Caribbean Trade Law and Development

Tag: Caribbean

  • Owen Arthur: Champion of Small States

    Owen Arthur: Champion of Small States

    Alicia Nicholls

    The late Prof. The Rt. Hon. Owen S. Arthur (1949-2020) wore many professional hats ā€“ distinguished economist, politician, statesman, member of the British Privy Council. Prof. Arthur may best be remembered by Barbadians as our longest serving Prime Minister (1994-2008) and theĀ architectĀ of one of the greatest sustained periods of economic boom in the countryā€™s economic history surpassed only by the period under Prime Minister the Rt. Ex. Errol Walton Barrow.

    Caribbean people recall Prof. Arthur fondly as an ardent regionalist and an architect of the Caribbean Single Market & Economy (CSME). But globally, Prof. Arthur has earned his place on historyā€™s page as an indefatigable champion of Small States issues.

    In this brief tribute, I discuss Prof. Arthurā€™s contributions through his practice and leadership to the advancement of global discourse on the issues affecting Small States, such as those in the Caribbean.

    Read the full tribute in this month’s Caribbean Studies Association (CSA) Newsletter here.

  • Caribbean Trade and Development News Digest – July 12 -18, 2020

    Caribbean Trade and Development News Digest – July 12 -18, 2020

    Welcome to the Caribbean Trade & Development News Digest for the week of July 12-18, 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 WEEKā€™S HIGHLIGHTS

    This week members of the World Trade Organization got to officially meet the eight candidates in the running to succeed incumbent Roberto Azevedo as next WTO DG. From July 15-17, each candidate participated in a special meeting of the WTO General Council and took questions from the membership, followed by a press conference. You can also access each candidateā€™s statement to the General Council once available here and watch the recordings on the WTOā€™s website here.

    Barbados’ soon to be rolled out special 12-month remote visa programme called the ‘Welcome Stamp‘ has created much excitement and largely positive international headlines. However, the island may soon have competition from other jurisdictions which have also announced digital nomad visas. In early June, Estonia adopted amendments to its laws to create a digital nomad visa programme, while Bermuda this week announced it will be launching a special one-year residential certificate. Read more

    REGIONAL NEWS

    More support for Govtā€™s new visa plan

    Barbados Today: The Barbados International Business Association (BIBA) has welcomed Governmentā€™s proposed 12-month Barbados Welcome Stamp initiative. BIBA President Derrick Cummins told Barbados TODAY there were several benefits that could be derived from the initiative including increased economic activity. Read more

    Now is the moment for CARICOM to re-engage with the Dominican Republic

    Dominican Today: There is a real case to be made for CARICOM setting aside its reservations and seeking an early engagement with the new administration in Santo Domingo, not least because as a former businessman Mr Abinader knows the Anglophone Caribbean. Read more

    LIATā€™s creditors to meet July 31

    Barbados Today: Creditors are about to have their say on whether cash-strapped regional carrier LIAT should go into liquidation. Almost three weeks after Prime Minister of Antigua and Barbuda Gaston Browne announced the airline would be liquidated and a new airline formed, LIAT has called a meeting of the companyā€™s creditors to discuss its wrapping up. Read more

    Antigua hopes to save LIAT with legislation

    Nation News: The Antigua and Barbuda government has provided an avenue for the regional airline, LIAT, to seek Court protection rather than being forced into liquidation after it announced that the Companies (Amendment) Act 2020 was gazetted on Wednesday. Read more

    JAMPRO, BSJ Partner To Develop Bamboo Industry

    Jamaica Gleaner: The Jamaica Promotions Corporation (JAMPRO) and the Bureau of Standards Jamaica (BSJ) are increasing their collaboration to develop Jamaicaā€™s bamboo industry, as demand grows globally for renewable material sources for paper and other manufacturing needs. Read more

    Jamaica launches ‘Return to Set’ guidelines as filming resumes

    Loop Jamaica: JAMPRO and the Jamaica Film and TV Association (JAFTA), have officially launched the ā€œSafe Return to Setā€ industry guidelines that will govern filming during and after the COVID-19 pandemic in Jamaica. Read more

    14 Entrepreneurs to start the OECS-Caribbean export coaching programme

    Dominica News Online: The OECS-Caribbean Export Development Agencyā€™s Technical Assistance and Coaching Programme launched on July 8, 2020 with the aim of strengthening the entrepreneurial and leadership skills of 14 selected young entrepreneurs from six countries of the Eastern Caribbean. Read more

