Tariff Shockwaves: How US Trade Policies Are Reshaping Southeast Asia’s Chip and Solar Export Future

Recent tariffs imposed by the U.S. government have dealt a severe blow to regional manufacturers, especially those in Vietnam, Malaysia, Thailand, and Cambodia.

Southeast Asia’s Tech Trade Hit by Rising US Tariffs

Southeast Asia, once a rising star in global chip and solar exports, is facing a sharp downturn in shipments to the United States. Recent tariffs imposed by the U.S. government have dealt a severe blow to regional manufacturers, especially those in Vietnam, Malaysia, Thailand, and Cambodia. What was once a lucrative trade pipeline is now faltering under the weight of geopolitics, trade protectionism, and intensified scrutiny over alleged trade circumvention.

The Numbers Tell a Troubling Story

In 2024, the U.S. imported 55 gigawatts of solar panels, of which a staggering 88% came from Southeast Asia. However, this dominance has been rapidly undercut by new tariff rates finalized by the U.S. Department of Commerce. Some solar imports are now facing duties as high as 3,521%, effectively freezing demand from American buyers and forcing Southeast Asian exporters to slash output.

Cambodia, for instance, saw its solar exports to the U.S. plunge nearly 60%, from over US$2 billion in 2023 to about US$830 million. Meanwhile, chip exports from the region have also come under pressure amid broader trade tensions, with top global players like Samsung warning of major setbacks in the wake of new restrictions and tariff risks.

Strategic Shifts in Supply Chains

In response, companies across Southeast Asia are recalibrating their strategies. Chinese-backed solar firms like Jinko Solar and Trina Solar, operating out of Malaysia, are now reconsidering their regional footprint after being hit with tariffs exceeding 250%. For these players, the economics of U.S. exports no longer make sense, leading to a potential pivot to other markets in Europe, the Middle East, and Latin America.

Interestingly, the Philippines appears to be emerging as a relative winner. According to recent analysis, it enjoys lower average tariffs and broader exemptions in key sectors like electronics, offering a potential safe haven for supply chain realignment.

Broader Economic Fallout

The repercussions extend beyond individual companies. The Monetary Authority of Singapore has warned that the latest round of U.S. tariffs could deliver a significant demand shock to the local economy, affecting more than half of Singapore’s exports to the U.S. At the same time, the very solar tariffs intended to protect American manufacturers are now biting back — First Solar, a major U.S.-based company, slashed its 2025 sales and profit guidance in response to disrupted supply flows and uncertain pricing.

What Lies Ahead

The tariff-driven reshaping of global trade is far from over. For Southeast Asia, this moment marks a critical inflection point. Countries and companies must decide whether to deepen their regional integration, pivot toward alternative markets, or invest in domestic growth to reduce dependency on the U.S.

While painful, this trade realignment could ultimately foster a more diversified and resilient export ecosystem. The coming months will reveal whether Southeast Asia can adapt to this new era of fragmented globalization — or be left behind in the global tech race.