Britain garment manufacturer moves operations to Cambodia

PHNOM PENH, A major garment manufacturer will move its product development center from the United Kingdom to Cambodia, a sign, according to some experts, that despite the effects of the economic crisis, the Cambodian garment sector continues to remain internationally competitive, local media reported on Monday.

Britain company New Island Clothing is setting up "a high level standards product development center," making the company one of the first to conduct the whole garment-production process -- from development to the placement of orders -- in Cambodia, New Island General Manager Kevin Plenty was quoted by the Cambodia Daily as saying.

The company, which has been in Cambodia for nine years and produces up to 75,000 men's shirts per week, had decided to set up the center here because it makes "the whole production process quicker for our customers," as the majority of materials come from the ASEAN region, said Plenty.

Kaing Monika, external affairs manager of the Garment Manufacturers Association in Cambodia (GMAC) said New Island's strategy showed the factory's "long-term vision and commitment in Cambodia," adding that most Cambodian factories only do "cut, make and trim" -- a production formula in which raw materials and designs are supplied and factories only really stitch the clothes together.

Tuomo Poutiainen, chief technical adviser for the International Labor Organization's garment sector program Better Factories Cambodia, said New Island's decision was "very positive for industry" and showed there was "enough confidence in the Cambodian garment sector to invest even in bad times."

Hundreds of factories have constituted the backbone of the garment sector of Cambodia, which used to generate above 70 percent of its total annual export volumes.

However, due to the global financial crisis and rising labor disputes, at least 60 garment factories have been closed and more than 50,000 garment workers lost their jobs since late 2008 and the sector's export volumes have also seen an obvious slide in the first quarter of this year.

But Plenty said he believed that the industry will see an economic turnaround within six months, and that he is not the only one within the garment industry to feel that way.