Among the tariffs announced on April 2, the highest are for Southeast Asia, including Cambodia at 49 percent, Vietnam 46 percent, Laos at 48 percent and Myanmar at 45 percent.
Even as markets tumbled on Monday—Hong Kong’s Hang Seng index was at its lowest since 1997, dropping 13.2 percent, Taiwan’s Taiex was down 9.7 percent, Japan’s Nikkei 225 index fell 7.83 percent —the message was clear: communication and finding a way forward was key.
The worst hit countries by the Trump tariffs in the Southeast Asian region, which are dotted with factories, have been moving quickly beyond the “‘absolute shock of such high tariffs,” towards phone calls, industry conversations, and perhaps the quickest interaction yet between policy makers and manufacturers.
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Analysts have been putting together their best guesses on the reasons for the high tariffs and have largely come up empty—other than the trade deficit itself.
There has been a flurry of letter writing to President Trump.
In his letter sent on Friday, Cambodian prime minister Hun Manet wrote that Cambodia
“proposed to negotiate” and requested “a postponement of the tariff implementation.”
“Cambodia remains fully committed to engaging in constructive and productive dialogue with the U.S. government to further deepen our bilateral trade, so that both nations and peoples can enjoy the tangible benefits from these significant trade relations,” he wrote.
While Vietnam and Taiwan have proposed zero tariffs on U.S. imports as a counter-measure, the Cambodian prime minister proposed to cut tariffs on select U.S. imports to 5 percent, down from 35 percent in 19 product categories.
This region is a larger sourcing hub for apparel and footwear manufacturer, and while producers have invested in factory safety, sustainability and growth in the post-Covid years, they have just begun the process of recovery and growth.
The manufacturers association in Cambodia—Textile, Apparel, Footwear and Travel Goods Association in Cambodia (TAFTAC)—noted that t it was working closely with the government and all relevant stakeholders to seek out “appropriate solutions to resolve and address the problem as soon as possible.”
Massimiliano Tropeano, garment sustainability and trade expert in Phnom Penh told Sourcing Journal, “At the moment, there are different variables in play. It is very difficult to say where the orders/ trade will go. The tariff issue is a sensitive one in the garment footwear and travel sector, and the elasticity of the orders to the tariffs applied is quite high.”
Can buyers, however, really move with such agility to new production zones?
“In theory, you could change/ swap your supply chain partners virtually every six months,” he said. “Although Turkey and Philippines may have a lower tariff measure, they have high operational costs, hence a higher base price. What matters at the end of the day is the landed cost to the buyer. It’s too early to say, but it will surely change the balances and the competitive map of the goods from various countries.”
The news of the tariffs came after a particularly warm and inclusive gathering at the first Cambodia Global Textile Summit concluded on April 1 in Phnom Penh that brought together more than 470 leaders from the industry, including government officials, global brands and factories. Plans and ideas to strengthen the industry fostering innovation, improving labor conditions and strengthening trade relationships to maintain its competitive edge were key.
Reaching out to president Trump to negotiate has been atop many agendas since Wednesday.
“I got a report from the USDR last night that more than 50 countries have reached out to the President to begin a negotiations. But they’re doing that because they understand that they bear a lot of the tariff,” Kevin Hassett, directo of the National Economic Council in the U.S., said on Sunday.
According to the World Trade Organization, the gross domestic product of Southeast Asia was $3.86 trillion in 2023, with Indonesia the biggest at $1.42 trillion and Thailand the smalles at $435.68 billion. This, of course, pales with the United States and its GDP of $26.95 trillion.
Apparel exports have been growing from the region: Vietnam outpaced Bangladesh in 2024 to become the second largest apparel exporter in the world with exports of $44 billion in 2024. Others, like Cambodia, have been growing fast, with a 23.78 percent increase in the industry year on year to $13.74 billion.
Myanmar, which has been facing tough times since the military coup in 2021—as well as being ravaged by a recent earthquake—faces 44 percent tariffs. In 2024 Myanmar apparel exports were estimated at an approximate $3.3 billion.
Vietnam and Taiwan have reacted quickly byproposing zero tariffs for U.S imports and Taiwan also promised an increase its investments in the U.S. as a possible solution.
In neighboring Thailand, prime minister Paetongtarn Shinawatra faced criticism at home for reacting slower than other ASEAN countries. She has put together a delegation to the U.S. to visit this week led by finance minister Pichai Chunhavajira and deputy prime minister Pichai Chunhavajira.
The intent is “to let the U.S. know that Thailand is not only an exporter but also a reliable friend of the U.S.,” she said, adding that the government had formed a working group along with policy related proposals to increase imports from the U.S. In turn, they would request a reduction to obstacles to Thai exports. Shinawatra was also quick to add that she would meet with representatives of the different sectors likely to be affected “to protect the national interest and economy.”
Apparel exports from Thailand approximated $1.47 billion in 2024.
Laos, a comparatively smaller player with apparel exports of $240 million out of its total exports of $803.3 million in 2024, has yet to issue an official response to Trump’s tariff policy.
There is also a larger discussion among ASEAN leaders who are weighing the benefits of collective action.
“It is like a string coming undone,” said a manufacturer in Vietnam. “The global economy…the factory workers…and the U.S. consumers.”
