Indo-Pacific Economic Framework for Prosperity: A snapshot of the initiative

My Bookmarks close
You have no bookmarks currently
    • Solar panels and wind mills in VietnamSolar panels and wind mills in Vietnam
    24 May 2022


    By UOB Global Economics & Markets Research

    Key takeaways

    • The IPEF aims to strengthen economic partnership between the US and its Asian partners through a non-traditional trade agreement; rather than negotiate on tariffs and market access, it integrates partners through agreed standards on selected pillars.
    • The framework covers four main pillars: the digital economy, supply chain resilience, anti-corruption measures and clean energy infrastructure.


    During the East Asia Summit in October 2021, US President Joe Biden announced that the US “will explore with partners the development of an Indo-Pacific economic framework that will define our shared objectives around trade facilitation, standards for the digital economy and technology, supply chain resiliency, decarbonisation and clean energy, infrastructure, worker standards, and other areas of shared interest.”

    On 23 May 2022, President Biden formally launched the Indo-Pacific Economic Framework for Prosperity (IPEF) during his five-day visit to South Korea and Japan. This is his first trip to Asia as US President.


    What is in IPEF?

    Unlike traditional trade agreements, the IPEF does not negotiate on tariffs and market access. The programme foresees integrating partners through agreed standards in four main pillars:


    What is in IPEF


    Who are the members?

    The pact is led by the US, with an initial list of 12 Indo-Pacific countries:




    Major Trade Blocs In Asia
    CPTPP: Comprehensive and Progressive Agreement for Trans-Pacific Partnership
    RCEP: Regional Comprehensive Economic Partnership


    What’s next for IPEF?

    Following the announcement, the 13 IPEF members will start negotiations on each pillar. The framework descriptions so far have been largely broad-based. There are few details as of now to judge how IPEF will eventually compare to other trade blocs like CPTPP or RCEP. The key will be when the members hold negotiation on the terms encompassing the pact – which will be one of the determining factors for the prospect of IPEF.

    Originally published as an infographic here.

    Source: White House Statement, media reports, UOB Global Economics & Markets Research


    This article shall not be copied, or relied upon by any person for whatever purpose. This article is given on a general basis without obligation and is strictly for information only. The information contained in this article is based on certain assumptions, information and conditions available as at the date of the article and may be subject to change at any time without notice. You should consult your own professional advisers about the issues discussed in this article. Nothing in this article constitutes accounting, legal, regulatory, tax or other advice. This article is not intended as an offer, recommendation, solicitation, or advice to purchase or sell any investment product, securities or instruments. Although reasonable care has been taken to ensure the accuracy and objectivity of the information contained in this article, UOB and its employees make no representation or warranty, whether express or implied, as to its accuracy, completeness and objectivity and accept no responsibility or liability for any error, inaccuracy, omission or any consequence or any loss or damage howsoever suffered by any person arising from any reliance on the views expressed and the information in this article.


    Find out how we can help your business expand across ASEAN

    Get in touch