MODERATOR: Greetings from the U.S. Department of State’s Asia Pacific Media Hub. I would like to welcome journalists to today’s on-the-record briefing with United States Trade Representative Ambassador Katherine Tai. Ambassador Tai will discuss her recent travel to the Philippines and Japan, the Biden-Harris administration’s efforts to strengthen ties with key partners in the Indo-Pacific region, and the Indo-Pacific Economic Framework.
With that, let’s get started. Ambassador Tai, I’ll turn it over to you for your opening remarks.
AMBASSADOR TAI: Well, thank you very much, Katie. Hello, everyone. As you know, last week I traveled to Manila and Tokyo. The United States has deep ties with both countries, the Philippines and Japan, and we are working with our allies and partners in the Indo-Pacific, and this work is more important than ever as we write our new story on trade.
The United States and the Philippines have a longstanding trade relationship. The United States is the Philippines’ third-largest trading partner, and the United States is one of the largest foreign investors in the Philippines. We also have strong people-to-people ties, and we are cooperating on a range of bilateral, regional, and global economic issues.
In my meetings last week with members of President Marcos’ administration, we worked to identify how the U.S. and Philippines can further strengthen our ties and continue to tackle our shared priorities. That engagement will continue next week when President Biden hosts President Marcos for a bilateral meeting at the White House.
After the Philippines I traveled to Tokyo. USTR has been especially focused on deepening our relationship with Japan over the last two years. Japan is the United States’ fourth-largest goods trading partner, with total two-way trade valued at nearly $230 billion in 2022. In 2021, we formed the U.S.-Japan Partnership on Trade, which has been an important platform to regularly discuss important trade issues between us. Since then, we have delivered tangible results for our workers, our small businesses, and producers in both countries, including on beef exports to Japan, tackling the climate crisis, addressing forced labor, and strengthening our supply chains. I had productive meetings with several of my counterparts, including Japan’s minister for economy, trade, and industry, Minister Nishimura.
Additionally, in my meetings in both countries, we discussed the ongoing negotiations on the Indo-Pacific Economic Framework. The IPEF is a major priority for the United States, the Philippines, Japan, and our other IPEF partners. Through the IPEF, we aim to deliver real opportunities for our people by focusing on labor standards, the environment, science-based and transparent regulatory systems, and an inclusive digital economy.
We recently announced that the next negotiating round will take place in Singapore in May, which will mark the third negotiating round in just five months. We anticipate continuing this aggressive schedule throughout 2023 as we work with our partners to make meaningful progress on this framework and to deliver tangible results. I am looking forward to continuing these conversations with our partners in the months ahead.
Finally, the United States is looking forward to hosting APEC this year, another topic that we discussed in my meetings in Japan and the Philippines last week. My trips to the region are valuable opportunities to discuss our priorities for our host year, where the U.S. aims to leverage APEC’s strength as a productive laboratory for advancing sustainable and inclusive trade. I am looking forward to welcoming my colleagues and engaging on these issues and more during the upcoming APEC trade ministers meeting in Detroit, Michigan, next month.
I am extraordinarily proud of our work to engage with our regional partners in bilateral and multilateral fora, and we intend to continue this work moving forward. Thank you and I am happy to take a few questions.
MODERATOR: Thank you, Ambassador Tai. We will now to the question-and-answer portion of today’s briefing. Our first question goes to Diep Nguyen Thi Ngoc of BizLIVE in Vietnam, who asks: “What are the main achievements during your recent business trips to some Asian countries?”
AMBASSADOR TAI: Well, this is a great question. I think that I counted up in my time as USTR – I have done I think over 15 trips to the region visiting my counterparts in the Indo-Pacific. I think the main achievements are coming to the region, meeting my counterparts in their offices, in their home countries, getting to meet stakeholders in business and civil society, and understanding more and being able to share our respective priorities and our interests and challenges as we engage on deepening and broadening our economic engagement in this region.
MODERATOR: All right. Our next question goes to Shu-ren Koo of Commonwealth magazine in Taiwan, who asks: “Taiwan is currently in talks with the U.S. on a trade initiative. Would that help Taiwan to join IPEF in the future? What is the possibility for the U.S. to negotiate an agreement for the avoidance of double taxation with Taiwan?”
AMBASSADOR TAI: Great. Okay, I’ll take each part of this question in turn. You are absolutely correct that the United States and Taiwan are engaging in a bilateral trade negotiation; we’re calling it the 21st Century Trade Initiative. We’ve had a negotiating round in January of this year, and I can let you know that we made a considerable amount of progress and I am very encouraged by the progress that we’ve been able to make in our negotiations so far.
You are also correct that Taiwan is not a member of the IPEF negotiations on what I would say is – we want to make sure that our negotiations are tailored to the particular partner and the aspects of our particular relationship. So we are very focused on this bilateral discussion with Taiwan and committed to a trade engagement, trade negotiation that is designed to make both of our economies stronger through our collaboration.
