CARICOM: Moving Beyond 40

July 17, 2013///by Khadija Holder

Thursday July 4th 2013 marked the 40th anniversary of the establishment of the Caribbean Community (CARICOM). As societal convention dictates, the 40th anniversary is one traditionally embodied by the Ruby. The ruby being one of the four most precious stones in the world, it is unsurprising that this grand occasion was demonstrated by profound sentiments from our region’s current leaders and decision makers in the integration movement: “Today we can boast about being the longest surviving integration grouping among developing countries… our own Caribbean Court of Justice and a CARICOM Youth Ambassador programme that celebrates its 20th anniversary this year” (CARICOM Secretary-General Ambassador Irwin LaRocque); “… in the current circumstances, strength in unity is no cliché… we are one people, one region, one community” (Incoming chair of CARICOM, Prime Minister of Trinidad and Tobago, Kamla Persad-Bissessar); “It [CARICOM] represents the vision and aspiration of our forefathers for a strong integrated region which would provide the best prospects for economic and social development” (Prime Minister of Jamaica Portia Simpson-Miller).

However, are these words adequately reflective of what CARICOM has been able to achieve? Are they visionary of what Member States are truly committed and prepared to accomplish? Or should they only be taken as words combined and structured eloquently for the purpose of commemoration? At the risk of sounding like a Jeremiah, recall must be made of Sir Shridath Ramphal’s warning at the Eleventh Sir Archibald Nedd Memorial Lecture of 2011 that ‘words alone are never enough, except to deceive’. This is not to imply that our current integration leaders are deceiving the CARICOM population. After all, the very nature of Regional Trade Agreements (or any agreement bringing together parties of different characteristics) is one of difficulty and complexity in achieving efficient operation and functional cooperation; a task even greater for CARICOM, in comparison to other Regional Trade Agreements (RTAs) such as the European Union and the ANDEAN Community, as its very own geographic structure rouses divisiveness and separatism. What Sir Ramphal’s statement shows is the need for and strength of action. Fact is, CARICOM has indeed made remarkable achievements along its road to the level of integration envisioned in the Treaty and by prominent West Indian integration activists. However, we wouldn’t be the avid thinkers and researchers that continue to build and promote progress within the region if we don’t acknowledge that many of these indicators of our movement ‘farther along the road of integration’, including the Caribbean Court of Justice, has yet to see any deep implementation or action.

And why is this? Why is it that we have not been able to match what we have envisioned in the Treaty with reality? From research, there appear to be two main hindrances to progress of the CARICOM Integration Project: further complexities and diminishing administrative resources to cover existing and new agreements, and a seeming disposition of convenient unity and regionalism. Addressing the latter first, let’s recap key events within the CARICOM timeline:

1973: The signing of the Treaty of Chaguaramas which established the Caribbean Community including the Caribbean Common Market by Barbados, Guyana, Jamaica and Trinidad and Tobago.

1974: Accession of the eight other Caribbean Free Trade Association (CARIFTA) members – Antigua and Barbuda, Belize, Dominica, Grenada, Montserrat, Saint Kitts and Nevis (at that time Saint Christopher-Nevis-Anguilla), Saint Lucia and Saint Vincent and the Grenadines.

1983: Accession of Bahamas (not to Common Market)

1989: CARICOM Heads agreed to establish the CARICOM Single Market and Economy by July 4th 1993, outlining thirteen priority steps in the Grand Anse Declaration

1992: CARICOM Heads decided that what was needed was complete overhaul of the Treaty of Chaguaramas; Report of the West Indian Commission called for the establishment of the Association of Caribbean States (ACS)

1994: ACS formed

1995: Accession of Suriname

2002: Accession of Haiti; Provisional application of the Revised Treaty of Chaguaramas (RTC)

2006: RTC comes into force

What is most significant about these dates of achievement is their simultaneous occurrence with national devastation. Prior to the signing of the Treaty of Chaguaramas: Guyana experienced balance of payment difficulties brought about by the 1971 nationalization of the bauxite industry requiring them to pay US owned Canadian subsidiary, ALCAN, US$53.5 million over a period of no more than 20 years with interest, at 6 percent subject to withholding tax, their obligation to repay a US$8 million loan from Chase Manhattan Bank, and the simultaneous reduction of US Aid; There was a decrease in Jamaica’s bauxite exports due to increased competition from Australia; Unemployment in Barbados skyrocketed as a result of effects of high oil prices and the international energy crisis; and Trinidad and Tobago faced unwavering economic pressure due the 1971 Tehran Agreement between twenty-two oil companies (including the Majors) and OPEC dwindling their market, and the removal of the US currency from the gold standard by Richard Nixon in 1971 causing dollars to no longer be exchangeable for any metal held by the US government and hence oil prices to correlate negatively to the dollar and the country unable to benefit from oil production as desired.

