The Garment Manufacturers Association in Cambodia (GMAC) has urged international buyers sourcing garments from Cambodia to raise their costs in order to keep factories financially workable. GMAC also demanded for increase in productivity in the sector from the garment factory workers after the recent increase in minimum wage rate to $140 per month from the current $128 per month, as per Cambodian media reports. Even though international companies like H&M, Gap, and Adidas have welcomed the rise in minimum wages of the Cambodian workers, GMAC fears the wage hike may affect orders in 2016. Hence the association wants the support of labour unions to convince buyers to pay manufacturers more in order to help them absorb the rising wage cost. Prime Minister Hun Sen also expressed concerns about companies fleeing Cambodia owing to the rise in minimum wages in a speech he gave recently at the National Institute of Education in Phnom Penh. He said, “In Myanmar, workers’ wages increased to $67, Laos is at about $80, Bangladesh’s special economic zones receive $75, India and Nepal also have low wages, but in a few months the wages will reach $140 in Cambodia.” He further warned that global companies might prefer to source garments from countries with cheap labour and may move out of Cambodia, hence he emphasised on working things out with the companies to make them stay. Meanwhile, certain brands like Levis Strauss, Gap, and Adidas have announced that they would continue sourcing garments from Cambodia in spite of the wage hike.
