7/29/2019 Investors From Korea Relocate to Cambodia

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Investors fromKorea relocateto CambodiaAnne Renzenbrink

KOREAN investors are relocatinglabour-intensive businesses to countries such as Cambodia after Indonesia raised its minimum wage.Anumber ofKorean investors hadclosed heir Indonesian factories andrelocated to other countries in theregion because their requests forminimum-wage exemption had beenrefused, TheJakarlll Pos t reported.Indonesia has raised provincial

minimum wages about 40 per centto RP 2.2 mill ion ($226) a month."One or two factories have movedtheir garment p roduction base toCambodia recently because of wages," Nam -Shik Kang, chairman of theKorean Chamber of Commerce inCambodia, told the Posryesterday.Ch eat Khemara, senior officer atthe Garment Manufacturers Association in Cambodia, said an increasingnumberof Korean investors had been

7/29/2019 Investors From Korea Relocate to Cambodia

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Cambodia would not lose its lowlabour costs advantage, Suzuki said."Ofcourse, wages in Cambodiawillincrease to some extent."Howeyer, the increase would bemuch greater in neighbouring countries. So the advantage of low labour, costs in Cambodia would not beundermined."Cam bodia has also the advantageof its location in the centre ofASEANan d improved logistical infrastructure. such as roads and ports."

Tl( Garm en t Co, a leading ThaiI fashion manufacturer, is reloca tingits largest production si te to Cambodia to escape high wage costs.Nam-ShikKang. however, said thatI although many Korean gaIlllent facto ries in Vi etnam were looki ng trelocate to Cambodia, they werehesitan t. "because VieUJam's in fra structure fo r business is very strongand well organised".He said that if Cambodia raiseu ftsm in im um wage LO $150 a mon th ,factori es would lose their competirive edge to Vietnam and Indones iaI \'Vitbout improving their productivityand quali ty."Many Korean investors will startI thinking of relocating their production base lo Myanmar very soon."