PHNOM PENH, Cambodia — Southeast Asian leaders and business officials warned on Thursday that escalating geopolitical tensions and renewed trade fragmentation are posing serious risks to the region’s economic stability, urging greater regional cooperation to shield ASEAN economies from mounting global uncertainty.
Speaking at the opening of the Cambodia-ASEAN Business Summit 2026, business leaders and policy experts said the convergence of geopolitical conflict, volatile energy markets, and unilateral trade measures could undermine Southeast Asia’s growth momentum if the region fails to strengthen its economic resilience.
Kith Meng, president of the Cambodia Chamber of Commerce, said a wave of unilateral tariffs and retaliatory trade policies across major economies has accelerated the fragmentation of global commerce and weakened confidence in the rules-based multilateral trading system.
“Recent tariff actions and countermeasures are pushing the world toward a more transactional and interest-driven economic order,” Mr. Meng said, warning that the shift could erode predictability for export-dependent economies across Southeast Asia.
The pressure has intensified with the latest escalation of conflict involving the United States, Israel, and Iran, which has rattled energy markets and heightened concerns about disruptions to global shipping routes. Analysts say instability around the Strait of Hormuz, a vital maritime corridor that carries roughly 20 percent of the world’s oil supply, has already pushed Brent crude prices sharply higher, raising fears of inflation and supply disruptions worldwide.
For ASEAN economies — many of which rely heavily on imported energy — rising oil prices could quickly translate into higher transportation and manufacturing costs, threatening consumer demand and slowing industrial activity.
“The immediate impact for ASEAN will likely come through energy price volatility,” said Thong Mengdavid, deputy director of the China-ASEAN Studies Center at the Cambodia University of Technology and Science. Disruptions in the Strait of Hormuz or renewed instability affecting Red Sea shipping lanes, he said, could significantly drive up oil and gas prices.
“Most ASEAN economies are net energy importers,” he noted. “Higher energy prices will push inflation upward, increase production costs, and weaken purchasing power across the region.”
For Cambodia, the impact is expected to be indirect but significant. Rising fuel costs could increase production and logistics expenses in key export sectors such as garments and agriculture, while imported inflation and financial volatility may strain household budgets and investor confidence.
Regional officials argue that ASEAN’s strategic advantage lies in maintaining neutrality amid intensifying global rivalries.
“In this environment, ASEAN’s strength is not in choosing sides,” Mr. Meng said, “but in upholding openness, neutrality and centrality.” He called on the regional bloc to continue serving as a stabilizing platform for dialogue and economic cooperation while keeping regional markets connected.
Economists say the Regional Comprehensive Economic Partnership (RCEP) — the world’s largest free-trade agreement — could play a crucial role in strengthening regional supply chains and reducing exposure to external shocks. By lowering trade barriers and expanding regional integration, the pact offers ASEAN countries an opportunity to deepen intra-regional commerce as global trade becomes more politicized.
ASEAN currently includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Vietnam, and Timor-Leste, which is in the process of joining the bloc.
Policy experts at the summit emphasized that strengthening regional resilience will require coordinated action, including expanded energy cooperation, diversification of energy sources, and greater intra-ASEAN trade.
For Cambodia specifically, analysts recommend maintaining fiscal discipline while supporting industries vulnerable to rising costs and expanding export markets to sustain growth.
Taken together, the warnings from regional leaders reflect a broader shift confronting many emerging economies: a world increasingly shaped by geopolitical competition, volatile energy markets and the erosion of the global trading order that underpinned decades of economic expansion.
As Mr. Meng told the gathering in Phnom Penh, “ASEAN must ensure that cooperation, transparency and mutual respect remain at the center of the region’s economic future.”