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Showing posts with label Caribbean governments. Show all posts
Showing posts with label Caribbean governments. Show all posts

Monday, August 22, 2011

The CARIBCAN trade agreement - what is the OECS strategy?

By Ian Francis


Within the next year, the much touted CARIBCAN trade agreement tinkering will be concluded. CARICOM, OECS and Canadian trade negotiators will take credit for a job well done after the signing ceremony.

It will be interesting to see where the signing ceremony takes place. If it is in the depth of winter, the Canadian negotiators are likely to push for a Georgetown or Bridgetown signing ceremony only to escape Canada’s brutal winter. On the other hand, irrespective of the cold and soggy winter in Canada, our Caribbean negotiators who are so embedded in the per diem culture will prefer an Ottawa signing ceremony in order to maximize their per diem incomes.

Ian Francis resides in Toronto and is a frequent contributor on Caribbean affairs. He is a former Assistant Secretary in the Ministry of Foreign Affairs, Grenada and can be reached at info@visminconsultancy.caOnce the revised agreement is signed, the burning question remains. How can the Caribbean trade and export sectors maximize opportunities in Canada through the CARIBCAN agreement?

It is not a new agreement and has been around since the Mulroney days. Unfortunately, its failure was well known when Caribbean governments took ownership and locked up the policies and tariffs in the cupboards of local ministries of trade and industry. Exporters and investors from some CARICOM states remained disengaged and could not seize the opportunity to penetrate and sustain markets within Canada because there was no information, no market intelligence and no encouragement of partnerships through joint ventures and other initiatives.

It is hoped that, this time around, Caribbean governments will understand that a successful trade and investment partnership must be realized through strong and effective institutional collaboration. To put it bluntly, the Caribbean and Canadian governments are not involved in trade exports. However, through the agreement and sensitizing of officials on both sides of the spectrum, it is quite likely that barriers will be minimized and officials will become more informed about the free movement of goods and tariffs that have been eliminated.

In objective and realistic terms, trade collaborative efforts and sustainability between CARICOM nations and Canada require more than dependency on the “tiny bob” consular missions established in Canada. With fairness, Jamaica, Trinidad, Barbados and Guyana maintain very effective consular missions with a strong trade arm.

Therefore, if the OECS is serious and committed to a trade and investment strategy between Canada and member states, the current regional approach and strategies for market penetration cannot be successful in its current form. Caribbean trade and investment initiatives cannot be achieved through obscurity or ineffective marketing networks.

The OECS must recognize that they require planning assistance to formulate, implement and sustain an effective trade strategy in Canada. It is achievable but there must be a willingness to understand the need for planning and collaboration.

An effective trade and investment strategy between Canada and the Caribbean within the context of the CARIBCAN trade agreement must extend beyond rum and nice beaches. Certainly, Caribbean rum imports in Canada will continue to be very important. However, those responsible for such products reaching Canadian shelves must understand that it is a competitive environment, as Trinidad, Cuba, Guyana, Jamaica and Barbados have already saturated the products.

Therefore, while the Europeans continue to fund the OECS Dominica-based Trade Unit, staff at this unit must understand that the import tariff on Caribbean rum will be affected within the new agreement and OECS nations need to introduce more than rum and hot pepper sauce to the Canadian market.

A few years ago, Michael Astaphan of Dominica and some other OECS colleagues began the process of establishing a private sector export organization. The concept had merit and received much needed assistance from the Europeans. Unfortunately, the concept died and a very valuable opportunity was lost. It is hoped that the concept can be revived because such an organization is of necessity, since most Caribbean exporters and investors are private sector persons.

Both CARICOM and the OECS must recognize that trade and exports should be private sector driven and not given the appearance that it is state sector driven. It is time to support and assist the private sector in their quest for new markets.

Another perception that must be dispelled with is the belief that regional chambers of commerce are the prime export movers in the region. While some chamber members might be exporters, we need to ask why Guyana, Barbados and other MDC Caribbean nations have strong and effective export agencies. The OECS needs to adopt a learning chapter from these organizations and support a strong OECS private sector export agency.

Another issue on Caribbean trade initiatives seems to be the duplication of regional agencies that purport to promote Caribbean trade abroad. There is the Barbados-based, CARICOM-funded agency Caribbean Exports, which continues to find successful niches with only hot pepper sauce promotion. Frankly speaking, this is another serious area that CARICOM’s new secretary general must address.

Maybe it is time to eliminate this agency and find some form of new organizational accommodation with the OECS that will witness the following three concrete outcomes: 1) Development and sustainability of a strong OECS private sector exporting agency to maximize opportunities and success through the CARIBCAN trade agreement; 2) strong and sustainable trade partnerships between private sector institutions in Canada and the OECS; and 3) moving the OECS trade initiative in Canada beyond the Trade Facilitation Centre.

Finally, successful trade implementation initiatives by OECS exporters to Canada require reliability, effective communications, utilization of information technology tools and seriousness. Canadian importers are not interested in stories and excuses as to why a product did not arrive.

The CARIBCAN trade agreement will provide excellent opportunities but its success will only be realized if the regional export private sector players are allowed to play their role. Once the agreement is signed, both regional multilateral agencies need to delimit their involvement.

The trade and investment process between Canada and the Caribbean must be private sector driven.

August 22, 2011

caribbeannewsnow

Monday, May 23, 2011

Resetting US-Caribbean relations

By Anton E. Edmunds:


The announcement of the departure of Assistant Secretary of State for Western Hemisphere Affairs Dr Arturo Valenzuela has prompted quite a reaction in the Washington community that tracks hemispheric affairs. While some argue that Valenzuela was marginalized by others with direct access to the White House and the Secretary of State, others have weighed in on how badly academics do in similar roles. There is even an assessment that the US role of protector of democracy in the region was damaged under his watch.

Anton Edmunds is the President of The Edmunds Group International, LLC (TEG), a business and government advisory service firm with offices in Washington DC and the Caribbean. He can be contacted at anton@theedmundsgroup.com and prior posts reviewed at Edmunds Group News, Views & Events.While it may be unfair to blame this one individual for the collapse of relationships with some countries that have become emboldened in their ability to goad the United States, it is equally unfair to look to Valenzuela’s predecessor as an example of a more effective Assistant Secretary or for that matter, claim that the US regional relationship has suddenly been harmed. The reality is that the United States has long had regional relationship problems and has not had a consistent regional strategy in decades. A key fact that most chose to ignore is that relationships do not remain static, and the region itself for better or worse has changed.

