Indo-Pacific nations ‘to strengthen supply chains for critical items’
- Making supply chains sturdier is likely to be first agreement between 14 countries in Indo-Pacific Economic Framework, which is meeting in the US on Saturday
- Food, energy, other key products disrupted by pandemic and war in Ukraine; leaders want to avoid such disruptions, and help counter China’s influence
Ministers from Japan, 12 other Indo-Pacific nations and the US will agree at a meeting Saturday in Detroit to bolster supply chains for chips, medicine and other critical items in the event of an emergency under a US-led economic initiative, sources familiar with the matter said Friday.
The enhanced supply chain resiliency will be the first agreement among the 14 member countries of the Indo-Pacific Economic Framework (IPEF), representing 40 per cent of global gross domestic product, and could help counter China’s economic influence in the region.
Supplies of food, energy and key industrial products like semiconductors were disrupted by the Covid-19 pandemic and Russia’s war in Ukraine.
The IPEF partners, also including Australia, Indonesia, India, South Korea and Thailand, aim to respond to emergencies more promptly, ensuring the procurement of vital goods and the sharing of information, under a new scheme, according to the sources.
The US-led initiative covers four pillars – fair trade, supply chain resilience, clean energy and proper taxation and anti-corruption – and is also regarded as a symbol of the world’s biggest economy’s reengagement in the fast-growing region after its withdrawal from the Trans-Pacific Partnership free trade deal in 2017.
Russia and China, which are deepening their economic and security partnership amid increasing tensions with the United States and other countries, are not part of the IPEF.