The European Commission has decided to withdraw part of the tariff preferences granted to Cambodia under the EU’s Everything But Arms’ (EBA) trade scheme due to the serious and systematic violations of the human rights principles.
The withdrawal of tariff preferences – and their replacement with the EU’s standard tariffs (most favoured nation MFN) – will affect selected garment and footwear products, and all travel goods and sugar. The withdrawal amounts to around one-fifth or the 1 billion euros worth of Cambodia’s yearly exports to the EU.
Unless the European Parliament and the Council object this will take effect from the 12th of August 2020 onwards.
High Representative for Foreign Affairs and Security Policy/Vice-President of the European Commission Josep Borrell commented at the time: “The duration, scale and impact of Cambodia’s violations of the rights to political participation and to the freedoms of expression and association left the European Union with no other choice than to partially withdraw trade preferences. The European Union will not stand and watch as democracy is eroded, human rights curtailed, and free debate silenced. Today’s decision reflects our strong commitment to the Cambodian people, their rights, and the country’s sustainable development. For the trade preferences to be reinstated, the Cambodian authorities need to take the necessary measures”.
Commissioner for Trade Phil Hogan said: “The European Union is committed to supporting Cambodia’s economic and social development through trade preferences. However, the respect for human rights is non-negotiable for us”.
The Commission’s decision addresses the human rights violations that triggered the procedure, while at the same time preserving the development objective of the EU trade scheme. It recognises the need to continue to support Cambodia’s economic development and diversification of its exports. All emerging industries in Cambodia will continue to enjoy duty-free, quota-free access to the EU market. High value-added garments and certain types of footwear will also continue to enjoy duty-free, quota-free access to the EU market. The Commission’s decision follows in-depth engagement with the Cambodian government and stakeholders. In particular, during the last twelve months, the Commission and the European External Action Service conducted fact-finding missions to Cambodia and held several meetings with the Cambodian authorities at both technical and political levels. With regard to civil and political rights, the European Commission believes there has been no significant progress since the launch of the EBA withdrawal procedure in February 2019.
The European Union reiterated the need for the government of Cambodia to re-open the political space in the country, to create the necessary conditions for the re-establishment of a credible opposition and to initiate a democratic process of national reconciliation through genuine and inclusive dialogue. This includes the reinstatement of the political rights of the opposition members and the repeal/revision of laws, such as the Law on Political Parties and the Law on Associations and Non-Governmental Organisations. “The Commission and the European External Action Service will continue their engagement with the Cambodian authorities and monitor the human rights and labour rights situation in the country closely. In case Cambodia shows significant progress, notably on civil and political rights, the Commission may review its decision and reinstate tariff preferences under the EBA arrangement”.
The EU is Cambodia’s largest trading partner, accounting for 45% of Cambodian exports in 2018. Exports to the EU from Cambodia reached 5.4 billion euros in 2018, more than double the 2.5 billion euros recorded in 2013. 95.7% of these exports entered the EU market under EBA tariff preferences (i.e. 5.2 billion euros out of the 5.4 billion euros in total). The EBA is one of the preferential trade arrangements under the EU Generalised Scheme of Preferences (GSP). It grants full duty-free, quota-free access into the EU market for all products except arms and ammunition for countries classified by the United Nations as Least Developed Countries. Access to these preferences comes with the obligation to respect human rights and labour rights.