Textile industries play a crucial role in the early development of a country, particularly in developing nations. These countries often have the advantage of producing high-quality textiles at a lower cost due to their abundant natural resources and affordable labor force. Southeast Asian nations, in particular, have become key players in the global textile industry, emerging as hubs for textile production. Their exports to developed countries like the USA and Europe have steadily increased, and they are also gaining attention from markets such as Australia, New Zealand, and Japan.

The year 2012 posed challenges for many textile-exporting countries, including those in ASEAN. Reduced textile imports by the USA and Europe led to a decline in textile exports for countries like India and China. China's market share in Europe, for instance, decreased from 41 percent in 2011 to around 39 percent in 2012. However, ASEAN countries performed relatively well during this period. Vietnam and Cambodia, in particular, saw significant exports of textiles and textile products to the USA and Europe in 2012, with Cambodian exports experiencing an 8.7 percent increase.

The Cambodian textile industry is one of the fastest-growing textile industries globally, attracting trade relations with Western and Asian countries. Cambodia primarily imports raw materials for textiles from China and exports finished products to countries worldwide, including the USA, Europe, and other Asian nations. Its proximity to Vietnam has played a pivotal role in the development of its textile and clothing industry. The industry receives substantial foreign investments each year, with China being the largest investor in Cambodian textiles. China also provides grants to support industry development, and Japan and Vietnam are significant investors in the country as well.

Textiles make a substantial contribution to Cambodia's economy, constituting approximately 80 percent of its total exports. In 2012, the industry generated revenue of around $4.6 billion, with the main importers being the USA and Europe. The garment exports in the first half of 2013 grew by approximately 32 percent compared to the same period in 2012, and this export growth trend is expected to continue, further boosting Cambodia's Gross Domestic Product (GDP) growth this year. Despite some challenges and shortcomings, the Cambodian textile industry makes a significant contribution to the global textile sector.

Several factors have contributed to the development of the Cambodian textile industry. The government's support for the industry has been commendable, allowing Foreign Direct Investment (FDI) in its garment sector, which has attracted substantial investments from foreign companies. FDI reached a value of approximately US$1.6 billion in 2012, marking a 73 percent increase. Cambodia can secure its textile and garment exports to the USA through the prevailing quota system, which is linked to labor conditions in the country, ensuring proper working conditions for laborers. Such labor entitlement laws help maintain investor confidence in Cambodian garment factories and promote ethical labor practices.


Cambodian textile industry, in comparison to the Chinese textile industry and Indian textile industry, is less developed. But rising labor costs in China is making textile manufacturers from the west to shift their focus towards other countries with cheaper labor. Cambodia has remained successful in reaping benefits from the scenario. It has been estimated that Cambodian labor prices are almost three times cheaper as compared to Chinese labor prices. Textile companies based in Hong Kong and having a huge work force are shifting their entire worker base to Cambodia. Besides, Japanese small-time enterprises also prefer Cambodia over other Asian countries like Indian and China.


USA, Europe, and many other developing countries lack the man power and natural resources to have a well-established textile industry. They prefer to outsource their manufacturing work to developing countries, as it proves to be cheaper to them. Cambodia, along with other ASEAN countries, is one of the most sought after destinations for outsourcing for these developed countries. Cambodia exported garments worth $532 million to the European Union and garments worth $660 million to USA in the first half of 2013. Garment exports rose by 45 percent during this period as compared to the same period in 2012 with respect to the European Union, and it rose by 17 percent with respect to USA.


Cambodian textile industry is not devoid of flaws, like the textile industries of all other countries. It has its own shortcomings, for example lack of infrastructural development in the country. But investors were able to overcome this disadvantage to a considerable extent (especially in the textile industry), because textile industry is largely labor intensive. Limitations in capital investment were overcome by foreign investors who were more than happy to invest in the Cambodian textile industry. The prevalent quota system protects the Cambodian garment industry from cut-throat competition. A possibility lurks that the phasing out of this advantage may result in the downfall of the industry. But till the time, Cambodian textile and garment industry is going strong.


Cambodian garment industry employs a strong workforce in its factories (around 500,000), and majority of them are young women (around 80 percent). It has been estimated that around one-fifth of the total women population in Cambodia has been employed in this industry. The industry has made many women in the country independent, working women who not only support themselves, but also support their families. This industry has provided employment opportunities to the women, and thereby increased their overall standard of living. Government organization and many NGOs have joined hands to improve the safety and living conditions of these workers, and the expected result is on its way.


As in the case of all the ASEAN countries, the textile and garment industry has a significant role to play in the overall growth of the Cambodian economy. The GDP growth of the country was recorded to be 7.2 percent in the year 2012. It is expected to grow by the same value in 2013 and by a value of 7.5 percent in 2014. Its textile industry has a big contribution towards its development. As the quality of the manufactured textiles and textile products improve with time, the Cambodian economy is expected to see more exports and foreign investments. The Cambodian

textile industry is next only to Vietnam in the Southeast Asian region. It will continue to play a major role in the global textile industry for a long time.


The influence of the Chinese experts is the biggest strength of this industry. It is easy to find Chinese employees in Cambodian garment factories, who offer Chinese expertise along with Cambodian artistry to textiles and garments. The factories moved from China to Cambodia depict a mixture of Chinese and Cambodian skills in the manufactured textiles and textile products. It is soon expected to level its field with China, India, and other major players of the global textile industry. The global textile industry will be benefitted with low priced and good quality products from Cambodia.


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