Stitch up: Power imbalances in global garment sector worsen in pandemic

SE Globe, Oct. 23, 2020

Workers commuting between factories and home by truck

 

In Cambodia, where the garment sector employed close to a million workers pre-pandemic, the backtracking has had a tangible effect. Approximately 130,000 workers in Cambodia’s garment and footwear industry lost their jobs due to the global economic downturn. The Ministry of Labour has stated that 450 factories had suspended operations as of June due to the pandemic, a number amounting to 40% of all apparel producers in the country. Some factories have since reopened but with reduced operations and uncertainty over orders and job security for workers. 

Ken Loo, secretary general of the Garment Manufacturers Association in Cambodia (GMAC), said that since the onset of the pandemic, it is not uncommon for payment to suppliers to be made as long as 180 days after shipment, affecting cash flow and wage payments. But Loo also explained this power imbalance is nothing new. 

“That’s always been the case in the market for the last 35 years,” he told the Globe. “The balance of power has always been with the buyer.”

Last year, garment exports from Cambodia totalled $9.3 billion in sales, with the majority going to the United States and Europe. Western brands have been trying to mitigate the decrease in demand in the West by cancelling orders or renegotiating contracts with suppliers, said Ath Thorn, president of the Cambodia Labour Confederation (CLC).

In full: https://southeastasiaglobe.com/globalbrandscovid/