Cambodia, 2 Other ASEAN Nations Face US Tariff Hikes of 10%-12.5%

Cambodia, along with Malaysia and Indonesia, will be subject to a 10% tariff hike from the United States. Thirty-eight other countries, including Thailand and Vietnam, will face a 12.5% tariff. This measure stems from a US investigation into 'forced labor' and 'excess capacity.' Deputy Prime Minister Sun Chanthol, First Vice-Chairman of the Council for the Development of Cambodia (CDC), stated on July 27, 2026, during a press conference that the new tariff rates imposed by the US on Cambodia and some other ASEAN countries range from 10% to 12.5%. The conference, titled 'New Customs Tariff Rates for Imports from Cambodia to the United States after the Compliance Investigation of Section 301 of the US Trade Act,' was held at the CDC headquarters. Changes in US tariff policies have been ongoing since President Donald Trump took office. On April 2, 2025, a 49% tariff was imposed on imports from Cambodia. However, subsequent negotiations led to a revised tariff rate of 19% on October 26, 2025. The Deputy Prime Minister suggested that the new tariff determination might serve as a pretext for the US to collect taxes as it desires. He noted that the US Supreme Court had previously rejected President Trump's tariff increases, which were not linked to forced labor, and that Cambodia does not use forced labor nor does it purchase raw materials from countries that do. Furthermore, he pointed out that even countries like Japan, South Korea, and the European Union, which do not employ forced labor, are subject to an additional 12.5% tariff from the US. This, he argued, indicates that the US is seeking procedures or pretexts through Section 301 of its trade law to increase tariffs on various nations with the aim of collecting 19% in taxes, as per signed trade agreements. According to Section 122 of the US Trade Act, Congress grants the President the authority to impose tariffs ranging from 10% to 15% within 150 days. The US initially applied a 10% tariff to all countries under this provision, but it expired on July 24, 2026, and has been replaced by tariffs under Section 301. The investigation under Section 301 covered 60 countries, focusing on two points: 'Force Labor' (the use of forced labor or the purchase of materials from countries using forced labor) and 'Excess Capacity' (where production capacity is excessive, and companies receive subsidies to produce more for export to the US, thereby creating unfair competition). Following the investigation, the US determined new tariffs ranging from 10% to 12.5% plus MFN. Consequently, the 60 countries importing goods into the US must comply with the new tariffs set by President Donald Trump. Cambodia, along with two other countries, Malaysia and Indonesia, will face a 10% tariff plus MFN, while 38 other countries, including Thailand and Vietnam, will face a 12.5% tariff plus MFN. Meanwhile, 154 tariff lines of Cambodian goods, including handicrafts such as scarves and hats, as well as products made from wood scraps, will continue to be exported to the US with zero tariffs. Source: AKP Khmer