Gone are the fledgling independent Caribbean states of a generation ago, and the new democracies of post conflict Latin America, both groups in the past clinging to a relationship with a regional hegemon freely dispensing aid and protection as these new nations weaned themselves from both colonial master and communist threat. Gone also is the belief by countries that the United States is a benevolent partner, willing to allow them to slowly evolve while accepting systems and standards consistent with its own. Instead what we see is a dysfunctional hodgepodge of struggling economies, each trying to eke out an existence in a merciless global marketplace while their leadership learn on the job the importance of good governance, an area where some would argue many are failing.

A perceived or real absence from the region by the US, while focusing elsewhere has served to exacerbate this weakening of ties and while opening of markets has done wonders for trade flows, it has proven not to be the panacea that Washington or the region once thought it would be. While by rote, Cuba has been the major focus of every incoming head of the Western Hemisphere at the State Department, it may not be any longer in reality the biggest problem. Instead it’s a combination of nuisance situations that serve to aggravate the United States vis-à-vis the Hemisphere.

There is Venezuela who some argue has managed to leverage its petroleum resources to gain friends and influence people; and one also sees a surging China providing aid to multiple nations and financing major a infrastructure and hospitality development. There is even an increased Middle-Eastern presence, with countries promising resources to a region some would argue is starved for attention and support, as in the case of Libya with the Eastern Caribbean.

The fact that the region has changed, with Caribbean and Latin American leaders becoming less wedded to their largest trading partner is not lost on observers. The hope is that with crime rampant, drugs flowing freely through the region and the threat of countries becoming controlled by criminal elements, the US and the region can find themselves once again together as partners sharing solutions to address important socio-economic problems.

This not unlike as in the days of the Cuba-Russia threat that preceded the Caribbean Basin Initiative and other similar initiatives. Recent initiatives such as Merida and the Caribbean Basin Security Initiative may well be attempts by the US to reengage.

Specific to the Caribbean, the Washington relationship appears to be one characterized more and more by feelings of both parties of dissatisfaction, distrust and disillusionment. The Caribbean unfortunately has long believed that a proud history of democracy should mean something more than it does, and that the tradition of a stable transition of government should be rewarded by thoughtful programs to advance this region’s development.

The reality is that be it with Europe or the United States, such a democratic history does not automatically translate into treats. As with the trade negotiations with the European Union, though called flawed by some, a level of maturity and creatively must be developed by the region if it is interested in working with its partners on co-authoring agendas and programs that are nuanced, thoughtful and comprehensive.

Caribbean leadership has also failed to effectively understand how Washington works and instead of cultivating multi-pronged alliances based on shared concerns such as security and mutually beneficial economic growth, instead depend on relationships of old and worse, looks to tenuous familial links between US government officials and countries of the region as a foundation upon which to advance policy discourse.

The great hope that a president of similar likeness and a State Department head who has travelled to the region in the past would usher in an era of re-engagement without real inputs from the Caribbean is a pipedream. Even relationships with entities such as the Congressional Black caucus have been badly managed and the Caribbean with few exceptions has failed to deliver its part of the equation when engaging groups like this by not submitting good ideas for consideration and worse, not engaging in the simplest of action of following up.

For the future, willingness by the Caribbean to develop and proffer solutions that take into consideration US policy direction is critical. That willingness must extend to listening to sometimes ill-conceived proposals but importantly, to understanding what drives them and to work to broker compromise where everyone wins.

While a knowledge gap and weakness at the senior levels at the US Departments of State, Commerce and other agencies in dealing with the Caribbean does not help and some may well characterize the placement of some who cover the region as tokenism, the Caribbean must itself step up to the plate by placing its best and brightest in the right space to rebuild a fractured relationship.

Some point out that a lack of attention by agencies such as USAID supporting on issues such as disaster mitigation and business continuity; the linking of key industries like tourism to agriculture; and the supporting of skills training in viable industry areas reflect changes in Washington and the centralization and politicization of this agency by the State Department.

Others argue that the bigger issue may simply be one of Caribbean irrelevance to the US or as stated before, the region’s inability to make itself heard. In any event, the lack of focus on the Caribbean is real and can be seen across the board.

In the case of the US Department of Commerce, it is perceived that the primary focus continues to be solely one of interest in building stronger alliances with Free Trade countries, with little acknowledgement of and unwillingness to invest in strengthening a robust trading relationship the Caribbean. Caribbean irrelevance to that entity may well be evidenced in the fact that never once in the three year history of that organization’s Americas Competitiveness Forum, has a Caribbean Head of State or corporate leader been featured.

In the case of others, including the Department of Energy, the use of proxies such as the OAS is becoming habit instead of direct engagement. One even sees the use of countries like Brazil and Canada as proxies for US engagement.

Unfortunately, for many in Washington there are some fundamentals that it is argued tell a different story. The lack of responsiveness from the region to overtures by the administration does allow many to question the seriousness of the Caribbean. As this is a problem also experienced by many an investor, the question as to whether Caribbean governments are incompetent or worse is not uncommon.

The now discounted Caribbean promise of an integrated marketplace, and regional standards in areas such as security has also served to dissuade many a career official from trying to advance a Caribbean agenda. Lack of action by the region on past initiatives does little to protect them from change by newcomers to Washington agency offices.

On the regional front, the Caribbean today is very much at the crossroads. The region lacks leadership at its crown jewel CARICOM, which begs the question as to which entity should major US agencies engage on regional programs. While the region itself reflects on the value of this body, one can only imagine what allies within agencies such as the State Department are thinking, as they have long had questions related to that organ’s ability to deliver. Gone too are the Caribbean statesmen of yore and lore who were able to command a certain amount of respect when it came to policy discussions with the US.

Compounding this is the re-emergence of regional and sub-regional rifts, often driven by personal and cultural inter-island animosities and protectionism that now consume significant time and resources.

When asked to comment about the future of the US-Caribbean relationship, there is expressed by many the hope is that the replacement for Dr Valenzuela will bring some broad regional experience and that Cuba and Venezuela, while they will continue to be key countries of focus will not be issues that derail the advancing a productive US-Caribbean relationship.

There is also hope that there will be real depth at the State Department and other administration agencies as it relates to the Caribbean, and one will see the Administration take a real stab at engaging Caribbean experts, maybe from the Diaspora community to fill out some of its ranks. Irrespective of the change in Washington, critical will be the ability of the region to do its part to help reset the relationship.

May 23, 2011

caribbeannewsnow

Friday, May 20, 2011

Dominica's Mary Eugenia Charles - A legacy for gender equality in the Caribbean

By Rebecca Theodore



As Caribbean governments continue their focus on the eradication of direct and indirect forms of discrimination against women through legislative reforms and the enactment of gender sensitive social policies, the achievements of Mary Eugenia Charles, grand dame of the Caribbean come to light.

