Caribbean Trade Law and Development

Category: WTO

  • Caribbean Trade & Development Digest – March 8-14, 2020

    Caribbean Trade & Development Digest – March 8-14, 2020

    Welcome to the Caribbean Trade & Development News Digest for the week of March 8-14, 2020! We are happy to bring you the major trade and development headlines and analysis from across the Caribbean Region and the world from the past week.

    THIS WEEK’S HIGHLIGHTS

    The COVID-19 outbreak has this week been declared a pandemic by the World Health Organisation. Globally, reported infections are now over 150,000 with deaths at nearly 6,000. The outbreak continues to have a negative impact on stock markets, commodities prices and global supply chains. Businesses worldwide have begun restricting employees’ travel and implementing work from home policies.

    According to an UNCTAD report published this week, the outbreak could cause global foreign direct investment (FDI) to shrink by 5%-15%.

    World services trade growth continued to weaken toward the end of 2019 and into the first quarter of 2020 according to the World Trade Organisation’s Services Trade Barometer, released on 11 March 2020. The indicator does not yet fully capture the economic impact of the COVID-19 virus and is likely to decline further in the coming months, according to the WTO.

    The WTO became one of several organisations which has cancelled all meetings in light of COVID-19. The Government of Kazakhstan has cancelled the WTO’s Ministerial Conference that was scheduled to be held there June 8-11 in light of the COVID-19 pandemic.

    In the Caribbean, several English-speaking Caribbean countries have now announced cases. This is in addition to several other non-English speaking Caribbean countries which reported cases earlier.

    See my articles on : The possible economic and trade impacts of COVID-19 on the Caribbean here and on small businesses/MSMEs here.

    REGIONAL NEWS

    ‘More trade coming’ with Suriname

    Barbados Today: With expected disruptions in global trade as a result of the COVID-19, Government officials are working around the clock to ensure that new opportunities are in place for Barbados to source some items from the region. Read more

    A WTO Investment Facilitation Agreement: Any added value for the Caribbean?

    Guyana Chronicle: With regional governments already undertaking reforms, would a WTO Multilateral Investment Facilitation for Development Agreement add value for the Caribbean or would the legal burdens of signing a multilateral agreement outweigh any potential benefits? Should the Caribbean seize this opportunity to be among the rule-makers in an area of development-interest to the region or should we sit this one out? Read more

    American firms, US revive ‘AmCham’ biz body

    Barbados Today: American business figures are seeking to re-establish a link with firms here and throughout the Eastern Caribbean in a bid to leverage new exports to the region. Read more

    All cruise lines cancel cruises over the next 30-60 days

    Barbados Today: Cruise Lines International Association (CLIA) has announced that all member ocean cruise lines are pausing sailings over the next 30-60 days. For most cruise lines, the cancellations will span the next 30 days. Read more

    Coronavirus shuts down Guyana-Suriname ferry crossing

    Demerara Waves: The Guyana-Suriname ferry service has suspended operations because that neighbouring country on Friday registered its first case of the novel coronavirus. Read more

    Barbados hosts successful consultations on CARICOM Strategic Plan

    Barbados Advocate: National consultations held in Barbados this week to help map the way forward for the results-focused new ten-year Caribbean Community (CARICOM) Strategic Plan, have been described as “rich and fruitful”. Read more

    Implementation of the Extended Article 164 Regime of the Revised Treaty of Chaguaramas

    St Lucia News Online: The Ministry of Commerce, International Trade, Investment, Enterprise Development and Consumer Affairs wishes to advise members of the general public of the impending implementation of a CARICOM wide initiative to enable the growth and development of the Less Developed Countries of CARICOM. Read more

    How will COVID-19 affect the economies of Latin America and the Caribbean?

    UNDP: The COVID-19 outbreak is a new potential source of volatility and a threat to the macroeconomic stability of Latin America and the Caribbean. While it is still too early to fully understand its impact on China’s growth, and how it will result in a slowdown in our region, what we know so far is that COVID-19 is spreading at an accelerated rate and has caused a disruption to China’s economy. Read more

    Belize and Florida continue to strengthen Bilateral Trade and Investment relationship

    Breaking Belize News: Тhе Веlіzе Тrаdе аnd Іnvеѕtmеnt Dеvеlорmеnt Ѕеrvісе (ВЕLТRАІDЕ), а ѕtаtutоrу bоdу undеr thе Міnіѕtrу оf Есоnоmіс Dеvеlорmеnt, Реtrоlеum, Іnvеѕtmеnt, Тrаdе аnd Соmmеrсе оf thе Gоvеrnmеnt оf Веlіzе (GОВ), wеrе hоѕtеd аt а twо-dау оutbоund Веlіzе Вuѕіnеѕѕ Міѕѕіоn іn Таllаhаѕѕее, Flоrіdа UЅА. Read more

    Jamaican businesses seek spin-offs from booming Guyanese economy

    Jamaica Observer: The massive oil discovery in Guyana will have a dramatic effect on driving its developing economy, with a growth rate of 85 per cent recently predicted by the International Monetary Fund (IMF). Read more

