Josh Weiner
As the trade war between the United States and China continues to reshape global economic dynamics, Cambodia is turning to Beijing for deeper financial ties. President Xi Jinping’s stop in Phnom Penh marks a strategic moment for both countries—Cambodia seeks a boost in infrastructure support, while China looks to strengthen alliances across Southeast Asia in the face of mounting Western economic pressure.
Strengthening Ties in Uncertain Times
Xi’s arrival in Cambodia, the final stop on his regional tour following visits to Vietnam and Malaysia, is expected to reinforce Beijing’s influence in a region where the US has been increasing tariff rates. Cambodian leaders, including King Norodom Sihamoni, Prime Minister Hun Manet, and Senate President Hun Sen, are welcoming Xi with hopes of securing more Chinese-backed investments—particularly for large-scale infrastructure such as the Funan Techo Canal, a $1.7 billion project that remains unfunded.
“We expect more cooperation including on infrastructure development,” stated Meas Soksensan, spokesperson for Cambodia’s Ministry of Economy and Finance. While past comments suggested China might cover the full cost of the canal, Cambodian officials have since revised this to 49 percent, indicating uncertainty over Beijing’s financial commitment.
A Strategic Friendship in the Midst of Tariffs
Phnom Penh’s partnership with China is both economic and strategic. Over the past decade, China has become Cambodia’s largest creditor and a key investor in roads, bridges, airports, and manufacturing. The relationship is further solidified by deep military ties, with both nations often referring to each other as “ironclad friends.”
China’s support becomes even more crucial in light of US tariffs. Cambodia, a major exporter of garments and footwear to the United States, has been hit with a 49% tariff rate—one of the highest globally. Notably, around half of the companies in this sector are Chinese-owned, highlighting the intertwined interests of the two nations.
“The US is clearly trying to isolate Beijing,” noted Al Jazeera’s Katrina Yu, “and Xi is responding by strengthening regional partnerships.” She added that Xi received the most enthusiastic welcome in Cambodia, reinforcing the deep bilateral trust.
The Bigger Picture: Debt, Diplomacy, and Domestic Concerns
Despite their close relationship, Chinese financial aid to Cambodia has slowed in recent years. Beijing signed no new loans in 2023, and its overseas investments have dropped amid China’s domestic economic slowdown and scrutiny over the viability of past projects under the Belt and Road Initiative.
Still, Hun Manet remains optimistic. In a recent video statement, he emphasized that Cambodia and China share “common interests based on the principles of respect for sovereignty, equality, and noninterference.” He credited Beijing with playing a “pivotal role” in the country’s development.
Xi’s Regional Message: Resist Hegemony, Embrace Unity
In a message published in Cambodian media, Xi Jinping called for united resistance against “hegemonism and protectionism,” echoing sentiments he expressed earlier in the week in Vietnam and Malaysia. This message underscores China’s push for regional solidarity as it navigates an increasingly competitive global environment.
Final Thoughts
Xi’s visit comes at a turning point for Cambodia. With US tariffs threatening key export sectors and global supply chains in flux, Phnom Penh sees Beijing not just as a financial backer, but as a long-term strategic partner. While immediate funding for the Funan Techo Canal remains uncertain, the broader message is clear: Cambodia is doubling down on its relationship with China—politically, economically, and diplomatically—as the global power struggle unfolds.
