Cambodia Tariffs
The landscape of Cambodia tariffs has undergone dramatic transformation in 2025, marking one of the most significant shifts in US-Cambodia trade relations since the establishment of bilateral commercial ties. Cambodia now faces some of the highest tariff rates imposed by the United States on any trading partner, fundamentally reshaping the economic dynamics between these two nations. The implementation of reciprocal tariffs has created unprecedented challenges for Cambodian exporters and manufacturers who have relied heavily on preferential access to American markets.
The current tariff structure represents a strategic pivot in US trade policy, specifically targeting countries perceived to have unfavorable trade balances with America. Cambodia’s tariff rates have become a focal point of international trade discussions, as the nation grapples with maintaining its competitive edge in global manufacturing while navigating the complexities of heightened trade barriers. These developments have far-reaching implications for Cambodia’s economy, which has historically depended on textile and garment exports to sustain growth and employment levels.
Interesting Stats & Facts About Cambodia Tariffs in 2025
| Key Facts | Details | Impact |
|---|---|---|
| Current US Tariff Rate | 36% on all Cambodian goods | Reduced from initial 49% |
| Implementation Date | August 1, 2025 | Affects all exports to US |
| Trade Deficit | $12.3 billion in 2024 | 9.4% increase from 2023 |
| Total Trade Volume | $13 billion in 2024 | Largest bilateral trade figure |
| US Imports from Cambodia | $12.7 billion in 2024 | 9.3% growth year-over-year |
| US Exports to Cambodia | $321.6 million in 2024 | 4.9% increase from 2023 |
| Primary Export Categories | Textiles, garments, footwear | 85% of total exports |
| Manufacturing Impact | Potential 30-40% cost increase | Threatens competitiveness |
The statistics reveal the magnitude of economic disruption that Cambodia’s tariff implementation represents for bilateral trade relationships. The 36% tariff rate currently imposed on Cambodian goods makes it one of the highest-taxed countries in US trade policy, second only to China in terms of punitive trade measures. The $12.3 billion trade deficit underscores the imbalanced nature of US-Cambodia commerce, where American imports vastly exceed exports by a ratio of nearly 40:1.
These figures demonstrate Cambodia’s heavy reliance on the US market, particularly in labor-intensive manufacturing sectors where the country has built competitive advantages over decades. The 9.3% growth in US imports from Cambodia in 2024 highlights the continued demand for Cambodian products despite growing trade tensions. However, the implementation of reciprocal tariffs threatens to reverse this positive trajectory, potentially reducing Cambodia’s market share in favor of competitors with more favorable trade terms.
Cambodia Import Tariffs Analysis in 2025
Import Structure and Tariff Classifications in Cambodia 2025
| Product Category | Tariff Rate Applied | 2024 Import Value | Market Share |
|---|---|---|---|
| Textiles & Garments | 36% | $8.9 billion | 70% |
| Footwear | 36% | $1.8 billion | 14% |
| Electronics | 36% | $1.2 billion | 9% |
| Agricultural Products | 36% | $0.5 billion | 4% |
| Other Manufactured Goods | 36% | $0.3 billion | 3% |
Cambodia’s import tariff landscape reflects a uniform application of the 36% reciprocal tariff across all product categories entering the United States market. This blanket approach represents a departure from traditional selective tariff structures, creating comprehensive barriers that affect every aspect of Cambodia’s export economy. The textile and garment sector, which accounts for $8.9 billion or 70% of total imports, faces the most significant impact due to its volume and Cambodia’s specialization in this industry.
The implementation of these uniform tariff rates has fundamentally altered the cost structure for Cambodian manufacturers, who must now absorb substantial additional costs or pass them on to American consumers. The $1.8 billion footwear industry represents another critical sector where Cambodia has established significant market presence, particularly in athletic and casual shoe manufacturing. Electronics and agricultural products, while smaller in volume, still represent important diversification efforts that are now threatened by the comprehensive tariff structure implemented in 2025.