    INTERNATIONAL NEWS

    Coronavirus could shrink global FDI by 5% to 15%

    UNCTAD: The coronavirus (COVID-19) outbreak could cause global foreign direct investment (FDI) to shrink by 5%-15%, according to an UNCTAD report published on 8 March. Read more

    Global Diplomacy Grinds to a Halt on Infection Fears

    Foreign Policy: One by one, the U.N., WTO, and other major international players are canceling regular gatherings. Read more

    COVID-19 Survey: Impacts on Global Supply Chains

    Business Facilities: Nearly 75 percent of companies report supply chain disruptions in some capacity due to coronavirus-related transportation restrictions, according to the newly released results of a survey focused on coronavirus disease 2019 (COVID-19) business and supply chain impacts. Read more

    Coronavirus: US travel ban on 26 European countries comes into force

    BBC: President Donald Trump’s travel ban on 26 European nations has come into force in the US, as part of a contingency plan to tackle the coronavirus crisis. Read more

    COVID-19-hit Iran asks IMF for aid amid US sanctions

    Deutsche Welle: For the first time in six decades, Iran has requested a loan from the IMF to fight the coronavirus outbreak. US sanctions have isolated the country from the global financial system. They could also stop IMF assistance. Read more

    Brexit: coronavirus sparks calls to extend EU transition period

    The Guardian: Britain and the EU are facing calls to back away from a “game of chicken” and extend the Brexit transition period immediately, as both respond to the coronavirus pandemic. Read more

    Brexit: EU drafts trade deal ahead of talks with UK

    BBC: The EU has drafted a post-Brexit trade deal proposal, covering areas such as security, foreign policy and fisheries. The 441-page draft legal text, seen by the BBC, was sent to the 27 EU states on Thursday night, ahead of being presented to the UK next week. Read more

    African Free-Trade Deal on Track Despite Coronavirus

    Bloomberg: The coronavirus pandemic is unlikely to scupper a July 1 target for the first commerce under an African-wide free-trade deal, even if meetings to iron out details are being canceled, according to the zone’s most senior official. Read more

    Global business travel could suffer $820bn virus hit, says group

    Al Jazeera: The global spread of the coronavirus is increasingly affecting business travelers, an industry body said. Read more

    STRAIGHT FROM THE WTO

    NEW ON THE CTLD BLOG

    The Caribbean Trade & Development Digest is a weekly trade news digest produced and published by the Caribbean Trade Law & Development Blog. Liked this issue? To read past issues, please visit here. To receive these mailings directly to your inbox, please subscribe to our Blog below:

  • A WTO Investment Facilitation Agreement: Any added value for the Caribbean?

    A WTO Investment Facilitation Agreement: Any added value for the Caribbean?

    Image by Nattanan Kanchanaprat from Pixabay

    Alicia Nicholls: The majority of World Trade Organization (WTO) Members have, this month, commenced negotiations to conclude a binding multilateral agreement on investment facilitation for development. The negotiations, which have received the support of the global business community, seek to facilitate investment flows between economies in a sustainable and pro-development manner. To date, one hundred WTO Members, including four CARICOM Member States, have endorsed the Joint Statement Initiative on Investment Facilitation for Development. Essentially, Member States will be negotiating the investment equivalent of the Trade Facilitation Agreement (TFA).

    Caribbean countries are largely net foreign direct investment (FDI) importers, that is, countries where FDI inflows exceed outflows. According to ECLAC’s Foreign Direct Investment in Latin America and the Caribbean Report of 2019, “FDI flows to the Caribbean totaled US$ 5.623 billion in 2018”. The 11.4% dip compared to 2017 levels was mainly attributed to reduced inflows to the Dominican Republic, which, despite the drop, accounted for a 44% share of FDI inflows to the Caribbean sub-region. The Dominican Republic’s share of regional inflows was distantly followed by the Bahamas (18%), Jamaica (14%) and Guyana (9%).

    Caribbean countries, to varying extents, have been implementing reforms at the national and regional levels to improve their business environments and the functioning of their investment promotion agencies (IPAs). The ultimate goal of these reform initiatives is to attract FDI that foments economic growth and development, foreign exchange inflows, job creation, and access to markets, skills, know-how and technologies.

    With regional governments already undertaking reforms, would a WTO Multilateral Investment Facilitation for Development Agreement add value for the Caribbean or would the legal burdens of signing a multilateral agreement outweigh any potential benefits? Should the Caribbean seize this opportunity to be among the rule-makers in an area of development-interest to the region or should we sit this one out? Read more here.

  • WTO: Curacao to begin accession process as separate customs territory

    WTO: Curacao to begin accession process as separate customs territory

    Image by Patrice Audet from Pixabay.

    Alicia Nicholls

    World Trade Organization (WTO) Members have agreed to establish a working party for the accession of the Dutch Caribbean dependency of Curacao to the 164-member organization. This decision was made at the latest meeting of the WTO’s General Council – the WTO’s highest decision-making body in Geneva – when it met on March 3-4, 2020.

