The Indo-Pacific Economic Framework

President Biden and leaders from a dozen other countries in the Indo-Pacific region announced a new economic initiative yesterday designed to counter China’s influence in the region.

• The 13 members are the US, Japan, South Korea, Indonesia, Malaysia, the Philippines, Singapore, Thailand, Brunei, Vietnam, India, Australia, and New Zealand; altogether, they represent ~40% of global GDP.

🌏 More deets...

• US officials said the IPEF is built around four pillars: cooperation on digital trade, improving supply chains, ramping up clean energy, and implementing tax, anti-money laundering and anti-bribery measures.
• Member countries can choose which of the areas they wish to participate in – a concession that helped entice some nations who were initially skeptical, a source told the WSJ.
• Unlike the Trans-Pacific Partnership, a 2018 trade deal the US pulled out of under then-President Donald Trump, the IPEF doesn’t include plans to negotiate tariffs or facilitate access to domestic markets.

☝️ One interesting thing: Notably absent from the new framework is Taiwan, even after a bipartisan group of 50+ senators wrote a letter to Biden last week urging him to add the country to the pact. Its inclusion would have undoubtedly drawn the ire of China, which is a top trading partner for many of the framework’s participants.

🇹🇼 Speaking of Taiwan... Biden said yesterday that the US would respond militarily to defend Taiwan if China tries to take it by force; the White House later clarified that his remarks didn’t signal any shift in American policy.