While the accomplishments and contributions of Mary Eugenia Charles to Caribbean politics are widely discussed in the scholarly and popular literature of universities and political arenas; it is also sometimes argued with much speculation, controversy, admiration and hatred. However, Eugenia Charles confronts Dominica and the Caribbean with the picture of a woman attributed with the enigma of power in a patriarchal society. Her leadership challenges the traditional belief of the inferiority of women and the authority and supremacy of men in the male-dominated sphere of politics in the Caribbean.

Rebecca Theodore was born on the north coast of the Caribbean island of Dominica and resides in Toronto, Canada. She writes on national security and political issues and can be reached at rebethd@aim.comAccording to the Journal of Caribbean International Relations, “Dame Mary Eugenia Charles championed the cause of gender equality long before it became commercially fashionable. As a feminist, Eugenia Charles evoked the burning issues of the rule of law, and the rights of the individual in society.” Yet, her relentless demands for equal rights, social justice, and the end of sex discrimination still does not guarantee women in Dominica and the Caribbean autonomy and freedom in the determination of their lives.

At a time when the human rights of women have been in many aspects undermined by ideals of masculine character and by historical disparities in the decision-making process, women in Dominica and the Caribbean should take strength in the strong symbol that has developed around the image of Dame Mary Eugenia Charles in the international arena.

Despite being president of the international federation of women lawyers, occupational segregation in gender-based wage gaps in the Caribbean still registers women as subjects of discriminatory stereotyping. Women in the Caribbean still lack promotional rights, free from job discrimination as social and legal institutions do not pledge equality in employment and earning and social and political participation.

It is against the drapery of such concepts that the distinctions between women as political leaders and gender inequality in the Caribbean are mirrored. The Economic Commission for Latin America and the Caribbean (ECLAC) documents that “despite higher levels of education, Caribbean women continue to cluster at the lower sectors of society in terms employment, wages, and political representation, making them vulnerable to poverty and gender-based violence and harassment.”

The role of women in political leadership in the Caribbean questions the meaning of democracy and citizenship and awakens the need for a more inclusive style of governance and politics. The roles that men and women play in society are not biologically determined and it is time to stop using biology as a metaphor for interpreting reality or other socio-cultural traditions and beliefs about a woman's place in the family and society.

While critics advance the view that gender equality has been achieved within the Caribbean community and it is boys and men who are now disadvantaged; gender inequality in the Caribbean still constrains the lives of women and is still a significant challenge despite important law reform efforts. Women’s level of participation in senior political positions remains extremely limited and violates their fundamental human rights.

Against the backdrop of this view, the need for structural reform, redefinition of power and a re-negotiation of our understanding of the practice of leadership becomes an urgent plea. The need to increase women's participation in politics and decision making is a valid goal especially at a time when attempts of developing Caribbean nationhood and identity are smothered by dependence on male constructs and standards. The Commission on the Status of Women further affirms that “women form at least half of the electorate in most Caribbean states, yet they continue to be underrepresented as candidates for public office.”

The male dominated social system in the Caribbean has excluded and been hostile to female participation in the political arena. According to the ECLAC study, female participation in the politics of the Caribbean is about 20 percent overall. In the English-speaking Caribbean, the average participation of women in Parliament averages 13.5 percent, varying from 7 to 25 percent. This means that recognition of the importance of women in reconstruction and the role and discipline of political parties in the Caribbean needs to be addressed because women's empowerment in the Caribbean is vital to sustainable development and the realization of human rights for all.

If reducing gender inequality is essential to increasing women's economic security, defeating poverty and fostering sustainable development and growth, then Caribbean governments should show greater efforts in advocating for legislation to advance gender equality, to eliminate all forms of discrimination based on sex, and to prevent gender-based violence and increase. The education system and the media should also stop upholding the patriarchal orientation of society as well as the epitomes of male supremacy.

Dame Mary Eugenia Charles will forever remain a strong symbol for years to come as a woman who challenged culture, structures of oppression, and gender inequality in the Caribbean. Her legacy of equality and accelerating human rights for women provide a firmer foundation for social and economic development and security and new approaches to leadership in Dominica and the Caribbean.

May 19, 2011

caribbeannewsnow

Thursday, February 3, 2011

How can CARICOM countries decrease the upswing of criminality?

By Ian Francis


Every day, the Caribbean region’s population, through the various and diverse media organs of print and radio resources, is bombarded with news of crime ranging from homicide, armed robberies, rape and other violent crimes against innocent citizens, who are later described as victims, after facing the trauma of being attacked and victimized by these misfits in our community.

As an exiled Caribbean person in North America, I understand the individual pains felt by victims and the lacking inadequacy of our law enforcement agencies to apprehend and bring many of these offenders to justice. Although, some of these alleged offenders are apprehended and brought to justice, the growing inadequacy of the justice system further compounds the situation by apparent backlogs, timid Crown prosecutors and lawless legal lawyers, who show very little respect for the judicial system by constantly plotting and finding schemes and alibis on circumventing the justice system.

Many of these legal misfits can be found throughout the regional court circuit and are very well known by sitting judges and magistrates. Unfortunately, the legislative disciplinary mechanism is still in draft or review in many regional states so these misfits enjoy disciplinary immunity.

So, a careful analysis of the crime upswing in the region should not be only attributed to the senseless hardcore criminals. Therefore, when the question of crime and criminality is posed to the ordinary citizen on the street, the usual response is “all ah dem in crime”.

Getting such comments, it became necessary for me to delve further into these damaging comments and the outcomes were as follows, with both victims and potential victims identifying group and individual contributions to this untenable situation in the region. Based on my frank and open discussions, it is fair to conclude that crime escalation in the region cannot be blamed only on hardcore criminals. There are many other accomplices, which include:

-- Crooked, lawless and unethical lawyers versed in running red short around the judicial system;
-- Rogue cops who wear the uniform but act as the ears and eyes to inform criminals and their accomplices of planned police operations against them;
-- The revisionist habitual criminal offenders and their known accomplices who have no respect for law and order and invasion of individual rights
-- Public servants who live above their means and in order to maintain the lifestyle, they have no alternative but to divert to corrupt practices, which often go undetected
-- Corrupted elected and appointed parliamentarians who see a niche where they can advance themselves by amassing wealth through money laundering and other corrupt practices
-- Corporate and small business owners who manipulate the customs, excise and tax systems.

