Most IPEF members became more dependent on China for trade over the last decade

The Biden administration launched the Indo-Pacific Economic Framework for Prosperity (IPEF) in 2022 to improve US trade relations in the region, strengthen supply chains, and—not least—reduce its members' economic reliance on China. The more specific goal was to prepare for a coordinated response to supply disruptions caused by pandemics or other factors and reduce the threat of China using trade to coerce behavior of member countries—which include Australia, Brunei Darussalam, Fiji, India, Indonesia, Japan, the Republic of Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, the United States, and Vietnam.

These goals face difficult challenges. As of 2021, China was still the top source of manufactured goods for all IPEF countries except Brunei and the top export destination for manufactured goods for half of IPEF member countries. As this chart demonstrates, IPEF members have become more reliant on trade with China since 2010, both in terms of exports and imports of manufactured goods. On average IPEF countries received more than 30 percent of their manufactured imports from China and sent almost 20 percent of their exports to China in 2021. The United States, however, has seen a 10 percent reduction in China's share of its total manufactured goods imports, mainly due to tariffs originating from Trump's China trade war.

These numbers reflect IPEF average increases in the China share of over 40 percent for imports and almost 45 percent for exports since 2010 (averages exclude Brunei, which is an outlier).

This PIIE Chart is adapted from Abigail Dahlman and Mary E. Lovely's blog post, "US-led effort to diversify Indo-Pacific supply chains away from China runs counter to trends."