Cambodia and US Sign Historic Trade Agreement, Reducing Tariffs to 19%

KUALA LUMPUR, Malaysia – On Octouber 26,Cambodian Prime Minister Hun Manet and US President Donald Trump officially signed the ‘Agreement on Reciprocal Trade’  on the sidelines of the ASEAN Summit in Kuala Lumpur.

The landmark agreement is set to significantly boost economic relations between the two nations, primarily by reducing the tariff rate on most Cambodian imports into the US to 19 percent.

Cambodian Deputy Prime Minister Sun Chanthol, First Vice-Chairman of the Council for the Development of Cambodia (CDC), highlighted that the agreement reflects Prime Minister Manet's commitment to national economic advancement.

Key features of the pact include: The US will apply a 19 percent reciprocal tariff on most Cambodian goods, while simultaneously eliminating tariffs on certain products like aircraft and parts, selected generic pharmaceuticals, and agricultural products not sufficiently produced in the US. Cambodia commits to eliminating tariffs on all US goods exported to Cambodia. Cambodia has committed to adopting a ban on goods produced by forced labour and to strengthening labour law enforcement. The Kingdom will cooperate with the US to restrict transactions with individuals and entities on key US sanctions lists (such as the SDN List), a move noted as a pivotal step to address the growth of scam centers.

Anthony Galliano, Group CEO of Cambodian Investment Management Holdings and Vice President of AmCham, called the deal a "decisive moment," noting that Cambodia has moved ahead of many competing nations to secure this trade pact, marking consecutive triumphs in a new era of Cambodia-US kinship.