Caribbean Trade Law and Development

Category: Caribbean

  • Report of Haiti’s 2nd WTO Trade Policy Review now online!

    Alicia Nicholls

    Following up to my previous article, Haiti has completed its second WTO Trade Policy Review which took place this week December 2nd-4th. The report of Haiti’s second review is now online.

    Haiti’s Economic and Trade Performance

    Some of the key summary points from the 2015 report in regards to Haiti’s economic and trade performance are as follows:

    • Haiti’s economy has been recovering slowly since the devastating earthquake in January 2010.
    • The fiscal deficit is largely financed by external grants and poses a considerable problem for medium-term expenditure sustainability.
    • The Haitian Government has implemented a set of measures to increase revenues and reduce the level of expenditure.
    • Haiti has maintained a large trade deficit for many years.
    • Remittances sent by Haitian workers living abroad are the main source of foreign exchange in the domestic economy.
    • Haiti’s main exports are textiles and clothing.
    • Services contribute around 56% of GDP.
    • Financial services still make only a modest contribution to GDP, although banking institutions have rapidly increased their holdings in recent years.

    Haiti’s Trade Policy Framework

    Some of the summary points in regards to its trade policy framework are as follows:

    • Generally speaking, Haiti’s trade and investment laws are relatively old.
    • Haiti has not signed any of the WTO plurilateral agreements.
    • Haiti receives non-reciprocal preferential treatment from a number of developed countries under the Generalised System of Preferences (GSP) and is also a member of the Caribbean Community (CARICOM).
    • Tariffs are still among Haiti’s principal trade policy tools, as well as being an important source of income, since customs revenue accounts for around one third of fiscal revenue each year.
    • There have been no major changes to the export regime since the previous Trade Policy Review.
    • Haiti has no legislation on competition, standardization or contingency trade measures.
    • Although a major step forward was made with the adoption of the legislation on copyright and related rights, the system of intellectual property protection remains weak, however, and trademarks are frequently infringed.
    • The agricultural sector continues to play a key role in food security and employment.The mining sector makes only a marginal contribution to GDP, despite its considerable potential.
    • Contributing to the majority of Haiti’s exports, the manufacturing sector’s contribution to GDP has remained relatively stable over recent years, at around 8%.

    The full WTO Secretariat report, the Government report and other documents from Haiti’s second trade policy review may be accessed here.

    Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. Please note that the views expressed in this article are solely hers. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

  • A sustainable future for SIDS necessitates an ambitious outcome at COP21

    Alicia Nicholls

    Over the next two weeks (November 30 to December 11), leaders and delegates from over 190 countries are gathered in Paris, France for the 21st Conference of the Parties (COP21) of the United Nations Framework Convention on Climate Change (UNFCCC), with the aim of achieving a legally binding multilateral agreement on climate change.

    For small island developing states (SIDS), which are already suffering the adverse effects of climate change, the stakes are particularly high. The importance of climate change to the post 2015 development agenda has been reflected by its inclusion as Goal 13 of the Sustainable Development Goals. Failure to act on climate change has implications not just for the economies, societies and survival of SIDS, but will undermine their achievement of many of the sustainable development goals, including poverty reduction.

    Vulnerabilities

    SIDS are not the only countries affected by climate change. However, while combined their contribution to global greenhouse gas (GHG) emissions is minuscule, they are among the most vulnerable to the adverse manifestations of climate change. The geographical vulnerabilities of small states, such as their geographic location, small land masses, concentration of human settlements and major infrastructure along coastal and low-lying areas and dependence on limited industries, enhance their vulnerabilities to rising sea levels, ocean acidification, coral bleaching, more frequent and destructive weather events and changing precipitation patterns.

    Several SIDS, including those of the Caribbean Community (CARICOM), are already experiencing beach erosion, more devastating hurricanes, flooding and longer droughts. The situation is even direr in lowlying islands and atolls in the Pacific like Kiribati which face displacement of coastal communities because of rising sea levels.

    Sustainable Development Goals and Climate Change

    Addressing climate change has been made part of the post-2015 development agenda. SDG 13 mandates states to take urgent action to combat climate change and its impacts. The targets under goal 13 include strengthening resilience and adaptative capacity to climate-related hazards and natural disasters, integrating climate change measures in policy frameworks, improving education and awareness, promoting mechanisms for raising capacity for effective climate change planning in LDCs and SIDS and implementing developed countries’ commitment of mobilizing jointly $100 billion annually by 2020 to address the needs of developing countries.

