China remains Cambodia’s top trading partner, US biggest export market in Q1

China remains Cambodia’s top trading partner, US biggest export market in Q1

China remained the biggest trading partner of Cambodia in the first quarter (Q1) of the year and the US the biggest export market, according to the trade data released by the General Department of Customs and Excise (GDCE) on Friday.

Accordingly, trade between Cambodia and China reached $5.16 billion during the January to March 2026 period, registering an increase of 26.8 percent year on year.

The growth underscores deepening economic ties under regional frameworks such as the Regional Comprehensive Economic Partnership (RCEP) and Cambodia’s bilateral free trade agreement with China, both of which have reduced tariffs and facilitated cross-border investment.

The United States ranked as Cambodia’s second-largest trading partner, with total trade reaching $3.48 billion in the first quarter—an increase of 39.3 percent year-on-year. Notably, exports to the US accounted for $3.36 billion of that total, resulting in a substantial trade surplus of $3.23 billion in Cambodia’s favour. The US market remains crucial for Cambodia’s garments, footwear, and travel goods sectors, which continue to anchor the country’s export-driven growth model.

Despite ongoing global economic uncertainties and shifting trade policies, demand from the United States has remained resilient. Industry observers note that Cambodia’s competitive labour costs and preferential access to Western markets have helped sustain export momentum, even as other manufacturing hubs face rising costs and geopolitical pressures.

China’s continued position at the top reflects its dual role as both a major supplier of raw materials and machinery to Cambodia’s manufacturing sector and a key investor in infrastructure, energy, and real estate. Analysts say this trend is likely to persist as Cambodia advances its industrial diversification strategy and integrates further into regional supply chains.

Overall, Cambodia’s international trade reached $16.93 billion in the first three months of 2026, representing a 17.2 percent increase year-on-year. The broad-based expansion highlights the country’s steady recovery and growth following recent global disruptions, including supply chain bottlenecks and inflationary pressures.

Vietnam remained Cambodia’s third-largest trading partner, with bilateral trade totalling $2.27 billion. However, this figure represented a slight decline of 3.2 percent compared to the same period last year, suggesting softer cross-border activity or shifting trade dynamics between the two neighbouring economies.

Japan ranked fourth, with trade volume reaching $753 million, up 14.8 percent year-on-year. Japan continues to play an important role as a development partner and investor, particularly in infrastructure and high-value manufacturing sectors.

Economists say Cambodia’s strong first-quarter performance reflects both external demand and domestic policy efforts to diversify export markets and upgrade production capabilities. However, they caution that maintaining this momentum will depend on global economic conditions, exchange rate stability, and Cambodia’s ability to move up the value chain.

Officials are optimistic that ongoing trade agreements and investment inflows will continue to support growth through 2026, reinforcing Cambodia’s position as an emerging hub in Southeast Asia’s evolving economic landscape.

khmertimeskh