Biden team considers digital trade deal to counter China in Asia, sources say
White House officials are discussing proposals for a digital trade agreement covering Indo-pacific economies as the administration seeks ways to check China's influence in the region, according to people familiar with the plans.
Details of the potential agreement are still being drafted, but the pact could potentially include countries such as Canada, Australia, Chile, Japan, Malaysia, New Zealand and Singapore, according to one of the people, who asked not to be identified because the process isn't public.
The deal could set out standards for the digital economy, including rules on the use of data, trade facilitation and electronic customs arrangements, according to another person.
It also would show the Biden administration is interested in pursuing new trade opportunities after spending its first months focused more on enforcing existing deals than advancing negotiations with the U.K. and Kenya that were inherited from the Trump administration.
Perhaps most important, the policy would represent an early effort by the Biden administration to present an economic plan for the world's most economically and strategically significant region after then-president Donald Trump's decision to withdraw from negotiations for the Trans-pacific Partnership trade deal in 2017.
A White House official said Monday night no decisions had been reached, but that the administration was intent on deepening its relationship with the Indo-pacific region in many areas, including digital trade. The Office of the U.S. Trade Representative declined to comment.
Chinese Foreign Ministry spokesman Zhao Lijian told a news briefing Tuesday in Beijing that he wasn't aware of the potential proposal, but said: “China follows the principles of openness, inclusiveness and win-win co-operation, and remains committed to working with neighbouring countries to promote regional development.”
Advocates for such an accord, including former acting Deputy U.S. Trade Representative Wendy Cutler, suggest that it could draw on existing arrangements in the region, including the U.s.-japan Digital Trade Agreement, as well as other agreements struck between regional nations such as the Singapore-australia Digital Trade Agreement and the Singapore-new Zealand-chile Digital Economy Partnership Agreement.
“Australia and Singapore are the front-runners, but needless to say there's opportunity for other similar arrangements, including in the Southeast Asia region,” Will Hodgman, Australia's high commissioner to Singapore, told Bloomberg Television on Tuesday. “So we'll look with interest as to what's unfolding with respect to other countries.”
A digital trade pact would “get the United States back in the trade game in Asia, while it considers the merits of rejoining the Comprehensive and Progressive Agreement for Trans-pacific Partnership,” Cutler, a longtime trade negotiator who's now vice-president of the Asia Society Policy Institute, wrote in an April op-ed together with Joshua Meltzer, a senior fellow at the Brookings Institution.