These strong perceptions and feelings by the population cannot be ignored anymore. Respective Caribbean governments need to take immediate action.

The situation is very gloomy throughout the region. It was only a few days ago that Trinidad’s National Security Minister accused crooked law enforcement officers of renting their weapons to criminals to commit serious crimes. With this and other allegations emerging from around the region, there should be no doubt or uncertainty in the mind of decision makers that “it is time for house cleaning”.

Yes, there are strong possibilities that many will be caught and, of course, there might be embarrassment; however, if CARICOM governments are committed to disrupting the criminal elements in their states, action and cleansing is needed on all fronts. These are some of the critical elements of transparency, accountability and good governance. Criminality is in our midst and it must be flushed out with vigilance and aggression.

CARICOM governments have from time to time talked about assets declaration. Rather than lamenting whether elected and appointed officials should make the necessary declaration, it is incumbent on respective governments to move swiftly with such legislation. In my view, all public servants in the employ of central governments and statutory bodies should make a declaration on what they own? How was it acquired? Current value and plans for future economic activities.

To put it bluntly, a police corporal with no relatives abroad, no significant local inheritance, no previously known and published financial accomplishments in his or current position is the owner of several houses, fishing boats and “one mores”. A careful examination and monitoring of this individual life style shows minimal activities in an existing financial institution. However, at the end of the day, he or she boasts assets to the tune of millions. Well, as a Jamaican friend would say, “da en sound right”.

This is the reality of criminal and unethical conduct in the CARICOM region. Rather than thinking that the criminal troublemakers are only deportees, it is ample time to dig deeper and identify other perpetrators. They are amongst us and detection is reasonably possible.

There are so many examples of public servant misconduct and alleged corruption in the region that the time has come when it cannot be ignored. Take a simple look at Stanford’s behaviour in Antigua, where he controlled a key staffer in the financial regulation department. Certainly, it occurred in Antigua but it will be very silly to think that there are no other misfits within the region.

Criminal lawlessness is not only amongst the poor. Let’s take a holistic approach and the results will be very surprising.

Ian Francis resides in Toronto. He writes frequently on Caribbean Commonwealth Affairs. He is a former Assistant Secretary in the Ministry of Foreign Affairs, Grenada and can be reached at info@vismincommunications.org

February 3, 2011

caribbeannewsnow

Thursday, August 26, 2010

The demise of the Caribbean Regional Negotiating Machinery

By Ian Francis:


There was no wake, prayers or visitation when the Heads of CARICOM Governments made the decision in Belize to bury the Caribbean Regional Negotiating Machinery (CRNM) and support the emergence of the Office of Trade Negotiations (OTN), which is now under the direct supervision of the CARICOM Secretary General headed by Ambassador Gail Mathurin.

I must confess my ignorance about Ambassador Mathurin’s permanent location but am extremely aware of her air jaunts between Grantley Adams and Cheddi Jagan airports.

The death of the CRNM was not a surprise. In the first instance, its creation should not have been entertained but the arm twisting of former Prime Minister Patterson by Sir Shridath and his other regional cronies resulted in “PJ’s” agreement for the creation of the CRNM.

It was very clear from the start that Sir Shridath brought forward the creation of the CRNM as he was determined to establish his own beachhead in Barbados and to flex his muscles within the multilateral community as a former secretary-general of the Commonwealth and foreign minister of the Cooperative Republic of Guyana.

It worked well for him, which led to the recruitment of key lifeguards, including Richie Bernal of Jamaica and Henry Gill of the Republic of Trinidad. Both individuals are well known within regional circles and have always demonstrated their distinctive qualities, skills and experience.

The exit of Sir Shridath from the CRNM was influenced by many occurrences. Prime Minister Patterson made the decision to demit office; there were couple of general elections held in the region, which resulted in the change of governments.

Sir Shridath saw the death warrant and was not prepared for the sentencing so his only saved-face option was to quietly exit from the CRNM. His clout and influence with some of the CARICOM Heads had dried up, thus making his reliance for survival untenable.

Prior to his departure from the CRNM, he carefully crafted his replacement which resulted in Jamaican-born Ambassador Richard Bernal assuming the direction of the CRNM.

Although Bernal assumed the position with great pomp, the weariness of the CRNM by CARICOM Heads grew, which made it difficult for the ambassador to run and manage an effective institution within the region. With much frustration, Ambassador Bernal saw an opening at a Washington-based international agency and decided to accept a position where he is now based and might be considering a run for the Secretary General position of CARICOM. We will have to wait and see as his cell phone number remains the same.

Bernal’s departure ensured that another lifeguard in the name of Henry Gill was quite appropriate for the position and assumed direction of the CRNM. Unfortunately, Gill’s term at the CRNM was short-lived.

The Heads of CARICOM at the Belize meeting made the firm decision that all trade negotiations should be under the aegis of the Secretariat, which meant that a major part of the CRNM based in Barbados would have to merge within the Georgetown Secretariat, thus bringing Gill under the reporting umbrella of the Secretary General.

As rumours have it, Gill vowed not to re-locate to Guyana and wanted no part of reporting to Carrington. This led to Gill’s demittal from the CRNM where he has now entered the regional lucrative environment of consulting.

In essence, Carrington and his group at the Secretariat won the fight, which led to the Secretary General’s immediate task of creating the OTN within the Secretariat.

Given the entire milieu above, several important trade negotiations between the Caribbean and many Western nations were announced. A famous and active negotiation is known as the CaribCan Trade Agreement, which is now taking place between the Commonwealth Caribbean nations and Canada.

The CaribCan Trade Agreement was first introduced in 1985 by the then Mulroney Conservative government. Unfortunately, much was not achieved in the area of trade and investments between the two regions. Very little was done in Canada to promote the initiative and the Caribbean governments made the tactical error by maintaining the agreement tightly shut in their industry ministries’ closet.

Canada in the last three years announced its intention to re-engage the Commonwealth Caribbean region, not only in bilateral and multilateral assistance but also to promote trade and investments between the two regions by rewriting the trade agreement.

Canada has kept its promise by providing financial assistance to the old CRNM and so far has engaged the OTN in three rounds of discussion with respect to the trade agreement. In addition, there have been other initiatives through the hosting of regional workshops by the (OECS-EDU).

Unfortunately, the participants and players for such events should be exporters, entrepreneurs and other participants that are interested in trade and investments environment. Unfortunately, there is a constant replay of government and state corporations’ representatives dominating these workshops, with exporters and entrepreneurs being left on the periphery.

In a recent conservation with an Ottawa-based senior foreign service official close to the CaribCan trade negotiations, I took the opportunity to share with him a press bulletin, which was issued by the OTN stating that negotiations are moving full speed ahead.

