Sat | Jul 21, 2018

Editorial | New light in CARICOM’s tunnel

Published:Tuesday | July 10, 2018 | 12:00 AM

Caribbean Community (CARICOM) leaders are known for their pledges to implement the agreements necessary to advance the integration of regional economies, only to stall in the face of the first noise of domestic political obstacle, whether perceived or real.

So, the heads of government who met in Montego Bay for their annual summit last week wouldn't be surprised that there may be many people across the region who are wary of their latest undertaking for a new push to get the CARICOM Single Market and Economy (CSME) really going. This newspaper fully appreciates any such scepticism, but has a sense not only of genuine and renewed purpose on the part of the leaders, but that the regional and global environments are conducive to the acceleration of the regional agenda.

That, however, does not mean that, as in the past, good intentions, and energy, won't wane. It is, therefore, important for stakeholders who appreciate the logic of regional conglomerations to exercise the levers they been afforded to help propel things forward.

CARICOM, over the 53 years of its existence - including its precursor, CARIFTA - has morphed from a free trade area into a customs union and what, since 2006, should have been a single market and economy, which supposes a free movement of labour and capital, deeply integrated fiscal policies, including, ultimately, a common currency.

The politics of most small states with borders delineated by hundreds, sometimes thousands, of miles of sea has often proved to be a hindrance to the ambition and profound intellectual merit of the idea. The Great Recession and the global banking crisis of a decade ago, as well as the economic crisis it unleashed, added to the uncertainty several members felt about the regional experiment. So, in 2011, CARICOM decided to put the CSME project on hold.

Since then, the initiative, never fast in the first place, has largely sputtered along, despite agreements to accelerate the project. Several factors, in the wake of Montego Bay, make the prospects for a CARICOM advance far more propitious.

First, they have the example of Brexit, the painful political and social - and potentially economically painful - contortions Britain has wound itself into as it attempts to extricate itself from a perfectly good partnership in the European Union for an uncertain, singular place in the world.

Moreover, the advent of Donald Trump in America, with his initiation of trade wars and attacks on multilateral institutions, can only have highlighted to CARICOM the merit of economic conglomeration and policy coordination. Indeed, as the leaders observed in their post-summit communique, "an inclusive, rules-based and transparent multilateral trading system under the WTO" is important to countries like those of CARICOM.

Along with these geopolitical drivers are a confluence of domestic circumstances, including the advent of new personalities, that should add fillip to the project. In Jamaica, Prime Minister Andrew Holness has bucked his Jamaica Labour Party's historical reticence to regionalism and seems keen to push the CSME. Economic reforms that are increasing Jamaica's competitiveness in the community have no doubt added to Mr Holness' confidence to proceed.

Further, Mia Mottley, Barbados ' recently elected prime minister and CARICOM lead on integration, is a committed regionalist who wants to advance the CSME. She seems to be convinced that the insulation of CARICOM is a help, rather than a hindrance, to lifting her country out of its economic crisis.

Importantly, too, there appears to be a practical approach by the leaders for advancing the agenda. Having set officials a 12-month task of drafting policy for integrating capital markets, they plan for a full summit in November to add urgency to the wider project. Significantly, too, the subcommittee on the CSME, led by Ms Mottley, is to meet quarterly, starting this September, focusing on what is "practical and achievable" over the next year.

All this makes sense. Yet, it is important to hold the leaders to account and ensure that they are on the same page with the private sector and civil society on what is practical and achievable. In Jamaica, these institutions often talk in a vacuum, without deep analysis, about what is wrong with CARICOM. They now have an opportunity to be relevant.