The Indo-Pacific region is home to some of the most dynamic and diverse economies in the world, accounting for 40% of global GDP and 28% of global trade. The region also faces many challenges, such as the COVID-19 pandemic, climate change, supply chain disruptions, digital transformation, and rising geopolitical tensions. To address these challenges and seize the opportunities for cooperation and prosperity, the United States and 13 other partners launched the Indo-Pacific Economic Framework for Prosperity (IPEF) in May 2022.
What is the IPEF?
The IPEF is an economic initiative that aims to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for the 14 IPEF economies. The framework covers four pillars: Trade; Supply Chains; Clean Economy; and Fair Economy. The IPEF partners have agreed to an aggressive negotiating schedule for 2023 in order to make substantial progress this year. The IPEF is part of the Biden Administration’s commitment to strengthening ties with allies and partners and tackling 21st-century economic challenges in the Indo-Pacific region.
The IPEF is not a trade agreement or a bloc, but rather a flexible and open platform for collaboration among like-minded partners that share common goals, interests, and ambitions for the region. The IPEF is open to participation from additional Indo-Pacific partners that share these values and principles. The IPEF also acknowledges the importance of technical assistance and capacity building for developing countries in the region.
What are the benefits of the IPEF?
The IPEF will provide tangible benefits that fuel economic activity and investment, promote sustainable and inclusive economic growth, and benefit workers and consumers across the region. Some of the expected benefits include:
- Trade: The IPEF will build high-standard, inclusive, free, and fair trade commitments and develop new and creative approaches in trade and technology policy that advance a broad set of objectives. These include facilitating digital trade, promoting innovation, protecting intellectual property rights, ensuring fair competition, enhancing transparency, addressing non-tariff barriers, supporting small and medium enterprises, fostering women’s economic empowerment, and advancing labor rights and environmental protection.
- Supply Chains: The IPEF will strengthen supply chain resilience and security in critical sectors such as semiconductors, pharmaceuticals, medical devices, clean energy, and minerals. The IPEF will also promote diversification, redundancy, reliability, efficiency, sustainability, and quality of supply chains through information sharing, best practices, standards development, regulatory cooperation, investment facilitation, risk management, and emergency response mechanisms.
- Clean Economy: The IPEF will accelerate the transition to a low-carbon economy that is aligned with the goals of the Paris Agreement and supports green growth and job creation. The IPEF will also enhance cooperation on clean energy development and deployment, energy efficiency, energy security, renewable energy integration, grid modernization, green hydrogen production and utilization, carbon capture utilization and storage, climate finance mobilization, green infrastructure investment, circular economy promotion, sustainable agriculture and fisheries management, biodiversity conservation, and climate adaptation and resilience.
- Fair Economy: The IPEF will foster a fair economy that ensures equitable distribution of benefits from economic growth and addresses social challenges such as poverty reduction, inequality mitigation, social protection enhancement, human capital development, digital inclusion, and corruption prevention.
The IPEF will also support good governance, rule of law, human rights, and democratic values in the region.
How to get involved in the IPEF?
The United States welcomes input from stakeholders on the IPEF negotiations and implementation. The U.S. Department of Commerce and the Office of the U.S. Trade Representative regularly hold public listening sessions and consultations with various groups such as business associations, civil society organizations, academia, and think tanks.
You can also submit your comments and suggestions online or contact your local U.S. embassy or consulate for more information.
The IPEF is a historic opportunity to shape the future of the Indo-Pacific region in a way that benefits all its peoples.
References:
[1] Statement on Indo-Pacific Economic Framework for Prosperity | The White House
https://www.whitehouse.gov/briefing-room/statements-releases/2022/05/23/statement-on-indo-pacific-economic-framework-for-prosperity/
[2] Indo-Pacific Economic Framework | U.S. Department of Commerce
https://www.commerce.gov/ipef
[3] FACT SHEET: In Asia, President Biden and a Dozen Indo-Pacific Partners Launch the Indo-Pacific Economic Framework for Prosperity | The White House
https://www.whitehouse.gov/briefing-room/statements-releases/2022/05/23/fact-sheet-in-asia-president-biden-and-a-dozen-indo-pacific-partners-launch-the-indo-pacific-economic-framework-for-prosperity/
Photo: Downtown Manila, by Pixabay
