Elizabeth Morgan | Matters arising from the 45th CARICOM heads conference

Perusing the communiqué of the 45th Conference of the CARICOM Heads of Government held last week in Port of Spain, Trinidad and Tobago, there are two matters on the agenda which caught my attention. These were under the CARICOM Single Market and Economy (CSME) and External Trade Negotiations.

CSME

Like others, I noted that the heads agreed to work towards the free movement of all CARICOM nationals within the community by March 31, 2024. This is an ambitious undertaking, given the direction of these discussions in the past. The use of “the community” here gives the wrong impression, as not all members of “the community” are participating in the CSME. It did not take long for the Ministry of Foreign Affairs of The Bahamas to issue a press release reminding the public that the country is not part of the CSME and, therefore, the free movement of people does not apply to them. It also does not apply to Montserrat.

You may recall that in January, the government of Gaston Brown in Antigua and Barbuda announced the waiving of work permit fees for foreign nationals living and working in those islands. This did not apply to those CARICOM nationals travelling as skilled workers under Article 46 (1) of the Revised Treaty for which Antigua and Barbuda has sought opt-outs. On this, I refer to my article ‘Antigua and Barbuda and free movement in CARICOM’ of January 11. So, the position of Antigua and Barbuda needs clarification.

There are other CSME participants which still have concerns about free movement of Haitian nationals. It, therefore, remains to be seen exactly what is meant by this decision of CARICOM heads and how it is to be implemented.

EXTERNAL TRADE NEGOTIATIONS

These are also interesting decisions which, we are informed, emerged from the meeting of the Prime Ministerial Subcommittee on External Trade Negotiations, chaired by Jamaica’s Prime Minister, Andrew Holness, held in April. Note an anomaly here, as ‘community’ in external trade negotiations can include The Bahamas, which is not participating in the CSME.

The heads decided as follows:

(i) That the region should prepare for and engage in negotiations to update the Community’s existing hemispheric trade agreements with a sense of urgency, and a willingness to arrive at mutually beneficial outcomes within the shortest possible timeframe;

(ii) That CARICOM should strengthen its trade and economic linkages with non-traditional partners to support further integration into the global economy;

(iii) That CARICOM should further explore and strengthen relations with Africa, building on established partnership arrangements; and

(iv) That as part of its transformational trade agenda, the Community will adopt a more strategic and sustained engagement in trade agreements with traditional hemispheric partners, to include services, and prioritising cooperation on trade finance, trade facilitation, transportation and payments arrangements.

Regarding decision (i) as I understand it, CARICOM is in the process of updating its trade agreement with Colombia. I refer to my article on ‘CARICOM-Colombia trade relations’ of February 16, 2022. The review of this trade agreement began then. So, this is a work in progress, and I am not sure it is moving quickly.

The other trade agreements in the hemisphere are with Venezuela, Costa Rica, Cuba and the Dominican Republic. I am not sure that negotiations to update these agreements will be starting or making much progress soon, if past history is anything to go by.

Regarding (ii) and (iii), CARICOM, with member states, continues the effort to strengthen its trade and economic linkages with non-traditional partners which, in this hemisphere, are Brazil and other Central American countries, including Panama. In Asia, the non-traditional partners include India and China. From the statistics, exports to these countries remain marginal.

AFRICA

On Africa, I have written about the recent trade mission led by Caribbean Export to West Africa (Ghana and Nigeria) in my article on June 21. This is definitely a work in progress.

Regarding decision (iv), the traditional hemispheric partners are Canada and the USA. CARICOM is trading with these countries under unilateral, non-reciprocal trade arrangements for goods only, the Canada-Caribbean Trade Agreement and the US Caribbean Basin Initiative (CBI), respectively. The MFN waivers for these have been renewed at the World Trade Organization.

There is no active mechanism through which to have trade discussions with Canada at the regional level.

With the USA, there is another trade-linked agreement, US-CARICOM Trade and Investment Framework Agreement, and there is a forum for trade discussions, the Trade and Investment Council.

Improving trade with the USA poses challenges for CARICOM, as pointed out by US international trade and customs specialist Andrea Ewart in her recent article, ‘CARICOM at 50: Its trade relationship with the USA’, in her Develop Trade Law newsletter. She points out that the CBI is underutilised; has declining tariff margins; excludes services; does not remove non-tariff barriers; and does not attract foreign direct investments.

A great deal of work is needed to transform provisions of CARICOM’s existing trade arrangements with Canada and the USA, if this is possible.

I note that the heads did not look at trade with the European Union and the United Kingdom.

In my view, on external trade negotiations, CARICOM needs to look at its policy and strategy, including production levels. It is okay for those countries producing oil and oil products to export to a wide range of countries, but others have to be able to produce goods which can be sold, and in quantities demanded. On services, CARICOM countries have to be able to compete with other global service providers and will need to be properly certified and accredited. It is essential that the private sector of all CARICOM countries are fully engaged in decisions to negotiate trade agreements, not just those in the CARICOM private-sector organisation.

I assume that at their retreat in Dominica in August, CARICOM heads will review and clarify these decisions.

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