Cambodia Export Tariffs Structure in 2025
Export Performance Under New Tariff Regime in Cambodia 2025
| Export Destination | 2024 Value | Tariff Impact | Projected 2025 Change |
|---|---|---|---|
| United States | $12.7 billion | 36% tariff | -25% to -35% |
| European Union | $6.2 billion | 0% (GSP) | +15% to +20% |
| Japan | $1.8 billion | 0% (GSP) | +10% to +15% |
| Canada | $0.9 billion | 0% (GSP) | +20% to +25% |
| Other Markets | $2.4 billion | Various | +5% to +10% |
Cambodia’s export strategy is undergoing forced diversification as a direct result of the 36% US tariff implementation. The projected decline of 25% to 35% in US-bound exports represents a massive shift in trade flows that will require fundamental restructuring of manufacturing and logistics networks. The $12.7 billion in current US exports faces severe compression, forcing Cambodian manufacturers to seek alternative markets with more favorable terms.
The European Union market, valued at $6.2 billion, is positioned to benefit significantly from trade diversion effects, as Cambodia retains Generalized System of Preferences (GSP) status providing duty-free access. Similarly, the Japanese market at $1.8 billion and Canadian market at $0.9 billion represent opportunities for growth as manufacturers redirect production away from the now-expensive US market. This trade diversion effect, while providing some relief, cannot fully compensate for the scale of US market losses, necessitating aggressive expansion into emerging markets across Asia, Africa, and Latin America.
Cambodia Product-Specific Tariffs in 2025
Major Product Categories Under Tariff Regime in Cambodia 2025
| Product Code (HS) | Product Description | Pre-2025 Rate | Current Rate | Trade Value 2024 |
|---|---|---|---|---|
| 6109-6117 | Textiles & Apparel | 0-15% | 36% | $8.9 billion |
| 6401-6405 | Footwear | 8-20% | 36% | $1.8 billion |
| 8517-8529 | Electronics | 0-6% | 36% | $1.2 billion |
| 0801-0814 | Agricultural Products | 0-10% | 36% | $0.5 billion |
| 9401-9404 | Furniture | 0-8% | 36% | $0.3 billion |
The product-specific tariff analysis reveals the dramatic increase in trade barriers across all major Cambodian export categories. The textile and apparel sector, previously benefiting from relatively low tariff rates of 0-15%, now faces a uniform 36% rate that represents a cost increase of 140-260% depending on the specific product classification. This massive escalation threatens the fundamental competitiveness of Cambodia’s $8.9 billion textile industry.
Footwear manufacturers experience similar challenges, with tariff rates jumping from a previous range of 8-20% to the uniform 36% level, representing increases of 80-350% in trade costs. The electronics sector, historically benefiting from near-zero tariffs under various trade preference programs, now confronts a 600% increase in tariff burden, making Cambodian electronic products significantly less competitive compared to alternatives from countries with more favorable trade terms. This comprehensive tariff restructuring forces a complete recalculation of pricing strategies and market positioning for all major Cambodian export industries.
Cambodia’s Top 10 Trade Partner Countries and Revenue in 2025
Leading Trade Partners and Revenue Analysis for Cambodia 2025
| Rank | Country | Trade Value 2024 | Growth Rate | Primary Products |
|---|---|---|---|---|
| 1 | United States | $13.0 billion | +9.3% | Textiles, Footwear |
| 2 | China | $7.8 billion | +12.5% | Electronics, Machinery |
| 3 | European Union | $6.2 billion | +8.7% | Garments, Agricultural |
| 4 | Vietnam | $3.1 billion | +15.2% | Raw Materials, Food |
| 5 | Thailand | $2.4 billion | +6.8% | Manufactured Goods |
| 6 | Japan | $1.8 billion | +4.2% | Textiles, Electronics |
| 7 | South Korea | $1.5 billion | +11.3% | Garments, Machinery |
| 8 | Singapore | $1.2 billion | +7.9% | Re-exports, Services |
| 9 | Canada | $0.9 billion | +13.1% | Textiles, Agricultural |
| 10 | Malaysia | $0.7 billion | +9.6% | Palm Oil, Electronics |
Cambodia’s trade diversification strategy becomes critical as the $13 billion US market faces significant compression due to tariff implementation. The Chinese market at $7.8 billion represents the second-largest trading relationship and shows robust 12.5% growth, indicating potential for expanded cooperation despite broader geopolitical tensions. European Union markets continue to provide stable demand worth $6.2 billion with 8.7% growth, supported by preferential trade agreements that maintain competitive access.
