Newly imposed US tariffs under President Trump have struck a major blow to Southeast Asian economies, particularly Vietnam and Cambodia, with rates of 46% and 49% respectively. These countries heavily rely on exports to the US—Vietnam’s exports make up 23% of its GDP, while Cambodia’s account for a staggering 67%. Other regional economies, including Thailand, Indonesia, and Malaysia, are also affected, though to a lesser extent.

Vietnam’s strategy to become a tech-driven, upper-income economy by 2045 now faces serious challenges. The country had deepened ties with the US in recent years, elevating relations to a Comprehensive Strategic Partnership, but now finds its growth targets at risk. Cambodia, whose economy depends heavily on its garment sector, fears mass job losses, jeopardizing political stability.

While Southeast Asian leaders are urging negotiation over retaliation, Washington remains firm. US trade advisor Peter Navarro dismissed Vietnam’s offer to eliminate tariffs, accusing it of acting as a trans-shipment point for Chinese goods.

Cambodia and Thailand have appealed for delays or tariff reductions, but the Trump administration is holding its ground. With rising economic strain and shaken investor confidence, Southeast Asia is facing a major test of resilience as it grapples with the fallout of shifting US trade policy.

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