Indo-Pacific Economic Framework Agreements are a Small Step Forward on Climate-Friendly Economic Cooperation

SAN FRANCISCO — The United States has joined 13 other countries in announcing major milestones related to the Indo-Pacific Economy Framework for Prosperity (IPEF) at the conclusion of talks in San Francisco. IPEF is an economic initiative launched in 2022 by U.S. President Joe Biden to advance the resilience, sustainability, inclusiveness, economic growth, and competitiveness for the 14 countries in the initiative: Australia, Brunei, Fiji, India, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Thailand, United States, and Vietnam.

The countries said in a joint statement they had completed work on three pillars of negotiations on supply chains, clean economy, and fair economy agreements. The countries had previously reached an agreement on supply chains, but additional steps are needed to finalize the text of the agreements and move them through domestic approval processes. 

Negotiations on a fourth pillar on trade were also on the agenda for the meeting, but those conversations did not move forward. Earlier this year, the Sierra Club proposed a series of recommendations on key provisions related to the environment and climate IPEF must include in order to begin to build a new model of trade that is good for people and the planet.

In response to the announcement,  Iliana Paul, senior policy advisor with the Sierra Club, issued the following statement:

With these latest IPEF agreements, the Sierra Club applauds the U.S. and its partners for focusing on cooperation on a range of issues, from renewable energy to low-carbon shipping, clean manufacturing, sustainable agriculture, and just transitions for workforces and communities — all of which are necessary elements of a clean economy future. 

We are pleased to see historic references to climate change in the IPEF’s Clean Economy pillar, which has received inadequate attention in trade and economic cooperation agreements to date. However, despite some promising developments, we are disappointed the Clean Economy pillar does not include any binding or enforceable environmental or climate commitments, or references to the Paris Climate Agreement. Many of the Sierra Club’s other recommendations for a climate-friendly agreement are also notably absent.

Additionally, we are happy to see a pledge to increase investment flows to support the clean economy transition and remove barriers to access to financing, although we encourage IPEF countries to more seriously resource the Catalytic Capital Fund, as the $30 million currently committed is an extreme underinvestment to combat climate change and build resilience. We also look forward to the proposed Cooperative Work Programs as a path forward on important issues such as embedded emissions accounting, mainstreaming of green jobs, and more.