Question Period Note: U.S. Economic Prosperity Network

On May 4, Reuters reported on a U.S. initiative to create an "Economic Prosperity Network" of trusted partners to address supply-chain risk and reduce its perceived over-reliance on China.

• Our conversations with U.S. officials indicate that the "Economic Prosperity Network" (EPN) is not yet a fully developed initiative, and will aim to deepen economic relationships with trusted partners on the basis of shared values

• The U.S. have assured us that Canada will be welcome to participate once they are ready to formally engage with other countries

• Canada will continue to engage with the U.S. on the EPN, and other U.S. efforts to address supply chain vulnerabilities exposed by the COVID-19 crisis

• Canada-U.S. cooperation during the pandemic, including our shared and reciprocal measures at the border to ensure the health and safety of Canadians while maintaining the flow of essential trade and medical supplies, shows the importance and closeness of our relationship

• Combined with the entry into force of CUSMA, Canada and the U.S. are capitalizing on the opportunity to deepen our integration at a time when the security and integrity of supply chains is brought into question.

In a Reuters report from May 4, 2020 (“Trump Administration Pushing to Rip Global Supply Chains from China”), U.S. Undersecretary of State for Economic Growth, Energy and Environment, Keith Krach, and another unnamed official speak about U.S. efforts to create an alliance of trusted partners under the auspices of an Economic Prosperity Network (EPN). The article includes a fragmented quote from Secretary of State Mike Pompeo, referring to work with Australia, India, Japan, New Zealand, South Korea and Vietnam to “move the global economy forward”, including with respect to supply chain security.

Canadian officials in Washington D.C. are in regular contact with their U.S. and like-minded counterparts and have been able to establish that the media report likely conflated the U.S. State Department-led initiative recently renamed EPN with a separate (and now concluded) “Indo-Pacific Coordination Group” where the U.S. and Indo-Pacific partners cooperated on the immediate COVID-response.

Canadian officials' understanding is that the EPN is a multi-pronged concept encompassing various existing U.S. plurilateral initiatives with the objective of deepening economic relationships on the basis of shared values (e.g. trust, transparency, reciprocity, accountability, and national sovereignty). At this time, it does not appear to include formal work on supply chains. However, Canadian officials continue to engage with other actors across the U.S. Government who are developing supply chain analysis.

Contrary to what was suggested by the media report at issue, the EPN will be open to all “trusted partners” and will not be limited to Indo-Pacific countries. U.S. officials also clarified that EPN participants would not be limited to national governments, but would also include universities, businesses, and other interested organizations. We expect the U.S. State Department to share more specifics about the EPN with potential participants in the near future.

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