In June, the two Southeast Asian nations were downgraded in State Department's annual assessment of how governments around the world have performed in fighting the flesh trade and other forms of exploitative labor.
The president can block various types of US aid and withdraw US support for loans from the World Bank and International Monetary Fund for governments that are blacklisted. But the US often chooses not to, based on its national security interests.
It's waiving sanctions against several countries, including Saudi Arabia, Uzbekistan, and Yemen.