Elizabeth Morgan | CARICOM’s performance in international trade

This week, I am looking at the performance of the CARICOM region in international trade for 2021/22. The second Agri-Investment Forum and Expo opened in Trinidad and Tobago on Friday, August 19.

The continuing aim is to prioritise agricultural development in the region and the promotion of food security. Agricultural production and intra-regional trade will be important going forward, with the continuing war in Ukraine, and drought, fires and floods in Europe, North America and elsewhere affecting supply.

As CARICOM countries cannot only depend on intra-regional trade, agriculture also has to provide raw materials for production of agri-processed products and fresh commodities. As while we look to food security, we still also must be increasing exports into the markets of international trade partners to maintain diversified economies and to earn foreign exchange.

The outlook for CARICOM member states for international trade in 2021 was not bright and international trade was further impacted by COVID-19 variants and logistical challenges. The trade figures for CARICOM illustrate the region’s anaemic performance in merchandise trade and in trade in services, primarily tourism. As stated previously, it is difficult to fully assess trade in services values due to the unavailability of statistics on a disaggregated basis.

I reviewed the CARICOM merchandise trade statistics using ITC Trade Map and created Table 1, attached. With the recovery in trade after steep declines in 2020, the CARICOM region continues to have trade deficits as imports out strip exports for most countries.

SURPLUS

The region in years past used to have a surplus with countries like Canada and the United Kingdom, but is now carrying a trade deficit. Imports from the world in 2021 were valued at over US$38 billion, while exports were valued at US$18.8 billion. The deficit is US$16.2 billion, an increase over the figure for 2017. The imports from the USA increased and exports also increased, most likely due to petroleum product exports from Trinidad and Tobago and the new entrant to the market, Guyana. The deficit with the USA, principal trading partner, remained significant. There must be concern about the level of exports, not just with Canada and the USA, but also with the UK and the EU 27, as well as countries in Latin America and the Caribbean, recalling that there are trade agreements with several of these countries. Exports to Africa are given as valuing US$311.6 m. In my view, much more work is needed to build export markets in Africa and Asia.

TRADE FIGURES NOT ENCOURAGING

The first-ever AfriCaribbean Trade and Investment Forum (ACTIF2022) will be held in Bridgetown, Barbados, from 1 to 3 September, with the theme ‘One People, One Destiny: Uniting and Reimagining Our Future’.

2022 trade figures reported for Jamaica recently show that imports are continuing to increase at a significant level, while exports are increasing marginally. Belize, an exporter of commodities, has seen a 25 per cent increase in the value of exports in the period January to June 2022. St Lucia resumed banana exports with some optimism.

Table II, attached, shows the figures available for tourist arrivals in 2021 and 2019. Although there was recovery in tourism in 2021, arrivals were still nowhere near the 2019 figures. The sector has been performing better in 2022. The hope has to be that a strong rebound will continue through to the winter season of 2022/23. An increase in tourist arrivals is critical to the tourism-dependent countries.

These trade figures are not encouraging for the health of economies in the CARICOM region, signalling that economic stagnation will be continuing in most of the CARICOM member states in spite of growth being reflected due to the economic recovery being experienced. CARICOM members need to make re-energising the CSME a reality as the foundation for intra- and extra-regional trade.

Elizabeth Morgan is a specialist in international trade policy and international politics. Email feedback to columns@gleanerjm.com