Cambodia rushes to calm food price fears

Posted at 03/27/08 8:11 PM

Agence France-Presse

PHNOM PENH - Cambodia Thursday rushed to calm fears over spiraling food costs, as it pushed out a series of measures meant to halt price hikes as thousands of factory workers facing hunger threatened to strike for higher wages.

A lifting of the ban on imported pigs and pork products was announced earlier in the day, following moves Wednesday to bring down the cost of rice by banning exports of the staple and prevent people from stockpiling other foods.

Finance Minister Keat Chhon, in a statement released Thursday, appealed for people "to remain calm ... and not to stock up on foods, which could make the situation even harder."

The price of meat and other goods has risen by as much as 40 percent over the past year on the back of near 11 percent inflation, with rice -- Cambodia's most important staple -- now costing nearly one dollar a kilogram.

Since Wednesday, the government has released surplus rice onto the market, allowing people to buy five kilograms each at reduced prices.

While rising food prices are part of a global trend, they have hit especially hard in Cambodia, where more than a third of the country's 14 million people are mired in poverty.

Prime Minister Hun Sen asked the country's finance and commerce ministries to address "the abnormal increase of price of goods," saying rising costs are "affecting the daily livelihoods of our citizens, especially workers, farmers and civil servants."

The measures come as thousands of garment workers threaten to strike if the industry's monthly 50 dollar minimum wage is not raised by five dollars.

Garment manufacturers narrowly prevented a walkout in 50 factories Thursday morning by agreeing to talks between factory owners and workers.

While Chea Mony, head of Cambodia largest workers' group the Cambodian Free Trade Union, described this as a "positive" step, he said a strike would be called next week if negotiations failed.

"We have postponed the planned strike at the request of the manufacturers," he told AFP, but added: "The workers' current wages cannot keep up with inflation."

The garment sector is Cambodia's largest industrial employer, putting to work as many as 350,000 people, mostly young women supporting poor families in the countryside, where many live on less than 50 cents a day.

Aid agencies have warned that Cambodia's growing food crisis could threaten tens of thousands of rural Cambodians with hunger in the coming year, as even food handouts have become significantly more expensive and harder to distribute.

Faced with this recent rising tide of anger, government officials have blamed the staggering cost hikes on "opportunists" seeking to gouge prices or gain political capital ahead of national elections, now expected to be held in July.

"Bad people are hyping up the situation for their own interests," Keat Chhon said.