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News

Dialogue with Cambodia on fair supply chains

BMAS/D. Baller

State Secretary Lilian Tschan welcomed the Cambodian Minister of Labour, Sour Heng, and his delegation to the Federal Ministry of Labour and Social Affairs.

On 17 January 2025, State Secretary Lilian Tschan welcomed the Cambodian Minister of Labour, Sour Heng, and his delegation to the Federal Ministry of Labour and Social Affairs.  The minister was accompanied by staff from the Ministry of Labour, other Cambodian ministries, representatives of the textile industry and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ). 

At the Federal Ministry of Labour and Social Affairs, the delegation met with German experts to discuss social dialogue in Germany, German and European legislation on human rights compliance in global supply chains, and occupational safety and health.

For many years, German development cooperation has been supporting the Cambodian Ministry of Labour in improving the national system for labour inspections and in the area of sustainability, with a focus on labour standards in the textile industry.  The textile industry plays a major role for Cambodia and its exports.  The industry is the largest employer, especially of women. 

With the Act on Corporate Due Diligence in Supply Chains (Supply Chain Due Diligence Act), the Federal Ministry of Labour and Social Affairs has committed itself to ensuring good working conditions in production countries such as Cambodia.  The law is intended to ensure that no products are offered in Germany that have been produced under indecent working conditions.  The legislation requires German companies to carry out a risk analysis to determine whether their suppliers also comply with certain standards. State Secretary Tschan emphasised that it is important for the Federal Ministry of Labour and Social Affairs to know how the law will affect producing countries and what challenges will arise.

State Secretary Tschan:  "German consumers expect the products they buy to be manufactured under good working conditions.  With the German and European supply chain legislation, we have created the conditions for German companies to ensure this along the entire supply chain.  However, this can only succeed if we exchange information on the challenges in important textile production locations such as Cambodia.”

In the subsequent expert discussion, the Cambodian Minister of Labour argued that German companies should not be allowed to pass on their due diligence obligations to small and medium-sized suppliers (SMEs).  Due to limited financial and human resources, the obligation to provide  an overload of evidence could ultimately lead to them being displaced by larger suppliers.

The Federal Ministry of Labour and Social Affairs emphasised that easing the burden on SMEs at home and abroad is a priority.  It is not permissible to transfer obligations under the Act on Corporate Due Diligence in Supply Chains to suppliers in partner countries such as Cambodia.  The same applies to the new EU Corporate Sustainability Due Diligence Directive (CSDDD).  Cooperation in the supply chain is a learning process based on dialogue and continuous exchange.  Ideally, contracted companies work fairly and on an equal footing with their suppliers over a longer period of time.  Industry initiatives can provide additional support. 

In addition, the Cambodian side was very interested in deepening the exchange on occupational safety and health, as Cambodia is currently working on corresponding legal regulations. 

The Cambodian and German labour ministries want to continue the mutually beneficial cooperation on labour and social policy issues.