U.S. President Joe Biden expressed his dedication to advancing a Pacific trade pact at the Asia Pacific Economic Cooperation (APEC) forum, despite facing challenges in strengthening workers’ rights. Speaking to corporate CEOs in San Francisco, Biden stated, “Our work is not yet done,” emphasizing the need for high-standard trade that protects and advances workers’ rights through robust enforcement of labor standards.
In addition to participating in the APEC summit, Biden’s administration established the Indo-Pacific Economic Framework (IPEF) group, comprising 14 nations. However, hopes for a trade deal within the IPEF were dashed recently as members could not reach a consensus on labor and environmental standards or compliance.
Deputy U.S. Trade Representative Sarah Bianchi informed Reuters that the U.S. and its Indo-Pacific partners will regroup and “recalibrate” their trade negotiations early next year. While negotiations typically take years, the White House intends to work on an “accelerated timeline.”
The creation of the IPEF by the White House aimed to strengthen economic engagement with Asia after former President Donald Trump withdrew from a regional trade pact in 2017. The upcoming presidential election, potentially involving Biden and Trump, could impact U.S. support for multilateral groups like APEC, the International Monetary Fund (IMF), and trade policy.
After a series of meetings, Biden revealed that leaders at the APEC summit signed a supply chain agreement to address bottlenecks and preempt potential issues. They also reached agreements to expedite clean energy transitions and combat corruption. Furthermore, Biden highlighted the launch of an “investment accelerator” to attract private investment for clean energy and technology projects, emphasizing that government investment alone is insufficient.
Prior to the APEC summit, Biden praised investments by U.S. companies in the region, including Amazon.com, Delta Air Lines, PepsiCo, Apple, and Boeing. He argued that continued U.S. economic growth would benefit the entire world, despite concerns about the sluggish global economy.
While the IMF lowered its growth forecasts for China and noted the unevenness of global growth, Biden stressed the importance of APEC countries, stating that 60% of U.S. exports go to these nations, and American businesses are the leading source of foreign direct investment in their economies.
U.S. Commerce Secretary Gina Raimondo confirmed that IPEF countries agreed to several “pillars” of the trade initiative, encompassing cooperation on clean energy and anti-corruption measures. Ministers also formally signed an agreed-upon text for a third pillar, focusing on supply chain resiliency.
Nevertheless, the U.S.-backed IPEF initiative is not the only trade effort in progress. Trade ministers from Comprehensive and Progressive Agreement for Trans-Pacific Partnership countries expressed willingness to welcome new members who meet the bloc’s standards. Under Biden’s administration, free-trade deals have been deprioritized due to pressure from labor groups.
With regards to the U.S.-China relationship, APEC members closely monitored the developments between the two economic giants and strategic rivals, fearing that intensifying competition could disrupt global trade and security. Following a high-stakes summit with Chinese President Xi Jinping, Biden emphasized the importance of a stable relationship between the U.S. and China, stating that it is beneficial for both countries and the world.
Biden clarified that the U.S. is not seeking to decouple its economy from China but rather to “de-risk and diversify.”
Richard Adkerson, CEO of mining company Freeport-McMoRan Inc, expressed optimism about the improving relations between China and the United States, describing the meeting between the presidents as encouraging. However, he acknowledged the need to wait and evaluate if this moment signifies a significant turning point in the relationship.