August 18, 2022

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Biden launches Indo-Pacific trade deal, warns of inflation

Biden launches Indo-Pacific trade deal, warns of inflation

TOKYO (AFP) – President Joe Biden launched a new trade deal with 12 countries in the Indo-Pacific region Monday aimed at boosting their economies as he warned Americans worried about high inflation that it “will be a burden” before they can get comfortable. The president said he doesn’t think recession is inevitable in the United States

Biden, speaking at a news conference after holding talks with Japanese Prime Minister Fumio Kishida, acknowledged that the US economy has “problems” but said they are “less important than the rest of the world.”

He added, “This will be a long distance. This will take some time.” In response to a question, he dismissed the idea that a recession in the US is inevitable.

His comments came before Biden launched the Indo-Pacific Economic Framework. His administration says the trade deal is designed to signal the United States’ dedication to the disputed economic sphere and to address the need for stability in trade after the turmoil caused by the pandemic and Russia’s invasion of Ukraine..

The countries that joined the United States are: Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam. Together with the United States, they account for 40% of global GDP.

In a joint statement, the countries said the agreement would collectively help them “prepare our economies for the future” after the fallout from the pandemic. The war in Ukraine.

Biden and Kishida were joined at the launch event by Indian Prime Minister Narendra Modi, while representatives from other countries appeared in the video. Modi was in Tokyo for Tuesday’s meeting of the Quartet, a four-nation security group that also includes the United States, Japan and Australia.

The White House said the framework will help the United States and Asian economies work closely on issues including supply chains, digital trade, clean energy, labor protection and anti-corruption efforts. Details still need to be negotiated among member states, making it difficult for the administration to say how this agreement will fulfill the promise of helping American workers and businesses while also meeting global needs.

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Critics say the framework has significant shortcomings. It does not offer incentives to potential partners by lowering tariffs or providing signatories with greater access to US markets. These limitations may not make the United States framework an attractive alternative to the TPPthat progressed without the United States after the withdrawal of former President Donald Trump. China, the largest trading partner for many in the region, is also seeking to join the Trans-Pacific Partnership.

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“I think a lot of partners will look at that list and say, ‘That’s a good list of issues. “I’m happy to be involved,” said Matthew Goodman, former director of international economics at the National Security Council during President Barack Obama’s administration. But he said they might also ask, “Are we going to reap any tangible benefits from participating in this framework?”

Kishida gave an official state welcome to Biden at Akasaka Palace, including a white-clothed military honor guard and squad in the front yard. After reviewing the combined forces, Biden put his hand over his heart as he passed the American flag and bowed slightly as he passed Japanese standards.

The Japanese prime minister took office last fall and is looking to strengthen ties with the United States and build a personal relationship with Biden. The two leaders ended their day with dinner at the famous Kochuan restaurant in Tokyo on the grounds of a Japanese garden.

Kishida said at their meeting that he was “extremely pleased” to welcome Biden to Tokyo on his first Asian trip during his presidency. Alongside Biden, he led a hard line against Russia over its invasion of Ukraine, saying that aggression “undermines the foundations of the world order.”

Biden, who is on a five-day visit to South Korea and Japan, called the US-Japan alliance “the cornerstone of peace and prosperity in the Indo-Pacific region” and thanked Japan for its “strong leadership” in standing up to Russia.

Kishida welcomed Biden’s new trade deal but said he still hoped the president would reconsider the United States’ position and bring it back to the Trans-Pacific deal that Trump withdrew from.

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“We believe it is desirable that the United States return to the Trans-Pacific Partnership,” he said.

The new agreement comes at a time when the administration believes it has an advantage in its competition with Beijing. Bloomberg Economics published a report last week that forecast US GDP growth of about 2.8% in 2022 compared to 2% for China, which has been trying to contain the coronavirus through strict lockdowns while also dealing with property collapse. The economic slowdown has undermined assumptions that China will automatically replace the United States as the world’s leading economy.

“The fact that the United States will grow faster than China this year, for the first time since 1976, is an absolutely stark example of how countries in this region should look at the issue of trends and trajectories,” the White House National Security said. Consultant Jake Sullivan.

The two leaders also met the families of Japanese citizens who were kidnapped by North Korea decades ago. The White House said Biden “expressed his deepest condolences for their suffering, and called on North Korea to correct this historic error and provide a full account of the 12 Japanese citizens who remain missing.”

The White House described the launch of the Indo-Pacific Economic Framework, also known as the IPEF, as one of the biggest moments of Biden’s Asia trip and his ongoing efforts to strengthen ties with Pacific allies. Through it all, administration officials have kept a close eye on China’s growing economic and military power in the region.

In September, the United States announced a new partnership with Australia and Britain called AUKUS aimed at deepening security, diplomatic and defense cooperation in the Asia-Pacific region.

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The US president also paid close attention to the informal alliance known as the Quartet, which was formed during the response to the 2004 Indian Ocean tsunami that killed about 230,000 people. Biden and his fellow coalition members are scheduled to meet Tuesday in Tokyo for their second in-person meeting in less than a year.

And earlier this month, Biden gathered representatives from the Association of Southeast Asian Nations in Washington for a summit.

Taiwan – which has sought membership under the IPEF – is not among the governments to be included. The participation of the self-governing island of Taiwan, which China claims as its own, would have angered Beijing.

Sullivan said the United States wants to deepen its economic partnership with Taiwan, including high-tech issues and the supply of semiconductors on a one-to-one basis.

Biden also issued a stern warning to China on TaiwanHe said the United States would respond militarily if China invaded the autonomous island. “That’s the commitment we made,” Biden said.

The United States recognizes Beijing as the single government of China and has no diplomatic relations with Taiwan. However, it maintains informal contacts with Taiwan, including a de facto embassy in Taipei, the capital, and supplies the island with military equipment for its defense.

Biden’s comments were met with a sharp reaction from China, which claimed Taiwan was a rogue province.

A White House official said Biden’s comments did not reflect a shift in policy.

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Associated Press writers Zeke Miller and Darlene Superville of Washington contributed to this report.