The diplomat known for his tight lips gave a loud laugh and said to me, “The agreement has been redrafted already and we have asked our Caribbean friends to check out full compliance with the World Trade Organization rules and regulations. Once they get back to us, it will be a done deal.”

In conclusion, as we move to finalize this agreement, there is work to be done on both sides, the OTN and its partners need to reach out and build capacities amongst those who will become the key actors in a trade agreement. The government of Canada has a responsibility to work with existing national and provincial trade organizations to get them actively engage in trade and investments dialogue on the Caribbean Commonwealth.

This begs the question. Will the remnants of CRNM remain in Barbados after the CaribCan Trade Agreement is signed or will it be fully integrated into the Secretariat? We will take a wait and see attitude.

Ian Francis resides in Toronto and writes frequently on Caribbean Commonwealth affairs. He is a former Assistant Secretary in the Grenada Ministry of Foreign Affairs and can be reached at info@vismincommunications.org

August 26, 2010

caribbeannewsnow

Friday, May 14, 2010

Timid Leadership setting back Caribbean in the world

By Sir Ronald Sanders:


Several commentators have lamented in recent years the seeming timidity of Caribbean leaders in not more aggressively defending and advancing the economic interests of Caribbean countries in the global community.

This apparent timidity has been evident in a number of areas including the surrender to bullying by the European Union (EU) when Caribbean governments signed up to an Economic Partnership Agreement (EPA) which went beyond the requirements of World Trade Organization (WTO) rules, and in the submission to the dictation of the Organization for Economic Cooperation and Development (OECD) over the operations of the financial services sector.

Sir Ronald Sanders is a business executive and former Caribbean diplomat who publishes widely on small states in the global community. Reponses to: www.sirronaldsanders.comThese capitulations will hurt the Caribbean now and haunt the region’s economic future for some time to come. Essentially, the space for making and implementing decisions in the Caribbean’s interest is either being severely restricted or lost altogether.

This malaise is weakening the once vibrant Caribbean Community which was led by courageous men and women who were not averse to standing up to the most powerful countries and agencies in defense of matters of importance to their nations and to the region.

While they sought strategic alliances with other nations and groups of countries, such as the pact with African and Pacific countries in the original negotiations with the EU, the motivation was the furtherance of their domestic and regional interest. They recognized that each of them was stronger for the support of the others, and they made unity not only a virtue but a tool, gathering together their best brains from government, the private sector and academia to map out their strategies and to implement them.

Somewhere along the path in recent years, the region has lost its way. The resolve to act collectively in the common interest of all appears to have been pushed to one side, as governments seek individual salvation. Collective action, long a strength of CARICOM, is paid only lip service. Worse yet, the collective use of the Caribbean’s best brains in government, business, and academia has disappeared.

So, the OECS countries join Japan to vote for commercial whaling even though there is a thriving tourism whale watching industry in the region; some countries have joined the Venezuelan-initiated ALBA – often taking positions within that group before discussing it in CARICOM; and the region remains divided on the issue of diplomatic recognition of China or Taiwan.

But, above all, bold leadership has diminished in the region, and it has reduced among Caribbean people the ambition to reach for the stars; to push the envelope so as to stride out of the shadows and into the global sunlight. The region is weaker for it. And, it will become weaker still unless the leadership of the region returns to the fundamentals of collective thinking and collective action, and asserts the Caribbean’s interest boldly; not surrendering to imposed rules in which they have not had a say; refusing to be bullied; and not allowing their governments to be captured by the inducements of others.

In this connection, a statement made to me by the Prime Minister of St Vincent and the Grenadines, Ralph Gonsalves, is warmly welcomed. The Prime Minister told me on the record that “Venezuela had nothing to do with St Vincent’s decision to offer itself for a non-permanent seat on the UN Security Council for the 2011-2012 term”.

Our discussion followed my commentary: “Serve the Caribbean’s interest, not some other country’s”.

Dr Gonsalves placed his government’s decision in the context of the need for small Caribbean states to be bold in order to reverse the idea that they are “little nothings”, and he was adamant that, should St Vincent and the Grenadines – one of the smallest of the Caribbean nations - succeed in this quest, its seat on the Security Council will be a CARICOM seat dedicated to advancing the region’s interest even as it deliberates, and helps to arbitrate on, global hot-spot issues.

Gonsalves looked forward to St Vincent’s UN mission being strengthened by personnel from other CARICOM countries and benefitting from advice and consultations with experienced present and former diplomats from the region. While he expected support from the ALBA countries, he declared: “We are not an ALBA candidate”. In this, the Prime Minister was prudently distancing his country from the controversial relations between Venezuela and Colombia, since it is Colombia against whom St Vincent will be competing for the single seat available to the Latin American and Caribbean group.

If, indeed, the St Vincent government is pursuing the Security Council non-permanent seat in a spirit of boldness and to assert the right of small countries to be represented and heard at the highest levels of global decision-making, then all Caribbean people should support it. When Guyana ran for - and got – the seat in 1975 as the first CARICOM state to do so, it was because the government at the time also felt that the domination by the larger Latin American states should end and the capacity of small states to contribute to thinking and solutions at the global level should be demonstrated.

None of this ignores the costs that the St Vincent government will face, and in this connection, every CARICOM government should pitch-in with money and qualified people. The quest must be a Caribbean one, for Caribbean purposes, financed by the Caribbean to assert the region’s independence.

And, as part of this resurgence of Caribbean boldness, regional governments should reject the recent offer made by the European Union to pay for Caribbean delegates to attend a Meeting of the CARIFORUM-EU EPA Joint Council, at ministerial level, on 17 May 2010 in Madrid.

This meeting was hastily proposed by the Commission of the European Union to be held on the day of the scheduled CARIFORUM-EU Summit in order “to adopt the two sets of Rules of Procedures” for the Joint Council.

But, CARICOM countries have not collectively addressed these rules. Worse yet, the European Commission (EC) has scheduled only one and a half hours to consider these complex legal rules whose application will have far reaching implications for the work of the Joint Council.

It is obvious that the EC expects the Caribbean to do nothing but rubber stamp the rules. And, it is time that regional governments call a halt to being railroaded.

They should reject the proposal for a hurried meeting of the Joint Council for which they are not prepared, and they should use the Summit to boldly tell the EU leadership of their dissatisfaction with the treatment the Caribbean has received for sugar, bananas and rum.

It is time again for collective and informed Caribbean boldness.

