Cambodia has slammed an EU threat to suspend trade benefits in the wake of a deeply flawed election as an "extreme injustice" that would reverse hard-earned economic development.

The EU warned the government last week that it had started a process to withdraw from the deal in response to widely criticised elections in July, which were held without any credible opposition and tainted by allegations of voter intimidation.

EU trade commissioner Cecilia Malmstrom said that unless there were improvements the trade preferences would be suspended, though the bloc's delegation in the country clarified the process still involved further decisions that could take a year.

In a response distributed to the media on Thursday, Cambodia's Ministry of Foreign Affairs said it can "only take this decision as an extreme injustice when the EU blatantly disregards the considerable progress made by the country, despite its recent tragic past".

Cambodia was ravaged by the ultra-Maoist Khmer Rouge regime in the 1970s and endured years of civil war until the first UN-sponsored elections in 1993.

It said that if the special trade access were scrapped, the EU could negate 20 years' worth of efforts to pull millions out of poverty.

The $7 billion apparel industry is the kingdom's largest formal employer, providing jobs to some 740,000 people in a country with a population of 15 million.

Prime Minister Hun Sen's ruling Cambodian People's Party swept all seats in parliament during the poll, cementing the country's status as a one-party state and extending his 33-year rule.