Caricom SME — soon come

By ANTHONY GOMES




PRECIOUS little has been reported in the media about the outcome of the 31st meeting of Caricom Heads of Government in Montego Bay. Apart from the sparse attendance by Heads of Government that can only be described as disappointing, the meeting was successful in bringing to the fore the three cardinal issues that for years have haunted the agenda of the conference. These are the issues of governance, that is, leadership, difficulties with intra-Caricom trade, the selection of a new Caricom Secretary General and reform of the Secretariat.

However, we are encouraged by Prime Minister Persad-Bissessar's expression of goodwill by promising to address several trade disputes existing between Jamaica and Trinidad and Tobago. The PM made reference to concerns about a "few perceived issues" related to the cost of production and inputs in both Trinidad and Jamaica, which would include the preferential cost of energy in Trinidad. She said, "We will assess and reassess and review, and where we can find amicable solutions that will endure and enure for the benefit of our people here in Jamaica and in Trinidad and Tobago."

The PM continued, "Now is not the time for the regional business community to be combative rather desperately, we need to join forces to impact in a sustainable way on the international scenario, so let us not in some ways concentrate on our differences and engage in warfare in the region." These remarks are well intentioned, indicating where the inquiry process should begin and the amicable attitude that should prevail.

The foregoing comments were well received and it is now clear that the PM is aware of our continued "bleating and bitching" about these "perceived issues" over the years. It is certainly not the intention to be "combative" as the issues at hand are legitimate trade problems encountered as part of our developing Caribbean trade regime, to be settled within the purview of the Revised Treaty of Chaguaramas without recourse to the World Trade Organisation, if possible.

The PM also gave advice on how the two states can enjoy successful commercial relationships. Three changes for improvement were recommended. First, engage in innovative improvements to their businesses. Second, create alliances between the business communities of both countries. Third, engage in meetings to discuss ways in which businesses could establish partnerships. These business liaisons are already in progress evidenced by the continuing investment by Trinidadian interests in new projects being developed in Jamaica. However, as the adage goes, "The largest room in the world is the room for improvement", and so we support and concur with the offered advice.

Regarding the paramount issue of governance, PM Golding as Chair of Caricom for the next six months said, "We acknowledge that there is an issue with governance, and we have not solved that problem. We are aware of the proposal to put in place a permanent executive commission or a group of commissioners who have executive powers and then, in effecting the decisions of heads, would translate it to a domestic legislation with a certain amount of automaticity. There is need for continuity and follow-up. There is need for coordination to ensure that those decisions can be implemented." We await the report of the sub-committee in January 2011 covering this key proposal for a Caribbean Commission. The issue of the inequitable terms of trade between the states has been dealt with above.

The selection of a successor to the Caricom Secretary General and reform of the Secretariat should be the subject of a Technical Working Group study. The world's largest current service industry is "bureaucracy" creating a multilayered structure comprising organs, bodies, treaty entities, installations and associate institutions in Caricom which excels in job creation but slows to a moribund pace of implementation of constructive decisions. To be relevant to Caricom today, it has to be reorganised from bottom up and turned into a lean, mean, multifaceted machine, equipped to manage the electronic speed of business today, without the "paper chase" that accompanies the conduct of the Secretariat's business dealings.

A point of high importance which passed unnoticed without comment, was reported by Rickey Singh in this newspaper on July 7, that referred to Trinidad's PM openly speaking about her government's reservations: "...as well as against a commitment to any form of political integration with the sub-region of the OECS as had been signalled by her predecessor, Patrick Manning." Such an outstanding rejection will surely reverberate throughout the Eastern Caribbean, but will reinforce Caricom's unity.

Mission: "The Caribbean Court of Justice shall perform to the highest standards as the supreme judicial organ in the Caribbean Community. In its Original Jurisdiction it insures uniform interpretation and applications of the Revised Treaty of Chaguaramas, thereby underpinning and advancing the Caricom Single Market and Economy. As the final court of appeal for member states of the Caribbean Community, it fosters the development of an indigenous Caribbean Jurisprudence."

There should be no rush to enjoin the CCJ in its original jurisdiction on the sensitive issue of disadvantaged trade in Caricom. The issue could be resolved by dialogue, investigation and conciliation, given the goodwill and understanding expressed by Kamla Persad-Bissessar during her visit to Jamaica. As with all things temporal, should the critical path as suggested not succeed, then referral to the CCJ should be considered. It is sincerely hoped that such recourse would not come to pass.

July 14, 2010

jamaicaobserver

Bahamas Blog International

Owen Arthur - the Caribbean Commissioner the region should have

By Sir Ronald Sanders:


Owen Arthur, the former Prime Minister of Barbados, is probably one of the best Commissioners of a Caribbean Commission that the region does not have but ought to have.

Indeed, had Caribbean Community and Common market (CARICOM) governments implemented the recommendation of the 1992 West Indian Commission to establish a Caribbean Commission, we may today have as its President, PJ Patterson the former Prime Minister of Jamaica, Owen Arthur as one of its Commissioners and someone from the OECS of the regional calibre of say, Ralph Gonsalves the present Prime Minister of St Vincent and the Grenadines, or Vaughan Lewis former Prime Minister of St Lucia, as the third Commissioner.

