Briefing with Under Secretary of State for Economic Growth, Energy, and the Environment Jose W. Fernandez And Bureau of Economic and Business Affairs Senior Bureau Official Matt Murray On the Recent Indo-Pacific Business Forum

You are subscribed to Collected Releases for U.S. Department of State. This information has recently been updated, and is now available. Briefing with Under Secretary of State for Economic Growth, Energy, and the Environment Jose W. Fernandez And Bureau of Economic and Business Affairs Senior Bureau Official Matt Murray On the Recent Indo-Pacific Business Forum 10/29/2021 01:27 PM EDT Jose W. Fernandez, Under Secretary for Economic Growth, Energy, and the Environment Via Teleconference MR ICE:  Thank you, Operator.  And good morning to everyone dialing in from here in Washington, D.C. or the Western Hemisphere, but also I'd like to say good evening to many of you joining us from the Indo-Pacific region today. We're very honored to be joined by the Department of State's Under Secretary for Economic Growth, Energy, and Environment Jose Fernandez, and the Bureau of Economic and Business Affairs Senior Bureau Official Matt Murray, who are going to discuss the recent Indo-Pacific Business Forum, which just wrapped up a little bit ago.  And then we're going to take a few of your questions. I am going to take this opportunity to remind everyone that this briefing is on the record, but it is embargoed until the conclusion of the call. Okay, and with that, Mr. Under Secretary, thank you again for joining us today.  I'm going to turn it over to you for some opening remarks.  UNDER SECRETARY FERNANDEZ:  Thank you, JT.  And it's a real pleasure to be here.  Good morning, and good evening to those of you out in the business forum.  Yesterday I had the pleasure of participating in several sessions of the IPBF.  We had over 25 panels, over a hundred speakers, and more than 2,300 participants.  It was really, really well attended, and then I think that this event demonstrated that the U.S. remains a committed, vital, and trusted economic partner in the entire region.  A lot of our involvement in foreign policy around the world now involves and revolves around COVID-19 and the pandemic that has cost so many of us so much.  And charting a sustainable and inclusive recovery remains our top priority.  In the Indo-Pacific region, I'm pleased to report that we've already delivered 63 million doses of the vaccine to the region.  We've done so in a transparent manner, as donations, not as sales, and we've done it with no strings attached. We were very pleased with the forum.  It's given us an opportunity to talk about how we can build back better, which is a priority of President Biden.  We've talked about how to expand internet access, unleash digital innovation.  We've discussed clean energy solutions and infrastructure for a more sustainable future.  And throughout this – these days, these two days, our focus has been on partnering with the private sector to deliver high-impact investment and drive market competition, job growth, and high standard economic development. U.S. investment and U.S. companies are going to continue to play a vital role in creating new economic opportunities for the people in the region.  And from supporting gender equality to developing human capital and workforce skills, U.S. firms have proven that they can have a track record of building local capacity and improving lives in the communities in which they operate in the Indo-Pacific. At this forum, we've had more than 50 – five-zero – U.S. Government initiatives, valued at nearly $500 million dollars.  These have been showcased at the forum.  But another aspect of our government initiatives is that they've involved a variety of factors – telecom, renewable energy, transportation, health care, aviation, and more.  And more importantly, we think, $6.5 billion in private investments have also been announced, primarily in the clean energy and digital infrastructure sectors, two of President Biden's priorities. And look, our support for a free and open Indo-Pacific has historically enabled increased American investment in the region, led to fair and open trade relationships, and promoted reforms that we believe have increased prosperity for Americans, and not just Americans, but people across the region. This is an area that I personally will be very, very much involved in.  I will be traveling to the region soon to follow up with our partners and allies on how we can build off the momentum of this forum to deliver a positive economic agenda. So I think you will hear the term "positive economic agenda" over and over again, because that's what we believe we bring to the region, and that's what I will personally be very much committed to doing. So with that, JT, let me turn it back to you, and I look forward to engaging in the conversation with our colleagues. MR ICE:  Thank you, Mr. Under Secretary.  Okay, just as a reminder, dial 1-0 to get into the question queue.  Let's please go to the line of Nick Wadhams.  OPERATOR:  And Nick, your line is open.  Please, go ahead. QUESTION:  Hi, Under Secretary, thank you.  I had a broader question both related to the events of the last day or two, but also to the broader situation on energy crisis.  