BARBADOS and other Caribbean Community Countries are again appealing to the international community to make available – and on a timely basis – Aid For Trade (AfT) resources.
The region’s position was put forward by Irwin LaRocque who was recently named the new Secretary General of the CARICOM Secretariat. He outlined the Caribbean’s position on Aid for Trade at the just concluded AfT review held in Geneva.
Ambassador LaRocque said that while the Caribbean can be proud of a number of lessons learnt, it also needs to improve in a number of major respects.
“Primary among these is convincing our development partners of the imperative of delivering AfT resources in a time-sensitive manner,” he noted.
“We need their understanding on the magnitude of the adjustment task facing small vulnerable highly indebted economies like ours. We are confident that they will not only hear us, but that they will respond positively and expeditiously,” said the regional official.
He remarked that CARICOM attaches great importance to the Third Global AfT Review. One measure of the importance attached by the highest political level in our Region to this event has been the submission of 19 Case Stories, including four by the Regional and Sub Regional Secretariats.
According to him, this Third Global Review represents an opportunity to take stock, evaluate the impact, establish best practices and recommit to Aid for Trade as a developmental tool.
“Given the uncertainty surrounding the conclusion of the multilateral trade negotiations, we cannot fail also with respect to delivering the trade capacity-building measures required if the developmental benefits of trade are to be fully realised,” he added.
AfT is an undertaking which the WTO members have proposed to assist developing countries in preparing for their participation in international trade.
Small countries face the harsh reality of opening their markets to imports and, as such, are requesting support from the WTO. At a meeting in Barbados held earlier this year, regional countries put together a number of case studies which were presented to the Geneva meeting.
The CARICOM Region faces the twin challenges of being small and vulnerable, highly indebted economies with all the attendant features as articulated in the 2006 SVE submission to the Aid for Trade Task Force. Some of the more notable characteristics include: (a) no automatic linkage between trade liberalisation and increased exports; (b) high costs of infrastructure – in particular, transportation and utilities; and (c) high dependence on trade, albeit with a narrow range of exports and markets.
“The small size and geographic dispersion of CARICOM countries add to the challenges faced in reaping the benefits of trade,” the Ambassador explained.
According to him, “the Caribbean has traditionally been preference-dependent in a global marketplace characterised by diminishing value of preferences. Mechanisms geared towards facilitating trade adjustment are therefore required to assist in the recalibration of our economies.”
He said that this should necessarily include support for strengthening productivity and trade competitiveness. Such an approach would ensure the optimisation of the benefits that should accrue from increased market access opportunities.
The global economic crisis continues to dampen the performance of our economies and has further deepened the Region’s chronic indebtedness. Sadly, the international economic governance architecture fails to internalise the specificities of small, vulnerable and highly indebted economies such as ours, as per capita income is used as the blunt variable to measure eligibility for access to funding on preferential terms.
CARICOM Heads of Government have identified the major areas for which Aid for Trade support is needed. These include support in Maritime Transport ICT to allow the region to compete in a global technology based economy, and support in the trade facilitating areas including Sanitary and Phyto-Sanitary Measures.
The four Caribbean-wide Aid for Trade projects which were the subject of Case Stories remain relevant in terms of designing projects to attenuate preference erosion, spur regional integration, enhance the capacity of the private sector to increase its competitiveness and move up the value chain.
A key example is CARTFund – a 10 million pound sterling facility funded by the UK’s Department for International Development (DfID), aimed at assisting Caribbean countries in boosting growth and reducing poverty through trade and regional integration.
Another Case Story submitted by CARICOM was that of the Support to the Caribbean rum sector. This EU-funded programme had several components, all aimed at addressing preference erosion. A business development services window also facilitated beneficiaries’ access to support in the preparation of project proposals.
One other major characteristic of this programme concerns empowering the private sector to seize trade opportunities. These are invaluable lessons that could be applied to other AfT initiatives.
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