Workers fainted when they did not say a word. Cambodian factories either closed or fled.

category:Finance
 Workers fainted when they did not say a word. Cambodian factories either closed or fled.


In the past few years, due to the rising labor costs, many enterprises in many countries have set up factories in Cambodia, but in recent years, the phenomenon of factories closing in Cambodia has become more and more serious. According to statistics, 54 factories closed in 2017 and 35 in 2018. So far, more than 70 factories have closed in Cambodia this year, which has doubled compared with last year.

So why is it that a factory that was once the best place to build a factory in the world is now either closing down or fleeing?

Raise salary till the boss wants to work!

There are several main reasons, first of all, the rising labor costs of factories. At first, the reason why international enterprises chose to open factories in Cambodia was that they valued Cambodias cheap labor, but now wages have risen to the bosses want to work.

From 1997 to 2017, the minimum wage in Cambodia rose from $40 to $153 in 20 years and from $170 in 2018, which was significantly higher than that in other competing countries for clothing and shoes exports, such as Bangladesh, $67 in India, $77-143 in India, $79 in Myanmar and $134 in Pakistan.

This year, Cambodias Ministry of Labor issued a new standard, with a floor salary of 182 dollars, plus employee benefits, a monthly salary of 480 dollars. If we calculate this salary standard initially, we will find that it is basically equal to the salary of Chinese workers, or even to the salary of a Chinese university student when he first stepped out of school.

In addition, starting in 2019, factories need to pay twice a month, in the second and fourth weeks of each month, which is not a small pressure for factories, because cash flow has a great impact on enterprises, and Cambodias regulations increase the cost of factories.

In addition, wage increases do not increase productivity is also a problem, that is to say, work efficiency is very low. Generally speaking, the productivity of Vietnamese and Indonesian garment factories is about 80% of that of China, while that of Cambodian garment factories is only 60% of that of China. That is why some Chinese enterprises feel it is better to move their factories back to China.

Strike or faint without a word

Interestingly, the workers in Southeast Asia are inefficient in production, but they have a high sense of rights protection. Although most of them are strikes caused by the runaway Communist bosses, there are also frequent strikes demanding salary increases or welfare benefits, and even the relocation of factories can trigger large strikes.

Garment factories are one of the pillars of Cambodias economy. For this reason, Prime Minister Hun Sen said in his meeting with workers that everyone should not kill chickens and take eggs. If the requirements are too high, the factories will withdraw from Cambodia, that is, the eggs are beaten by flying eggs.

Cambodian workers may faint if they disagree with each other. Sometimes it is because of poor physical fitness. But some reasons for fainting are very funny, such as being scared by the sound of car tire explosion, being stunned by chicken excrement, being stunned by the smell of gasoline, or having a worker faint, a large number of workers fainted with it, etc. Its a big surprise in the world.

Countries with the largest number of public holidays in the world

In addition to such human factors as salary increases, low productivity and strikes, investors cant stand Cambodia for another ridiculous reason: Cambodia is recognized as the country with the largest number of holidays in the world, with 28 days of public holidays, almost a whole month. Take October for example, October 8-10 is the Day of the Dead, October 15 is the Day of Mourning the Father, October 23 is the Day of Remembrance of the Paris Peace Agreement, October 29 is the Kings Day of Inauguration, and last Sunday, it seems like a month of busy vacation, which is good for workers, but for bosses, it is like crying without tears. Of course, the international environment has also changed. Because of the previous Cambodian election, the European Union has threatened to abolish preferential tariffs in Cambodia many times, which is also a fatal blow to Cambodias garment and shoes industry, because Cambodia will pay an additional $600-700 million in tariffs per year based on its current exports. All these lead to the need for investors to make a comparison between input and output, to make rebalancing and re-selection. Author: Shui Pi Chat Studio Source: Responsible Editor of China Times: Wang Xiaowu_NF

In addition to such human factors as salary increases, low productivity and strikes, investors cant stand Cambodia for another ridiculous reason: Cambodia is recognized as the country with the largest number of holidays in the world, with 28 days of public holidays, almost a whole month. Take October for example, October 8-10 is the Day of the Dead, October 15 is the Day of Mourning the Father, October 23 is the Day of Remembrance of the Paris Peace Agreement, October 29 is the Kings Day of Inauguration, and last Sunday, it seems like a month of busy vacation, which is good for workers, but for bosses, it is like crying without tears.

Of course, the international environment has also changed. Because of the previous Cambodian election, the European Union has threatened to abolish preferential tariffs in Cambodia many times, which is also a fatal blow to Cambodias garment and shoes industry, because Cambodia will pay an additional $600-700 million in tariffs per year based on its current exports.

All these lead to the need for investors to make a comparison between input and output, to make rebalancing and re-selection.

Author: Water Skin Talk Studio