New opportunities to boost Caribbean trade
Published:Thursday | June 18, 2015 | 1:07 PMMcPherse Thompson
PIGEON ISLAND, St Lucia:
A new World Bank report, which examines emerging economic opportunities for the Caribbean, shows that CARICOM agreements have driven a rapid increase in intra-regional trade and that a common market would lead to a substantial rise in exports in the region.
At the same time, it says that the gains for the Caribbean of entry to the North American Free Trade Agreement would be six times the size of the gains for implementing a Caribbean common market.
Those were among the prospects the report - titled Trade Matters: New Opportunities for The Caribbean - suggests could boost trade and generate a positive cycle of shared prosperity in the region.
The report, which was released and discussed at the Third Regional Caribbean Growth Forum at the Sandals Grand St Lucia Resort, also suggests that improving trade-facilitation environments through modernised customs systems and better connectivity would have a major impact on trade.
In that regard, it said that efforts across the region to modernise customs administrations and border management should be accelerated.
It noted that with the expansion of the Panama Canal and the expected increase in transhipment, initiatives to modernise port infrastructure such as the introduction of the automated systems for customs data (ASYCUDA) in Jamaica, as well as initiatives in the Dominican Republic, The Bahamas, and Haiti, were being undertaken to ensure more efficient trading.
The report said that while Caribbean economies recently adopted a record number of reforms to improve local regulatory climate, exporting firms remained affected by limited access to electricity, telecommunications, and transport services, as well as the need for policies to further promote technology capability and innovation.
And, with the exception of The Bahamas, St Kitts-Nevis, St Lucia, Belize, and Haiti, exports from Caribbean countries to growing emerging markets remained small.
It suggests that the rapidly changing environment for Caribbean exports presents not only opportunities, but also challenges for those highly dependent on external markets given that despite its high openness to trade, the region's global share fell from three per cent in 1970 to nearly 0.25 per cent in 2012.
Exporting firms account for 34 per cent of formal employment and were the largest employer for the poorest, but exporting also made employment more vulnerable to external shocks, it said.
Canada-CARICOM free trade
Among the World Bank's recommendations is that the negotiations towards a Canada-CARICOM free trade agreement, launched in 2007, should also be pursued.
Arrangements for the negotiation of the Canada-CARICOM trade agreement were announced in Jamaica in January 2001.
Following four rounds of exploratory discussions, then Canadian Prime Minister Stephen Harper announced, on July 19, 2007, the launch of negotiations towards such an agreement.
However, the parties have failed to conclude those negotiations, which were ultimately aimed at replacing another agreement, which expired in December 2013.
Canada has since advocated for its partners within CARICOM to redouble their efforts to ensure a free trade agreement is reached in the near future.
World Bank Vice-president for Latin America and the Caribbean Jorge Familiar said: "Entrepreneurs are already seeing improvements in the business climate. Continued efforts to improve trade facilitation and step up investments in research and innovation, as well as quality education, will help improve skills and generate well-paid jobs in the Caribbean."
More than 200 government officials, private-sector repre-sentatives, civil society and development partners gathered to discuss a new agenda for sustainable growth in the region.
Participants were expecting to learn from experiences in the Caribbean and other small island developing states, propose new strategies and tools necessary to achieve growth while tracking the progress of reforms on the three pillars of the World Bank-organised growth forum: logistics and connectivity; investment climate; and skills and productivity.