The 14-member of the Indo-Pacific Economic Framework for Prosperity (IPEF) including India and the United States, all of which together represent 40% of the global economy and 28% of goods and services trade, had its first in-person ministerial meeting in Los Angeles.
“This meeting was a chance to deepen our partnerships and fill in the details about how we will work collectively to address the challenges and opportunities that will define the 21st century,” said United States Trade Representative (USTR) Katherine Tai. “After several days of intensive discussions, we have made real progress toward that goal and I am excited to continue developing this Framework, which will unlock enormous economic value for our region and serve as a model for the rest of the world to follow.”
According to an official USTR statement the ministers, including India’s Commerce Minister Piyush Goyal, had positive and constructive discussions and announced a substantial milestone in their pursuit of a high standard and inclusive economic framework.
That is notwithstanding that India will not join the trade pillar, one of the four pillars of the IPEF. However, the USTR said bilaterally the two countries have the Trade Policy Forum which is scheduled to meet at the end of this year to discuss some of the same issues discussed in the IPEF.
The in-person ministerial meeting was hosted by the USTR and U.S. Secretary of Commerce Gina M. Raimondo. “Our first in-person meeting has been an undeniable success,” said Secretary Raimondo. “This week, 14 countries came together to chart a path forward that will create economic opportunity, improve labor conditions, and promote sustainability for all of our economies. Just as importantly, this ministerial gave us an opportunity to show that we can deliver concrete and tangible economic benefits for partner countries while pursuing an inclusive and high standard framework at the same time. I am proud of the progress we’ve made and I’m excited to continue building momentum in this effort.”
Since its launch in May launch, IPEF countries have engaged in intensive discussions to scope out each pillar of the Framework. At the conclusion of the Senior Officials and Ministerial meetings, the partners reached a consensus on ministerial statements for each of the four IPEF pillars: Trade; Supply Chain; Clean Economy; and Fair Economy, the official statement said.
“The Framework will advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for our economies. Through IPEF, the partners aim to contribute to cooperation, stability, prosperity, development, and peace within the region. The Framework will also offer tangible benefits that fuel economic activity and investment, promote sustainable and inclusive economic growth, and benefit workers and consumers across the region. The 14 IPEF partners represent 40 percent of global GDP and 28 percent of global goods and services trade,” it said.
As part of the four pillars, the 14 countries agreed on the outlines to negotiate the four pillars, which specifically include data flows and labor rights, green energy and environmental standards, anti-corruption and tax measures and supply chain resilience.
Tariff cuts, which constitute the core of trade deals, are not part of the IPEF. The IPEF is America’s way to significantly engage economically with Indo-Pacific even as China seeks to dominate Asia.
The ministers participating included those from India, Australia, Brunei, Fiji, Indonesia, Japan, South Korea, Malaysia, New Zealand, Philippines, Singapore, Thailand and Vietnam.
The trade pillar, which India has not joined initially, “will seek high-standard provisions in areas that are foundational to resilient, sustainable, and inclusive economic growth, including labor, environment, digital economy, agriculture, transparency and good regulatory practices, competition, inclusivity, trade facilitation, and technical assistance and economic development,” according to the USTR.
“In the Supply Chain Pillar, the countries will seek to coordinate actions to mitigate and prevent future supply chain disruptions and secure critical sectors and key products for our manufacturers. The United States will work with IPEF partners to identify sectors and products critical to our national security, economic resilience, and the health and safety of our citizens – and then act collectively to increase the resilience of these sectors, creating jobs and economic opportunities in key industries of the future,” the statement said.
“In the Clean Energy Pillar, the countries will seek to expand investment opportunities, spur innovation, and improve the livelihoods of citizens as the partners unlock the region’s abundant clean energy resources and substantial carbon sequestration potential. The partners aim to advance cooperation on clean energy and climate-friendly technologies, as well as mobilize investment and promote usage of low- and zero-emissions good and services,” the USTR statement said
Finally in the Fair Economy Pillar, “the countries will seek to level the playing field for businesses and workers within partner countries by preventing and combatting corruption, curbing tax evasion, and enhancing transparency, recognizing the importance of fairness, inclusiveness, the rule of law, accountability and transparency.”