The ASEAN region collectively represents over $8 billion in trade value, with Vietnam ($3.1 billion), Thailand ($2.4 billion), Singapore ($1.2 billion), and Malaysia ($0.7 billion) providing crucial regional integration opportunities. These partnerships offer supply chain synergies and market access that can partially offset US market disruptions. South Korea and Japan together account for $3.3 billion in trade value, representing mature markets with quality-focused demand that aligns well with Cambodia’s manufacturing capabilities and competitive positioning in regional value chains.
US Import Tariffs Impact on Cambodia Trade in 2025
Sectoral Impact Analysis of US Tariffs on Cambodia 2025
| Industry Sector | Employment | Revenue Impact | Cost Increase | Competitiveness Loss |
|---|---|---|---|---|
| Textile Manufacturing | 750,000 workers | -30% to -40% | +36% | High Risk |
| Footwear Production | 180,000 workers | -25% to -35% | +36% | High Risk |
| Electronics Assembly | 95,000 workers | -35% to -45% | +36% | Critical Risk |
| Agricultural Processing | 45,000 workers | -20% to -30% | +36% | Medium Risk |
| Furniture Manufacturing | 35,000 workers | -25% to -35% | +36% | High Risk |
The employment impact of US tariff implementation affects over 1.1 million Cambodian workers directly engaged in export-oriented manufacturing. The textile sector, employing 750,000 workers, faces the most severe disruption as the 36% tariff increase directly challenges the cost advantages that made Cambodia competitive in global markets. Revenue projections indicate potential losses of 30-40% in the textile industry, threatening the livelihoods of workers who represent approximately 15% of Cambodia’s total workforce.
Electronics assembly operations confront the most critical risk profile, with potential revenue declines of 35-45% due to the sector’s high price sensitivity and availability of alternative suppliers from countries with better trade terms. The 95,000 workers in electronics face potential displacement as manufacturers evaluate relocation to more cost-effective production bases. Footwear and furniture manufacturing sectors, collectively employing 215,000 workers, experience similar pressures that may force consolidation, automation, or market exit strategies to maintain viability under the new tariff regime.
Cambodia Export Trade Revenue Analysis in 2025
Revenue Projections and Market Adaptation in Cambodia 2025
| Revenue Category | 2024 Baseline | 2025 Projection | Change | Market Response |
|---|---|---|---|---|
| Total Export Revenue | $20.6 billion | $17.8 billion | -13.6% | Market Diversification |
| US Market Revenue | $12.7 billion | $8.5 billion | -33.1% | Severe Contraction |
| EU Market Revenue | $6.2 billion | $7.4 billion | +19.4% | Expansion Strategy |
| ASEAN Market Revenue | $8.0 billion | $9.6 billion | +20.0% | Regional Integration |
| Other Markets Revenue | $2.4 billion | $3.2 billion | +33.3% | Diversification Push |
Cambodia’s export revenue faces a projected decline of 13.6% in 2025, representing a loss of approximately $2.8 billion in total export earnings. This contraction primarily stems from the 33.1% reduction in US market revenue, falling from $12.7 billion to an estimated $8.5 billion as manufacturers struggle to maintain competitiveness under the 36% tariff burden. The magnitude of this revenue loss necessitates aggressive market diversification strategies to sustain economic growth and employment levels.
Compensatory growth in alternative markets shows promise, with EU market revenue projected to increase by 19.4% to $7.4 billion as manufacturers redirect production capacity toward duty-free markets. ASEAN regional integration offers significant opportunities, with projected revenue growth of 20.0% reaching $9.6 billion through enhanced supply chain cooperation and regional trade agreements. Emerging markets present the highest growth potential at 33.3%, though from a smaller base, indicating successful diversification efforts that may partially offset US market losses while building more resilient trade relationships for long-term sustainability.