    Climate change poses not only an existential threat to SIDS but also to their ability to meet sustainable development goals. Longer droughts as a result of changing precipitation patterns diminish crop yields and hurt livestock which in turn diminish the livelihoods of farmers and the families which depend on small plots of land for income and food. Low agricultural yields means reduced food production which has an impact on nutrition and food security, with implications for the achievement of SDG 2 – zero hunger. For subsistence farmers, income from surplus yields is used to finance household expenses and education of children. Loss of homes and livelihood from cyclones, droughts and floods has an impact on the eradication of poverty (SDG 1 – no poverty). In many poorer countries, women make up the majority of small farmers and are the ones required to fetch water for their families, highlighting the gendered impact of climate change which affects the achievement of SDG 5 – gender equality.

    The oceans are the lifeblood of SIDS, whether through fisheries or as part of their tourism product. Ocean acidification due to oceanic uptake of CO2, warming seas and coral bleaching cause fish to migrate to more favourable waters resulting in lower fish yields and loss of aquatic biodiversity (SDG 14 – life below water). This in turn leads to loss of income for fishermen, glass bottom boat operators and entire coastal communities which depend on marine biodiversity and fish catches for food and income, again with implications for poverty reduction (SDG 1). Another alarming aspect of climate change is saltwater intrusion into freshwater aquifers which limits the availability of fresh water for human consumption, farming and other economic activities and will undermine the achievement of SDG6 – clean water and sanitation.

    Speaking of the achievement of SDG9 – industry, innovation and infrastructure, the major economic drivers in SIDS tend to be tourism, agriculture, fisheries, which are climate sensitive industries. In Grenada an entire nutmeg harvest was devastated by Hurricane Ivan in 2005. Major infrastructure in many islands, such as hotels, road networks, electrical power plants and such, are concentrated along coastal areas which can become inundated by rising sea levels and destroyed by hurricanes.  Destruction or damage of these ports of entry impact on their ability to receive tourists, which is crippling for economies dependent on tourism.

    Aside from these impacts on economic growth and sustainability, infrastructure and livelihood, the loss of human life is one of the greatest threats. One only needs to consider the devastation by Tropical Storm Erika in Dominica and the loss of life to see that the impact is indeed real. According to the Rapid Damage and Impact Assessment, the damage and loss has been estimated at US $483 million which is equivalent to 90 percent of Dominica’s GDP.

    The scale of the problem

    Climate change has been one foreign policy area on which CARICOM countries have been steadfastly united. They have participated keenly in climate change negotiations and have submitted their intended nationally determined contributions (INDCs) setting out their post-2020 country commitments. A taskforce on climate change was also established.

    Previous attempts by the global community to achieve an internationally accepted binding agreement for the reduction of GHG emissions have left a lot to be desired. The Kyoto Protocol, adopted in Kyoto, Japan in 1997 and entered in force in 2005, is the first multilateral treaty requiring countries to cut their GHG emissions. However, the US, currently the second largest  emiter, never ratified the Agreement and China  (currently the largest emiter) and India, were exempted from the emission cuts because they were not major emiters during the period of industrialisation. Moreover, the emission cut targets of 5.2% under Kyoto are not enough.

    The inertia of the world’s major emiters on substantially cutting emissions and on achieving an ambitious binding agreement so far on climate change has had devastating consequences. The World Meteorological Organisation reported that concentrations of carbon dioxide increased at their fastest rate for 30 years in 2013. Moreover, a World Bank scientific report published in 2012 found that the world is heading towards a temperature increase of 4 degrees celsius by the turn of the century if current emission levels remain. A recent report by the IPCC further reiterated this. Such an increase would be catastrophic for SIDS.

    The current global position for emissions reduction is for limiting temperature increase to no more than 2 degrees above pre-industrial levels. However, any long term temperature increase by 1.5 degrees Celsius over pre-industrial levels will have a devastating impact on SIDS. As such, countries of the Alliance of Small Island States (AOSIS), including CARICOM, have been pushing the “1.5 to Stay Alive” campaign to raise awareness and support for cuts which will limit the increase to no more than 1.5 degrees.

    Moreover, the current level of actual financing provided by developed nations to meet the adaptation needs of small states has been woefully inadequate.

    CARICOM negotiating position

    The Rt. Hon Dr. Kenny Anthony, Prime Minister of St. Lucia, has lead responsibility for climate change for CARICOM.

