Better to Ride These Bikes Than Make Them

Cambodia’s export business is in the process of changing due to shifts in manufacturing in Asia. A business publication in the country has reported unexpected growth in the “machinery and transport equipment” sector and speculated it was as [sic] “probably bicycles.” But when Cambodia jumped into the top ten exporters of bicycles to the EU in 2012, it prompted the European Bicycle Manufacturers’ Association (EBMA) to investigate. The EBMA discovered that bicycle companies had moved their production to Cambodia from Thailand and China, citing increased expenses. The move is estimated to save 14 percent on taxes. A favourable scheme is in place for Least Developed Countries (LDCs) under the Generalized Scheme of Preferences (GSP) known as the Everything But Arms (EBA) agreement. The EBA allows countries ranked among the 48 LDCs to export products duty-free to the EU, except arms and ammunition. … The Special Economic Zone (SEZ), according to a USAID report, offers pro-business perks to investors, a quick turnaround on red tape, low taxes, low wages, ease of doing business and a “young and educated” population. The report listed 1,500 workers in the bicycle industry. The minimum monthly salary then for factory work was 60 dollars a month, or 33 cents per hour, which would necessitate working six days per week to make 60 dollars monthly. Dated 2008, this shows that wages have not risen in four years. …

http://www.iede.co.uk/news/2013_750/better-ride-these-bikes-make-them