Cambodia wants preferential trade treatment from the US for its garment and footwear exports. The US generalised system of preferences (GSP) scheme allows duty-free entry of certain non-sensitive items from 120 developing nations but excludes garment and footwear products. If the US accedes, Cambodia hopes to enhance its export growth, investment and employment generation.
The United States will be reviewing its GSP program by year end and voting on the GSP Footwear Act of 2017, which would allow outdoor shoes and boots, as well as other footwear manufactured abroad, to be included in the program. Cambodia has duty free and quota free status from the US for 82.6 per cent of its products. Improvement of working conditions for factory workers is one of the main criteria set by the US when it comes to giving preferential trade treatment. And Cambodia says it has performed well in improving the conditions of garment workers and that workers are now paid decent salaries, allowing many families to get out of poverty.
Cambodia’s garment and footwear sector exports rose by 7.2 per cent in 2016 compared to 2015. The country gets 100 per cent preference from Australia, New Zealand, Norway and Switzerland and 99 per cent preference from the EU under the Everything But Arms clause.