scenario, I will be left with only one option: go abroad to find work," she told DW.
In October, Cecilia Malmström, the EU commissioner for International Trade and Trade Agreements, announced that Cambodia would cease to be a part of the European bloc's Everything But Arms (EBA) scheme because of the Southeast Asian country's disregard for human and labour rights.
The EU's EBA program is important for Cambodia and other developing countries, as they can export their products to Europe free of duty and quota. The removal from the EBA would mean that thousands of Cambodians could lose their jobs.
Myanmar could face the same sanction. A European Union delegation visited the country earlier this month to evaluate Myanmar's response to the violence against Rohingya Muslims.
A decision about Myanmar's removal from the EBA hasn't been made yet, but Malmström made it clear that the country must pay heed to the Rohingya issue. "If they don't act, Myanmar authorities are putting their country's tariff-free access to the EU market in danger," she said.
The process to remove a country from the EBA can take up to 18 months.
Dependence on the EU market
People in Cambodia and Myanmar are worried about the EU measures, as both countries rely heavily on clothing and shoe factories that manufacture products for Western markets.
Western clothing brands such as H&M, C&A and Adidas often look for outsourcing production to countries that have a cheap workforce. They could move out their production if these countries were removed from the EBA. This could lead to the closure of factories and to massive unemployment.
Cambodian factories that manufacture products for EU markets employ over 700,000 people. Garments are the country's biggest export – about 43 percent of which makes its way to Europe.
Similarly, Myanmar's 500 factories employ around 480,000 people. The EU is the Myanmar's biggest market, which receives about 45 percent of Cambodia's total exports.
"I earn between $200 (€177) and $250 (€221) per month. I can support my parents who live in the countryside, as well as my younger sister who's still studying," Sreymom said, adding that she would lose her livelihood if the factory shuts down.
But the EU wants to censure the Cambodian government for committing grave human rights abuses and repressing political opponents and rights activists. The country's largest opposition party, the Cambodian National Rescue Party, was declared illegal by the country's Supreme Court last year. The July election only consolidated the one-party rule of Prime Minister Hun Sen, who has been ruling the country since 1985.
In Myanmar, the Rohingya crisis has intensified since August 2017. The stateless minority group is facing serious oppression in the Buddhist-majority country, with close to 700,000 Rohingya fleeing to neighboring countries since the start of a military crackdown in August, 2017. Since then, at least 10,000 Rohingyas have been killed and thousands have been displaced. A UN report has accused Myanmar's top military commanders of committing genocide, crimes against humanity and war crimes.
Is the pressure working?
Malmström recently said it's not too late yet for Cambodia and Myanmar to turn the tide, but a tariff-free access to the EU won't come without conditions.
"The EU is one of the biggest export markets for Cambodia. If there's no EBA, our workers will lose their jobs and their income," Ath Thorn, the president of the Cambodian Labour Confederation, the country's largest trade union, warned.
"I encourage the EU and the Cambodian government to engage in talks and iron out differences," Thorn told DW.
Andrea Breyer of the AVE trade association of German retailers in Myanmar told DW that the Southeast Asian country's potential removal from the EBA could be damaging. "As most garment factories in Myanmar mainly produce for the European market, it is likely that many of them won't be able to keep their businesses running. This would mainly affect women, as they make up 98 percent of the workforce in these factories," Breyer said.
The EU measures apparently are yielding some results. Last week PM Hun Sen agreed to grant more rights and freedom to labor unions. He also promised that cases against union leaders should be reviewed or dropped.