Cambodia has a promising opportunity to strengthen its trade and investment relationship with the United States amid shifting global supply chains and evolving geopolitical dynamics, according to a prominent business leader.
Anthony Galliano, Vice-President of the American Chamber of Commerce in Cambodia (AmCham Cambodia) and Group CEO of Cambodian Investment Management Holdings (CIM), told Khmer Times that it was “unsurprising that Vietnam was the first in Southeast Asia to cut a deal given its strategic importance to the US as America’s eighth-largest trading partner and top source of key imports like textiles, electronics, and furniture”.
He noted that Vietnam’s “fast-growing exports, geopolitical alignment, manufacturing power, and perception of being a friendly production base positioned it as the logical and urgent choice for the US to secure a trade deal, especially as the global supply chain realigns away from China.”
Galliano further explained that Vietnam’s advantage was strengthened by lobbying from American businesses, especially retailers and manufacturers, who opposed high tariffs on Vietnamese imports to keep consumer prices low. Additionally, Vietnam plays a pivotal role in the US Indo-Pacific strategy and recently upgraded its relationship with Washington to a “comprehensive strategic partnership”.
Despite this, Galliano pointed out, “There are material relationships and strategic differences between Vietnam and Cambodia.” He acknowledged that the 20 percent tariff Vietnam faces “is substantial, impacting key sectors like apparel and electronics, raising concerns it still poses a cost barrier.” However, this outcome was “much less than the threatened 46 percent, which relieved immediate pressure on Vietnam’s export-reliant economy.”
He also highlighted the “critical concessions on Vietnam’s part, such as duty-free admission of the US goods, including large-engine vehicles and select agricultural products and granting the US preferential total access to the Vietnamese market.”
“This transaction may very well be a quasi-benchmark for future deals with variables such as strategic importance, market barriers, geopolitical relationship, regulatory environment, taxes, duties and tariff regime, and transhipment issues,” Galliano said.
Turning to Cambodia’s prospects, he added: “Cambodia may also be in a different position given that the US wants to strengthen trade ties with countries it perceives as not closely aligned with China.”
Galliano’s remarks come shortly after the Royal Government of Cambodia (RGC) submitted three key documents to the US office in Washington DC. Days later, the Council for the Development of Cambodia (CDC) hosted an online meeting with the United States Trade Representative (USTR), emphasising both countries stand ready for the next round of tariff negotiations.
According to a press release from the Royal Government Spokesperson Unit (RGSU) dated June 26, Deputy Prime Minister and First Vice-Chairman of the CDC, Sun Chanthol, and Minister of Commerce Cham Nimul held a virtual conference on June 25 with Sarah Ellerman, Assistant USTR for Southeast Asia and the Pacific.
The release said both sides applauded the significant progress made in previous negotiation rounds and presented additional proposals for further consideration. Cambodia and the US reiterated their commitment to working closely toward a mutually beneficial agreement.
Chanthol has led two previous rounds of in-person talks with US officials in Washington, the first on May 13-14 and the second on June 4-6, with the third round conducted virtually on June 25.
The Royal Government, under Prime Minister Hun Manet’s leadership, reaffirmed its dedication to continued cooperation with the US to achieve a trade and investment relationship that benefits both countries.
