The European Union on Friday informed Cambodia that it will lose preferential trade status unless it makes “clear and demonstrable improvements” to its rights record, as dictated by a tariff-free export scheme the country benefits from when sending goods to the bloc, according to media reports.
The EU launched a fact-finding mission to Cambodia in early July to assess whether Prime Minister Hun Sen’s government was adhering to its commitments in the Generalised Scheme of Preferences—an agreement that grants Cambodian exports tax-free entry into the European market under the Everything But Arms (EBA) scheme.
Weeks after the investigation, the ruling Cambodian People’s Party (CPP) steamrolled a general election widely seen as unfree and unfair following the Supreme Court’s dissolution of the opposition Cambodia National Rescue Party (CNRP) for its role in an alleged plot to topple the government—guaranteeing strongman Hun Sen another term in office to add to his three decades in power.
On Friday, European Commissioner for Trade Anna Cecilia Malmstrom said she had notified Cambodia that the EU was ending its preferential trade status because of a worsening of the country’s human rights record amid a crackdown by Hun Sen on the political opposition, NGOs, and the independent media surrounding the July 29 election.
“I have notified Cambodia today that we will launch the procedure for withdrawal of EBA,” Reuters news agency quoted Malmstrom as saying, following a meeting of EU trade ministers in Austria.
“Without clear and demonstrable improvements this will lead to suspension of trade preferences,” she said.
By launching a six-month review of its duty-free access to the EU, the bloc could impose tariffs on Cambodian exports within a year, according to EU rules.
“Our trade policy is value-based. These are not just words. We have to act when there are severe violations,” Malmstrom said, adding that Myanmar is also likely to have its special access to the EU stripped over its treatment of the Muslim Rohingya.
Calls by RFA’s Khmer Service to Cambodia’s Council of Ministers spokesman Phay Siphan for comment on the EU’s decision went unanswered Friday.
CNRP deputy president Mu Sochua, who is living in self-imposed exile to avoid a string of what are seen as politically motivated convictions of opposition members, said the EU’s move was a direct response to Hun Sen “crossing a red line in abusing human rights and democracy.”
“This is the EU’s final warning, and it will be troublesome for Cambodia’s economy,” she said.
“The CNRP doesn’t want to see any economic sanctions. We’d rather see [the CPP] return to the negotiating table … and allow all of the party’s members to rejoin politics.”
According to the European Commission, the EU ranked as the second biggest trade partner of Cambodia in 2017, importing goods worth 5 billion euros (U.S. $5.8 billion) from the country. Key EU imports from Cambodia include textiles, footwear, and agricultural products.