    In a press conference given by Dr. Anthony, CARICOM’s negotiating position was articulated. It re-emphasises the position taken in the Community’s  Declaration for Climate Action issued pursuant to regular meeting of CARICOM Heads of Government in Barbados in July of this year. As stated by Dr. Anthony, CARICOM is advocating for:

    the retention of the principal of special circumstances and unique vulnerability of SIDS;

    five-year review cycles of green house gas emission reduction targets with the first review to take place prior to 2020, to allow for the adjustments necessary to achieve the goal of 1.5 degrees;

    recognition of loss and damage (the irreversible, slow onset impacts of climate change to which it is not possible to adapt, example sea-level rise and ocean acidification) as a critical issue for SIDS and the development of a mechanism to address this element, treated separately from adaptation;

    support for REDD+ (efforts to reduce emissions from deforestation and forest degradation and the sustainable management of forests);

    adequate provisions for adaptation to help Caribbean countries reduce their vulnerability to effects of climate change and develop great climate resilience where possible; and

    commitment by developed countries to take the lead in scaling up the provision of adequate, predictable and new sources of financing for mitigation, adaptation, loss and damage, and for technology support.

    The threat of climate change to the livelihoods, economies and very existence of SIDS cannot be understated. World leaders in their various statementsleading up to the conference have all recognised that COP 21 represents a critical development juncture where adaptative and corrective action can still be taken towards charting a new course towards a climate friendly sustainable future. However the window of opportunity for avoiding an environmentally catastrophic global temperature increase of 4 degrees Celsius is closing.

    A comprehensive, legally binding agreement with ambitious and substantive commitments on emissions reductions to reduce the global temperature increase to no more than 1.5 degrees over pre-industrial levels, which provides binding commitments for technology transfer, capacity building and adequate financial support for adaptation of SIDS and other vulnerable countries and communities to climate change and which recognises the vulnerability and differentiated responsibility of small states and LDCs will help reverse this. The hope of SIDS for a sustainable future depends on what action or inaction world leaders take over the next few days.

    Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. Please note that the views expressed in this article are solely hers. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

  • 24th Commonwealth Heads of Government Meeting Concludes in Malta

    Alicia Nicholls

    Heads of Government of the Commonwealth Caribbean joined other leaders of the 53-state Commonwealth Group of Nations for the 24th Commonwealth Heads of Government Meeting in Malta on November 27-29. The meeting was held under the theme “The Commonwealth: Adding Global Value” and comes in the aftermath of the terrorist attacks in Paris and immediately precedes the 2015 United Nations Climate Change Conference (COP21).

    The agenda focused on the following themes: peace and security, human rights and good governance, migration, sustainable development, small states, climate change, trade, youth, gender quality and women’s empowerment, public health, current situations, movement of Commonwealth citizens, Commonwealth collaboration and the election of the new Secretary General.

    Outcomes

    Baroness Patricia Scotland was elected the 6th and first female Secretary General of the Commonwealth. It was agreed that Guyana would be one of the member governments to serve on the Commonwealth Ministerial Action Group (CMAG) for the next two years.

    The final communiqué released by the leaders includes several noteworthy points of specific importance to the Commonwealth Caribbean, and other small island developing states. The leaders also released a separate statement on climate change.

    Climate Change

    • Developed Commonwealth countries committed to assisting in mobilizing US$100 billion per year by 2020 to address the adaptation and mitigation needs of developing countries.
    • A Commonwealth Climate Finance Access Hub has been established to build the capacity of Commonwealth small and other climate vulnerable states to access climate finance with regional support.

    Trade & Freedom of Movement

    • A voluntary Commonwealth Trade Finance Facility was launched to increase trade and investment finance, in particular for small and other developing economies with limited access to trade finance.
    • Leaders acknowledged a proposal for a “Commonwealth Advantage” under which Commonwealth governments will consider measures to enhance access to each others’ countries more easily and for longer in keeping with their national legislation and international obligations regulating visa policies. A working group has already been working on this.

    Peace & Security

    • Commonwealth leaders recognized the growing trend of recruitment of youth persons by extremist groups as fighters, including from some Commonwealth countries.
    • Leaders renewed their commitment to implement and support national strategies to counter these threats, including the need to address recruitment and radicalization of youth via the internet and Commonwealth programmes to raise awareness and prevent young people from falling victim to radicalization and terrorism.
    • They called upon all member governments to implement their obligations under the UN Security Council Resolution 2178(2014) on foreign terrorist fighters in full and to join or fully implement the Arms Trade Treaty.