    Under the WTO Agreement, any State or separate customs territory “possessing full autonomy in the conduct of its external commercial relations and of the other matters provided for in this Agreement and the Multilateral Trade Agreements” may accede to the WTO on terms to be agreed between it and the WTO.

    Constitutionally, Curacao is a constituent country and separate customs territory within the Kingdom of the Netherlands and is part of the original membership of the Kingdom of the Netherlands to the General Agreement on Tariffs and Trade (GATT), and later the WTO. The Kingdom of the Netherlands has supported Curacao’s bid for WTO membership as a separate customs union and placed Curacao’s request on the General Council’s agenda.

    Curacao’s application for accession, which was made in October 2019, will make it among several accessions to the WTO currently on-going. According to the WTO Accessions 2019 Annual Report by the Director-General which was one of the meeting agenda items, “at the end of the year, out of the 22 ongoing accessions, 14 were considered as active, continuing their engagement with Members and/or the Secretariat”.

    With regard to The Bahamas, the only independent Caribbean country which is not yet a WTO Member, the Accessions Report 2019 noted that “the accession Working Party of The Bahamas met once and was very active until Hurricane Dorian made landfall in September, becoming the worst natural disaster in the country’s history”. The Bahamas’ accession to the WTO remains a point of contention in the country as there remains strong opposition against joining the multilateral trading body.

    Other items were discussed at the meeting which would be of interest to the Caribbean. Two Caribbean WTO representatives, Mr. Stephen Fevrier of the Permanent Mission of the Organisation of the Eastern Caribbean States (OECS) to Geneva and H.E. Mr. Chad Blackman, Ambassador of Barbados to Geneva are among the new chairpersons for WTO bodies.

    The US has resubmitted documents – a working paper and a draft General Council decision – in support of its bid to bring out changes to the way the WTO allows eligibility for special and differential treatment. The US delegation also submitted a draft General Council decision on “The Importance of Market-oriented conditions to the World Trading System”.

    The documents from the General Council Meeting may be accessed via the WTO’s documents portal.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

    DISCLAIMER: All views expressed herein are her personal views and do not necessarily reflect the views of any institution or entity with which she may be affiliated from time to time.

  • WTO Reform High on US President’s Trade Policy Agenda for 2020

    WTO Reform High on US President’s Trade Policy Agenda for 2020

    Alicia Nicholls

    Reform of the World Trade Organization (WTO) remains a high priority on United States (US) President Donald Trump’s ‘America-First’ Trade Agenda. This was confirmed in the recently released 2020 Trade Policy Agenda and 2019 Annual Report of the President of the United States on the Trade Agreements Program by the Office of the United States Trade Representative (USTR).

    Among the priorities listed for the President’s 2020 trade agenda is that the Administration “will push for a WTO that reflects current economic realities and strengthens free-market economies”. Readers would recall, for example, that last year the US stepped up its campaign advocating the introduction of criteria-based eligibility requirements, as opposed to the current and longstanding practice of self-selection as a developing country. In early February of this year, the US revised its list of developing and least-developed countries for purposes of US countervailing duties law.

    In December last year, the WTO’s Appellate Body became defunct following some two years of US blocking of appointments and reappointments to the once seven-member body over allegations of judicial overreach by the WTO’s highest arbiter of trade disputes. Earlier this month, the USTR released a report reiterating some of its criticisms of the Appellate Body’s operation.

    Consistent with the Administration’s stance, this present report has argued that “a number of features at the WTO reflect out-of-date assumptions and do not reflect current realities”.

    So what are the US priorities for WTO reform this year? The report notes that in addition to addressing the Appellate Body, the US will seek a new fisheries agreement, a digital commerce agreement, enforcing notifications obligations, and seeking reform of “special and differential treatment” for “developing” countries. It will also advocate for “other changes at the WTO that will have the WTO working for its Members.”

    The report further states that “the United States will also explore a broader reset at the WTO”. It notes, for example, that “the WTO currently locks-in outdated tariff determinations that no longer reflect deliberate policy choices and economic realities. ” As a result, it argues, “countries that have large economies that have developed significantly over the past two decades continue to maintain very high bound tariff rates, far in excess of the rates applied by the United States or to which the United States is bound”. It will also seek more plurilateral agreements.

    Other trade policy priorities outlined in the 300-plus page document are: pursuing trade agreements that benefit all Americans and enforcing US trade agreements and trade laws vigorously.

    Bearing in mind that this is a presidential election year in the US, it is likely the Trump Administration will use its ‘progress’ on WTO reform and other ‘wins’ like the recently updated NAFTA (renamed to the USMCA) and the Phase One trade deal with China as examples of a trade policy that puts Americans first in its bid to support the President’s re-election. This will definitely be a space to closely watch in coming months.

    The full USTR report may be accessed here.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

    DISCLAIMER: All views expressed herein are her personal views and do not necessarily reflect the views of any institution or entity with which she may be affiliated from time to time.