Had such a Commission been in place and operating, CARICOM countries may have been dealing with their current financial and economic crises in a collective and cohesive fashion, and much better than they are currently.

As it is, each country has struggled to deal on an individual basis with the walloping effects not only of the global financial crisis, but also of the consequences of the collapse of CLICO and British American.

While it is true that in mid-June, the governments of the seven small members of the Organization of Eastern Caribbean States (OECS) signed a Treaty to establish an Economic Union among themselves, that treaty is not yet operational and while, once it is operational, it will represent progress, it remains insufficient. It is the wider CARICOM region that has to deepen its integration arrangements and especially its machinery for joint decision-making and implementation.

Regrettably, Owen Arthur is not looking for a job as a Commissioner or even Head of a Caribbean Commission. Indeed, one interpretation of a comment he made recently in the Bahamas suggests that he may be interested in being Prime Minister of Barbados once again.

In a very important speech to the Institute of Chartered Accountants of the Caribbean at its annual meeting in the Bahamas on June 25, Arthur said: “You should allow me to begin by stating how very pleased I am to be able to share the same platform once again with Prime Minister Hubert Ingraham who until recently, like I do now, carried the title of Former Prime Minister. His presence fortifies my belief in the concept of the second coming”.

Whatever Arthur meant by that comment, the rest of his statement was a telling analysis of the present financial and economic condition of the Caribbean Community, and a blistering revelation of the lack of support from the International Financial Institutions (IFI’s).

It has to be said, however, that while the IFI’s have not been as responsive to the Caribbean as they could have been, and the IMF in particular has applied the usual prescriptions for providing Stand-By arrangements to Jamaica and Antigua and Barbuda, CARICOM countries failed to provide the IFI’s and major world economies with a clearly defined plan of what they need, for what, and how they plan to repay it.

It should be recalled that when the global financial crisis erupted, the world, and the Caribbean Region within it, faced an economic crisis of unprecedented proportions. Globalisation threatened to overwhelm the Caribbean with a world-wide recession, and indeed it did. Growth in every country except Guyana (according to the IMF) declined in 2008 and 2009. In some cases, there was negative growth. The ratio of debt to GDP escalated everywhere even in normally cautious Barbados. Tourism, on which the entire region (except Guyana and Trinidad and Tobago) now relies, declined everywhere if not in numbers, certainly in spending.

No State, no Government, no society within the region was immune from the economic consequences of the global financial crisis and the effects of the collapse of CLICO and British American. In that context, CARICOM societies expected their governments to come together to explore measures they could take in concert to enlarge the capacity of the region. Indeed, several regional commentators urged such action in very specific terms. As it turned out, CARICOM governments set up two separate task forces and both reported, but no joint plan was put to the IFI’s and none to the major world economies.

Owen Arthur reminded his audience in the Bahamas that “in April 2009, the G20 countries pledged provision of an additional $1.1 trillion to the IMF and the Multilateral Development Banks to enable them to carry out a programme to restore credit, growth and jobs to the world economy”, and he observed that “we have witnessed the carrying out of a rescue and recovery programme for the world’s developed economies, involving an unprecedented commitment of financial resources and the incurring of fiscal deficits on a scale that has hitherto been unimaginable”.

But, while the developed countries were bailing themselves out, they failed to deliver on the pledge “to make available an additional $850 billion of resources through the IMF and the multilateral development banks to support growth in emerging market and developing countries by helping to finance counter-cyclical spending, bank recapitalization, infrastructure, trade finance, balance of payments support, debt rollover and social support”.

Arthur pointed out that the IMF introduced a new Flexible Credit Line through which the bulk of additional IMF financing was to be channelled. As he said: “It was also especially intended to herald a fundamental change in the procedures for accessing IMF funds and meeting IMF programming tests”.

However, it could not be used by Caribbean countries and the facility into which $500 billion was pledged to support recovery in the developing world was used by countries in Latin America, Africa, Eastern Europe and Asia.

In the Caribbean, the IMF has agreed to two Stand-by Arrangements, one for $1.3 billion with Jamaica, and the other for almost $120 million with Antigua and Barbuda for which all the traditional IMF conditionalities apply.

As Arthur concludes: “It however cannot fairly be said that IMF response has or will assist in any major material way in achieving the grand overarching objectives stated on April 2nd, 2009 of fostering counter-cyclical stimulation, spurring employment creation nor attending to the needs of structural diversification in Caribbean economies”.

The space allowed in this commentary does not permit discussion of Arthur’s analysis of the lack of adequate response by other IFI’s to the Caribbean. But, his statement should be compulsory reading for all.

His conclusion is also extremely important. He said: “Where there is common threat, we must devise and pursue a common response. Should this global crisis engender such a common response to the common threats faced by the societies of the region, it will have served to usher in a better way of doing things in the Caribbean and will help to ensure that our best days are still ahead of us”.

In simple terms, Owen Arthur has made the case for a Caribbean Commission. If it were in existence, and if someone of his calibre – if not he himself – was Commissioner for the Community’s finance and trade negotiations, the region as whole might have got from the IFI’s a reasonable share of the resources it has been denied – largely because it failed to produce a clearly defined plan that could be effectively argued.

July 2, 2010

caribbeannetnews

Bahamas Blog International