Elizabeth Morgan | Needed: A CARICOM foreign trade strategy and agenda
Foreign trade is as important to all other CARICOM member states as it is to Jamaica, and their trade profiles are similar. Within CARICOM, foreign trade policy is aimed at increasing exports to third countries, investment inflows, job creation and economic growth. It gives a clear indication of the region’s positions and goals in the international arena. In its foreign trade policy formulation, CARICOM last devised a formal strategy and agenda between 2007 and 2009.
The regional foreign trade policy is set at the national and regional levels through consultations and coordination.
Article 80 of the Revised Treaty of Chaguaramas deals with Coordination of External Trade Policy. CARICOM member states are thus required to:
1. Coordinate their trade policy with third states or group of states;
2. Pursue, as a group (jointly), negotiations of trade and economic agreements with third states or group of states.
The regional policy should thus be coordinated through the following CARICOM organs:
n The Council for Trade and Economic Development (COTED), and
n The Conference of Heads of Government via the Prime Ministerial Subcommittee on External Trade Negotiations.
The CARICOM Office of Trade Negotiations (OTN) was established in the CARICOM Secretariat to coordinate and manage the region’s foreign trade negotiations, which means that it plays a role in formulating regional foreign trade policy.
In structuring its policy in the early 2000s, the focus of the strategy and agenda was on negotiating multilateral (WTO Doha Round) and bilateral free trade agreements.
Besides negotiations with the European Union (EU), there were several countries which had indicated interest in negotiating bilateral free trade agreements with CARICOM.
Since negotiations with Canada were suspended in 2015, CARICOM has not formally undertaken to review and devise a new foreign trade strategy and agenda. The external trade work programme in COTED has included upgrading some existing bilateral agreements; doing some work with the USA; keeping abreast of World Trade Organization (WTO) developments; preparing for the WTO review of the CARIFORUM/EU EPA; and more recently, working on the roll-over agreement with the United Kingdom (UK) resulting from Brexit. Negotiations on existing trade agreements have been rather slow.
Undoubtedly, CARICOM needs a new trade strategy and agenda. In an article inBarbados Today of November 19, 2018 titled ‘Regional Trade Agenda for the Caribbean’ written by Junior Lodge, international trade consultant, he had addressed the need for a trade agenda.
Since 2015, the global push to negotiate bilateral and plurilateral free trade agreements has lost momentum. CARICOM has also reflected trade negotiation fatigue and disinterest.
Brexit and the advent of President Donald Trump in the United States (US) signalled an attitude change to globalisation in developed countries, as it was evident that there were winners and losers, and the losers were making their voices heard.
Shift to protectionist positions
There has been a shift towards more protectionist positions. Though a developing country, China has become a powerful force in global trade and investment.
The WTO Doha ‘Development’ Round was sidelined, with the US demonstrating a lack of confidence in the multilateral approach, calling into question the role of the WTO. Reform of the organisation is being discussed. Trade in services and, with technology advances, e-commerce has grown in importance.
The regional integration process, particularly the CSME, which should be the foundation from which all CARICOM trade agreements would be negotiated, had been making little progress and in danger of unravelling.
In developing a new CARICOM trade strategy and agenda, in my view, some of the issues to be considered are:
- The evolving regional and international trade environment;
- Advances in technology, including automation, and its impact on investment, production, job creation and trade;
- Impact of climate change and other environment issues, for example, dealing with plastics disposal;
- Impact of health issues on trade, for example, the use of trade policy measures to address non-communicable diseases and obesity as well as other health issues;
- The changing view of globalisation and the move towards protectionism;
- Trade as a means of achieving the United Nations Sustainable Development Goals (SDGs);
- The role of multilateralism: future of the WTO and UNCTAD;
- The situation in the EU and the UK in light of Brexit, including the ACP/EU Post Cotonou Negotiations and the CARIFORUM/EU EPA;
- The future and role of the African Caribbean and Pacific (ACP) Group of States;
- The feasibility of Commonwealth trade;
- CARICOM’s trade relationship with the US, Canada and Mexico;
- Possibilities for improving CARICOM’s trade relationship with South and Central America;
- Importance of trade in services; and
- Making progress towards full implementation of the CSME, including addressing the involvement of the private sector and strengthening the services regime.
Let’s hope that the CARICOM OTN and COTED are now looking seriously at this matter. A new CARICOM trade strategy and agenda would provide guidance to our delegations and diplomatic representatives in the various capitals and international institutions.
Elizabeth Morgan is a specialist in international trade policy and international politics. Email feedback to firstname.lastname@example.org