US unveils 13 nation economic pact to assert Asia leadership
The Joe Biden administration announced that a dozen Indo-Pacific countries will join the US in a sweeping economic initiative designed to counter China’s influence in the region, even as questions remain about its effectiveness. Altogether the nations involved in the Indo-Pacific Economic Framework, or IPEF, constitute roughly 40% of global gross domestic product (GDP), according to the White House, which has touted its launch as a marquee accomplishment of President Joe Biden’s first trip to Asia.
Australia, India, Japan, South Korea and New Zealand were included, along with seven Southeast Asian countries. “The United States is deeply invested in the Indo-Pacific,” Biden said Monday at an event in Tokyo launching the partnership. “We’re committed for the long haul.”
The framework is the most significant US effort to engage Asia on economic matters since former President Donald Trump in 2017 withdrew from the Trans-Pacific Partnership agreement negotiated under the Obama administration. But unlike that trade deal, the new framework doesn’t include any tariff reductions and it’s unclear which parts are binding, making it hard to quantify the economic benefits.
“This framework is intended to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for our economies,” the countries said in a joint statement. “Through this initiative, we aim to contribute to cooperation, stability, prosperity, development, and peace within the region.”
Democrats and Republicans in Congress have questioned the initiative because it doesn’t include a goal of negotiating mutual tariff reductions to make US exports cheaper for consumers in foreign markets, a typical objective of past trade negotiations.