PHNOM PENH: Cambodia has successfully negotiated a reduction in its US tariff rate from 49% to 36%, a significant initial achievement. However, the nation is already looking ahead, preparing to leverage a “second negotiating card” in pursuit of an even lower rate.
This news comes from Deputy Prime Minister Sun Chanthol, who also serves as the First Vice Chairman of the Council for the Development of Cambodia and Chairman of the Working Group on Tariff Negotiations with the United States. He shared these developments during a conference on the US tariff negotiations on the afternoon of July 8, 2025.
Deputy Prime Minister Chanthol, while keeping the specifics of Cambodia’s new negotiating strategy under wraps, emphasized the need for careful and deliberate use of their “cards.” The core of Cambodia’s argument for further reductions will revolve around its status as a least developed country (LDC), from which it isn’t expected to graduate until December 2029.
Cambodia plans to appeal to the United States for understanding, requesting the lowest possible tax rate to attract more investors, create jobs, and ultimately lift its population out of poverty by its target graduation year.
The initial tariff reduction from 49% to 36% is considered a major success, which Deputy Prime Minister Chanthol credited to honest and straightforward negotiations, as advised by Prime Minister Hun Manet. This new 36% tariff rate is scheduled to take effect on August 1, 2025.
However, a letter from President Donald Trump indicates that the US will provide Cambodia with an opportunity for further negotiations before August 1. Cambodia’s negotiating team is ready to pursue this, whether in person or online, with the goal of driving the tariff rate below 36%.
Deputy Prime Minister Sun Chanthol stressed the critical importance of these negotiations for bolstering and expanding trade between Cambodia and the United States. He also highlighted the need for Cambodia to continue enhancing its appeal to investors, assuring them of the Royal Government’s commitment, under Prime Minister Hun Manet’s leadership, to resolving the tariff issue with the United States.
