Ministers from 14 member states of the US-led Indo-Pacific Economic Framework are expected to declare the start of formal negotiations this week in Los Angeles, according to informed sources, as they work to codify an economic order based on on rules in the fast-growing country. Region.
Thursday’s two-day meeting in Los Angeles will be the first in-person ministerial meeting of the Indo-Pacific Economic Framework for Prosperity, known as IPEF, which US President Joe Biden’s administration has created as a vehicle to counter China’s rise in the region.
Unlike a traditional trade agreement, the IPEF does not involve tariff reductions and trade liberalization which are sensitive subjects in the United States. Biden’s predecessor, Donald Trump, pulled the world’s largest economy out of the Trans-Pacific Partnership trade deal in 2017 over such concerns.
Instead, IPEF, which collectively accounts for around 40% of global gross domestic product, is focused on setting high standards in new areas such as the digital economy and supply chains for semi- conductors and other strategically important materials.
The IPEF, which Biden announced during his trip to Japan in May, is seen as re-engaging the United States in the Indo-Pacific and offering a Washington-led alternative to economic coercion and trap-strap diplomacy. Beijing’s debt.
The IPEF consists of four policy pillars which seek to promote fair trade, supply chain resilience, clean energy as well as decarbonization and infrastructure, as well as measures against tax evasion and corruption. .
In a show of flexibility, members can choose to join one of four pillars individually in what trade experts call a decentralized pillar approach.
US Trade Representative Katherine Tai and US Secretary of Commerce Gina Raimondo will co-host the meeting, with Minister of Economy, Trade and Industry Yasutoshi Nishimura representing Japan.
Nishimura promised Japan would play an active role in the talks during a face-to-face virtual meeting in late August with Tai and with Raimondo by phone.
The USTR office will be in charge of fair trade measures and the rest will be under the direction of the Department of Commerce, according to the US government.
In Los Angeles, member states are expected to determine which countries will participate in negotiations for which of the four pillars, an outcome to be published in a post-meeting document, according to Japanese government officials.
Experts say the decentralized pillar approach appears to have lowered barriers to participation for some countries, particularly those in Southeast Asia.
The ministers will aim to build a structure capable of ensuring a stable supply of vital commodities such as chips and minerals like rare earths even in the event of natural disasters and other eventualities, Japanese officials said.
They also intend to strengthen cooperation in new energy technologies using hydrogen and ammonia, as well as in renewable energy, they said.
The Biden administration hopes negotiations related to each pillar will wrap up in a year or up to 18 months, according to the Center for Strategic and International Studies, a Washington-based think tank.
An Asia-Pacific Economic Cooperation summit meeting scheduled for November 2023 is seen as the informal deadline to finalize IPEF agreements, with some experts hoping to see “early harvests” in areas such as trade and of supply chain.
The current 14 members of IPEF are Australia, Brunei, Fiji, India, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Thailand , the United States and Vietnam.