May 14, 2010

caribbeannetnews

Friday, April 16, 2010

After a year of the Economic Partnership Agreement (EPA) with Europe: What benefits for the Caribbean?

After a year of the EPA with Europe: What benefits for the Caribbean?
By Sir Ronald Sanders:


The European Commission (EC) will be holding a symposium on April 22 and 23 on the year-old Economic Partnership Agreement (EPA) between the European Union (EU) collectively and 15 Caribbean countries individually.

Sir Ronald Sanders is a <br />business executive and former Caribbean diplomat who publishes widely on small states in the global community. Reponses to: www.sirronaldsanders.comThere is, as yet, no indication that Caribbean governments or the Caribbean Community (CARICOM) Secretariat will be holding a similar exercise.

It has to be assumed that each of the governments that signed the EPA has long established units both to implement its terms and to monitor its effects on individual economies.

Therefore, relevant authorities in each of the Caribbean states as well as the Secretariat of the Caribbean Community (CARICOM) should be able to provide a list of the benefits that have been secured from the EU under the EPA. Our publics had been told that we would benefit not only from the exports of new goods and commodities to the EU but also from the provision of a wide range of services. Additionally, Caribbean companies would have the right of establishment in the EU.

Against this background, it should be fairly easy for the competent authority in each country to provide information related to just a few matters such as: what preparations and actions have been taken by exporters of goods and especially services to access the EU market; what are the investment plans by companies to establish in the EU market; and how easy or difficult are their plans looking for access to Europe.

There is a very important clause in the EPA which allows for a review of it within 5 years of its coming into force. That clause was hard fought for, and came about only because Guyana’s President Bharat Jagdeo had the courage to insist upon it even after other Caribbean governments had agreed to sign the EPA without such a review mechanism.

In defence of several Caribbean heads of government, it should be noted that they were reluctant to sign and many did so only after their crucial exports of bananas and sugar and some manufactured goods (from Trinidad and Tobago for instance) were threatened by the EC with a higher tariff in the EU market.

But, if the EPA is to be properly reviewed – and it should be subject to such a review on an annual basis – it is essential to monitor its implementation and to gather information that will inform an examination

However, informed sources in the region say that some governments have done very little about implementation and others have done nothing at all.

What is known for certain is that even though Caribbean countries and the EU are supposed to be ‘partners’ under the EPA, the EC has denounced the Sugar Protocol causing Caribbean countries to lose their preferential price for sugar; the EC has agreed a new trade regime for bananas with exports from non African, Caribbean and Pacific countries that will decimate what is left of the banana industry in the Caribbean; and come June 20, the EC will renege on an undertaking to the Caribbean rum industry to help finance restructuring and marketing while at the same time reducing tariffs on competing rum from several Latin American countries.

Not surprisingly several Caribbean businesses have lamented the benefits to them of the EPA so far. For example, Ramesh Dookooh, President of the Guyana Manufacturing and Services Association, observes that “Guyana earns much of its revenue on traditional exports, including rice and sugar, both of which are not covered by the EPA’s duty- and quota-free. Thus, the private sector in our country has its reservations about the economic opportunities available under the EPA”. Nonetheless, he is hopeful. He says: “Wider consultation with stakeholders and a stronger focus on the developmental dimension of the agreements could make the EPAs even more effective.”

Unfortunately, there has not been much evidence of consultation. The experience of sugar, rum and bananas indicate that the EC now takes the Caribbean for granted. After all, they do already have a signed full EPA from the region, so why concern themselves overly about the Caribbean.

The EC also controls the purse strings. They have knotted those strings on the purse of the 8th European Development Fund (ED) from which money for restructuring and marketing the rum industry should have come, and its daunting bureaucratic procedures halt many Caribbean countries in their tracks from getting money to implement the EPA under the 10th EDF.

An EU fund, managed by the Caribbean Development Bank (CDB), is reported to be exhausted with no sign of being replenished.

Undoubtedly, the global financial crisis – as well as the failures of regional financial institutions – has battered Caribbean governments. All CARICOM countries have been preoccupied with saving their economies from shocks including worsening terms of trade especially with the EU – even Guyana though it had 3.3 per cent growth in 2009.

But, Caribbean governments cannot afford to let attention to the EPA with the EU slip. The European Commissioner for Trade, Karel De Gucht, recently told German business people: “The economic crisis has temporarily halted the process of globalisation. But let there be no mistake: this process is very likely to pick up again with renewed vigour. The EU must put in place the conditions to benefit from it to the full”. He is looking to a “successful conclusion” of the global negotiations at the World Trade Organisation (WTO) “to boost Europe's GDP by around 45 billion Euros”.

Commissioner De Gucht will measure a “successful conclusion” very differently from the Caribbean, but the region should have its own collective plan of action and its own definition of success on which it should collaborate with like-minded countries.

The implementation of the EPA and the procuring of benefits from it have not been evident so far, and the EC has not been helpful to the Caribbean in the process.

When Caribbean leaders meet their EU counterparts for a Conference on May 17th in Spain, they should be fully briefed and prepared to tell European leaders of their dissatisfaction and propose means of making the EPA deliver on the ‘partnership’ it promised.

April 16, 2010

caribbeannetnews

Sunday, February 28, 2010

To OAS or not to OAS: that is the question

Ronald Sanders





At a meeting of leaders of Latin America and the Caribbean on February 23, Caribbean Community (Caricom) governments supported a joint "Declaration on (the) Falklands Islands Issue".

The Declaration "confirmed their support of Argentina's legitimate rights in the sovereignty dispute with the United Kingdom over the Falkland Islands Issue", and recalled "regional interest in having the governments of Argentina and the United Kingdom resume negotiations to find a fair, peaceful and definitive solution to the dispute over the sovereignty" of the Falklands/Malvinas islands. They went further to call on the European Union (EU) countries to amend their charter to remove the Falkland Islands from the list of overseas territories associated with the EU.

The support of Latin American countries for Argentina in this matter is quite understandable. They have links of language, culture, history and proximity that go back centuries.

But the support of Caricom countries for Argentina's "legitimate rights" is puzzling. Both the UK and Argentina have claimed the Falklands/Malvinas for almost 200 years. So what now makes Argentina's rights more "legitimate" than Britain's? And why call for "negotiations" between Argentina and Britain to find "a fair, peaceful and definitive solution" to the dispute if it has already been decided that Argentina's rights are "legitimate"?

Unless there is something they have not made public, this position by Caribbean governments appears on the surface to run counter to their own national interests.

