Cambodia's Lifeline: Tariff Cuts Secure Garment Industry's Future

A reduced U.S. tariff rate of 19% on Cambodia's exports has stabilized its garment sector, crucial to its economy. Deputy PM Sun Chanthol credited President Trump for easing tensions and making trade viable. The garment industry supports nearly one million workers and contributes significantly to Cambodia's GDP.


Devdiscourse News Desk | Updated: 01-08-2025 08:20 IST | Created: 01-08-2025 08:20 IST
Cambodia's Lifeline: Tariff Cuts Secure Garment Industry's Future
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Cambodia's garment and footwear sector has been given a lifeline thanks to a significant reduction in U.S. tariff rates. What was initially a crippling 49% tariff, later reduced to 36%, has now been adjusted to 19%, allowing Cambodia to remain economically competitive, according to Deputy Prime Minister Sun Chanthol.

In expressing gratitude to former U.S. President Donald Trump, Chanthol highlighted how the new tariff rate has averted industry collapse. Concerns were rife that higher levies would divert business to neighboring countries like Indonesia and Vietnam, but now Cambodia's largest economic sector is secure.

The garment industry, which employs nearly a million, primarily female workers supporting large families, is a key driver of Cambodia's $49.8 billion economy. With exports to the U.S. contributing 37.9% of its shipments, Chanthol also announced the purchase of 10 Boeing 737 MAX 8 aircraft as part of ongoing trade agreements.

(With inputs from agencies.)

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