PORT OF SPAIN – The Caribbean Community (CARICOM) Secretary General , Irwin La Rocque says while the CARICOM Single Market and Economy (CSME) continues to be a work in progress, it is sufficiently advanced to be used more effectively by the regional private sector.
The CSME allows for the free movement of goods, skills, services and labour across the 15-member grouping and La Rocque said that it still remains as relevant today as when the idea was first conceived in 1989.
“It represents tremendous potential to provide business opportunities for manufacturing, services and agriculture. The CSME has been fashioned to provide the opportunity for us to use our resources – human, financial and natural – to build a competitive economy. It allows for expanding scope and scale of production, using the skills and capital available in our Region, and allowing for cross-border production and production integration,” La Rocque told the annual general meeting of the Trinidad and Tobago Manufacturers Association (TTMA).
He said all of the basic elements of the CSME are mutually supportive; be it trade in goods, trade in services, movement of skills and capital and the right of establishment.
“We therefore need to make advances on all elements simultaneously for us to be truly successful,’ he said, adding that the CSME is a vehicle through which businesses, utilising the enlarged single space, can expand their horizons to enhance their competitiveness and so use the regional platform as a springboard into the global market.
The region’s top public servant said in that regard, CARICOM has negotiated a number of trade agreements with countries such as Venezuela, Colombia, the Dominican Republic, Cuba and Costa Rica, as well as with the European Union.
He predicted that the CARICOM market will grow from approximately six to more than 16 million, as soon as Haiti puts the necessary requirements in place to participate in the CSME.
La Rocque said that Trinidad and Tobago has the largest share of the trade in goods within the Single Market. In 2016, the last year for which CARICOM has released regional trade data, the country’s total exports to the rest of CARICOM amounted to US734 million dollars, representing 32 per cent of CARICOM’s intra-regional exports.
La Rocque said that this was the lowest figure in 13 years, due primarily to the drop in energy prices. He said it also represented 10 per cent of Trinidad and Tobago’s global exports indicating that CARICOM was Trinidad and Tobago’s second largest export market in 2017.
He said excluding petroleum and petroleum products, exports to CARICOM totalled US567 million dollars or approximately 25 per cent of total intra-regional exports.
Further, non-petroleum exports to CARICOM in 2016 represented 11 per cent of Trinidad and Tobago’s total global non-petroleum exports, La Rocque said, adding “it is clear, therefore, that the CSME provides an important market for Trinidad and Tobago’s manufacturers”.
La Rocque said that these figures do not include trade in services which is a significant aspect of Trinidad and Tobago’s trade with the region.
“While the CSME continues to be a work in progress, it is sufficiently advanced to be used more effectively by the private sector. There has been significant progress in several specific ways. There is free trade in goods and services, free movement of skills and capital, and the cross-border establishment of businesses. It is true that there have been some hitches but these are being addressed.”
The CARICOM Secretary General said that the Common External Tariff (CET) and Community Rules of Origin regimes are operational, but “after about 25 years we are doing a comprehensive review of this regime, including the mechanisms for suspensions of the CET”.
He said the administrative arrangements for free trade in services, free movement of skilled nationals and the right of establishment are all in place and working fairly well.
Under the right of establishment, companies setting up subsidiaries in other jurisdictions are entitled to move their managerial, technical and supervisory staff. The CARICOM agreement on Social Security allows for the transfer of their social security benefits.
“Regrettably, we have not made the progress I would like to have seen on Contingent Rights, another important element with respect to the movement of skilled nationals and managerial and technical staff,” he said, noting that the Double Taxation Agreement has been incorporated into domestic law and it is important for cross-border investments within the Region.
La Rocque said an important part of the CSME is a mechanism for resolving disputes arising out of rights and responsibilities emanating from the Revised Treaty and decisions of the Organs of the Community. “This can never be over-emphasised. The Caribbean Court of Justice (CCJ) in its original jurisdiction is fully operational. Indeed, Trinidad Cement Limited (TCL) was the first private sector entity to bring a matter before the Court, against the Community, and successfully so,’ La Rocque added.
He told the manufacturers that work is on-going in a number of areas, including with respect to the Single Economy.
A draft policy for the legal framework to support the development of an Integrated Capital Market, is being considered by member states, and a draft model Securities Bill is under preparation.
“This Bill seeks to standardize the licensing requirements for the registration of market participants and securities and the harmonisation of the regulations for issuance and trading of securities across member states.
“The implementation of harmonized securities law will remove the confusion of having to comply with different laws and improve the ease of doing securities business in the Community. In addition, the Model Securities Law would allow firms to raise capital across member states while providing investors with the opportunity to invest in a wider range of financial instruments.”
But as he outlined the developments taking place within the 15-member integration movement, La Rocque said current actions being taken by the EU to blacklist Caribbean countries and the requirements imposed for removal from that list, “may undermine our ability to provide incentives to attract investment”. (CMC)