The Caribbean has always strongly supported a people's right to self-determination. It is in fulfilment of their own right to self-determination that Caribbean Community (Caricom) countries are independent states. In this regard, since the people of the Falklands/Malvinas have consistently and overwhelmingly chosen to be British, Caribbean governments would certainly not argue that the manifest wish of the people of the Falklands/Malvinas should be ignored, particularly since Britain has exercised de facto sovereignty over the islands continuously since 1833.

The national interests of 12 of the 14 independent Caricom countries are much more bound up with Britain than they are with Argentina. Caricom's trade with Britain far exceeds trade with Argentina; investment in Caricom countries from Britain is much greater than any investment from Argentina; official development assistance from Britain to Caricom countries directly and indirectly (through the European Union and the Commonwealth for instance) is much larger than any assistance from Argentina; the number of tourists from Britain to Caricom countries is considerably greater than from Argentina; and far more Caricom nationals live, work and study in Britain than in Argentina.

What appears to have triggered this discussion at the 33-nation Cancun meeting is the fact that a British oil exploration company, Desire Petroleum Plc, announced that it had started drilling for oil 60 miles (100 kilometres) north of the Falklands/Malvinas. Argentina objects to this development.

In giving support to Argentina, Caricom countries run the risk of compromising their own interest. For instance, where would they stand if Venezuela objected to oil exploration off part of Guyana, despite long-standing international arbitrations and agreements confirming Guyana's title? Also, where would these countries stand if Venezuela objected to oil explorations that might be granted by some of them near Aves Island/Bird Rock to which Venezuela lays claim? In the case of Belize where Guatemala claims the entire country, the same argument applies.

Then we come to the matter of the creation of a grouping of these 33 countries that excludes Canada and the United States. Some of the Latin American leaders - in particular those with a strong anti-American position - proclaimed to the media that this new grouping should replace the Organisation of American States (OAS).

Well, replacing the OAS is simply in no country's interest - not even those with the most rabid anti-American governments. There has to be a forum in the Hemisphere where all its countries are represented and where discussions can take place at all levels of government and on all issues. And that organisation is clearly the already well-established OAS. In this regard, Cuba should return to the OAS and the exclusion of the present elected government of Honduras should cease.

In any event, I suspect that only a very few governments touted the idea of an "alternative" organisation to the OAS and even fewer would have supported it. Certainly for Caricom countries, there is no other organisation in which they can engage the US government on a regular and sustained basis at all levels. That alone makes the OAS worthwhile for them.

Further, Caricom governments greatly value their relations with Canada, which has been an ally and partner for generations in the Hemisphere and in the Commonwealth. They would want deeper, not distant relations with Canada.

There is absolutely nothing wrong with Latin American and Caribbean countries establishing a grouping that is not an alternative to the OAS, but is additional to it.

However, no one should believe that it will be anything more than an opportunity for dialogue at the leadership level. It will have no secretariat and therefore little means of implementing decisions; decisions will have to be made by consensus, therefore no binding decisions will be made. In truth, the grouping is so amorphous and is made up of countries at such different levels of development and with such differing interests and ambitions, that its meetings will largely be obligatory and its decisions only declaratory.

The Summit "Declaration of Cancun" does have as one of its objectives "the co-ordination of regional positions ahead of meetings and conferences of global reach... to project the region and increase its influence". This is to be welcomed provided that the view of smaller Caribbean islands are seriously considered and reflected by the larger Latin American states.

This brings us to the OAS itself. The US government should regard this move by Latin American and Caribbean countries to set up a Hemispheric grouping, which deliberately excludes it, as a firm warning that its neglect of Latin America and the Caribbean's development needs and issues, and its oftentimes casual dismissal of their positions is not in the interest of the United States. The authorities in Washington need to engage Latin American and Caribbean countries as genuine partners and neighbours, and a strengthened and revitalised OAS is the place to do so.

In this connection, Caricom countries should indicate their support for the re-election on March 23 of the incumbent Secretary General José Miguel Insulza. His task over the last five years in a fractious organisation, which also relies on consensus for decision-making, has not been easy. But he has tried to introduce reforms and he has been the most forceful secretary general the OAS has seen for a long time. Additionally, he has been very mindful of his obligations to his Caribbean member states.

He has also taken on Hugo Chavez over violations of media freedom in Venezuela and he has not been afraid to point out shortcomings by the US government. To have offended both these adversaries, he must have done something right for the rest.

Over the next five and final years as secretary general, Insulza can be bold in giving the OAS real direction in reforming its mandate and establishing it as a meaningful forum for settling hemispheric issues and advancing democracy, development and human rights.

Responses and previous commentaries at: www.sirronaldsanders.com


Sir Ronald Sanders is a consultant and former Caribbean diplomat.


February 28, 2010

jamaicaobserver

Friday, January 29, 2010

Caribbean diplomacy: An endangered species

By Sir Ronald Sanders:

Caribbean governments are in danger of weakening still further their diplomatic capacity endangering its effectiveness, and imperiling their countries’ maneuverability in a harsh world.

Industrialized nations have several instruments on which to draw in their relations with other countries. Among these are military might, economic clout and diplomatic capacity.

Sir Ronald Sanders is a business executive and former Caribbean diplomat who publishes widely on small states in the global community. Reponses to: www.sirronaldsanders.comIf their security is threatened by other states or non-state actors, such as drug traffickers and terrorists, they are able to deploy their military; on the economic front, they can apply trade sanctions withdraw financial assistance or institute measures to halt cross-border transactions; in diplomacy, they have well-staffed, well trained and well informed foreign ministries and missions abroad who bargain for their interests. When diplomacy fails, big countries have economic clout and military might on which to fall back.

For small states, such as those in the Caribbean, diplomacy is the only instrument they have to advance their cause and defend their interests in the international community.

In this connection, Caribbean governments should place enormous emphasis on making their diplomatic capacity as strong as possible.

But, there is a growing tendency in many countries of the region to focus diplomacy in the Head of Government. Many Heads of government, already bogged down with urgent and pressing domestic problems have assigned the foreign affairs portfolio to themselves. In doing so, they either do not attend crucial meetings that impact their countries, or they attend without the full understanding of complex issues that only exclusive ministerial responsibility backed by expert analysis allows. In each case, their country’s interest is not well served.

Beyond this, even where governments have appointed foreign ministers, foreign ministries are not seen as vital - or even on par - with ministries concerned with domestic issues. Therefore, the financial and other resources that they get in annual budgets are inadequate to the extremely important job they have to do on behalf of their nations.

Worse yet, little attention appears to be paid to where and why overseas missions should be located, and who would be best to man them. In many cases, governments have followed the traditional road establishing missions where they are now least needed and neglecting capitals and international organizations, such as the World Trade Organization (WTO), where they are most required.

