The Indo-Pacific Economic Framework (IPEF) is a regional forum initiated by the US Biden administration mainly motivated by strategic competition with China, to secure alternative supply chains. Proponents say IPEF will strengthen economic cooperation between its participants and include high labour and environmental standards; a digital trade framework; open and predictable supply-chains, investment in de-carbonisation and clean energy and transparent tax and anti-corruption standards. See the 'Four Pillars' negotiating objectives here. IPEF does not include market access commitments like lower tariffs. The main incentives are increased investment and capacity building projects.
So far, IPEF includes the US, Australia, Brunei, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, Fiji and Vietnam. Other countries may join later.
The US is not part of the two big existing regional trade agreements. These are the Regional Comprehensive economic Partnership (RCEP) of the ten ASEAN countries plus five other countries, and the Comprehensive and Progressive Trans-Pacific Partnership of 11 Pacific Rim countries (CPTPP), because of bipartisan opposition to trade deals which give increased market access to US markets. The U.S. Congress does not currently have ‘fast track’ authority which enables negotiation of trade agreements that offer tariff reductions or other access to US markets, so it will not be enforceable through trade penalties. IPEF may be a mixture of diplomatic agreements and aspirational statements.
If there are some legally binding IPEF agreements in areas like digital trade, they may be modelled on existing trade agreements like the
Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and the
Singapore Digital Economy Agreement that are dominated by corporate interests. Without genuine consultation with trade unions, environmentalists and other civil society organisations, IPEF will not meet its claimed goals of improving workers’ rights and environmental standards.
See our short explainer in The Conversation., our longer IPEF submission to the Department of Foreign Affairs and Trade (DFAT) and the recording of our December 13, 2022 IPEF public seminar here.