Cambodia’s Garment Exports to Australia Increase

Cambodia is reaping the rewards of trade agreements with Australia as clothing exports from the Kingdom to the nation in the first quarter of 2023 rose to $42.575 million
Rush hours in Phnom Penh. Kiripost/Siv Channa
Rush hours in Phnom Penh. Kiripost/Siv Channa

Australia's clothing imports from Cambodia have bucked the general trend of a decrease, with imports in the first quarter of 2023 increasing to $42.575 million compared with the same period last year.

The majority of nations that export clothing have seen a decline in orders as a result of slow brand and store purchasing. Demand in retail sectors has been constrained by high inflation rates in Europe and the US.

From January to March, Australia imported $42.575 million of clothing from Cambodia, up from $26.651 million during the same time in 2022 and $38.347 million in October to December 2022.

According to information gathered from Fibre2Fashion's market analysis tool TexPro, shipments totaled $37.390 million from July through September and $28.536 million from April through June of the previous year.

The ASEAN-Australia-New Zealand Free Trade Area (AANZFTA) and the Regional Comprehensive Economic Partnership (RCEP), two advantageous trade agreements between the countries, have helped Cambodian garment manufacturers compete in the Australian market, according to the Australian Embassy in Phnom Penh.

“Australia is pleased with the growth in our trade and investment with Cambodia and we are looking for opportunities to expand this cooperation,” cited the Australian Embassy in Phnom Penh in response to a Kiripost email on Thursday.

The Embassy added that in September, it launched an $87 million flagship program, the Cambodia Australia Partnership for Resilient Economic Development (CAPRED). It is also assisting the government in modernizing its regulatory framework and capacity to benefit from new free-trade agreements, including an upgraded AANZFTA.

Compared to sales of $112.846 million in 2021, imports from Cambodia totaled $140.926 million in 2022. Australia imported $96.221 million worth of clothing from Cambodia in 2020, down from $116.376 million in 2019, but orders grew again in 2021 and 2022. TexPro estimates that inbound shipments were worth $99.487 million in 2018.

During the first quarter of this year, Australia imported pants and shorts worth $10.655 million, or 26.03 percent of the total, according to a product-by-product study. The import value of shirts was $3.546 million, innerwear was $3.699 million, T-shirts were $3.650 million, and jerseys were $9.071 million.

Additionally, CAPRED assists Cambodia's small and medium-sized companies in connecting to regional supply chains so that more of the value-added stays in the country.

Last year, during the ASEAN-related summits hosted by Cambodia, Australia’s Prime Minister, Hon Anthony Albanese, announced a new Special Envoy for Southeast Asia.

The Special Envoy, Nicholas Moore, is developing a strategy to strengthen Australia’s economic engagement with Southeast Asia, bolster two-way trade, and grow Australian investment.