    Grenada to Reduce Airline Ticket Taxes to Encourage Regional Travel

    Caribbean National Weekly: Prime Minister Dr Keith Mitchell has disclosed that Grenada will soon be reducing taxes on airline tickets as part of measures aimed at encouraging intra-regional travel within the Caribbean Community (CARICOM). Read more

    Trinidad & Tobago PM: No Involvement in LIAT

    Newsday: The Trinidad & Tobago Prime Minister implied the Government will not step in to save cash-strapped LIAT by reversing TTā€™s past surrender of most of its shareholding, speaking at a briefing on Monday at the Diplomatic Centre, St Annā€™s. Read more

    Leaders ā€˜acceptā€™ regional airfare levies too high

    Barbados Today: High airline taxes, long blamed by many regional experts for their role in a slump in intra-regional travel, may, after all, have to be lowered, a Caribbean leader has hinted. Read more

    INTERNATIONAL NEWS

    Brexit no obstacle to WTO leadership bid, says Liam Fox

    BBC: Liam Fox has downplayed the importance of Brexit in his bid to be the first British boss of the World Trade Organization. Read more

    WTO, ICC, B20 Sound Alarm on Diminishing Availability of Trade Finance Amid Pandemic

    IISD: The World Trade Organization (WTO), International Chamber of Commerce (ICC), and Business Twenty (B20) Saudi Arabia have issued a joint statement that shines a spotlight on ā€œthe diminishing availability of trade finance.ā€ Read more

    The formidable challenges facing the WTOā€™s next Director General

    ING: The World Trade Organisation has begun choosing its new Director General, with eight candidates in the running. As if safeguarding the rules of world trade during a pandemic wasn’t challenging enough, dispute settlement needs reform, Chinaā€™s status within the world trading system has to be addressed, and success partly depends on US voters in the autumn. Read more

    India revives initiative to conclude Preferential Trade Agreement with S African Customs Union

    Economic Times: Discussions between Southern African Customs Union (SACU) [South Africa, Namibia, Botswana, Lesotho, Eswatini] and India to achieve a Preferential Trade Agreement (PTA) have been revived with the two sides holding a virtual meeting last week to discuss various aspects of the PTA. Read more

    US, India Discuss ā€˜Possibilityā€™ of Free Trade Pact

    VoA: The U.S. and India discussed the ā€œpossibilityā€ of a free trade pact, Indiaā€™s Commerce and Industry Ministry said in a statement Thursday, just days after India began free trade agreement talks with the European Union. Read more

    US cars ‘must be left out of post-Brexit trade deal’

    BBC: Safety experts are urging the UK government to exclude American cars from any post-Brexit trade deal. Read more

    EU, India move closer to free trade deal

    Deutsche Welle: Following an online summit between the European Union and India, the two powers have announced plans to set up a “high-level dialogue” on investment and trade. Details of any potential free trade pact remain uncertain. Read more

    EU talks to rescue ā‚¬750bn recovery package stall amid heated debate

    The Guardian: European Union leaders agreed to reconvene at noon on Sunday after spending an evening locked in intense negotiations in an attempt to save a summit on the terms of a ā‚¬750bn (Ā£682bn) pandemic recovery fund from an acrimonious end as the debate over the blocā€™s financial future became ā€œheatedā€. Read more

    Foreign Minister Toshimitsu Motegi eyes Britain trip next month to discuss trade deal

    Japan Times: Foreign Minister Toshimitsu Motegi could visit Britain as early as next month for negotiations on a trade deal that both countries want to finalize this year, government sources said Friday. Read more

    China says will stick with U.S. trade deal, but respond to ‘bullying’

    Reuters: China said on Thursday it will stick to the Phase 1 trade deal it reached with the United States earlier this year but warned that it will respond to ā€œbullyingā€ tactics from Washington, as relations continue to deteriorate. Read more

    Digital trade agreement of 1998 costs India, other developing nations $10 billion per annum

    Business Today: A research paper published by the United Nations Conference on Trade and Development (UNCTAD) suggests that the developing country members of the World Trade Organisation (WTO) maybe losing about $10 billion tax revenues due to a moratorium on customs duties on electronic transmissions (ET) agreed in 1998 and continued since then. Read more

