US to develop economic framework with allies in the coming months

US to develop economic framework with allies in the coming months

KUALA LUMPUR: The United States' planned economic framework will be inclusive and flexible, and will not be structured like a typical free trade deal, according to its commerce secretary Gina Raimondo, who said on Thursday November 18 that the framework could involve several key areas, including the digital economy, supply chain resiliency, infrastructure, export control, and clean energy.

She said that the US will develop the framework with allies in the months to come, because we absolutely don't envision this to be a traditional trade agreement.

On Wednesday, Raimondo said an Indo-Pacific economic framework could be launched at the beginning of next year, and her Asia visit was to lay the groundwork for potential partnerships.

Critics of the US strategy for the region pointed out its lack of an economic component after former President Donald Trump withdrew from a US-inspired trade deal in 2017 known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

The US and Malaysia agreed earlier on Thursday that both countries plan to sign an agreement by early 2022 on transparency, resilience and security in the semiconductor and manufacturing sector supply chains.

The agreement comes as Malaysia tries to address a shortage of semiconductor chips after supplies were disrupted due to curbs imposed to stem a surge in COVID 19 cases this year.

Malaysia's chip assembly industry, accounting for more than a tenth of global trade worth over US $20 billion, has warned that shortages will last at least two years.

Raimondo said both governments had a wide ranging discussion with the semiconductor industry on Thursday, including to reduce redundancy in investments and boost supplies.