Cambodia has been hit with a steep tariff of more than 3,500% on its solar cell exports to the U.S. – the highest among Southeast Asian countries – after producers and the government failed to cooperate with a year-long U.S. trade probe now nearing its end. The decision comes amid a broader trade war unleashed by the Trump administration, which has redrawn global trade lines.
The duties, announced Monday, cap a yearlong investigation by the U.S. Commerce Department, which found that solar producers in Cambodia, Vietnam, Malaysia and Thailand were unfairly benefiting from government subsidies and undercutting U.S. prices. The probe began under President Joe Biden after American manufacturers accused Chinese firms of routing exports through Southeast Asia to avoid existing tariffs.
Cambodian officials claim the new levies apply only to a handful of factories under investigation.
The new duties come on top of a broader 49% tariff on Cambodian goods, which remains under negotiation with the U.S.
By comparison, the new anti-dumping and countervailing duties on solar cells exported from Cambodia, set as high as 3,521%, are significantly steeper than those for Vietnam, Thailand, and Malaysia, which face rates of up to 395.9%, 375.2%, and 41.56%, respectively.
Before the tariffs are finalized, the International Trade Commission will hold a vote in June.
Meanwhile, experts say the penalties point to deeper geopolitical rifts and missed diplomatic chances, as Cambodia’s tilt toward China and failure to meet trade standards strain ties with Washington and risk key export markets.
Cambodian officials, such as the spokesperson for the Ministry of Commerce Pen Sovicheat, assert that the tariff on solar exports is separate from other trade policy tension with the U.S. and is limited in scope.
Sovicheat declined to comment on why solar firms in Cambodia chose to stop cooperating with the U.S. Commerce Department.
Two solar companies with facilities in Cambodia – Solar Long PV Tech and Hounen Solar – told U.S. trade officials in October they could no longer devote resources to the anti-dumping probe. A lawyer for U.S. firms warned that the decision would likely lead to steep penalties.
That warning proved true. Both companies saw their tariff rates skyrocket from 125.37% to 3,403.96% on Monday, according to Cambodia’s Ministry of Commerce.
At least two other companies, Jintek and ISC Cambodia, were hit with the same rate.
The Ministry of Commerce said it coordinated with relevant private and public sector stakeholders to address the allegations of transhipment but did not elaborate further.
Solar Long PV Tech, Hounen Solar, and Jintek did not respond to CamboJA News’ requests for comment.
The new rates are expected to severely impact trade, especially as Cambodia’s solar exports to the U.S. were already on the decline. In 2024, solar panel exports dropped sharply to $830 million – a nearly 60% fall from $2.07 billion in 2023. Exports to the U.S. alone plunged by more than 61%.
Stephen Higgins, managing partner at Phnom Penh-based Mekong Strategic Capital, said the sharp drop in solar exports reflects the sector’s limited role in Cambodia’s economy. He added that his market research has yet to show the solar cells are genuinely produced in Cambodia, rather than transshipped from China.
“Cambodia needs to make sure that it isn’t being used as a transhipment point to allow the Chinese to avoid U.S. tariffs or other trade restrictions,” Higgins said. “Instead, they need to make sure there is genuine value-added manufacturing.”
Sovicheat rejected claims that Cambodia is being used to reroute Chinese solar products, saying all exports are certified by the Commerce Ministry only after inspections ensure compliance with Rules of Origin.
Others say the problem goes beyond paperwork.
Sophal Ear, a Cambodian political analyst and professor at Arizona State University, said Cambodia likely failed to disprove its role in helping China bypass trade rules – but added the issue goes deeper, into geopolitics.
He said Phnom Penh missed early opportunities to engage U.S. trade officials, which might have softened the outcome. Proactive diplomacy and technical assistance requests could have clarified the country’s solar operations.
Cambodia’s reluctance to address U.S. concerns over corruption, transparency and political freedoms has further hurt its trade standing, Sophal added, alluding to the less-transactional foreign policy of the former Biden administration.
Unlike Vietnam, Thailand and Malaysia, who maintain strategic dialogue with Washington, Cambodia is seen as more China-aligned and dependent on Beijing’s industrial network.
Ear said the solar tariffs are part of a broader trend, citing the earlier suspension of preferential trade agreements and Trump’s 49% “reciprocal” tariffs as signs of deepening mistrust.
“Trade is becoming a proxy battlefield for deeper concerns,” he said. “The U.S. is beginning to see Cambodia less as a trade partner and more as a strategic outpost in Beijing’s orbit, which invites harsher treatment in the current climate.”
“No country that depends so heavily on one market – especially one as unpredictable as the U.S. – can afford complacency,” he added.
The U.S. embassy in Phnom Penh declined to comment, referring a reporter to the Department of Commerce which did not respond by the time of publication.