Can you give us a sense for what sort of energy-related moves the administration is making as prices hover at pretty high levels and supply chains concerns linger?  Are you looking to pressure OPEC, for example, which has a meeting next week, or talking to allies and partners in the region about ways of trying to ease bottlenecks and bring energy prices down?  Just looking for a more global perspective on the energy crunch.  Thank you. UNDER SECRETARY FERNANDEZ:  Yeah.  Thank you, Nick.  Look, I – there is great interest, as you can imagine, in the administration about this.  I have been following it.  There have been statements made by deputy – by Jake Sullivan and others.  I don't particularly want to get ahead of that now.  But just understand that we are following the situation.  We're talking to our European partners.  I know that the IPBF also included discussions on longer-term clean energy solutions, and the Indo-Pacific region is – will be part of the solution as well.  That's all I have to say on that point, Nick. MR ICE:  Let's go to the line of Rita Cheng. OPERATOR:  And Rita, your line is open. QUESTION:  Hi, thank you for doing this.  I remember a few days ago President Biden just announced that the U.S. plans to explore an Indo-Pacific economic framework.  Would you like to elaborate a little bit on that?  And then what is U.S. strategy to upgrade the rule-based order in trade, given that the U.S. is not going to join the CPTPP?  Thank you. UNDER SECRETARY FERNANDEZ:  Sure.  Look, I think I would say a couple of things on that and thank you for the question.  The Indo-Pacific region is a critical part of our economy.  It's not just that it accounts for over half of the world's population and 60 percent of global GDP.  From a U.S. point of view, let's start from the beginning. The U.S. is a Pacific country.  It's got a long history of engaging in the region.  Today, seven of the top 15 U.S. export markets are in the Indo-Pacific.  Two-way trade between the U.S. and the region was over $1.75 trillion.  I can go on.  U.S. exports support over 3 million U.S. jobs, bilateral trade over 5 million jobs in the Indo-Pacific region. The reason I'm saying this is that the Indo-Pacific region is a critical – a critical part of our economic as well as diplomatic relations.  We will continue to be involved.  What the President mentioned last – a couple of days ago is something that we have been working and consulting with our allies and partners in developing.  He announced that we will explore with partners the development of an Indo-Pacific economic framework that will define shared objectives, shared objectives – shared objectives around trade facilitation, standards for the digital economy and technology, supply chain resiliency, clean energy infrastructure, and the like. And we will do it consistent with our values, with our common values, with our common strategies that we've discussed with our allies.  And again, it's not – it is not part of a change in our strategy.  We've been a Pacific nation, and we will continue to be.  And from where I sit, which is the economics and trade portfolio, there is no more important economic partner for the U.S. than the Indo-Pacific region.  You can see it in the – you can just see it in the numbers. MR ICE:   Let's go to the line of Will Mauldin. OPERATOR:   And Will, your line is open. QUESTION:  Thank you so much for having this.  I just wanted to follow up a little bit on the last question to make sure I understand that Indo-Pacific economic strategy as it's emerging.  So there is an interest in, obviously, trading and exporting to Indo-Pacific countries.  And it sounds like there's also an interest in, obviously, increasing investment, government-led as well as private sector-led, and probably doing some things on digital rules of the road and security. But there's – just so we understand, there's not interest in lowering trade barriers with Indo-Pacific countries right now, and let me know if that's correct or if that is something that's going to change in this administration.  The priority seems to be on investment and digital rules of the road, if I understand correctly; or if not, please help.  Thanks so much. UNDER SECRETARY FERNANDEZ:  I think you will find that we are continuing to focus not just on investment but also on trade.  As I said earlier, bilateral trade supports over 5 million jobs in the Indo-Pacific region and over 3 million jobs in the U.S.  Fair trade, trade that follows long-accepted rules that many nations have benefitted from, are things that we – that have helped our economic and trade relationship with the region, and we will continue to do that.  It is not simply about investment.  It is not simply about trade.  It's a much broader and deeper economic relationship. In a couple of weeks, APEC will – we'll have a meeting of APEC, and that organization has always focused on lowering trade barriers, which remains a priority for us.  So I think – I'm very pleased to say that our trade involves – our economic relationship involves trade and investment and that we will continue to deepen it.  