Cambodia and the United States Tariff: Modeling the Economic Impacts with GTAP-FIN

We examine the potential economic impacts of the new United States (US) tariff on Cambodia using a dynamic global general equilibrium model (GTAP-FIN). We simulate the impact of US tariff increases announced in August 2025 while also examining two additional hypothetical cases for Cambodia. Hence, we investigate three scenarios: (i) the headline “reciprocal” tariff rate (19%) as announced on 31 July 2025; (ii) a hypothetical case, in which Cambodian products are only subject to the base tariff rate (10%); and (iii) a hypothetical case, in which Cambodian products are subject to a 36% tariff (the threatened rate leading up to 31 July 2025). US real output falls, driven by short run job losses, long run capital stock contractions, and losses in allocative efficiency. The impacts on Cambodia’s economy are close to zero at the 19% tariff level, positive at the 10% rate and negative at the 36% rate. Globally, regions most exposed to US tariffs see the largest impacts on real gross domestic product (GDP) and consumption. The analysis does not capture the potential adverse effects of heightened global trade policy uncertainty, suggesting that economic impacts on Cambodia may exceed those estimated in this report.