Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
Korea joins US-led trade pact as China bristles
U.S. President Joe Biden, right, speaks at the Indo-Pacific Economic Framework for Prosperity launch event in Tokyo, Monday. Second from top left on screen is President Yoon Suk-yeol. AP-Yonhap
By Nam Hyun-woo
President Yoon attends summit for IPEF online, joins bloc to contain Beijing
By Nam Hyun-woo
President Yoon Suk-yeol on Monday announced Korea's entry into the U.S.-led Indo-Pacific Economic Framework (IPEF), an initiative aimed at seeking free, open and resilient partnerships between like-minded countries in the region as well as containing China's economic assertion.
Yoon attended the IPEF summit held online on the occasion of U.S. President Joe Biden's visit to Japan. The leaders of 13 countries ― Korea, the U.S., Australia, Brunei, India, Indonesia, Japan, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam ― took part in the summit.
“No single country alone can tackle these tough challenges,” Yoon said during the summit, referring to the pandemic, supply chain disruptions and other crises. “Given these difficult circumstances, the launch of the IPEF for the shared prosperity of the regional countries is immensely important.”
“Today's launch of the IPEF amid this rapidly changing economic environment is a testament to the regional countries' commitment to solidarity and cooperation in what I view as a meaningful first step forward,” Yoon continued. “I expect the IPEF will move forward under the principles of openness, inclusiveness and transparency to open an era of shared prosperity in the Indo-Pacific.”
Yoon also promised the leaders that Korea will cooperate with regional partners in building reciprocal supply chains in semiconductor, battery and future mobility technologies.
President Yoon Suk-yeol delivers his remarks as he attends the Indo-Pacific Economic Framework held online, Monday. Captured from White House live stream
The participating countries issued a joint statement expressing their commitment to a free, fair, open, interconnected, resilient, secure, and prosperous Indo-Pacific region.
“This framework is intended to advance resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness for our economies,” the statement read. “We invite participation from additional Indo-Pacific partners that share our goals, interests, and ambitions for the region. We are committed to collaborating with our framework partners in a manner that acknowledges the importance of technical assistance and capacity building, allows us to maintain a flexible approach, and delivers tangible benefits for our peoples.”
In the statement, the leaders set four pillars for their partnership ― trade; supply chains; clean energy, decarbonization and infrastructure; and tax and anti-corruption ― and underscored the values of freedom, fairness and sustainability in each pillar.
The statement, however, did not specify details on how the countries will achieve those values, because the IPEF differs from existing free trade pacts and is more focused on confirming that member countries are in the same bloc and share similar values. As a result, the new trade pact is seen as reflecting U.S. ambitions to solidify ties with key economies in the Asia-Pacific region by building a supply chain that excludes China.
“Korea's entry into the IPEF will help the countries to stabilize their supply chains, play a leading role in the global rule-setting process on digital and other emerging trade issues,” Korea's presidential office said in a statement. “At the same time, Korea will be able to secure future growth momentum by strengthening partnerships with major countries in the region in the fields of infrastructure, digital and other new technologies.”
Chinese Foreign Minister Wang Yi bumps elbows with Pakistan's new foreign minister Bilawal Bhutto Zardari during their meeting in Guangzhou, China, Sunday. Xinhua-Yonhap
Although the statement did not explicitly mention China, it has already drawn protests from the country's top authorities.
According to local reports, Chinese Foreign Minister Wang Yi said the U.S. Indo-Pacific strategy is “doomed to fail,” referring to the IPEF.
“Facts will prove that the so-called 'Indo-Pacific strategy' is essentially a strategy for creating divisions, a strategy for inciting confrontation, and a strategy for destroying peace,” Wang said during a press conference following talks with Pakistan's new Foreign Minister Bilawal Bhutto Zardari in Guangzhou.
“Is the U.S. trying to accelerate the recovery of the world economy or is it creating economic decoupling, technological blockade, industrial chain disruption, and aggravating the supply chain crisis?” Wang asked.
Beijing has been reacting sensitively to Yoon's diplomatic policy of enhancing Seoul's alliance with Washington to encompass even the economic sector. This strategy, however, has triggered concerns that Korea may face China's economic retaliation, as it did in 2017 after the deployment of a U.S. Terminal High Altitude Area Defense system here.
On his way to the presidential office, Monday, Yoon strived to downplay those concerns, telling reporters that Korea “must join the IPEF” for the sake of its national interests.
“The IPEF is not a conventional trade pact like a free trade agreement, rather it is about setting up a broad economic and trade rule in the region,” Yoon said. “If we were to be excluded from this rule-setting process, there will be damage to our national interests.”
During an interview with Yonhap News Agency, Monday, Seoul's First Vice Minister of Foreign Affairs Cho Hyun-dong said, “Enhancing the economic and tech alliance with the U.S. is not aimed at excluding certain countries.”
“The IPEF is a chance for Korea to reflect our interests in the field of supply chain, digital economy, decarbonization,” Cho added.
Presidential secretary for economic security Wang Yoon-jong also stressed that the IPEF is not an exclusive pact.
“We should understand both the IPEF and the RCEP as part of efforts to expand regional economic partnership,” Wang, the presidential secretary for economic security, told reporters after the Yoon-Biden summit on Saturday.
The RCEP, or the Regional Comprehensive Economic Partnership, is a China-led trade pact, which is accepted as the counterpart of the IPEF.