Cambodian garment factories are to sue over recent strikes, while those in Bangladesh are counting the cost of three months of political turmoil.

Cambodian garment factories will pursue legal action against unions they hold responsible for strikes that caused a sector-wide shutdown over the Christmas and New Year period, the Garment Manufacturers Association in Cambodia (GMAC) has said.

"Our members have granted power-of-attorney to GMAC to act on their behalf [in this matter]. To date we have received complaints from more than 250 factories and I believe more will come in the following weeks," GMAC secretary general Ken Loo told just-style.

GMAC published an open letter in late December in which it accused six trade unions and their leaders of instigating what the association considers an illegal strike.

Following a police crackdown, in which four demonstrators died and dozens were seriously injured, the strike was called off last week.

Loo said that GMAC would not negotiate with what he called the 'minority unions' who had called the strike.

It is unclear what effect the stop work will have on orders this year, but several of Cambodia's foreign clients including H&M, Gap, Inditex, Adidas, Puma, Levi Strauss & Co and Columbia Sportswear expressed their concern over the violence in an open letter.

GMAC was quoted last week as suggesting that the strikes would cost the industry US$200m, but Loo emphasised that the financial impact was unknown.

"There are too many factors that remain uncertain at this point to make any meaningful estimate. As for a drop in orders, again, it is too early to tell."

Union groups have not responded to just-style's request for comment.

Bangladesh hopes for the best
Elsewhere, Bangladesh's garment manufacturers have managed to retain most of their international buyers despite disruption caused by the three months' long political turmoil in the country, just-style has been told.

"Walmart and H&M had initially planned to shift their orders to China and other countries, but now they are coming back with whole orders," said Nasiruddin Ahmed Chowdhury, first vice president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

The disruption has nevertheless cost Bangladesh's largest export industry dearly.

"For sending finished goods from factory to Chittagong port and internal mobilisation of raw material we had to incur lot of unwanted expenditure," Fazlul Hoque, former president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told just-style.

Chowdhury said some manufacturers had even to send cargo by air at their own cost.

To add to their woes, the period coincided with a 30% wage increase implemented across the garment industry from 1 December 2013.  

Hoque said many garment and knitwear manufacturing companies were unable to repay bank loan instalments in time.

To offset these losses, the government has provided a range of incentives. Chowdhury said, for example, that income tax has been temporarily reduced by 50%, bank interest rates are down by 1% and insurance premiums have been reduced by 35% for garment exporters.

The industry is also pressing for a reduction in electricity costs, he told just-style.

Despite the turmoil, exports have maintained annual growth of 20% and confidence is returning in the industry, Hoque said: "Luckily in the last few days things are improving and we are hoping for the best."

With additional reporting by Raghavendra Verma.