US punishing tariffs put South-east Asian solar exporters’ China Plus One strategy in a bind

[SINGAPORE] The US has slapped tariffs as high as 3,500 per cent on South-east Asian solar exports, delivering a major blow to the region’s role as a manufacturing hub – chiefly for Chinese solar giants – and escalating the Biden-era clean energy trade war under US President Donald Trump.

The four affected markets – Cambodia, Malaysia, Thailand and Vietnam – had accounted for nearly 80 per cent of US solar imports before a two-year tariff waiver expired in June 2024.

The new tariffs are expected to slow the expansion of South-east Asia’s solar manufacturing sector, potentially pushing investors to redirect capital to other regions such as Europe, India or the Middle East, said Sharad Somani, partner and head of infrastructure at KPMG Asia Pacific.