Beijing has criticized the Indo-Pacific Economic Framework (IPEF) proposed by the United States, calling it Washington’s attempt to induce Southeast Asian countries to “decouple from China”.
US President Joe Biden hosted a special two-day summit with leaders of the Association of Southeast Asian Nations (ASEAN) which ends on Friday. At the summit, the United States is expected to share more details on the framework, which is expected to be officially launched later this month when Biden visits South Korea and Japan.
This is not a free trade pact in the mold of the Trans-Pacific Partnership that the Obama administration has championed and negotiated for years as part of its foreign policy “pivot” to Asia, only to see the Trump administration abandon it. An iteration of the same agreement was later adopted by other Pacific nations.
But IPEF seeks to foster ties with Indo-Pacific economic partners by establishing trade rules and building a supply chain, without China.
In President Biden’s words at the East Asia Summit last year, IPEF involves “trade facilitation, standards for the digital economy and technology, resilience of the supply, decarbonization and clean energy, infrastructure, labor standards and other areas of common interest. ”
On Thursday, Beijing warned Washington that the Asia-Pacific is “not a chessboard for geopolitical competition” and that any framework for regional cooperation should “follow the principle of respect for the sovereignty of others and non-interference in the internal affairs of others”.
Chinese Foreign Ministry spokesman Zhao Lijian said China rejects the “Cold War mentality” when it comes to regional groupings.
The People’s Daily, the mouthpiece of the Communist Party of China, said in an editorial that the IPEF is designed to “compensate for the shortcomings of Washington’s previous engagement with Southeast Asia, which focused only on safety and ignored economics”.
“The United States has deep political and strategic goals aimed at forcing countries to decouple from China,” some analysts quoted by the newspaper said.
The rally in Washington is the second special U.S.-ASEAN summit since 2016, when then-President Barack Obama hosted the bloc’s leaders in Sunnylands, California.
ASEAN leaders minus Myanmar and the Philippines attended a White House dinner with Biden on Thursday and met with a host of US political and business leaders, but had no bilateral meetings with the US president. . The leaders were meeting with Biden and Vice President Kamala Harris on Friday at the State Department.
There are 10 ASEAN member states, but the Burmese junta was not invited to the summit and the Philippines, which held a presidential election last weekend, only sent its foreign minister.
Singapore Prime Minister Lee Hsien Loong was the first ASEAN leader to host IPEF.
Speaking during an engagement with the US-ASEAN Business Council and the American Chamber of Commerce on Thursday, Lee said IPEF “must be inclusive and provide tangible benefits to encourage broader participation”.
“We encourage greater ASEAN participation in IPEF and hope that the United States will directly invite and engage ASEAN member states in this endeavor,” he said.
At present, it is understood that only two of the 10 ASEAN countries – Singapore and the Philippines – are expected to be part of the initial group of countries to sign up for negotiations under the IPEF.
“Most ASEAN members have remained hesitant to voice support for Biden’s IPEF, which they say is a counterweight to China’s Belt and Road Initiative in particular and economic coercion. of Beijing in general,” said Huynh Tam Sang, a senior lecturer in Ho Chi Minh City. City University of Social Sciences and Humanities (USSH) in Vietnam.
“Given the economic proximity to China, ASEAN member states have sought to avoid provoking Beijing, let alone getting involved in Sino-US competition,” Sang said.
Yet, judging by prepared statements and initial reactions from ASEAN leaders on the prospects for ASEAN-US economic cooperation and IPEF, “they not only appreciate the substance of the relationship, but are eager to see it grow,” said Thomas Daniel, a senior fellow at the Malaysian Institute for Strategic and International Studies.
“Unfortunately, Washington is still unable to fully grasp or respond to Southeast Asia’s desire for practical dimensions that will bring immediate and tangible benefit to local economies and communities,” he said. he declared.
On Thursday, Malaysian Prime Minister Ismail Sabri Yaakob urged the United States to adopt a more active trade and investment agenda with ASEAN countries. He pointed to the China-backed Regional Comprehensive Economic Partnership, which entered into force this year, as an important tool to boost regional trade and economic activities through the reduction of trade barriers.
Seeking to deliver tangible benefits at the summit, Biden offered $150 million for infrastructure, security, pandemic preparedness and other ASEAN efforts.
More division in the block?
Details of the IPEF remain vague, but policymakers in Washington said they are designing a framework to prioritize flexibility and inclusion, with a choice arrangement for participating countries, allowing them to select individual areas in which they want to make more specific commitments.
The IPEF seeks to foster economic cooperation by establishing trade rules on “four pillars”: trade resilience, infrastructure, decarbonization and the fight against corruption.
An analysis by the Washington-based Center for Strategic and International Studies (CSIS) said that even if the IPEF delivers on its promises, “it will need to be well designed and managed”.
“To the extent possible, the framework should seek to advance binding rules and firm commitments that go beyond broad principles and objectives,” the SCRS said.
At the same time, “the Biden administration will need to deliver tangible benefits to regional partners, especially the less developed ones,” according to the analysis.
There are warnings that the proposed framework, if not carefully considered, could even create a greater gap between countries in the Southeast Asian region.
“Small and medium powers in Southeast Asia are likely to take a cautious approach to initiatives proposed by major powers, especially when such multilateral frameworks could undermine ASEAN’s centrality,” USSH’s Sang said. from Vietnam.
Countries like Singapore, the Philippines and Malaysia may seek to join certain “pillars” that may serve their pragmatic interests, but “China may seek to discourage smaller regional states from forging ties with Washington by participating in IPEF” .
Sang said this could pose a particular dilemma for Laos and Cambodia, which may not want to be left behind but have deep and growing economic ties with China.