    US-Africa trade will be positively impacted by AfCFTA ā€“ Florizelle Liser

    The Africa report: The Corporate Council on Africa (CCA) is the leading business association focused solely on promoting business and investment between the United States and the African continent. In this time of pandemic, both the continent and the US are looking for ways to strengthen their relationship. Read more

    Digital Trade Is the Next Big Thing in Africa

    AllAfrica: Wamkele Mene was recently appointed Secretary General of the African Continental Free Trade Area Secretariat. Because of COVID-19, free trade for countries that have ratified the agreement did not begin, as planned, on 1 July 2020. In this interview with Africa Renewal’s Kingsley Ighobor, Mr. Mene explains the way forward, how increased intra-African trade can boost economies post-COVID-19 and how digital trade will be next big thing on the continent. Read more

    China says its dollar-denominated exports, imports jumped in June, beating expectations of a decline

    CNBC: Chinaā€™s dollar-denominated exports and imports rose in June, as restrictions eased and countries started to reopen their economies. Read more

    UAE-China trade to surge on the back of strong ties between the two nations

    The National: Bilateral trade between China and the UAE will continue to surge in the coming years on the back of strong relations between the two countries, despite a temporary roadblock caused by the effects of the Covid-19 pandemic, according to top officials. Read more

    Lessons from Covid, China: India needs a new paradigm for trade, industry, and development

    The Indian Express: Promoters of free trade say countries that trade with each other are unlikely to go to war with each other. The volume of India-China trade has been growing for many years. Yet soldiers of the two countries are skirmishing along their borders. Ten years ago, the Indian ambassador to China pointed out that while the volume of trade was growing no doubt, the pattern of trade was worrying. 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:

  • CAC-ECSEA Webinar – Welcoming the New Normal

    CAC-ECSEA Webinar – Welcoming the New Normal

    On Friday, July 10, I am pleased to be a presenter in the CAC-ECSEA Webinar ‘Welcoming the New Normal’ hosted by the Caribbean-ASEAN Council. Please see flyer for details!

  • COVID-19: Why Caribbean Countries should re-examine their investment treaties

    COVID-19: Why Caribbean Countries should re-examine their investment treaties

    Alicia Nicholls

    All Caribbean countries have signed at least one treaty containing provisions meant to reciprocally protect, promote and liberalise the flow of investments between themselves and their treaty partner(s). Unfortunately, the vast majority of our countriesā€™ international investment agreements (IIAs) are older generation bilateral investment treaties (BITs) which lack many of the development-friendly language and best practices of newer vintage IIAs. The end result is that Caribbean countries could potentially face significant legal exposure to claims brought by investors under these treaties.

    Although most Caribbean countriesā€™ experience thus far with investor claims have been contract-based and not treaty-based, the threat for treaty-based claims looms larger now in the midst of the novel coronavirus (COVID-19) pandemic. This is because Caribbean governments, like those governments around the world, have had to take measures to contain and mitigate the spread of the virus, and may face claims from foreign investors who feel aggrieved by these measures and seek legal protection under these BITs. Ā 

    This article argues that the time is long overdue for Caribbean countries to re-evaluate whether their BITs remain ‘fit for purpose’ and to take proactive steps to mitigate the risk for investor disputes post COVID-19.

    CARICOM Investment treaty landscape

    CARICOM countries are party to a spaghetti bowl of IIAs. Some are investment chapters in free trade agreements, such as the CARIFORUM-EU Economic Partnership Agreement. However, the majority are the 83 BITs signed by individual Caribbean governments with external treaty partners, many dating back to the 1980-1990s. Of these BITS, 56 are currently in force according to data from UNCTAD’s IIA Navigator.

    Although the effectiveness of IIAs at attracting foreign direct investment (FDI) inflows remains debated in the academic literature, countries sign these agreements in order to increase their attractiveness to foreign investors. Signing IIAs shows their commitment to guaranteeing investors and their investments certain minimum standards of treatment, as well as protection from heavy-handed State action, such as, for example, direct or indirect expropriation of investorsā€™ investment(s) without compensation.

    Another feature of IIAs is the inclusion of Investor-State Dispute Settlement (ISDS), allowing investors to by-pass domestic courts and bring a claim against a host State before a neutral and independent arbitration tribunal, either ad hoc or established under the rules of an established arbitration centre, such as the International Centre for Settlement of Investment Disputes (ICSID).

