“We cannot accept what they demand, we cannot exchange our legal system and independence [to retain the EBA],” said Prime Minister Hun Sen. Pic courtesy of Khmer Times/Khem Sovannara

THE Cambodian government said the demands made by the European Union over the Everything but Arms trade status were unacceptable and will not be fully implemented.

“We cannot accept what they demand, we cannot exchange our legal system and independence [to retain the EBA],” said Prime Minister Hun Sen.

His comments came after the EU handed over a preliminary report to the government last week regarding steps the government must take to retain its EBA status.

The Cambodian government has a month to respond to the report and a final decision by the EU is expected in February next year.

According to the Khmer Times, although the report has not been made public, the EU initially launched the EBA review over perceived democratic and human rights setbacks following the dissolution of the opposition party CNRP.

After the report was filed, EU’s spokesperson for foreign affairs and security policy Maja Kocijancic said on Twitter that political space in Cambodia remains a concern.

“The EU reiterates the importance of the Cambodian authorities taking immediate action to open the political space in the country, to establish the necessary conditions for a credible, democratic opposition,” said Kocijancic.

Hun Sen said Cambodia was well-prepared to lose the EBA.

“If they want us to pay tax, then let’s pay them. It does not matter. Currently, they use EBA as tool to threaten us and force us to follow them.

“I wish to inform you that we cannot exchange our sovereignty with your aid or trade preference. They cannot use the EBA to threaten us anymore.”

He also noted that Cambodia would eventually lose its EBA status before 2030 as its economy continued to grow.

“We will pay full tax in the near future,” he said.

The EU is one of Cambodia’s biggest markets for textile and garment products with duty free access under the EBA. The EU market accounts for about 40 percent of Cambodia’s exports.

Last year, the EBA enabled Cambodian goods worth US$5.8 billion (RM24.2 billion) to be exported to the largest trading bloc in the world.

The EU accounts for 17.3 per cent of all of Cambodia’s trade, coming second just behind China, which accounts for 23.8 per cent.

A loss of EBA status could cost Cambodia US$654 million (RM2.7 billion) a year and puts at risks the jobs of the 800,000 Cambodians employed in the garment and textile manufacturing sector.

Meanwhile, Centre for Alliance of Labour and Human Rights, executive director Moeun Tola said the government should fulfil the EU’s demands to retain the EBA.

He said investors would move to other countries if the EBA was withdrawn, noting that the government should provide stronger support to investors so they still do business in the country.

“If the government can provide subsidies for their investments, it will be good,” he said.

International Relations Institute of the Royal Academy of Cambodia director general Kin Phea said the EBA issue was EU’s political agenda and was politically motivated.”

“The human rights situation in Cambodia is much better than other countries in the region such as Laos and Myanmar,” he added.