Landmark Indo-Pacific supply chain agreement to go into effect on February 24

The United States announced on Thursday that a landmark agreement on supply chain flexibility?under the Indo-Pacific economic framework, involving 14 partner countries including India, Japan, and Australia, will go into effect on February 24. US Commerce Secretary Gina Raimondo stated that the agreement will enable a collaborative approach to strengthening supply chains and preventing potential disruptions. The US Department of Commerce announced that the Indo-Pacific Economic Framework for Prosperity (IPEF) agreement on supply chain flexibility will go into effect on February 24. "This is a critical step in bringing the landmark, first-of-its-kind agreement into action and promoting coordination among the IPEF partners, to build resilient, efficient, productive, sustainable, transparent, diversified, secure, fair, and inclusive supply chains." ?

In May 2022, US President Joe Biden launched the ambitious Indo-Pacific Economic Framework for Prosperity (IPEF), which aligns with Washington's long-term vision for the Indo-Pacific region. It is an initiative to foster closer collaboration among like-minded countries in areas such as clean energy, supply chain flexibility, and digital trade. Aside from India, Japan, and Australia, the IPEF's other members include Brunei Darussalam, Fiji, Indonesia, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam. "The IPEF member nations negotiated the supply chain agreement to establish a framework for deeper collaboration to prevent, reduce, and prepare for supply chain disruptions, such as those experienced in recent years by the COVID-19 pandemic. "I am delighted to see the ongoing commitment and enthusiasm of the IPEF partners?

"With the IPEF supply chain agreement shortly entering into force, we will now move forward and work collaboratively through this innovative framework to strengthen our supply chains and prevent potential disruptions before they arise for the collective benefit of our countries' workers and businesses," US Commerce Secretary Raimondo said in a statement. Since the signing of the IPEF supply chain agreement in November, five IPEF partners—India, Japan, Singapore, the United States, and Fiji—have deposited their instruments of ratification, acceptance, or approval, allowing the agreement to enter into force, according to the US Commerce Department. With the agreement's entry into force on February 24, the focus in the coming months will be on various milestones set out in the pact related to establishing three supply chain bodies.?

After the pact goes into effect, the main focus will be identifying representatives for the three supply chain bodies by March 25 and selecting chairs for each by April 24. The priority would also be to create guidelines for the facility-specific reporting mechanism on labour rights?variance in IPEF supply chains by August 22. The IPEF supply chain agreement was negotiated by the Ministerial Statement on Pillar II (supply chains) issued during the IPEF ministerial meeting in Los Angeles in September 2022. Negotiations were largely concluded in May 2023, following approximately six months of consideration. The agreement's text became public in September 2023.

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