Designed to increase EU and non-EU companies’ participation in the protection of human rights and environmental standards in the region, the proposed new due diligence rules are also likely to impact Cambodian garment footwear and travel goods sector.
Expected to be approved in a few months, the EU Corporate Sustainability Directive draft will initially affect Cambodia’s garments, footwear, travel goods, bicycles and certain food products exports to the EU, says Tom Hesketh, Deputy Director, EuroCham-the European Chamber of Commerce in Cambodia. Massimiliano Tropeano, Sustainability and Garment Expert, EuroChams adds, Cambodian garment factories supplying to European brands seem ready for the new rules and hopes, EuroCham’s efforts in collaboration with GIZ will accelerate the passage of these rules.
Hesketh opines, the Cambodian government and brands will encourage these factories to change current practices. Brands themselves will communicate these regulations to the factories they supply to, he adds. The Garment Manufacturing Association in Cambodia (GMAC) will also play an important role in coordinating with these factories.
Boosting sustainable practices
The new strategy will help push Cambodian GFT sector towards new environmentally sustainable practices, believes Tropeano. This will enable some of Cambodia’s biggest industrial sectors to install solar panels on their roofs. It will also reduce the timeframe for return on investment in Cambodia’s GFT sectors to three years against the earlier eight years, making the sector more liberalized, adds Tropeanno.
The Cambodian garment industry also faces issue of recycling its garment waste. Majority of waste collected by Sarom Trading is from the garment industry, adds Tropeano. This huge amount of waste from the industry is filling up landfills. To resolve this issue, the industry needs to take a multipronged approach to the problem. One way is to address this issue of waste by incinerating the Chip Mong plant. Already, GIZ has launched an initiative with major brands and the Hong Kong Research Institute of Textiles and Apparel (HKRITA) to install a Green Machine to recycle this waste. The feasibility report for this project is likely to conclude in a few months, adds Tropeano.
Focus on up skilling laborers
Hesketh hopes, factories will comply with these rules as they shift towards more responsible practices. They will also emphasize on upskilling of laborers to facilitate production of higher-value goods. To boost the growth of value-added sector in Cambodia, it needs to avail the services of the Cambodian Garment Training Institute (CGTI) says, Tropeano. GMAC can use its credit to send employees to the training centre. However, a few members of the association fail to invest time and money in training. This puts them at greater risks of future challenges, he sums up.