    Border Disputes in Guyana and Belize

    • The leaders endorsed the outcome statement of the Commonwealth Ministerial Group on Guyana following its meeting in September 2015, and reaffirmed their “unequivocal support for the maintenance and safeguarding of Guyana’s sovereignty and territorial integrity”.
    • They also welcomed the signing of thirteen cooperation agreements between Belize and Guatemala and reiterated their full support for the sovereignty and territorial integrity of Belize.

    Small States

    • A Commonwealth and Maltese government-funded Small States Centre of Excellence will promote the interests of small states and provide targeted capacity building programmes and other support.

    The full statements may be accessed here:

    Commonwealth Leaders’ Statement on Climate Change 

    Final Communique 

    Alicia Nicholls, B.Sc., M.Sc., LL.B. is a trade and development consultant with a keen interest in sustainable development, international law and trade. Please note that the views expressed in this article are solely hers. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

  • Intra-Commonwealth trade projected to increase to $1 trillion by 2020

    This week the Commonwealth of Nations released its Commonwealth Trade Review 2015 entitled “The Commonwealth in the Unfolding Global Trade Landscape: Prospects Priorities Perspectives”. The report which was released ahead of the Commonwealth Heads of Government meeting in Malta this week details the trade performance and trends in the 53-state voluntary grouping and discusses prospects for future intra-Commonwealth trade. The Commonwealth comprises a diverse set of countries, most of which are former British colonies. It includes developing and developed countries, as well as small states and land locked states.

    Though not a trading bloc, trade amongst Commonwealth states is already substantial and growing. Intra-Commonwealth trade has grown almost 10% annually since 1995 and was estimated at $592 billion in 2013. It is projected to reach over 1 trillion in 2020.The report emphasises that there is scope for more intra- Commonwealth trade due to the historical ties, shared values, long established trade, familiar administrative and legal systems, use of the English language mostly and strong diasporic communities.

    Commonwealth Trade

    Some key points from the report:

    • Total combined Commonwealth exports of goods and services were $3.41 trillion in 2013 and accounted for 14.6% of global exports in that year.
    • Developing Commonwealth states increased their share of Commonwealth exports from 36% in 2000 to over 50% in 2013. This expanded share was attributed mainly to Asian countries which comprise 4/5 of total Commonwealth developing country exports in 2013.
    • Merchandise exports comprised 76% of all Commonwealth exports while the remaining 24% is services exports

    Commonwealth Caribbean Trade

    Caribbean states, along with Pacific states, comprise the majority of small states in the Commonwealth. The report reveals that:

    • Total Commonwealth Caribbean exports in 2013 comprised only 1.14% of total Commonwealth exports of goods and services and 2.25% of total Commonwealth developing country exports of goods and services.
    • Commonwealth Caribbean exports have grown from 14 billion in 2000 to 39.1 billion in 2013 and are forecasted to reach 41.2 billion in 2015.
    • Trinidad & Tobago accounted for 60% of all Commonwealth Caribbean goods and services exports in 2013, with its total exports of goods and services reaching 24.7 billion in 2013. The other top Commonwealth Caribbean exporters were Jamaica, the Bahamas and Barbados.
    • Intra-Caribbean exports account for 55 per cent of Caribbean members’ intra-Commonwealth exports, while developed countries accounted for 40% and developing countries was 25% in 2013.
    • Services accounted for 60% of Commonwealth Caribbean countries’ exports in 2013 and were dominated mainly travel trade, followed by transport and other business services.

    Other major points made in the report:

    • Commonwealth small states’ share in world trade has declined from over 0.7% in 1980 to just 0.46% in 2011, with loss of preferences being a major factor. Small states are also faced with declining export orientation of their economies; export GDP ratio of small states has fallen while it has risen globally. This is compounded by the numerous competitiveness challenges small states face, including their small domestic markets, unfavourable geographical location.
    • China has grown as a major trading partner in the Commonwealth, with Commonwealth States exports to China increasing from 19 billion in 2000 to 268 trillion in 2013, while Commonwealth states’ imports from China have grown from $16 billion in 2000 to $359 in 2013.
    • The report also mentions the many opportunities which exist within the Commonwealth for enhancing trade and suggests ways in which developing countries can improve their trade performance. These include through the use of trade preferences, aid for trade, addressing the implementation gap, promoting the role of private sector and the global trade support architecture.

    The full report is available on the official website of the Commonwealth here.