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The Caricom survival game

Wednesday, June 13, 2018

By themselves, substantial trade surpluses—facilitated by single market conditions involving our Caribbean neighbours—establish T&T as a net beneficiary of the Caricom process.

There are also other benefits derived from services provided by regional Caricom institutions that help pool and synergise financial and other resources. These agencies include CXC, CARPHA, CARDI and several others that provide important services to the region.

This is not PR on account of my bias, but a statement of fact. Consider T&T making its own way in the world as a small, physically vulnerable island economy and be honest about what life might have been like without a supportive regional community.

I am not certain whether there is a public service unit anywhere with authoritative, non-trade data to support this assertion, but I am convinced that if the work is done, the increasingly pervasive suggestion that this country invests more than it derives from Caricom can be seriously challenged.

This, of course, is not to say we in fact receive sufficient bang for our buck. There are inefficiencies in the system and we need to sufficiently regain interest in the regional project in order to influence positive change. Our gradual and deliberate withdrawal from a leadership position has not helped. Our recent performances at international fora are instructive.

The imbalance in our favour is so much so that some of our partners frequently lament what they consider to be our unfair, advantageous position. The Jamaicans complain time and again about our disproportionate competitive advantage in the manufacturing sector owing to low energy rates. This is so without reference to the ubiquity of non-regional products on their supermarket shelves and steep differences in wage levels and other factors of production between the two countries.

But it is also correct that we have not always been the best neighbours. For example, there must be a solution to the current situation in which Vincentian fruit and vegetable vendors are unable to access foreign exchange as payment for their goods sold on the T&T market.

I cannot imagine that the big supermarkets here are telling non-regional suppliers that they should hold on to TT dollar payments. But this is what we are doing to the Vincentians.

As Prime Minister Ralph Gonsalves pointed out at last week’s consultation on the CSME, while his country pays its bills to us in hard currency, our much lower obligations to lowly vendors are being settled in TT dollars. As a consequence, these suppliers have been made to bank their money in T&T until they are able to make the necessary conversion to EC or US dollars.

What makes North American suppliers of apples, grapes, pears and plums different from Vincentian growers of yams, cassava and pumpkins? There has to be a way, through a process of offsetting trade payments perhaps, to settle this matter without the situation reaching the point where there are questions about good neighbourliness.

So peeved about this situation was the Vincentian Prime Minister last week that he linked the affair to a rather tentative future for Caricom—the single market in particular. Of course, he, of all people, knows better.

One effective long-term solution is currency convertibility within the training bloc or, better yet, a single Caribbean currency. The technicians point to the difficulties, but they also recognise the success of the Eastern Caribbean monetary union.

The fact of the matter is that even a lukewarm Jamaican polity recognises the geo-political significance of a cohesive Caribbean response to emerging challenges. The recent Bruce Golding report on the island’s future as a member of the Community said as much.

Last week’s consultations, however, also called for a very serious reality check on the status of the integration movement and stakeholders significantly and justifiably challenged the viability of some erstwhile important pillars.

There is perhaps some snipping and reshaping to bring the integration project back on track. But it is absurd to suggest that some very important benefits have not been accrued out of our collective recognition of the survival game involved.


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