Australian minister urges greater U.S. economic engagement with Indo-Pacific

Australian Foreign Minister Wong visits Thailand

WASHINGTON (Reuters) - Australia's Foreign Minister on Wednesday praised Washington's commitment to Indo-Pacific security but said its departure from a regional trade pact was still being felt and that enhanced U.S. economic engagement with the region should be a priority.

In a speech to a Washington think tank a day after bilateral talks, Penny Wong said it was necessary to show partners in the region there was more to engagement than security interests.

"U.S. policy should be based on a clear understanding of what the rest of the Indo-Pacific wants," she told the Carnegie Endowment for International Peace.

"The region sees development, connectivity, digital trade and the energy transition as vital domains in which consistent U.S. leadership and influence would be welcome."

Wong said the U.S. decision - made by former President Donald Trump in 2017 and endorsed by President Joe Biden - not to proceed with the pact now known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) was still being felt, just as the decision not to proceed with a transatlantic pact was being felt by other international partners.

"Plainly there is a view in Washington that U.S. allies must work together on principles of collective security," she said. "But we also have reached a stage in the evolution of our alliances where they will increasingly require a fully developed economic dimension as well."

Wong said that for Australia membership of CPTPP and other economic agreements underlined that its national interest "lies in being at every table - at every table - where economic integration in Asia is being discussed."

She said the broad take up of a U.S.-led Indo-Pacific Economic Framework (IPEF) showed the appetite for American economic leadership, but added: "A commitment to the region requires greater economic engagement."

Biden launched IPEF in May as a way to raise environmental, labor and other standards across Asia.

But his administration has ignored calls for a return to CPTPP because of concerns about the effect this could have on U.S. jobs and has frustrated smaller Asian countries by its unwillingness to offer greater market access they seek via IPEF.

(Reporting by David Brunnstrom, Michael Martina and David Lawder.)