With respect to the possibility of an agreement with Taiwan that avoids double taxation, anytime the word “tax” or “taxation” comes up, I know that this is the jurisdiction of my colleagues in the Treasury Department. And so as I pass the buck over the Treasury Department and Secretary Yellen, I will say that I do know that they are looking at this issue, but I don’t have an update in terms of what they’re considering.
MODERATOR: All right. Our next question goes to Dahn Le of VnExpress in Vietnam, who asks: “How has the U.S. addressed concerns from Southeast Asian countries in the IPEF negotiations, such as guarantee inclusiveness or take into account different reform priorities in developing economies?”
AMBASSADOR TAI: This is also a great question. The IPEF has four pillars of economic engagement. One of them is trade. The others are supply chains, de-carbon infrastructure, and good governance, which is tax and anticorruption. Across these four pillars we have 14 countries engaging in these negotiations. It was important in the design and architecture of the IPEF to ensure that the participation reflects the diversity that is in the Indo-Pacific region. And so we have large economies like the United States, like India, and also very small economies like Fiji. We have advanced economies here participating among the 14, and we also have more than half, I think, would be considered emerging or developing economies at multiple different levels of development from middle income all the way to much less developed.
And so you are right, it is really important in the IPEF for our discussions to be able to take into account the diversity of interests and diversity of priorities, especially with respect to our developing economy partners.
One aspect of the negotiations that I can tell you about is that in addition to negotiating rules and negotiating agreements on practices and procedures, we are also at the same time having a very robust conversation and brainstorming, if you will, around capacity building and technical assistance. And I think that this is an important innovation in the IPEF where in a typical, more traditional trade negotiation that we’ve had in the past, you only get around to thinking about how your partner is going to be able to implement and whether or not capacity building and technical assistance is going to be required after you’re done with the negotiation. In the IPEF, we are taking up that conversation while we are negotiating the rules and the agreements on practices and procedures, precisely because it is an important part of ensuring that what we are negotiating is going to be meaningful and can be translated into practice.
MODERATOR: Our next question goes to Qingting Zheng of 21st Century Business Herald based in Beijing. Your line is open.
QUESTION: Thank you so much for this opportunity. My question is, how would you describe the relationship between IPEF and regional trade agreements like CPTPP and RCEP? Given that China is excluded from the IPEF, is there a risk that the IPEF would create conflict and confrontation in the region? And how do you see the prospect of the U.S. joining China in multilateral trade agreements in the Asian Pacific region? Thank you.
AMBASSADOR TAI: So the IPEF is not a traditional trade agreement like the CPTPP or the RCEP. The IPEF is designed to address the specific challenges that we know that we are facing today. Those include supply chain fragilities, the climate crisis, and widening inequalities in our economies. And so the – what’s the word I’m looking for? The unifying theme in the IPEF engagements go to economic issue areas and topics, where by collaboration the United States and these partners in the Indo-Pacific can promote more resilient, more sustainable, and more inclusive economies.
In that sense, then, I do not see this as being in conflict with other types of arrangements. If anything, it is about the United States bringing a program of economic engagement to this region to work together with some of our closest partners in the region to navigate collectively through a very disrupted time in the global economy.
MODERATOR: Our next question goes to Bryan Wu from The Edge in Singapore, who asks: “How have the IPEF negotiations around pillar two, supply chains, evolved with the shift in global supply chains toward resilience and ASEAN’s increase in supply chain significance, as manufacturer’s turn toward a China-plus-one strategy?”
AMBASSADOR TAI: So I know that this is a really meaty question deserving of a meaty answer, but I’ll just start by saying of the four pillars, USTR is leading pillar one, which is the trade pillar, and our colleagues at the Commerce Department take the lead in the negotiations on the other three pillars. So I am going to respectfully punt on weighing in on this one and encourage you to pose that question to Secretary Raimondo and her team at Commerce.
MODERATOR: Okay. The next question goes to Eric Martin of Bloomberg. Eric, you should be able to unmute yourself now.
QUESTION: Yes, thank you. I wanted to just ask about China and how China came up in the conversations in Japan and the Philippines in terms of the tariffs that the U.S. continues to have on 300 billion of Chinese exports, and also just in terms of working with allies to confront China, whether export controls or other share of measures that can be taken in coordination were discussed, or just how China came up in the discussions generally.
And Deputy USTR Sarah Bianchi last week seemed to suggest that the tariff levels on China could actually be raised as a response to U.S. displeasure with China failing to honor its phase one agreement commitments, and I just wanted to ask about that, if that’s something that’s under consideration. Thank you.
AMBASSADOR TAI: Well, Eric, it’s nice to hear your voice even if I can’t see you in this forum. On your primary question, which is how did China and the China tariffs come up in my meetings last week with counterparts, I honestly can tell you as you were asking that question I was searching my memory of my discussions with various counterparts, and honestly, I don’t think that topic came up. Truly, when I am visiting our partners in the region, it is to further our bilateral relationships, to further our mutual understanding, and to, for my part, educate myself to become a better and more responsive partner economically to these countries in the region.
