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The Indo-Pacific economic framework agreement: how to get the best out of it and future steps

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Fourteen countries in the region, including Indonesia, are currently negotiating the Indo-Pacific Economic Framework for Prosperity (IPEF) Agreement. Text-based negotiations are clustered into four areas of cooperation namely trade, supply chain, clean economy, and fair economy. The expected outcome is the conclusion of legally binding international agreement(s). As of the date of this paper, the IPEF negotiating group has substantially concluded the final text of the agreement relating to supply chain resilience (IPEF supply chain agreement / Pillar II).

Indonesia’s position towards IPEF is positive engagement. Indonesia’s participation in the partnership started since its inception in May 2022. Later that year in September, Indonesia gave its full support for all IPEF’s four pillars of cooperation by signing on all the Ministerial Statements. Indonesia would then host the second negotiating round in Bali, in March 2023, paving the way towards finalization of the text of the supply chain agreement in May 2023, in Singapore. In the recently held IPEF Ministerial Meeting in Detroit, Indonesia conveyed its readiness to further the negotiation of the remaining three pillars of IPEF.

On the surface, IPEF and its surrounding environment look nice. Leaders’ statements, events and exhibitions, media exposures, all look promising for growth. But this is not the case. Despite headlines showing supports, critiques on the downsides of IPEF are palpable. Scholars, businesses, civil societies, politicians, economists, and government(s) have provided their concerns. Central to these critiques are the free trade dogma: market access, economic efficiency, peace and stability. IPEF lacks all the mentioned feats. Joining IPEF does not necessarily resulted to benefits. There will be also costs. Indonesia needs to clearly understand this situation.

This paper is intended to decipher IPEF. Starting from characterizing the partnership, to identifying blind spots, particularly for Indonesia. It would include both the positives and negatives features of IPEF. Having clear understanding on the above, this paper would then discuss on how Indonesia could get the best out of its participation in IPEF. It would finish by providing future steps that Indonesia may consider taking after IPEF.

Keywords: international trade, trade agreement, free trade, economic cooperation, non-economic trade agreement, Indo-Pacific, Indonesia.

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Ketersediaan

2023-0067

Sesparlu 72-2023

Training Materials Repository

Tersedia

Informasi Detail

Judul Seri

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No. Panggil

Sesparlu 72-2023

Penerbit

Jakarta : Kementerian Luar Negeri., 2023

Deskripsi Fisik

Digital File

Bahasa

English

ISBN/ISSN

-

Klasifikasi

NONE

Tipe Isi

text

Tipe Media

computer

Tipe Pembawa

online resource

Edisi

-

Subjek

-

Info Detail Spesifik

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Pernyataan Tanggungjawab

UPT Sekolah Staf dan Pimpinan Luar Negeri

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