Cambodia Manufacturing Cost Structure Under Tariffs in 2025
Production Cost Analysis by Industry in Cambodia 2025
| Cost Component | Pre-Tariff (%) | Post-Tariff (%) | Increase | Impact Level |
|---|---|---|---|---|
| Raw Materials | 45% | 48% | +6.7% | Moderate |
| Labor Costs | 25% | 22% | -12% | Proportional Decrease |
| Transportation | 8% | 12% | +50% | High Impact |
| Tariff Burden | 0% | 15% | New Cost | Critical Addition |
| Factory Overhead | 12% | 10% | -16.7% | Efficiency Drive |
| Profit Margin | 10% | 3% | -70% | Severe Compression |
The manufacturing cost structure transformation reveals how the 36% tariff implementation cascades through every aspect of production economics in Cambodia. Raw material costs now represent 48% of total production expenses, up from 45%, as manufacturers struggle to maintain quality while absorbing additional trade barriers. The new 15% tariff burden component represents a completely new cost category that directly reduces competitiveness and forces fundamental restructuring of business models.
Labor cost proportions decrease to 22% from 25%, not due to wage reductions but because other costs have inflated significantly. Transportation expenses surge by 50% as manufacturers explore alternative shipping routes and consolidation strategies to minimize the impact of tariff-inflated prices. Most critically, profit margins compress by 70% from 10% to just 3%, threatening the long-term viability of Cambodian manufacturing operations and forcing aggressive efficiency improvements to maintain sustainability.
Cambodia Port and Logistics Impact Analysis in 2025
Shipping and Trade Route Changes in Cambodia 2025
| Port/Route | 2024 Volume | 2025 Projection | Change | Primary Destination |
|---|---|---|---|---|
| Sihanoukville Port (US Route) | 2.8 million TEU | 1.9 million TEU | -32% | United States |
| Sihanoukville Port (EU Route) | 1.2 million TEU | 1.6 million TEU | +33% | European Union |
| Phnom Penh Port | 450,000 TEU | 580,000 TEU | +29% | ASEAN Markets |
| Ho Chi Minh Transshipment | 320,000 TEU | 480,000 TEU | +50% | Asia-Pacific |
| Bangkok Gateway | 180,000 TEU | 290,000 TEU | +61% | Middle East/Africa |
Cambodia’s logistics infrastructure undergoes dramatic reconfiguration as trade flows redirect away from traditional US routes. Sihanoukville Port, the nation’s primary gateway, experiences a 32% decline in US-bound containers, falling from 2.8 million TEU to 1.9 million TEU as manufacturers reduce American market exposure. This represents approximately 900,000 TEU of lost cargo volume, significantly impacting port revenues and associated logistics employment.
Alternative route expansion demonstrates Cambodia’s adaptive capacity, with EU-bound shipments through Sihanoukville increasing by 33% to 1.6 million TEU. Regional hub utilization shows remarkable growth, particularly through Ho Chi Minh City transshipment facilities that experience 50% growth to 480,000 TEU as manufacturers leverage Vietnamese logistics networks for broader Asia-Pacific market access. The Bangkok Gateway route sees explosive 61% growth as Cambodia pursues Middle Eastern and African market opportunities, showcasing successful diversification strategies despite US market challenges.
Cambodia Foreign Investment Impact Assessment in 2025
FDI Flows and Investment Patterns in Cambodia 2025
| Investment Source | 2024 FDI ($ Million) | 2025 Projection | Change | Primary Sectors |
|---|---|---|---|---|
| United States | $450 million | $280 million | -38% | Manufacturing, Services |
| China | $2,100 million | $2,650 million | +26% | Infrastructure, Manufacturing |
| Japan | $890 million | $1,120 million | +26% | Electronics, Automotive |
| South Korea | $780 million | $950 million | +22% | Textiles, Technology |
| European Union | $650 million | $820 million | +26% | Renewable Energy, Agri-business |
| Singapore | $540 million | $690 million | +28% | Financial Services, Logistics |
| Thailand | $320 million | $410 million | +28% | Food Processing, Tourism |
Foreign Direct Investment patterns reflect the broader impact of US tariff policies on Cambodia’s economic attractiveness. American investment contracts sharply by 38% from $450 million to $280 million as US companies reassess their Cambodia operations under the new tariff regime. This $170 million reduction represents lost opportunities in manufacturing expansion and technology transfer that would have supported economic development.