    Though popular back in the 1980s-90s, in recent years, however, the legitimacy of ISDS internationally has been increasingly questioned for many reasons. Firstly, arbitral tribunals have been criticized for their generous interpretation of vaguely drafted provisions, such as the Fair and Equitable Treatment (FET) standard, in favour of investors. Secondly, in many cases, tribunals have arrived at different decisions on the same facts. Thirdly, there is concern about the lack of geographic and other diversity of persons who serve as arbitrators on these panels. Fourth, there is the potential of using Most Favoured Nation (MFN) clauses for treaty shopping.

    A study I conducted a few years shows that there is no consistency in Caribbean countriesā€™ BIT practice, which is reflective of our unequal bargaining power as rule-takers. Moreover, because of their vintage, our older BITs lack the best practices in development, such as more express provisions for the Stateā€™s right to regulate in the publicā€™s interest, development exceptions and provisions on investor obligations.

    There are, of course, defences that States can make to investor claims, but many of these older BITs have very broadly drafted protections and lack the exceptions or defences newer BITs have included permitting the State to take action in the interest of public health. Failing this, States would have to rely on other defences under international law, such as necessity.

    ISDS and Caribbean countries

    Caribbean countries have had some experience with claims brought by foreign investors. Although the majority of these claims have been contract-based, one of the most well-known examples of a Caribbean country which was on the losing end of an investor dispute under a treaty-based claim was that of the Dunkeld International Investment Ltd. V Government of Belize. Following Belizeā€™s compulsory acquisition of certain shares in Belize Telemedia Company, in which Dunkeld held an interest, Dunkeld brought a claim against the Government of Belize under the Belize-UK BIT. Belize was ordered by the arbitral tribunal to pay millions of dollars in compensation.

    In an excellent article from April 2020, the International Institute for Sustainable Development (IISD) raised the alarm about a possible deluge in investor claims post-COVID-19 and called for a ā€˜global, coordinated responseā€™ to this risk. This fear and call to action are not unfounded as in the aftermath of the Global Financial Crisis, Argentina faced a litany of investor claims. The stakes are even higher for small States like ours. Defending investor claims is costly and the award amounts, if on the losing end, can be in the millions or billions of dollars, a cost which cash-strapped Caribbean governments, whose economies have been severely impacted by months of shutdowns and border closures, can ill-afford to pay. Ā There is also the potential for reputational damage for those countries involved in investor disputes, which could affect their investment attractiveness. Ā 

    How can we get around this?

    Even prior to the COVID-19 pandemic, a growing number of countries around the world have already either suspended or completely overhauled their BITs to limit their legal exposure to investor claims under these treaties. For example, a couple years ago India unilaterally terminated its BITs with over 50 treaty partners, including Trinidad & Tobago, and South Africa terminated BITs with several EU countries.Ā  More recently, in May 2020, 23 EU countries signed an agreement to terminate all intra-EU BITs.

    The CARICOM Secretariat has for many years been working on a Draft CARICOM Investment Code, as well as a template Member States could use for investment agreements with third country partners, incorporating many of the most recent investment treaty best practices. However, to my knowledge, there has not been a systematic review by individual CARICOM countries of their BITs and whether they are indeed ‘fit for purpose’, that is, drafted in a way that promotes investment for sustainable development. Moreover, current economic exigencies may make such a comprehensive evaluation of our BITs low down on the policy totem pole for Caribbean countries.

    Despite this, Caribbean governments should support calls for a multilateral solution to prevent what many anticipate could be a slew of investor claims arising from governmentsā€™ COVID-19 measures. However, there are interim mitigating measures they can take, such as deciding with their treaty partners to issue interpretive notes for some of the most used (and abused) provisions by investors or carving out COVID-19 related measures from the application of ISDS.

    On a final note, Caribbean governments need to be more actively involved in efforts to ensure investment rule-making actually creates an environment conducive to attracting investment for sustainable and inclusive development. We must move from simply being ā€˜rule-takersā€™ to part of the ā€˜rule-makersā€™. As such, our governments should, for example, consider taking an active part in the UNCITRAL Working Group III on ISDS reform.

    Alicia Nicholls, B.Sc., M.Sc., LL.B is an international trade and development specialist. Read more of her commentariesĀ hereĀ or follow her on TwitterĀ @licylaw. All views expressed herein are her personal views and do not necessarily reflect the views of any institution or entity with which she may from time to time be affiliated.