Cambodia Faces High US Tariffs Despite RCEP Export Gains
PHNOM PENH, July 16 – Cambodia’s exporters face the imminent threat of steep U.S. tariffs, with a 36% duty scheduled to take effect on August 1, as trade negotiations with Washington remain stalled.
While the country is benefiting from deeper integration with the Regional Comprehensive Economic Partnership (RCEP), its external trade picture remains mixed. Exports to RCEP markets—primarily Vietnam, China, Japan, Thailand, and Australia—rose 12.8% in 2024 to US $9.06 billion, accounting for about one-third of total exports. However, imports climbed even faster, widening the overall trade deficit.
At the same time, Cambodia’s substantial bilateral trade gap with the U.S.—standing at US $12.3 billion in 2024—is under scrutiny. The country’s dominant garment and footwear exports to America are now at risk, as tariff hikes threaten competitiveness and margins.
Despite three rounds of talks, little progress has been made in softening the U.S. position. In response, Cambodian officials have offered tariff concessions on 19 U.S. product categories in an effort to reach compromise.
U.S. firms that had begun relocating production from China to Cambodia are now weighing the cost of these new trade headwinds. The final outcome of the talks may define whether Cambodia solidifies its role in global supply chains—or is forced to reorient toward regional markets.
Sources:
- ARC Group, “U.S. Tariffs Threaten Cambodia Exporters,” July 2025
- Xinhua News, “Cambodia’s RCEP Exports Rise Despite Deficit,” July 2025
- Camboja News, “Cambodia Offers Tariff Concessions Amid U.S. Talks,” July 2025
- The Wall Street Journal, “American Firms Shift Production to Southeast Asia,” July 2025