The View From Europe

By David Jessop
Some time on or around October 15 the Economic Part-nership Agreement (EPA) between Europe and Cariforum will be signed in Barbados.
The decision to do so by thirteen of fifteen Caribbean heads of government meeting in special session on Septem-ber 10 follows weeks of public and private debate.

At the meeting Haiti said it was not ready while Guyana seemingly leaving itself isolated, suggested that on the basis of the outcome of a public consultation it would not sign.
Despite this President Jagdeo appears to have left the door open to agreeing under duress if Europe, as appears likely, intends making Guyanese exports to Europe subject to its GSP tariff regime.
Irrespective of where one stands on the EPA or the complex history that led to its negotiation, the Caribbean has at the highest political levels reaffirmed the decision that all Caribbean heads took in December 2007 at a meeting at which participants indicate, some of the EPA’s subsequently most vocal critics did not comment.
What happens next is important if the EPA’s suggested shortcomings are not to become self-fulfilling prophecy.

The region and its institutions will have to raise their game and determine rapidly and in practical terms how it is to implement what has been agreed.
It cannot allow the three-year moratorium on tariff liberalisation to become a further opportunity for delay, power politics and personal animosities to reign.
Barbados and Jamaica are establishing implementation units but it is far from clear what is happening at a regional level or elsewhere. Indeed who will control this process at a Cariforum level and where the secretariat responsible for implementation will be located could well see new inter-regional fault lines emerge over the EPA.

Now that Caribbean heads of government have agreed to proceed, logic suggests that there is a pressing need for the intellectual debate to draw to a close so that the much harder practical work of understanding and delivering the detailed transitional content of the EPA with the private sector can begin.

What this suggests is that the moment has come for business supported by the media to ask government, its agencies, Cariforum how the EPA’s provisions are to be implemented; who will be responsible; and most importantly how enterprise, which has the task of delivering any benefits that will flow from the EPA, is to benefit from the array of technical support potentially available. The danger is that if they do not, their silence will enable institutions in the region and Europe to move at the pace that suits them.
There are also many other critical steps that are required if the EPA is to be made to work.
The most difficult of these is completing the Caribbean Single Market and Economy.

The Regional Develop-ment Fund needs to be made operational and the Carib-bean inter-institutional in-fighting that has characterised the sixth months since the EPA was initialled and has caused one Caribbean head of government to raise in writing with Caricom’s Chairman serious concerns about the conduct of high officials, needs to be resolved.

There needs to be a viable and genuinely representative Caribbean Business Council consisting of large and small enterprises and the big sectoral groups so that they can engage Cariforum heads and Cariforum in a debate about competitiveness, inter-regional and extra-regional investment and trade policy and how the regional business climate can be made more dynamic.
Regional institutions and the public sector need reorienting and properly resourcing.

If the EPA or growth through freer trade is ever to work the public sector and its institutions must become enablers operating in the real time of the business community.
Previous experience suggests that if this does not happen then the three-year moratorium and fifteen years of transition built in to the EPA will not be enough.
A new, better considered and more realistic approach is required towards overseas investors.

Those most alarmed about the EPA’s implications for economic sovereignty seem not to recognise that for the most part European investors other than in the tourism sector are not very interested in the EPA or the Caribbean. Recent history suggests other more likely scenarios.

Digicel, the Spanish hotel groups and the wealthy individuals invested in the region found their way to Caribbean opportunity without any free trade agreement. Indeed while the Caribbean worries about the EPA’s impact on the regional economy and sovereignty hardly any business in Europe has even heard of the arrangement.

Beyond this the implications of eventual market opening to Canada or to the wider world through the Doha Round needs to be better understood and fully debated now if the Caribbean is to avoid being plunged again into another divisive debate.
The EPA creates a benchmark and as such establishes a precedent that will affect all future negotiations.
The Caribbean private sector needs to find ways to press the European Com-mission and its development arm on how the transitional development mechanisms are to work to their advantage.

The EC has a disastrous track record in delivering on time programmes that relate to a finite economic transition processes.
New development partners for the region need cultivating.
If the Caribbean is to ensure the best possible insertion into the global trading system it requires a more aggressive, determined and co-ordinated foreign trade policy, foreign policy and economic development policy.

It needs to find ways for better donor co-ordination between the support coming from nations like Venezuela and China and the assistance that will be forthcoming from Europe and bilaterally from traditional partners.

And finally there is a case for NGO’s, trades unions and others in civil society to be posing practical questions as to how the institutional arrangements are to provide them and their stakeholders and members with an effective forum for a debate on the social impact of implementation
The EPA presages a change of direction for the Caribbean. It is based on an assumption that the region as a whole has the confidence and ability to abandon past thinking and rise to the challenge of what has been agreed.

Its successful delivery requires a kind of faith as future economic success will depend ultimately on the ability of the region’s private sector to compete in their own markets with European suppliers and service providers.

The region’s leaders now need to ensure that what they have agreed is delivered.
Previous columns can be found at www.caribbean-council.org