Cambodia Faces ‘Ticking’ Clock on European Trade-Penalties Plan

(Bloomberg) -- The European Union triggered a year-long process for imposing trade sanctions against Cambodia as a result of alleged human-rights violations in the country.

The European Commission in Brussels moved on Monday toward suspending a policy that lets Cambodia export all goods except weapons duty-free and quota-free to the EU.

The commission, the EU’s executive arm, will monitor the situation in Cambodia for the next six months and decide within 12 months whether to revoke -- at least in part -- the bloc’s trade preferences. In the coming six to nine months, the commission will issue a report with findings, according to the decision due to be published on Feb. 12 in the EU Official Journal.

“Today’s move is neither a final decision nor the end of the process; but the clock is now officially ticking and we need to see real action soon,” EU Trade Commissioner Cecilia Malmstrom said in an emailed statement.

The EU is trying to prod changes in the political behavior of Cambodian Prime Minister Hun Sen while being wary of damaging the country’s economy, where a $5 billion garment industry employs 750,000 people and is the biggest exporter.

Hun Sen, who extended his 33-year rule last July when his party won a boycotted election, has so far struck a defiant tone with the European side.

The commission on Jan. 29 won the green light from EU national governments to initiate the process for suspending the bloc’s trade preferences for Cambodia.

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