Biden launches Indo-Pacific trade deal and warns of inflation

President Joe Biden unveiled a new trade deal with 12 Indo-Pacific nations. Biden warned Americans worried about inflation that there wil...

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  • President Joe Biden unveiled a new trade deal with 12 Indo-Pacific nations.
  • Biden warned Americans worried about inflation that there will be a “process” before they feel some economic relief.
  • The president added that it does not seem inevitable that there will be an economic recession in the United States.

On Monday, US President Joe Biden unveiled a new trade deal with 12 Indo-Pacific nations that aims to bolster their economies, warning Americans worried about inflation that there will be a “process” before they feel some relief, according to The Associated Press.

The president added that it does not seem inevitable to him that there will be an economic recession in the United States. At a press conference after meeting with Japanese Prime Minister Fumio Kishida, Biden admitted that the US economy has “troubles” but said it is doing better than other countries.

Biden warns what will happen to inflation in the US

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Photo: AP

“This is going to be a process. This is going to take a while,” he said, though he rejected the idea that the US recession is inevitable. The president made his remarks before introducing the Indo-Pacific Economic Framework, a trade agreement he designed with his administration to show US interest in the disputed economic region and address the need for trade stability. The countries that joined the initiative are Australia, Brunei, India, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand and Vietnam.

Together with the United States, they account for 40% of world GDP. The partners said in a joint statement that the deal will help them “future-proof our economies” following disruptions caused by the pandemic and the Russian invasion of Ukraine. In his meeting with Kishida, Biden said the new framework will also increase US cooperation with other countries in the region. Filed Under: US inflation.

How will the deal ease inflation?

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Photo: AP

The White House said the mechanism will help the United States and Asian economies work more closely on issues such as supply chains, digital trade, clean energy, worker protection and anti-corruption. Details have yet to be negotiated among member states, making it difficult for the administration to spell out how the pact will deliver on its promise to help American businesses and workers while meeting global needs.

Critics point out that the mechanism has big loopholes. It offers no incentives to potential partners such as tariff reductions or guarantees of greater access to US markets, which makes the plan an unattractive alternative to the Trans-Pacific Partnership (TPP), an initiative that carried on after the United States abandoned it. China, the largest trading partner for many countries in the region, also wants to join the TPP. Filed Under: US inflation.

What does US intend?

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Photo: AP

“I think a lot of partners are going to look at that list and say, ‘That’s a good set list. I’m happy to be involved,’” said Matthew Goodman, former director of international economics at the National Security Council under former President Barack Obama. However, he pointed out, they might also wonder if there are any tangible benefits to joining.

The initiative is a new step by the Biden administration to try to preserve and expand US influence in the region which, until recently, seemed increasingly influenced by China. Biden, who is on a five-day tour of South Korea and Japan, described the alliance between Washington and Tokyo as a “cornerstone of peace and prosperity in the Indo-Pacific” and thanked Japan for its “strong leadership” against Russia. The White House announced its plans to build the economic framework in October as a replacement for the TPP, which the United States abandoned in 2017 under President Donald Trump. Filed Under: US inflation.

The post Biden launches Indo-Pacific pact and warns of inflation appeared first on Mundo Hispanico.