Businesses spent years diversifying away from China. Trump’s trade war could destroy those economies

For Tim Hsu, who sells modern lamps and ceiling lights mostly to American customers, US President Donald Trump’s historic tariff announcement has upended his carefully made plans.

For Tim Hsu, who sells modern lamps and ceiling lights mostly to American customers, US President Donald Trump’s historic tariff announcement has upended his carefully made plans. Last year, the Taiwanese businessman decided to invest in Cambodia to diversify his production base beyond his traditional stronghold of south China. He was preemptively hedging against the risk of possible higher tariffs on China during Trump’s second term. But Wednesday’s announcement of an unexpectedly harsh levy on all US imports from Cambodia, the highest rate in Asia and second-highest globally, has changed everything. “If the 49% tariff remains unchanged, we will withdraw our investment from Cambodia,” Hsu told CNN. For now, his next move remains uncertain as questions linger over whether the steep tariff will stay. Pulling out of Cambodia is relatively easy for him because the investment is still in an early stage. But for many other companies with long established factories employing thousands of workers in the country, one of Asia’s poorest, the tariff news is nothing short of devastating. And it’s not alone.