Friday, April 12, 2013

Continuity and Change in the post-EPA Caribbean

What is required to ensure regional survival in a new world

Jamaica Observer

THE ensuing debate and what some might call tabanca, related to the CARIFORUM-EU Economic Partnership Agreement (EPA), are very worrying.

It would seem that observers and analysts have adopted the position that the European Union (EU) and its agents are evil, and should be called out for their malicious and iniquitous transgressions against puny counterparts in the Caribbean, who have little chance of engaging the former colonial masters on equal terms. Ironically, in the same breath, many have praised the recent fortune of Antigua and Barbuda in securing an unprecedented victory against Goliath-- the all-powerful United States. The discussion on being assertive and enhancing internal capacity seem to missing from many recent commentaries. Instead, it would seem the age-old dependency and% vulnerability rhetoric have taken centre stage, diminishing and obscuring important resolve to stimulate the necessary dynamism to ensure some modicum of competitive adaptation to the situation that has now befallen the Caribbean.

Within the context of globalised trade reciprocity, it is foolhardy to persist in a mode of requesting concessionary measures from either the EU or other trading partners. Unfortunately, any beggar-thy-neighbour principle cannot be enforced or resurrected within the present global political economy in which Caribbean small island states do not possess internal dynamic or geo-economic clout.
In this ongoing saga of finger-pointing we need to ask ourselves what has truly brought the region to this point and how we should actually be responding.
Prior to 2008, the English-speaking nations within Caricom had enjoyed exceptional preferential treatment for more than 30 years, first from Britain, as ex- colonial polities, and latterly the European Union through market access and guaranteed price levels for their goods. Belal Ahmed, in a 2001 report, highlighted that Caribbean sugar and banana industries — the mainstay of many of the Windward islands — suffered from a number of challenges, inter alia, a lack of technologically intensive production methods and resultantly improved productivity, labour issues, limited crop diversification, little research and development support and downstream activity. Though globalised markets and liberalisation affected regional producers, it could be argued the solutions to many of these issues could have been controlled by and were within the reach of the territories themselves.
Despite being challenged by WTO rulings and possessing concessionary market access, the evidence shows the required quotas for bananas or sugar to Europe had, on several occasions, not been sufficiently met. Perhaps the attendant capacity was not put in place, which resulted in significant revenue losses. Cotonou (1975-2000) and Lomé (2000-2008) come to their inevitable end. However, why did we not put the necessary mechanisms in place while regional producers benefited from concessions? It may be argued, as Sonjaya Lall and others have suggested, that trade preferences tend to retard dynamic capability and result in uncompetitive, sheltered industries. Perhaps, in the case of the EPA negotiations, the strategies may have faltered, negotiators outwitted or the bluster of civil society actors ignored. Alternatively, perhaps, the negotiators were overconfident that the regional private sector policymakers would get their act together in time to ensure competition on an even keel. But what are the reasons for our failure in achieving economic targets over the years and effectively implementing our industrial policy regimes to diversify exports? Though the main sectors have shifted to services, very little has been done to reduce dependence on a single industry, seek niche areas with high potential returns, or to proactively adapt to global developments by moving into higher value-added manufacturing linked to improved technology based on cumulative learning.
We need to examine other perspectives and seize opportunities with respect to indigenous technological capability and learning. To date, the anti- EPA camp has marginally considered areas of innovation, learning and cumulative capacity building in their arguments. Scholars like Carlota Perez argue that the windows of opportunity for development are constantly shifting along with the techno-economic paradigm or technological revolutions. In what ways have Caribbean private sector companies taken advantage of the Internet age in innovating and differentiating their products? The issue of market access would certainly be relevant once there are goods and services of a high calibre to trade, and are constituted with technological inputs that would attract the demand to render them competitive in the EU market and elsewhere.
In this regard, greater access to technological and supply networks could be negotiated through well-placed members of our diaspora. Could it be that complacency become entrenched as a result of meagre economic growth spurts over the years? Moreover, the failure of our regional academic institutions to inculcate broad-based and integrative thinking in their charges, and consequently inspire context-specific and region-wide action cannot be overlooked. In addition, the efforts at building relevant research and action-driven capacity to leverage and take advantage of the information revolution in meaningful ways, based on failed policies, can certainly have some sway.
Sadly, many learned observers, despite their experience and knowledge, remain blinkered by outdated perspectives. As a young researcher, I am bemused and remain uninspired by the course of the debate to date. The Washington-based institutions may have kicked away the ladder, but the East Asian tigers (South Korea, Singapore, Taiwan, and to a lesser extent Malaysia and Hong Kong) doggedly continued their campaign to develop market-ready microelectronics, software, ICTs, manufacturing, and other service-oriented sectors. Despite their initial teethong problems, they learnt over time and ensured that the lessons learnt were part of their subsequent economic strategy. Are we afraid that this new episode in our economic history will expose the inadequacies of our analyses and development prescriptions? That, in fact, our present situation may be a consequence of the frailties driven by academic and policy insularism, perpetrated at our highest regional institutions?
This EPA exposé related to ill-prepared Caribbean states and private sector stakeholders has constrained regional actors from taking on the world and adapting to the demands of globalisation, even though leading analysts have acknowledged the Caribbean region as part of the global economy for the last 500 years. Why then have we not got our act together or learnt lessons during the post-independence era? It is rather simple to blame the politicians, the political system, the structural deficiencies of the global economy which disadvantage small states, the EU, the negotiators, the negotiating machinery, the regional institutions, and all and sundry, than to take a serious introspective look at the discrepancies and short-sightedness of our analyses and policy prescriptions, and even our own efforts to take action in our own time and sphere of influence. Which academic or writer will ever admit fault or retrospectively state that their analyses were inadequate for fear of being relegated to irrelevance, especially in a small-island context? But, as Plato suggests: "The learning and knowledge that we have, is, at the most, but little compared with that of which we are ignorant." The shameless blame game and the weeping and gnashing of teeth surrounding the EPA must come to an end. Those who do not wish to get their hands dirty need no longer speak from their soap boxes. We need to break ourselves out of the mould of victimhood and re-assert our God-given character of resilience and capacity for "creative" agency. Our actions must be well considered and evidence-based, and the net must be cast wide enough to capture ideas and knowledge that will do justice to the cause. It is high time we cut our losses from this saga and take that brave step forward to engage the world.

Keston K Perry is a student at Newcastle University Business School (NUBS) in the UK pursuing an MSc in Innovation, Creativity and Entrepreneurship. His research involves the potential catalytic role of Caribbean diasporic entrepreneurs in terms of transnational learning, entrepreneurial activities and technological resourcing capabilities and their implications on innovation and public policy in Trinidad and Tobago.


Jamaica Observer

April 10, 2013