It cannot be in the best interest of any country for its diplomatic missions to be regarded as a pasture to send unwanted nuisances or reward political friends. Diplomacy, as has been pointed out, is a vital tool for small countries and its best brains should be appointed to its service.

There is a most important role for Heads of Government in a nation’s diplomacy. But, it is a role best played after the most careful diplomatic preparation that lays the groundwork for success. Otherwise, what should be the tool that clinches a deal in a blaze of glory will fail like a damp squib. Occasional successful forays by Heads of Government in international and bilateral negotiations should not be mistaken as a prescription for how accomplishment is to be achieved. Often, in these circumstances, the apparent success simply happens to serve the interests of the other government or institution involved.

When the European Union (EU), a grouping of 27 large nations, recently brought their new Constitution into effect, they appointed a Foreign Minister in addition to a President. In effect, what the EU nations did was to strengthen their global diplomatic outreach in trade, economic cooperation and investment. In addition to their own national foreign ministries, they now have the additional services of EU missions around the world, most of which have been beefed-up with additional expert staff.

In this connection, while the recently initialed Economic Union Treaty of the Organization of Eastern Caribbean States (OECS) is to be welcomed as the right step forward, it is disappointing that it failed to advance the diplomatic capacity of six small independent states who would most benefit from strengthened and unified diplomacy.

The draft Treaty, which is to be ratified by the parliaments of each country before formal signature and implementation, reads as follows in relation to foreign policy:

“The organisation shall seek to achieve the fullest possible harmonisation of foreign policy among the Member States, to seek to adopt, as far as possible, common positions on international issues, and to establish and maintain, wherever possible, arrangements for joint overseas representation and/or common services”.

Words such as “fullest possible”, “as far as possible” and “wherever possible” are usually inserted in Treaties of this kind where the governments intend to make the least change to the existing situation and where the real intention is to carry on business as usual. The signal that this sends is unfortunate, for the six independent members of the OECS would benefit enormously from a fully joined-up diplomatic service particularly in the present precarious conditions that confront their economies.

They least, of all, can afford layer upon layer of government. Already their tax payers are paying contributions to upkeep both the Caribbean Community and Common Market (CARICOM) Secretariat and the OECS Secretariat. Arguably, they maintain the OECS Secretariat because they believe that participation in it brings them greater strength than they have individually. If that is the case, then surely establishing and strengthening joint diplomatic capacity is not only in their bargaining interest, it would also reduce their individual expenditure on foreign affairs or more effectively focus their spending.

Of course, a major difficulty the OECS faces is their neglect of the requirement of the existing Treaty to harmonize their foreign policies “as far as possible”. Thus, three of the six independent states are members of the Venezuelan-initiated organization, ALBA, and three are not, and three of them have diplomatic relations with China while three maintain formal relations with Taiwan. Only a serious and visionary dialogue, supported by rigorous analysis of their long-term interests, will create a rational policy.

The global political economy is not friendly to small states of even tolerant of them. In a world being remorselessly driven by the interests of the larger and more economically powerful states – in which China and Brazil must now be included with the US, the EU and Japan - Caribbean countries need better and stronger diplomatic capacity to advance their causes and protect their interests.

January 29, 2010

caribbeannetnews


Wednesday, December 30, 2009

Mixed fortunes for Caribbean economies in 2009, says new report

GEORGETOWN, Guyana -- The Caribbean Economic Performance Report 2009, compiled by the Caribbean Centre for Money and Finance, recently projected the member states to end this year with mixed fortunes, as some will see growth while others will be in deficit.

The report says many Caribbean economies remain in recession, awaiting the recovery of the United States and other Industrial economies, which supply the region’s tourists, remittance and foreign direct investment, and which absorb Caribbean exports.

It adds that advance tourism bookings are reported to be dismal, and natural gas prices remain low, even though oil prices have recovered substantially.

Foreign exchange inflows continue to decline compared to 2008, economies remain depressed and unemployment is on the increase, in spite of efforts by governments and private firms to minimize the loss of jobs.” the report noted.

However, it added that balance of payments pressures have abated in Jamaica, the country most severely affected by outflows, and the exchange rate there has stabilized.

“Foreign exchange levels remain acceptable throughout the region, aided by a small increase in the global allocation of Special Drawing Rights (SDRs) by the International Monetary Fund (IMF)," the report outlined.

Five member countries of the OECS have accessed modest amounts of IMF financing, and the Jamaican authorities remain in discussion with the Fund for financing under a Standby Arrangement.

“Aruba, Belize, Guyana, Haiti and the Netherlands Antilles all recorded higher levels of foreign exchange reserves, comparing the latest month with a year earlier, with increases ranging from 10 to 30 percent,” the report states.

The 27 page document also noted that the average growth rate for the region is expected to be 1.6 percent this year, with Belize, Dominica, Guyana, Haiti and Suriname expected to record positive but slow growth in 2009.

It noted too that Guyana, despite a decline in growth of real output during the first quarter of 2009, which was due primarily to losses in the sugar sector, rebounded due to mixed output in the manufacturing and services sectors and the rice industry.

In the first quarter of 2009, the report says, Guyana’s inflation rate dropped sharply to 1.95 per cent compared to the 7.45 per cent it recorded for the same period in 2008. This was due to the fall in international oil and commodity prices as well as falling domestic prices of food items.

Caribbean economies cannot expect to emerge from recession before the US does. Advance tourism bookings are reported to be dismal, and natural gas prices remain low, even though oil prices have recovered substantially. Most tourism economies and the energy and mineral industries depend mainly on the US market.

The prospects for agriculture and those tourism economies that are less dependent on the US are not much better, because the economies of Canada, the UK and the rest of Europe all depend heavily on exports to the US to help fuel the recovery of economic output.

The policy responses of Caribbean governments are beginning to take effect as they marketing and promotional activity, and measures for some degree of amelioration of the adverse social impact of the economic contraction. So far the impact on government budgets and debt service has been mild, but much of the additional expenditure is yet to come on stream.

The economic recession has depressed fiscal revenues everywhere, and the impact has been especially severe because of the region’s increasing dependence on the Value Added Tax (VAT), which is especially sensitive to a fall in spending.

Even though governments’ efforts to contain the adverse impact of the crisis have resulted in only modest increases in spending, it says, the extent of revenue loss meant that the overall fiscal position deteriorated badly everywhere.

The unfinanced fiscal gap was the main motivation for OECS countries to seek financing from the IMF and other international financing agencies.

December 30, 2009

caribbeannetnews