Friday, April 19, 2024

THE ISSUE: Economic integration a proven model

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Is a regional economic model the answer for Caribbean countries?
THE CARICOM Single Market and Economy (CSME) is not very topical these days. Protracted economic recession seems to have sapped whatever political will there was to fully implement this important aspect of the regional integration movement.

Disillusionment surrounding the CSME was illustrated after the United Kingdom’s recent decision to leave the European Union when talk about a so-called “CARexit” emerged. Such negativity was not helped by the fact that around the same time the Jamaica government launched a CARICOM Review Commission, chaired by former Prime Minister Bruce Golding.

The familiar phrase “unity is strength” has been used in some instances in the region, but has not managed to penetrate the thinking of authorities in relation to economic development.

Countries like Barbados have largely continued to do their own thing while trying to recover from economic recession, growing debts, and fiscal heartache.

However, there is a view that a regional approach to economic development might be the better option for Barbados and its neighbours – certainly those in the English-speaking Caribbean – rather than doing it all alone.

Based on statements at the most recent CARICOM Heads of Government meeting in Georgetown, Guyana, there seems to be some recognition that CSME needs attention. The CARICOM Secretariat said: “Heads of Government have mandated the intensification of a public information campaign on the benefits and provisions of [CSME], as well as a comprehensive review of programme.”

CARICOM chairman, Dominica Prime Minister Roosevelt Skerrit said regional leaders were fully committed to implementing all elements of the CSME regime since they remained convinced it was the only option to achieve sustainable growth and development.

“I cannot understand why we have not completed the essential infrastructure to facilitate movement towards an effective free trade area, a meaningful Community or a Single Market and Economy,” Skerrit said.

“Why has it proven so difficult to move people, goods and services cheaply and efficiently around the Caribbean? Why is it cheaper to travel by air from Dominica to New York than it is to travel from Dominica to Guyana? Why are Saint Lucian bananas cheaper in London than in Barbados?” he asked.

The Caribbean Development Bank is one agency that thinks the region would benefit from greater economic integration. In its most recent annual report, it said borrowing member countries needed to be dynamic, export oriented, competitive, inclusive, diverse and environmentally resilient economies, with a focus that included “regional integration to maximise the gains”.

“Maximise regional integration and take advantage of free trade agreements such as economic partnership agreements, and seek new agreements,” it advised.

In a new report entitled Regional Integration And Spillovers, the World Bank said “despite a multitude of regional trade agreements, economic linkages within [Latin America and the Caribbean] tend to be limited and largely confined to sub-regions”.

The Inter-American Development Bank, in a 2015 report on the topic Supporting Trade, Integration And Regional Cooperation In Latin America And The Caribbean, said “regional and global integration, trade, and regional cooperation are mechanisms that facilitate economic growth and social and sustainable development in the Latin America and the Caribbean region”.

Recently, the bank also said that its updated institutional strategy 2016-2019 “identifies the lack of regional economic integration as one of the three main development challenges of the region”.

“Regional and global integration, trade, and regional cooperation are mechanisms that facilitate economic growth and social and sustainable development in the Latin America and the Caribbean  region,” it added.

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