1. THIRD GLOBAL REVIEW OF AID for TRADE
Statement on behalf of the Caribbean Community
Geneva, July 18-19, 2011
The Caribbean Community (CARICOM) attaches great importance to the III 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.
This III 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 realized.
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 liberalization 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 Caribbean has traditionally been preference-
dependent in a global marketplace characterized by diminishing value of preferences.
Mechanisms geared towards facilitating trade adjustment are therefore required to assist in
the recalibration of our economies. This should necessarily include support for
strengthening productivity and trade competitiveness. Such an approach would, ensure
the optimization 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 internalize 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’s primary policy response rests with the vigorous pursuit of strengthened
regional integration. In that regard, we have established the institutional framework for the
Single Market and Economy through a Revised Common External Tariff (CET), the
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2. Caribbean Court of Justice (CCJ) with original jurisdiction on CSME matters, a Caribbean
Competition Commission, the CARICOM Development Fund (CDF) for disadvantaged
countries, sectors and regions and the Caribbean Regional Office for Standard and Quality
(CROSQ). CARICOM Heads of Government have already signed an inter-governmental
agreement establishing the CARICOM Agricultural Health and Food Safety Agency
(CAHFSA). The Community is working towards operationalising this agency which will be
responsile for putting in place the Regional SPS Regime. As we consolidate the Single
Market, additional emphasis will be placed on the establishment of the framework for a
Single Economy through focus on sectoral development.
The Region is also realigning economic relations with major trading and development
partners as evidenced from the implementation of CARIFORUM-European Union
Economic Partnership Agreement (EPA) and the current negotiations for a CARICOM-
Canada Trade and Development Agreement. CARICOM countries continue to be active
participants in the DDA process and remain committed to the realization of a multilateral
trading system that places development at its core.
Far from standing still, we are forging ahead with strengthening regional integration, while
seeking to recalibrate the multilateral trading system in a manner that takes full cognizance
of the development needs of small, vulnerable and poor economies. We are also
attempting to enhance our global competitiveness. We have an ambitious but necessary
trade agenda. All of this requires the active and generous support of our traditional
development partners and new partners. We acknowledge the very valuable support we are
receiveing from our development partners in terms of putting in place the soft
infrastructure required. But, the Region’s private sector is becoming impatient and
CARICOM heads of Government have determined that new assistance should directly
address private sector competitiuveness and job creation. In short, they want tangible
results on the ground.
CARICOM Heads of Government have identified the major areas for which Aid for Trade
support is needed. In the short term, as a region comprising many small island and coastal
developing states we need support in Maritime Transport. We also need support on ICT to
enable us to enter into and compete in a global technology based economy and we will need
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. There are two critical lessons that can be distilled
from this project. First, the rate of disbursement has been strong and dispatched in a
timely manner. In light of other experiences of the Caribbean , this is a most welcome
development. The second lesson is that offering built-in support for project design and
preparation resulted in high project approval rates. It therefore appears prudent that
inserting capacity building measures in Aid for Trade projects might yield considerable
results.
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3. 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
to access 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.
We are currently finalizing arrangements with the EU for some support to implement the
EPA. We are also working with the IDB to develop specific proposals on Maritime
Transport and ICT. At the same time, also with the assistance of the IDB and DfID, we are
taking steps to formally design and promote a CARICOM Regional Aid for Trade Strategy
on the basis of which we will intensify our resource mobilization endeavours with our
International Development Partners. I take this opportunity to place on record
CARICOM’s appreciation for the close collaboration and support being provided by the
IDB, in particular the staff of its Integration and Trade sector. We also express our
appreciation for the support being provided by the EU, Canada through CIDA and
Germany through the Agency for International Cooperation (GIZ) to our ongoing work to
develop the CARICOM Single Market and Economy and by extension our international
trade agenda..
While we can be proud of a number of lessons learnt, we also need 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. 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.
I thank you.
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