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Indonesia stands to benefit from IPEF despite reservations, experts say
Economic experts believe Indonesia should still participate in the Indo-Pacific Economic Framework pact and leverage its position as a mediator.
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United States President Joe Biden and Japanese Prime Minister Fumio Kishida listen to leaders of countries virtually attending the launch of the Indo-Pacific Economic Framework for Prosperity (IPEF) in Tokyo on May 23. (Reuters)
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mid geopolitical reservations over the United States-led Indo-Pacific Economic Framework (IPEF) agreement, analysts say Indonesia could still play a role in ensuring it gets the most out of the multilateral cooperation platform.
US President Joe Biden launched IPEF in Japan late last month as the economic component of the US Indo-Pacific strategy. The US foreign policy doctrine is regarded by many analysts as an attempt to exclude strategic rival China.
Washington claims it has managed to secure the membership of 14 founding countries, representing at least 40 percent of the world’s gross domestic product (GDP). Among them are US allies Japan, Australia and India, but also Indonesia and a number of Southeast Asian nations. China is absent from the grouping.
The pact proposes four pillars of cooperation tempered by American norms – connected economy, resilient economy, clean economy and fair economy – although very little has taken shape beyond what the US calls “collective consultations toward future negotiations”.
Even so, some economic experts believe Indonesia should still participate in the pact and leverage its position there.
Dandy Rafitrandi, an economics researcher at the Centre for Strategic and International Studies (CSIS), said that participating would still benefit Indonesia, even if it remains unclear what “real commitments” the US will offer.
“If we don’t join, we might be seen as less competitive [to the US] compared with other countries,” he said on Wednesday.
