BANGKOK — Cambodian Prime Minister Hun Sen is facing economic pressure to reverse a recent crackdown on opposition groups and basic freedoms in his country.

Cambodia faces an economic collapse from the slated withdrawal of crucial European Union trade preferences that will likely force its leader to walk back a prolonged political crackdown, observers and labor groups say.

The EU told Cambodia on Friday it will lose duty-free access to the world’s biggest market within 12 months for its “blatant disregard” of human and labor rights standards attached to trade preferences it is granted as a developing nation.

Unless the government takes significant actions to redress an autocratic backslide including reinstating the country’s banned opposition in the next six months, the “Everything But Arms” (EBA) preferences will be withdrawn.

“This could be disastrous. I mean, if I were an investor looking at certainly the garment sector I would be very concerned about now,” said political economist Sophal Ear, an associate professor of diplomacy and world affairs at Occidental College in Los Angeles.

“I would pause any expansion plans because it would be like wait, things could go completely haywire,” he said.

Moeun Tola, Executive Director of the Center for Alliance of Labor and Human Rights, said a huge number of workers would be forced into unemployment and the ball is now in Hun Sen’s court.

“If the government really care about the nation and our people, they should reconsider the demands/recommendations from EU,” he said.

Garment manufacturing is Cambodia’s biggest industry, accounting for about 40 percent of the gross domestic product and some 800,000 jobs, while the EU is by far its largest export market, absorbing almost $6 billion worth of goods last year according to its own figures.

Preferential access to that market is seen by some of Hun Sen’s critics as one of the few meaningful negotiating chips to counter an autocratic leader increasingly emboldened by Chinese support.

Statements of concern and threats to review the EBA in the past have been brushed off by his government as empty and bemoaned by some of his critics frustrated with a lack of concrete punitive international intervention.

‘Defense of sovereignty’

The immediate reaction to the announcement from Hun Sen, who has ruled for more than 30 years, has been defiance.

“No matter what measures they want to take against Cambodia, in whatever way, Cambodia must be strong in its defense of its sovereignty,” he said in a post to his Facebook page Monday.

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