While Caribbean Community (CARICOM) countries are reportedly committed to and are active participants in international trade negotiations, some uncertainty has emerged amongst Member States concerning the benefits to be derived and costs entailed.
There is also mounting concern over the scope and pace of the adjustment process, which would result from the conclusion of any or all of these negotiations.
These were the sentiments of Jamaican Prime Minister Most Hon. P.J. Patterson, who delivered the lead presentation on the status of external trade negotiations in which the Region is involved, during the recent Twenty-Sixth Regular Meeting of the Conference of Heads of Government of CARICOM.
Prime Minister Patterson, who Chairs the Prime Ministerial Sub-Committee on External Economic Negotiations, emphasized that the erosion of trade preferences in key commodities like bananas and sugar for example, has been a catalyst of this apprehension, as has tardy progress on special and differential treatment for small, vulnerable developing economies in the World Trade Organization (WTO) Doha Round and the general push towards reciprocity in trade relations.
Recently unveiled plans by the European Commission on June 22 for an overhaul of the Common Market Organisation for sugar, which propose to cut guaranteed prices totalling 39 percent in the price of white sugar over a period of four years (which – if adopted – would seriously impair the functioning of the Sugar Protocol between Africa, Caribbean and Pacific (ACP) Countries and the European Union (EU)), is one example of weakening global support for preferential trade mechanisms – long enjoyed by Caribbean economies.
“There is a lack of empathy for the challenges facing small, vulnerable developing economies, with relatively high per capita incomes. Only the destitute gain attention, and even this is at the behest of civil society activists. Current geo-politics are such that the Region is no longer a priority for any major power,” Prime Minister Patterson said.
Apprehension is increasing particularly as governments contemplate their ability to finance export diversification, concurrent with fiscal fallout from reduced tariffs.
Development financing needs are escalating at a time when development assistance to the region is suffering a steady decline.
There has been a discernable shift of aid resources away from the Caribbean, and into those African countries where poverty is high and increasing. Allied to this, there has been pronounced diversion of resources traditionally earmarked for development purposes to security driven objectives, notably Iraq.
There appears to be a global move towards a purely market-driven approach to economic policy, the ideological tenets for which are spilling-over into trade policy.
The philosophical shift to free trade instead of development assistance in the form of aid and preferential trade arrangements is manifested in the approach taken by developed countries in all the arenas of negotiation in which the region is engaged.
Prime Minister Patterson lamented that in the post-Cold War era, where fundamentalist free market/free trade economics is pandemic, middle-income countries have been graduated without notice or formal announcement. “All of this is unfolding against the background of rampaging globalization, that is dismantling national barriers to international transactions, obliterating the meaning of sovereignty, foreclosing development options and disparaging the diversity of cultures and national societies,” he said.
Director General of the Caribbean Regional Negotiating Machinery (RNM) Ambassador Dr. Richard Bernal underscored Prime Minister Patterson’s sentiments, noting that as recently as the mid-1990s the world was a more hospitable environment in respect of preferential trade arrangements and for the development of small, vulnerable developing economies, such as those of the Caribbean.
“Rather than pressing for the abandonment of preferences, rich nations should be examining ways of maintaining them as long as possible, and identifying tangible compensatory measures to ameliorate the effects of preference erosion,” Dr. Bernal said.
He suggested further that in the case of small, vulnerable developing economies, “their share of global trade is so negligible that preferences cannot possibly be seen as disruptive or somehow an impediment to free trade, in a way that harms global welfare gains.”
From The Bahama Journal