And it's our aim to continue to expand it. MR ICE:   Operator, would you please repeat our instructions for folks to get into the question queue? OPERATOR:   And once again, you may press 1 and then 0 for your questions or comments, 1 and then 0 for your questions or comments. MR ICE:   Thank you.  Let's go to the line of Humeyra Pamuk. OPERATOR:   And Humeyra, your line is open. QUESTION:  Hello, thanks for doing this.  Please forgive me, but I'm going to have to ask the same question for the third time because it's probably me; I just couldn't hear an answer.  Are you currently in talks for a regional economic framework in the Indo-Pacific?  Because, like, critics have said that one lacking part in President Biden's Indo-Pacific strategy was the regional economic element of it.  So I understand, Mr. Under Secretary, you're saying you're continuing to explore certain things.  But is this business as usual?  Or is there a specific effort to back up the current Indo-Pacific strategy with a specific regional framework? And then my second question, if I may, is – it's about Huawei.  The previous administration had put an incredible amount of focus on that company, and also pressure, which it saw – like, they saw Huawei as an extension of the Chinese Government.  It  has – it had actively asked partners and allies to stop doing business with Huawei.  Is it not this administration's policy to do that?  What is your view of Huawei?  And is that call to partners and allies not to do business with Huawei continuing, or is that part – like, it's no longer the case for this administration?  Thank you. UNDER SECRETARY FERNANDEZ:  We continue to speak to our allies and partners around the world about the need to have trusted networks in the 5G – not just in the 5G space, but generally.  So that is something that – excuse me – that I have been personally involved in – sorry, that I have been personally involved in, and I think you will continue to see our efforts to consult with our allies and partners and discuss jointly about how we keep our systems, networks, and telecommunications secure. On your first question, we have – we continue to consult with our allies and with our partners.  We – if you look at our recent high-level engagement in the region, that's a testament to how important the Indo-Pacific to us, and we prioritize the efforts in the region.  President Biden participated in APEC in July and then the U.S.-ASEAN Summit, an East Asia Summit this week.  He hosted the Quad leaders in September.  He welcomed the prime minister of Japan; he then welcomed the president of the Republic of Korea in his first foreign head of state – as his first foreign head of state visitors.  The Indo-Pacific region is a critical linchpin in our economic and diplomatic relations, and I think what you will see is just a deepening of what this administration has been trying to do in its first year in office. If you look – let me just add if you look at – if you look at a number of our priorities – infrastructure, supply chains, the digital economy – these are priorities for this administration, and the Indo-Pacific region is at the forefront of that effort.  It's also, by the way, a priority with me.  I'm spending much of my time on infrastructure and supply chains and the digital economy. MR ICE:  Let's go to the line of Kristina Anderson. OPERATOR:  And Kristina, your line is open.  Please, go ahead. QUESTION:  Hello.  Thank you for taking my question.  So economic development and the priorities, as described, seem to be heavily dependent on science and technology because that's kind of the future of innovation and the thing that will drive economic development.  So I'm wondering, is there an educational component or sort of a coordinated piece that will go with this that will focus on ramping up student exchange, cooperative research across?  And that also builds trust, and trust is a part of – a necessary pillar to economic – building economic relations.  Thank you.  That's my question. UNDER SECRETARY FERNANDEZ:  Thank you, Kristina.  That's a good question, and I'm – as someone who has spent a fair amount of time in the education sector, it's a – I am – I've always been pleased to see that exchanges, student exchanges are a critical aspect of our diplomacy.  Some of the best advocates that we have in foreign countries are people who studied here, who were able to experience our universities, who were able to experience our society.  So I think you will continue to see an emphasis on that from the State Department.  People-to-people exchanges are critical, and that's not just in the university setting, but also among our researchers on science. In my family, we actually have an office of scientists, and we work very closely with them.  If you look at some of our main priorities on climate change, on supply chains, these involve – many of these involve science and science experts.  So, yes, I think on the personal level, I'm very committed to making sure that those continue, and that in fact we deepen them to the extent that we can. MR ICE:  I think we have time for just one or two more questions.  Could we go to the line of Philip Heijmans. OPERATOR:  And Philip, your line is open.  Please, go ahead. QUESTION:  Thanks a lot.  Yeah, I'd just like to go back to the Indo-Pacific economic framework again.  