Prime Minister-elect Sam Rainsy: WORKERS' $160 WAGE DEMAND NOT EXCESSIVE, SIMPLY NECESSARY

៣០ ធ្នូ ២០១៣ / 30 Dec. 10:00 A decent salary...

ការទាមទារ របស់កម្មករ ឲ្យបានប្រាក់ខែ យ៉ាងតិច ១៦០ដុល្លារ មិនមែន ជាការទាមទារ ច្រើនហួសហេតុទេ, គឺ គ្រាន់តែ ដើម្បី ឆ្លើយតបទៅ នឹងសេចក្តីត្រូវការ ចាំបាច់ សម្រាប់ ឲ្យកម្មករ រស់បាន ប្រកប ដោយភាពថ្លៃថ្នូរ។ 
សូម អានអត្ថបទ ជាភាសាអង់គ្លេស ក្រោមនេះ ដែលចុះផ្សាយ ក្នុងកាសែត ខេមបូឌាឌែលី (Cambodia Daily) ថ្ងៃទី ៣០ ធ្នូនេះ។

The Cambodia Daily | 30 December 2013

WORKERS' $160 WAGE DEMAND NOT EXCESSIVE, SIMPLY NECESSARY

By Sam Rainsy

With regard to the ongoing nationwide strike facing Cambodia’s garment industry, there are some voices criticizing workers’ demand for an immediate doubling of the monthly minimum wage from $80 to $160 as being “unreasonable” and “impossible” to meet.

The workers’ demand may look “striking,” but it is only the result of a long injustice inflicted on workers whose frustrations must be fairly and timely addressed.

For a long period of time, factory owners and government officials have shown ignorance and negligence regarding the deterioration of the workers’ living conditions.

An article titled “Real Wages in Garment Sector Fell Over 10 Years” in The Cambodia Daily of July 15, 2013, points to the fact that, according to a report by the Worker Rights Consortium, “Wages for Cambodian garment workers decreased by more than 20 percent in real terms between 2001 and 2011 despite the industry’s exponential increase in exports (…)”.

In 2001 the average wage rate was $51 per month; in 2011 it went “up” to $70, but when adjusted for inflation that increase is the equivalent of $39.78, a drop of 22 percent in real terms, the report states.

In no other countries in the region has there been such a fall in workers’ living standards, all the more surprising in the context of a "booming" economy. [This reflects an ineffective allocation of resources and an unfair/unacceptable distribution of income].

Actually, Cambodia shockingly goes against the general trend toward better living conditions: Over the same decade-long period, real wages have increased by 28.4 percent in Vietnam, 39.7 percent in Indonesia, and 129.4 percent in China.

Cambodian workers are therefore entitled to a long overdue catch-up when it comes to fixing the minimum wage for a country which boasts a “thriving” garment industry accounting for over 80 percent of national exports.

However, under the present economic conditions, would an immediate doubling of the minimum wage be “unreasonable” and “impossible” to achieve? No, if we consider the example of Bangladesh, which raised its minimum wage for garment workers by 77 percent as recently as November. Over the above-mentioned decade-long period, real wages in Bangladesh have decreased by only 2 percent versus 22 percent in Cambodia, which justifies a more substantial wage catch-up for our country.

In absolute terms, a monthly minimum wage of $160 may look a little bit high compared to some other poor countries. But the cost of living in Cambodia is also higher than in neighbouring countries partly because of commercial monopolies and money extortion associated with systemic corruption.

Besides, because of government negligence, public and social services are extremely poor in Cambodia compared to neighbouring countries such as Thailand and Vietnam, which means that Cambodian workers have to spend more for their survival and well-being.

When using the concept of purchasing power parity for choosing meaningful exchange rates for international comparison, a minimum monthly wage of $160 for Cambodia is in line with the level of salaries in most countries we have to compete with.

From a strictly humanitarian point of view, social surveys show that $160 represent a minimum monthly wage required for any worker to live decently in Cambodia’s present economic conditions.

A comprehensive approach is needed to assess any demand for wage increase. Cambodia’s dollarized economy, which reflects the country’s weak economic foundations and the government’s incompetence in ensuring confidence in our national currency, compounds the many issues facing the country: declining competitiveness, growing trade deficit, accelerating inflation, deteriorating living standards.

The impact on business profitability of any salary increase would be limited given that workers’ wages currently represent only 20 percent of production cost.

In any case, to help the garment industry “absorb” the impact of a doubling of the minimum wage, Cambodia will have to seriously address the problems of government incompetence and corruption. This is an effort worth making for the sake of our workers.

In private, factories owners and managers and the business community in general have been complaining about money extortion practices by government officials at all levels. Transparency International rates Cambodia as one of the world’s most corrupt countries, which affects the competitiveness of our industry regardless of the level of workers’ salaries.

According to industry sources, if garment companies did not have to pay heavy and frequent bribes and other forms of “unofficial taxes” to the corrupt authorities, they would save huge resources allowing a significant increase in workers' salaries without affecting the industry’s competitiveness.

Therefore the government and factory owners must not point their fingers to workers accusing them of jeopardising the industry’s competitiveness. They must look at all the causes of the country’s economic and social problems. 

The industry’s overall competitiveness will not be hurt by the current workers’ demand if government corruption and incompetence are properly and timely addressed.

And if the government is corrupt and incompetent beyond repair, then this country definitely needs a government change.

----------------

Sam Rainsy is the president of the CNRP and a former Cambodian minister of finance.

សម រង្ស៊ី / Sam Rainsy
www.facebook.com/rainsy.sam.5