So that’s what I would say primarily. It’s not to say that China isn’t an important economy in the region. In fact, it is very important. But the purpose of my trips are really about the individual relationships that are reflected between the United States and the counterparts in the country that I am visiting.
MODERATOR: Our next question goes to the live queue, to Steven Overly of Politico. And Steven, you should be able to unmute yourself now.
QUESTION: Hi, thank you for taking the questions. I wanted to ask, Ambassador, what is the status of the digital trade chapter in IPEF? And some members of Congress have expressed concern that the agreement will inhibit their ability to regulate, particularly on digital issues like data privacy, antitrust, and artificial intelligence. I wonder how you respond to those concerns. Thank you.
AMBASSADOR TAI: Hi, Steven, and I apologize – there’s some siren activity outside our office, in case you can hear the background noise. On the digital negotiations in IPEF, the status is that we are still in negotiations. As with the other topics in the trade pillar, we are heading into our third round of negotiations amongst senior officials that will happen in the next couple of weeks. So a lot of work is going on, really important conversations.
In terms of the concerns that we’ve heard from members of Congress and how I would respond, I think I would just point you to the congressional records in the two hearings that I just had last month, where these concerns were also raised. We are very, very much about advancing an inclusive digital economic negotiation and engagement with our partners in the region. And I guess that’s what I would say.
MODERATOR: All right. Our next question goes to Mara Lee with International Trade Today. Mara, you should be able to unmute yourself now.
QUESTION: Hi, this is Mara Lee. Thanks for taking my question. I wondered if you could tell us anything about the trade facilitation initiatives that are being talked about in the IPEF negotiations.
AMBASSADOR TAI: I’d be happy to, Mara, and really delighted to, because trade facilitation is – for the general public, sounds kind of boring, but it’s actually a really important part of the nuts and bolts of trade. It’s about the practices and the procedures, and making things go at the border, at customs, and moving goods across that border, bringing them in and getting them out. A lot of our work is about ensuring that our economies are more compatible or even interoperable, that we are maximizing the opportunities that we have to – and efficiencies at that border. So that might include modernizing and updating the way that documentation is handled and accepted at the border, allowing for digitization, for instance, of the submission of the types of forms that you have to submit in moving goods across the border.
For a more complete rundown, I would recommend – and this applies as well to Steven’s question on the digital discussions – I’d refer all of you to our website, where we are posting public summaries of the proposals that we are making in the negotiations in the trade pillar.
MODERATOR: Okay. Our final question goes to Qingting Zheng of the 21st Century Business Herald in China, who asks: “During your recent visit to Japan, you said that China-U.S. decoupling is neither a goal nor achievable. In the context of the ever-escalating U.S.-China tech war, how will the United States carry out normal commercial cooperation with China? The IMF warn that chain fragmentation could lead to a new Cold War in the world. What is your response?”
AMBASSADOR TAI: Well, my response is that I stand by what I said last week, and I – and it’s been consistent across our administration in terms of decoupling is not the goal and decoupling is not practicable either as a goal. Nevertheless, we do have a complex and complicated relationship with China, especially around level playing field issues and the fairness of the trade and trade opportunities between us. So those are issues that we absolutely need to tackle and address in our relationship, because it is important for the world’s two largest economies to be able to address their concerns with each other. It is a matter of not just our own economies, our workers, and our businesses, but as the two largest economies in the world, it impacts the entire world economy.
So I think that’s what I would say there, which is it’s – the U.S.-China trade relationship is one of profound consequence, economically, for the world economy, and it is going to be important for us to address the complexities and the challenges that we have in this relationship, to be clear-eyed and honest about those challenges, but also to recognize that as the world’s two largest economies, we have a responsibility to our own workers, businesses, and also to the world to get things right between us.
MODERATOR: And now, Ambassador Tai, if you have any closing remarks, I’ll turn it back over to you.
AMBASSADOR TAI: Well, I want to thank all of you for your interest and for following our issues. I do want to emphasize that with respect to the Asia Pacific, we used to say that the future is Asia. I think we’ve said it for so long that it is clear that Asia is now. And it is really important for us to be engaged. I am very, very encouraged by the warm reception, the excitement that our partners have expressed in engaging with us on economic issues.
And I also want to underscore the tremendous opportunity that is there for the collaboration that we are seeking, for the framework that we are building, to address the specific challenges and needs that our economies – our people, our workers, our businesses small and large – are facing today. We have all been through a lot these last few years, and it is our commitment to our partners in the region that we want to work together to rebuild the world economy, one that can be more inclusive, that will be more sustainable, and one that will be more resilient.
Thank you all so much.
MODERATOR: That is all we have time for today. Thank you for your questions, and thanks to Ambassador Tai for joining us. We will provide a transcript of this briefing to participating journalists as soon as it is available. We’d also love to hear your feedback, and you can contact us at any time at AsiaPacMedia@state.gov. Thanks again for your participation, and we hope you can join us for another briefing soon.
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