US nixes return to Trans-Pacific trade pact – The Manila Times

Credit: Original article can be found here

THE United States is “not in a position to rejoin” the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and will instead pursue creation of a “better” pact called the Indo-Pacific Economic Framework, Commerce Secretary Gina Raimondo said on Thursday.

Raimondo spoke to the media from Kuala Lumpur, where she is wrapping up a week-long visit to the region, the first for the Biden administration official.

In addition to signing an agreement with Malaysia on trade in semiconductors, Raimondo met with other government and business figures in Japan, Singapore, Malaysia, Australia and New Zealand, where she pitched a new agreement, called the Indo-Pacific Economic Framework, as a better alternative to the CPTPP.

The CPTPP, originally called simply the Trans-Pacific Partnership or TPP, was a proposed trade agreement signed in February 2016 by Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States. Former US president Donald Trump removed the US from the pact shortly thereafter, however, as part of his administration’s campaign of punitive actions against most of the country’s trading partners.

The agreement was resurrected as the CPTPP by the remaining signatories and it was widely expected that the Biden administration would seek to rejoin the pact, but Raimondo’s comment seemed to dash those hopes with finality.

‘Friend-shoring’

“The Indo-Pacific Economic Framework will not be a traditional trade agreement,” Raimondo said. The new pact will instead focus on areas such as supply chain coordination and resiliency, coordination of investments in trade-related infrastructure, agreements on export controls and common technology standards, and clean energy development, she explained.

While the top priority for the US is understandably to support its domestic industries, “the US commitment to the region is steadfast,” Raimondo declared.

“What we are really pursuing is ‘friend-shoring,’ working with like-minded allies to integrate supply chains and promote shared principles with a flexible and inclusive economic framework,” she added.

When pressed for examples of how the proposed agreement would work, Raimondo suggested that it could include provisions to give small and medium enterprises broader opportunities to participate in trans-Pacific supply chains and allow for more “flexible” cross-border investments such as through public-private partnerships.

Raimondo said that discussions about the proposed Indo-Pacific Economic Framework “are still in a very preliminary stage,” and that the US is hoping to begin negotiations in earnest “sometime in early 2022.”