Regional integration is about enabling a group of member states to compete more creditably in the global economic and political environment and collectively stem the tide of international and other adversities, especially in these trying times.
According to Sir Arthur Lewis, “economic and political integration” has been a perennial and neuralgic issue on the Caribbean agenda.
Seminal truth underscores the philosophy of regionalism in its various manifestations.
The short-lived West Indies Federation was followed by the revival of the integrationist ideal in the less ambitious Caribbean Free Trade Association.
Then there is broadening the scope of integration through the establishment of the Caribbean Community and Common Market (CARICOM), aimed at formalizing a customs union, foreign policy coordination and functional cooperation as prescribed in the Treaty of Chaguaramas (1973).
The inclusion of Suriname in 1995 signalled a move towards cultural diversity, further illustrated by including Haiti as a full member of the community in 2002.
Following were the inauguration of the Caribbean Court of Justice in 2005, the initiation of the CARICOM Single Market in 2006, and the ultimate ambitious target set to achieve by 2015: full mobility of goods, services and people, and the harmonization of economic policies in a CARICOM Single Market and Economy (CSME).
Evaluations of the Caribbean Community are normally cast in the mould of the ultimate ambitious target – a CSME – which not even the most acclaimed regional integration movement, the European Community, has achieved.
This is mainly due to the fact that political and economic realities are not fully appreciated based on what gains can be realistically expected from the CSME process and what policies should be explored to maximize these gains.
Overall, there are wide differences among CARICOM countries in resource endowments, human capital, economic infrastructure, and institutional capabilities.
Their associated export specializations suggest that divergence and differentiation rather than convergence and homogeneity will continue to be the norm in the near future.
What is clear is that traditional gains from regional integration – whether in terms of enlarged market effect or competitive/ allocational gains – are bound to be limited because Caribbean economies display a high degree of openness, the enlarged market is relatively small, and countries have relatively similar factor endowments.
However, impediments to an accelerated approach to the CSME are compounded by the failure of the region to reach agreement on several important prerequisites for a “single economy”.
Among them are the establishment of a monetary union (not totally achieved by the EU), adoption of a CARICOM investment agreement, harmonization of tax policies and provision for fiscal incentives.
At the same time, successes have been recorded with respect to the establishment and implementation of the Regional Development Fund (in Barbados), the replacement of the Caribbean Regional Negotiating Machinery with the Office of Trade Negotiations within the Directorate of Trade and Economic Integration of the Caribbean Community Secretariat, and the establishment of the Caribbean Competition Commission (in Suriname).
These are all critical to sustaining a level playing field, coordinating trade negotiations and guaranteeing the application of common standards in trade and production in the community – prerequisites for a sustainable integration process.
In addition, many of the activities related to free movement of certain categories of people – university graduates, cultural workers, teachers, nurses and sportspeople – are in effect.
Other categories, like artisans and domestics with the CARICOM Vocational Qualification, have been approved. Yet others, based on contingent rights of spouses and families of “certified” workers, are in the process of being finalized.
Today, The basic rationale for CARICOM integration is to overcome the constraints on development specially associated with small size.
