APEC Summit: Progress, But No IPEF Trade Deal


The 13 countries negotiating the US-led Indo-Pacific Economic Framework trade pillar said at the close of their Summit that progress is being made, even though they were not able to not able to close out the trade deal.

The acknowledgment from trade ministers came as President Biden announced that talks are completed on the other three pillars – supply chains, clean energy and anti-corruption.

The Administration had hoped the trade pillar would be done as well in time for the Asia Pacific Economic Cooperation meets taking place this week in San Francisco.

IPEF is seen in the Administration as a means of offering the region an alternative to China.

But the trade talks hit snags when some Congressional Democrats raised concerns about the lack of enforceable labor and environmental standards, while IPEF partners were unhappy with the Administration’s sudden decision to scale back its original vision for rules governing digital trade.

The countries participating in the trade pillar said they “are seeing progress in the areas of trade facilitation, inclusivity, technical assistance and economic cooperation and agriculture, among others.”

“We are committed to continuing our work towards a mutually beneficial Trade Pillar outcome, accompanied by technical assistance and economic cooperation, that advances workers’ rights through strong and enforceable labor standards; promotes fair, open, and rules-based trade; benefits our ranchers and farmers; improves economic opportunities for families and micro-, small-, and medium-sized enterprises; protects the environment; builds trust in the digital economy; and drives sustainable, equitable economic growth,” according to their statement.

The IPEF involved 14 countries including the United States, but India opted not to participate in the trade pillar.

Negotiations to Continue

Negotiations on the trade pillar will continue, Deputy National Security Advisor for International Economic Mike Pyle told reporters yesterday. He downplayed the delay in completing the trade pillar, noting that trade negotiations traditionally take years to complete.
Negotiators will “keep at” the trade talks, he said. “There's been progress that's been made. In the weeks and months ahead, we expect to continue putting shoulders against that effort, both here in the United States as well as with another IPEF partners. We're going to do that in a way that continues to consult intensively with leaders on Capitol Hill, with a full set of stakeholders back here in the United States – including, importantly, our friends in the labor community.”

Signaling the Administration’s commitment to worker rights, President Biden yesterday signed the first-ever Presidential Memorandum outlining the US commitment to worker rights globally. The memorandum directs federal departments and agencies to advance labor rights and worker empowerment in their work abroad.

US Trade Representative Katherine Tai participated in an event on the sideline of the APEC meetings detailing the new initiative. The global workers rights directive goes hand-in-hand with the Administration’s worker-centered trade policy,” she said. “The common thread through all of this is our commitment to bring workers’ voices to the decision-making table. To craft trade policies with and for workers. To meet them and their communities where they are, so that their priorities help shape our policies.”

Polishing the Turnip

Participating Administration  put the outcome in as constructive a light as possible.  

President Biden spent his time in San Francisco stressing US longstanding commitment to a region often overshadowed by China.“We aren’t going anywhere. For decades, America’s enduring commitment to the region has been a springboard that’s enabled growth – transformative growth, ensured the open flow of commerce, and lifted millions of people out of poverty,” he said.

The President's  discussions with Chinese Premier Xi yielded many polite nods., with Bill Bishop at Sinocism noting: The US readout reiterates the US framing that the "United States and China are in competition", something the PRC wants to reject, at least publicly, but the PRC agreed that both the US and PRC would include the phrase “responsibly managing competitive aspects of the relationship” in their respective readouts.

Mike Gallagher (R-WI), Chairman of the House Select Committee on the Chinese Communist Party released the below statement calling for the Biden administration to work with Congress on trade after its Indo-Pacific Economic Framework (IPEF) failed to secure congressional support this week.

House Foreign Affairs Committee Chairman Michael McCaul released the following statement expressing his disappointment with the President's talks with Xi. "Despite 4 hours of talks and the expenditure of US taxpayer dollars, the meeting yielded nothing substantial, except a mere promise of more meetings in the future."

USTR Katherine Tai emphasized  the U.S. APEC host year theme of "Creating a Sustainable and Resilient Future for All," emphasizing inclusivity, sustainability, and resilience in economic policies. 

Pillars II, III, & IV

Secretary Raimondo emphasized the substantial conclusion of IPEF Pillars III and IV, and sighed off on the Pillar II Supply Chain Agreement, which was substantially concluded earlier this year.

The U.S. fact sheet on the IPEF Clean Economy Agreement is available here.

The U.S. fact sheet on the Fair Economy Agreement is available here.


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