IPEF: Now more than just four Pillars
IPEF1 had some setbacks (and some misinformed reporting) over the last week. However, among its successes was the announcement of substantial conclusion of an overarching Agreement on the Indo-Pacific Economic Framework for Prosperity:
Recognizing the importance of maintaining their partnership into the future through a formalized and durable structure for ongoing cooperation at the ministerial level, the IPEF partners announced the substantial conclusion of the negotiations on the proposed Agreement on the Indo-Pacific Economic Framework for Prosperity to establish an IPEF Council and Joint Commission. The IPEF Council would consider matters affecting the collective operation of the agreements related to the four IPEF pillars, as well as considering the possibility of adding new members or new agreements. The Joint Commission would monitor work under the agreements negotiated under Pillars II-IV, with a view to identifying ways to reduce duplication and potential conflicts and enable work between or across those agreements. The IPEF Council and the Joint Commission would meet annually, with the goal for all ministerial meetings to be co-located and concurrent.
This is a small but potentially important step. The original Joint Statement launching IPEF in May 2022 referred to “launching the process to establish the Indo-Pacific Economic Framework for Prosperity”. But it was never exactly clear what the ‘Framework’ actually was (beyond the fact the IPEF partners were negotiating) or when it would be ‘established’. An overarching IPEF Agreement will hopefully help to make this all clearer.
Presumably the overarching IPEF Agreement will set out the broader objective of IPEF as a whole and how it’s Pillars will operate together. It will also set up regular Ministerial meetings to help lock-in IPEF as a forum for regional economic negotiations and discussions. The overarching bodies will help unify and deconflict the work across the various IPEF Pillars. And, perhaps most importantly, having a clear foundational agreement will help establish IPEF itself as part of the region’s architecture, rather than just seeing IPEF as a grouping of countries or disparate set of agreements and committees.
An overarching IPEF Agreement could also result in greater member control of IPEF. While IPEF is centrally a US project - and so will likely live or die based on US engagement - if the overarching IPEF Agreement can set clear guidelines or rules around adding new members or creating new Pillars this could help the other IPEF members take more ownership of IPEF as a regional initiative.
Based on the Joint Statement from Ministers, it also seems that one of the aims of the overarching IPEF Agreement is to increase the durability and sustainability of IPEF. This is particularly relevant in light of recent US domestic political machinations regarding IPEF and doubts over whether future administrations would continue to see its value. While it is just as easy for a future administration to ignore or withdraw from an overarching IPEF agreement as it could from any other IPEF agreement (the Executive Agreement issue remains), a more “formalized” institutional structure, including regular scheduled meetings, provides a natural hook for continued participation in IPEF as a whole outside of specific discussions on, e.g., the Trade Pillar or Green Economy Pillar.
It will also be interesting to see how the overarching IPEF Agreement deals with some of the more unique elements of IPEF. For example, IPEF partners aren’t required to participate in all Pillars so will this impact their participation in bodies with oversight over Pillars they don’t participate in? How will the overarching language regarding new members interact with existing accession provisions in Pillar II? What will the requirement for IPEF membership be, particularly given the variable approach to participation in Pillars? And how will new ‘Pillars’ be added (I assume consensus will be required, although perhaps some lessons have been learned from the WTO’s experience with plurilaterals) and will minilateral groupings and non-binding arrangements also be on the table? While the actual agreement itself is likely to be simple and avoid detail, and so perhaps will not deal with all of these points, at some point the IPEF partners will need to work these out too.
While (hopefully) the overarching IPEF is not the most interesting thing that IPEF delivers, it will hopefully be a useful small step to working out exactly what the point of IPEF is and how it will work as part of the region’s economic infrastructure.
Full disclosure: I worked on IPEF in my previous job, this post is obviously based purely on public reporting.