Updated May 23, 2022 - World

Biden launches new Indo-Pacific trade pact

PM Narendra Modi attend the Indo-Pacific Economic Framework for Prosperity at the Izumi Garden Gallery in Tokyo on May 23.
Attending the Indo-Pacific Economic Framework for Prosperity at the Izumi Garden Gallery in Tokyo on Monday were (from left) Japanese Prime Minister Fumio Kishida, President Biden and Indian Prime Minister Narendra Modi. Photo: Saul Loeb/AFP via Getty Images

President Biden announced Monday that 13 countries were joining a new, U.S.-led Asia-Pacific trade pact designed to counterbalance the influence of China's government in the region while strengthening ties with allies.

Driving the news: The Indo-Pacific Economic Framework for Prosperity (IPEF) "will enable the United States and our allies to decide on rules of the road that ensure American workers, small businesses, and ranchers can compete in the Indo-Pacific," per a White House statement.

  • The new framework "will help lower costs by making our supply chains more resilient in the long term, protecting us against costly disruptions that lead to higher prices for consumers," the White House added.
  • Biden said at a Tokyo news conference alongside Japan's Prime Minister Fumio Kishida that the IPEF "is a commitment to working with our close friends and partners in the region on challenges that matter most to ensuring economic competitiveness in the 21st century," per AFP.

The big picture: Initial IPEF partner countries with the U.S. are Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam, according to a White House statement.

  • The pact was being launched some five years after then-President Trump withdrew the U.S. from the Trans-Pacific Partnership "in order to prepare our economies for the future," per a joint statement from the countries.
  • "This framework is intended to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for our economies," the statement added. "Through this initiative, we aim to contribute to cooperation, stability, prosperity, development, and peace within the region."

Editor's note: This article has been updated with new details throughout.

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