Similarly, prior to the 1989 decision to establish the CSME, Jamaica, having imposed a bauxite levy to combat low commodity prices that resulted in a reduction of the much depended-upon Foreign Direct Investment, was forced to accept the terms of the Structural Adjustment agreement with the IMF that required the Jamaican government to reunify and devalue its currency, place the currency on a crawling-peg system of regular devaluations during the following  year, impose new taxes on consumer goods, reduce government expenditures, increase charges for government services, lift price controls, guarantee profits for private firms, set a ceiling on wage increases, and limit the activities of several state-owned corporations. By 1989 unemployment, unequal distribution of wealth and debt prevailed in Jamaica. Meanwhile, Trinidad and Tobago suffered from a collapse of oil prices by more than 70 percent between 1985 and 1986 as developed countries – having learned from the Arab oil embargo – engineered new methods to diminish their dependency on oil (engine technology, mass transit systems, lower horsepower engines, petroleum reserves, the International Energy Agency), resulting in efficiency gains that caused a breaking point of oil’s relative invulnerability to price movements. Concurrently, revenue of member states declined due to a reduction in sugar and banana quota preferential purchases by the developed countries.

Before the 1992 establishment of the West Indian Commission and resulting ACS, the region was once again plagued with economic adversity as the Gulf War of 1990-1991 had adversely affected the tourism sector and sugar exports also fell dramatically. By 2008 preferential marketing prices of the Sugar and Banana Protocols under the Lomé Convention ceased as a result of the Cotonou Partnership Agreement and forced the dominant export products for many CARICOM countries like St. Lucia and St Vincent to face the full impact of globalization. This apparent convenient regionalism has manifested an underlying insular nationalism, which has fueled trade wars such as the Trinidad and Tobago v Jamaica Patty issue and the current energy pricing issues between the said countries; the Shanique Myrie case, which has proliferated various accusations on how Jamaican, Guyanese and Vincentian nationals are treated at ports of entry; and continuing delays in the implementation of a seamless economic space, which has harmed the private sector’s ability to contribute to the implementation of the Global Jobs Pact.

CARICOM and its member states are also increasingly becoming burdened by cumulative complexities as they make further bilateral and regional commitments and upkeep multilateral obligations. Aside from holding a multitude of Agreements, MOUs, Treaties, Declarations and Instruments of ratification, CARICOM is currently faced with diminishing administrative resources within bilateral agreements, including the EPA implementation and CARIBCAN negotiations. Complexities also continue to propagate and internal commitments stalled as member states become faced with obligations within their external agreements (for example in 2008 Dominica joined the ‘Alternativa Bolivariana para las Américas’ [ALBA], to which St. Vincent and the Grenadines and Antigua and Barbuda then acceded to in 2009 and in 2010 Guyana and Suriname ratified the ‘Unión de Naciones Suramericanas’ [UNASUR]). Furthermore, in recent times – subsequent to the economic crisis – CARICOM undertook yet another integration experience, the Community of Latin American and the Caribbean States (CELAC), despite still being challenged by its own internal deepening and widening CARICOM integration agenda.

With changes in the world continuing to introduce complex challenges for development and increases in vulnerability to trade and exogenous shocks, it will be interesting to see whether integration is placed as a priority or option throughout future decades, as the world’s hydrocarbon reserves continue to dwindle, climate change effects increase, and the world’s inter-connectedness and resulting difficulties widens. Yes, indeed, ‘integration is a process not an event’. But as Ambassador LaRocque highlighted, we are in an environment that is vastly different from 1973. Therefore no longer can just-in-time and convenient approaches to integration and regional development be relied upon. According to Lim (2009), “The evolution of regionalism in times of crisis is dependent on the individual and collective actions of members in a trade bloc.” Now that our Ministers have reaffirmed their commitment to CARICOM and regional integration, it is now more than ever that the three words of Sir Shridath Ramphal and the West Indian Commission must be blared – “TIME! FOR! ACTION!

 

“When the unsung benefits of regionalism are no longer available as instruments to bolster local development, and bargaining with larger countries, and coping with the destructive reach of drug trafficking – only then perhaps will Governments be forced into reconstructing those vital elements of regional support that neglect had helped to destroy. We will then, perhaps, as with CARIFTA in 1965, resume the old cycle of rebuilding what we once had, but carelessly destroyed; and so ad infinitum. But let us remember, a civilization cannot survive save on a curve that goes upward, whatever the blips in between; to go downward, whatever the occasional glimpses of glory, is to end ingloriously. Caribbean civilization is not an exception.” - Sir Shridath Ramphal

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References: http://tinyurl.com/l2u3chr

Lim H, (2009) “Expectation for East Asia Economic Integration” Singapore Institute of International Affairs