Fourteen participating countries of the Indo-Pacific Economic Framework (IPEF), a multilateral economic cooperation body led by the United States, have reached an agreement on supply chains.
On the 27th (local time), the Ministry of Trade, Industry and Energy announced that ministers from 14 countries, including South Korea, reached a supply chain agreement at the IPEF ministerial meeting held in Detroit, USA. This is the first agreement among participating countries since its launch in May last year.
The participating countries agreed to activate a "Supply Chain Crisis Response Network" composed of governments of participating countries in the event of a supply chain crisis, and to discuss cooperation measures such as mutual coordination, identification of alternative suppliers, development of alternative transportation routes, and expedited customs clearance.
Additionally, to foster skilled workers essential for supply chain stabilization and improve labor conditions, a "Labor-Management-Government Advisory Body" will be established to understand the current status of labor rights in each country and identify areas for improvement. A system will also be operated to inspect labor-management situations at workplaces on site.
The Ministry of Trade, Industry and Energy explained, "The IPEF supply chain agreement is significant in that countries with diverse economic characteristics, including advanced and developing countries, resource-rich countries, and technology-leading countries, participate together to build a mutually complementary cooperation system."
IPEF was officially launched in May last year under the leadership of the Joe Biden administration in the United States. Fourteen countries participate, including the United States, South Korea, Japan, Australia, India, Thailand, Malaysia, Indonesia, Vietnam, the Philippines, Singapore, Brunei, New Zealand, and Fiji.
As China leads the Regional Comprehensive Economic Partnership (RCEP), the world's largest free trade agreement (FTA), and seeks to expand its influence in the Indo-Pacific, the United States created this forum to counterbalance China.
Since September last year, IPEF has been negotiating in four areas: trade, supply chains, clean economy, and fair economy. Among these, an agreement was first reached among participating countries in the supply chain area. Negotiations in the remaining three areas will continue in the future. There is an assessment that China may react sensitively to this agreement.
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