Bilateral trade between Cambodia and the EU was valued at $3.863 billion last year, a huge drop compared with the figure recorded in 2019, with both the COVID-19 pandemic and Brexit being blamed.
Data from the Ministry of Commerce showed that in 2020 Cambodia exported $3.203 billion of goods to the EU and imported $659 million from the trade bloc.
The ministry’s data did not mention figures for exports and imports for comparison with the year before but, in 2019, the two-way trade between Cambodia and the EU’s then-28 countries was valued at approximately $6.7 billion.
Lim Heng, vice-president of Cambodia Chamber of Commerce, said the decline of Cambodia’s trade with the EU was hit hard by COVID-19, which caused demand for clothes in the bloc to decline.
“The virus pandemic affected the entire world, including the EU, which is the biggest market for Cambodia’s garment products and this affected the textile sector in Cambodia, so the country’s exports declined and some factories suspended operations,” Heng said.
In February 2020, the European Commission recommended that the EU withdraw 20 per cent of the Everything but Arms (EBA) preferential trade deal with the Kingdom, claiming that Cambodia had violated human and labour rights and that democracy in Cambodia had declined.
This was ratified on Aug 12 last year.
According to the ministry’s data, the UK is now excluded in the EU’s trade list with Cambodia.
The UK was one of the biggest EU countries, having a huge trade arrangement with Cambodia, before it quit the bloc at the beginning of this year.
“The withdrawal of 20 percent of the EBA scheme from Cambodia last year also resulted in the effect on trade between Cambodia and EU, but… we got a GSP (generalised system of trade) from the UK under which we can export the 20 percent we lost from the EU to the UK instead,” Heng said.
The EU ranked as the second biggest trade partner of Cambodia in 2019, accounting for 11.9 percent of the country’s total trade. . Cambodia is the EU’s 54th largest trading partner.