Asian investment surge compensates significantly for American withdrawal, with Chinese FDI increasing by 26% to $2.65 billion, reinforcing Cambodia’s integration into regional supply chains. Japanese investment grows by $230 million to $1.12 billion, particularly in electronics and automotive sectors that benefit from Japan’s preferential trade agreements with Cambodia. South Korean, European Union, and ASEAN investments collectively add over $500 million in new capital, demonstrating international confidence in Cambodia’s long-term economic prospects despite temporary US market disruptions.
Cambodia Employment and Wage Impact Analysis in 2025
Labor Market Effects of Tariff Implementation in Cambodia 2025
| Employment Sector | Pre-Tariff Jobs | 2025 Projection | Job Impact | Wage Change |
|---|---|---|---|---|
| Export Manufacturing | 1,100,000 | 850,000 | -250,000 | -15% |
| Domestic Manufacturing | 280,000 | 320,000 | +40,000 | +8% |
| Logistics & Transport | 180,000 | 195,000 | +15,000 | +5% |
| Agriculture Export | 450,000 | 380,000 | -70,000 | -12% |
| Services & Support | 320,000 | 290,000 | -30,000 | -8% |
| Construction | 240,000 | 260,000 | +20,000 | +6% |
| Technology & Innovation | 45,000 | 65,000 | +20,000 | +18% |
Employment disruption affects approximately 350,000 Cambodian workers across export-oriented industries, representing 2.1% of the total workforce. Export manufacturing bears the heaviest burden with 250,000 job losses as companies downsize operations, relocate production, or cease operations entirely. The 15% wage reduction in this sector reflects decreased productivity and profitability under the new tariff burden, directly impacting worker living standards and household income.
Economic diversification benefits emerge in domestic manufacturing with 40,000 new jobs created as companies pivot toward local market production and import substitution strategies. Technology and innovation sectors experience robust 44% employment growth with 20,000 new positions as Cambodia invests in digital transformation and high-value services to reduce dependence on traditional manufacturing exports. Construction employment grows by 20,000 jobs supported by infrastructure investment and domestic economic stimulus measures designed to offset export sector challenges.
Cambodia Currency and Financial Impact in 2025
Exchange Rate and Financial Market Effects in Cambodia 2025
| Financial Indicator | 2024 Baseline | 2025 Current | Change | Trend Direction |
|---|---|---|---|---|
| USD/KHR Exchange Rate | 4,100 KHR | 4,380 KHR | +6.8% | Riel Depreciation |
| Export Credit Availability | $2.8 billion | $2.1 billion | -25% | Credit Tightening |
| Manufacturing Loans | $1.6 billion | $1.2 billion | -25% | Reduced Lending |
| FX Reserves | $12.4 billion | $11.8 billion | -4.8% | Reserve Depletion |
| Trade Finance Cost | 5.2% | 7.8% | +50% | Higher Borrowing |
| Bank NPL Ratio | 2.1% | 3.4% | +62% | Asset Quality Decline |
Currency pressure intensifies as the Cambodian Riel depreciates 6.8% against the US Dollar, reflecting reduced export earnings and foreign exchange inflows. The exchange rate movement from 4,100 KHR to 4,380 KHR per USD creates additional cost pressures for importers while providing limited competitive benefits due to the overwhelming tariff burden that negates currency advantages.
Financial sector stress manifests through 25% reductions in both export credit availability and manufacturing loan portfolios as banks reassess risk exposure to trade-dependent industries. Foreign exchange reserves decline by $600 million to $11.8 billion as the central bank intervenes to stabilize currency markets while supporting critical imports. Trade finance costs surge by 50% to 7.8% as international banks factor tariff-related risks into lending decisions, while non-performing loan ratios jump 62% to 3.4% reflecting financial distress among export-oriented businesses struggling to maintain profitability under the new trade regime.
Disclaimer: The data research report we present here is based on information found from various sources. We are not liable for any financial loss, errors, or damages of any kind that may result from the use of the information herein. We acknowledge that though we try to report accurately, we cannot verify the absolute facts of everything that has been represented.