On one hand, you have China who has kind of expressed an interest in joining the CPTPP.  Is this framework in a sense going to directly compete with that?  And also, where does China fit into this economic framework?  Is it going to consider China's interests included?  And, yeah, I just wonder is it going to be, again, as comprehensive as TPP was?  Thank you. UNDER SECRETARY FERNANDEZ:  Look, this – our approach to the region is not about what we're against, but it's really what we are about.  And if you look at our competitive advantage vis-à-vis many of our competitors, it's our partners; it's our allies; it's what we can do together.  And so if you look at the region, we are – we have the Asia-Pacific Economic Cooperation.  We have the Association of Southeast Asian Nations.  We have the Quad.  We have this forum.  We are – we're going to continue to engage our partners about what we – about a positive economic agenda.  And what does that mean?  Well, that means. first of all. working with them to fight off COVID, to end the pandemic, and prepare for the next pandemic.  And we're doing that not just by donating vaccines, although that's a critical aspect of it, but also by working on infrastructure, by working on supply chains, making sure that our supply chains are secure, are dependable, and diversified.  All of that involves the Asia Pacific region. So no, it's – at the end of the day, it's defending our interests, working alongside partners and allies to make sure that we have fair trade, that we have fair competition, that we have fair practices, and that the rules of the road are not dictated by any one nation, but actually that the rules of the road that all nations have benefited from are continued – are followed.  And this is not just a foreign policy issue, but it's also a domestic U.S. issue, because we believe that if rules are followed, that if we have adherence to global trading norms and that we can avoid unfair and coercive practices, our workers will benefit, as will the workers and the peoples of the Indo-Pacific. MR ICE:  We have time for one last question.  Let's go to the line of Joel Gehrke. OPERATOR:  And Joel, your line is open. QUESTION:  Hi, thank you for doing this.  I'll start first on the market access piece, then also kind of a security, economic security question as well.  Following up on my colleagues, I guess I wonder:  What is the Biden administration doing, or planning to do, to give allies and partners the market access needed to have a serious alternative to the prospect of investment with China, given all the downsides that can come from investment with China, as we've seen in Australia?  And then on the economic security side, wondered:  Could you say if there's any coordination with allies to close off what's been called tech leakage, provision of different semiconductor chips, or even investment?  There's a really interesting report out from Georgetown about U.S. investment going to support Chinese artificial intelligence projects.  Is there anything – as you look at the landscape from the U.S. side all the way to the Indo-Pacific, is there anything that the U.S. can do to deprive China of sort of a support from democratic nations for some of their more pioneering and perhaps dangerous research? UNDER SECRETARY FERNANDEZ:  Joel, that's a good question.  It goes a little bit beyond my portfolio.  I will tell you this:  Our concerns with China and its practices have to do with, frankly, lack of adherence to global trading norms, non-market policies, subsidies, unfair competition, unfair and coercive practices.  Those are common concerns not just of the United States, but of all of our partners. So yeah, we, I think – I think we have constant discussions with them on these issues.  I think also what we – what the – this forum was about, why it's so important, is we have to have a positive agenda.  We have to have – we are following – all of our nations are looking to improve their security, they are looking to cooperate economically with the U.S.  As I said at the beginning of this conversation, seven of our top 15 export markets are in this region.  This is a critical region; we speak to them constantly.  Just last night, I spoke to two ministries from the region on different issues – all of them having to do with economics. And in addition to that, something that we haven't talked about but that is a major focus of the forum is the private sector.  Again, if you look at our competitive advantages, they involve our allies, and they also involve our private sector.  No one can boast of a more vibrant private sector than the Indo-Pacific and the U.S. and our allies. So we have to use – we have to use that advantage to pursue economic prosperity and economic security.  This is not about keeping anyone out; it's about improving the lives and the economies of all nations in the Indo-Pacific. MR ICE:  And with that, ladies and gentlemen, we've run out of time.  I do want to take a moment to thank again Under Secretary Fernandez for joining with us this morning, along with our Economic and Business Affairs Bureau Senior Bureau Official Matt Murray.  Thank you both for coming with us.  And I also want to thank everyone for dialing in today. 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