In October 2021, President Biden announced the United States’ intention to pursue an “Indo-Pacific Economic Framework” (IPEF) as a means of strengthening U.S. ties in the Asian region. Substantive discussions on the IPEF have not yet begun, and indeed, there has not yet been an announcement how the negotiations will be conducted or which nations will be involved. Nevertheless, enough about this proposed framework of agreements has been announced that companies in the region can begin to prepare for the process. This article will discuss what is known about the IPEF, why the current administration is taking this approach, and how countries in the Asian region may be affected by this new agreement.
By way of background, in February 2016, after years of negotiations, the Trans-Pacific Partnership (TPP) was signed. The TPP covered 12 countries, including the United States, and was described as a high-standard “21st Century” trade agreement. However, one of then-President Trump’s first actions in office was to withdraw the United States from the TPP. The remaining TPP countries renegotiated the agreement without the United States (essentially removing certain elements of the agreement the United States alone had backed), and ultimately entered into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Since President Biden’s inauguration in January 2021, pressure has been building for the United States to reengage with Asia on economic and commercial matters. The IPEF is the United States’ current policy response.