On May 23, 2022, the United States and several allies in the Asia-Pacific-India region announced the launch of the Indo-Pacific Economic Framework for Prosperity (IPEF) to pursue regional economic engagement. Secretary of Commerce Gina Raimondo stated, “This framework will enable the United States to expand its economic leadership in the Indo-Pacific and work with our allies and partners in the region to secure our supply chains, increase clean energy production, and cooperate on the development and regulation of emerging technologies. Nearly one billion people in the Indo-Pacific will enter the middle class over the next decade. Deepening our ties to the region is good for American workers and businesses and that of our partners in the region, and it is crucial to our ability to stay competitive.”
According to the “Statement on Indo-Pacific Economic Framework for Prosperity”, entered into by the United States, Australia, Brunei Darussalam, India, Indonesia, Japan, Republic of Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand, and Vietnam, the IPEF is intended “to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for our economies. Through this initiative, we aim to contribute to cooperation, stability, prosperity, development, and peace within the region.” The IPEF members will engage in discussions involving “four key pillars”: (1) encouraging free and fair trade; (2) improving transparency, security and sustainability of supply chains; (3) accelerating the development and deployment of clean energy technologies; and (4) promoting fair competition and enforcing tax, anti-money laundering and anti-bribery regulatory regimes. A White House Fact Sheet provides additional background on the economic engagement that will occur under the IPEF.
During brief remarks to the press, President Joseph Biden stated that the “future of the 21st century economy is going to be largely written in the Indo-Pacific — in our region.” He also indicated that the framework will be open to other countries that may wish to join in the future. In conducting the first ministerial meeting, U.S. Trade Representative Katherine Tai noted that the IPEF would “link major and emerging economies to tackle 21st century challenges,” including issues such as the digital economy and emerging technology, labor commitments, the environment, trade facilitation, transparency and good regulatory practices, and corporate accountability. The United States will also use this forum to pursue an accelerated implementation of the World Trade Organization’s Trade Facilitation Agreement in an effort to improve the movement of goods across borders.
The Indo-Pacific covers half the population of the world and more than 60% of the global GDP. The IPEF involves countries that negotiated the Trans-Pacific Partnership (TTP) from which the United States removed itself before the agreement was ratified. (For additional background on the TPP, see the Update of January 23, 2018). In remarks to the press upon announcing the IPEF, Ambassador Tai stated that the United States would remain out of the TPP as the agreement did not have sufficient congressional support to pass.