Cambodian Garment Exports to U.S. Show Resilience Despite 19% Tariff, Analysts Say

PHNOM PENH, Cambodia (Sept.26, 2025) — Cambodia’s garment exports to the United States remain resilient despite a 19% tariff imposed by the U.S. government, according to local analysts, who say the country continues to offer an attractive climate for foreign investment and manufacturing.

The tariff, introduced under President Donald Trump, applies to Cambodian imports, while American goods enjoy duty-free access to the Cambodian market. Despite the asymmetry, Cambodia’s export sector has shown strong performance.

Ky Sereyvath, an economic researcher at the Royal Academy of Cambodia, said the garment industry still holds robust potential. “Cambodia can maintain stable profits and good export performance. Investors will continue to flow in,” he said, citing access to large markets, low production costs, and a skilled labor force as key advantages.

Kaing Monika, Deputy Secretary-General of the Textile, Apparel, Footwear and Travel Goods Association in Cambodia (TAFTAC), acknowledged that the tariffs have squeezed profit margins. “Buyers are asking all parties to share the cost increase,” he said.

From January to August 2025, Cambodia exported garments worth $7.73 billion—a 19% year-on-year increase. Total exports of garments, textiles, footwear, and travel goods reached $10.97 billion during the same period.

Despite global headwinds, industry leaders remain cautiously optimistic. However, Cambodia’s economic growth forecast has been revised downward due to slowing demand from key partners including the EU, China, Japan, and South Korea.

According to the government’s Budget Strategic Plan 2026–2028, growth is expected to slow to 5.2% in 2025 and 5% in 2026.

Still, Cambodia’s strategic location, competitive production costs, and young labor force continue to position it as a major manufacturing hub in Southeast Asia.