Caribbean Trade Law and Development

Tag: development

  • Caribbean Trade & Development News Digest – November 22-28, 2020

    Caribbean Trade & Development News Digest – November 22-28, 2020

    Welcome to the Caribbean Trade & Development News Digest for the week of November 22-28, 2020! We are pleased to bring you the major trade and development news headlines and analysis from across the Caribbean Region and the world from the past week.

    On November 30 each year Barbados celebrates its independence. We wish fellow readers in Barbados and all Barbadians both here and in the diaspora Happy 54th Anniversary of Independence!

    THIS WEEK’S HIGHLIGHTS

    This week, the World Trade Organization (WTO) released its World Trade Report 2020 with a focus on how governments use policies to foster digital innovation. Read the press release and access the full report here.

    While China and Australia are among the signatories to the recently signed RCEP, that has not slowed simmering diplomatic and trade tensions between the two Asia-Pacific nations as China slapped tariffs on wine imports from Australia. Read more in this Reuters story here.

    As in-person Brexit negotiations continued this week, there is some skepticism on whether at this late stage a deal is even possible before the expiration of the transition period. Read this commentary by Euronews here.

    Looking regionally, the Caricom Council on Trade and Economic Development (COTED) held a virtual meeting this week on November 27-28, 2020 .

    A Caribbean Manufacturers Association (CMA) was launched this week. Read more . The UWI, CDB and EU have collaborated to produce the first State of the Caribbean Climate Report. Access the full report here.

    At Barbados’ Virtual ‘We Gathering’ Independence event, which brought together persons from across the island and the world, Minister in the Ministry of Foreign Affairs, Jerome Walcott noted that the country will be opening three embassies in African countries next year which will have commercial attaches, as well as deepening its engagement with the Barbadian diaspora by establishing a diaspora policy and a national diaspora registry.

    REGIONAL NEWS

    Cubans Seek Alternatives after Western Union Closes

    Havana Times: Cubans are looking for new alternatives so that remittances can continue to flow from the US to Cuba via cryptocurrencies or debit cards, after Western Union closed its offices on Monday. This has been one of the hardest blows for families on both sides of the Florida Strait, reported Reuters. Read more

    Because of Trump sanctions, Western Union remittances come to an end in Cuba
    NBC: “The problem is not the closure of Western Union, but that Western Union is practically the only U.S.-to-Cuba provider of remittance payments,” said a Washington, D.C-based analyst. Read more

    New CARICOM Manufacturers’ Association formed

    Loop: Six manufacturing associations across the Caribbean have agreed to join forces under a new CARICOM Manufacturers’ Association (CMA). Read more

    CARICOM congratulates Barbados on 54th Independence Anniversary

    BarbadosToday: The Caribbean Community (CARICOM) has extended congratulations to the Government and People of Barbados on its 54th Anniversary of Independence. Read more

    Blowout Of CARICOM COVID-19 Travel Bubble – Regional Heads Squabble Over Country Classification

    Jamaica Gleaner: The contents of a recent letter from Gaston Browne, the Antigua and Barbuda prime minister, to his Barbados counterpart, Mia Mottley, appears to reflect both frustration in St John’s and long-running difficulty among Caribbean Community (CARICOM) leaders to agree and implement common policies. Read more

    Barbados and Scotland launch three-day cyber event

    BarbadosToday: The first-ever virtual trade mission between Barbados and Scotland was launched today. The two countries, determined that the global COVID-19 pandemic will not be a deterrent, are staging the three-day event to showcase products and services from both territories. Read more

    Protect our share

    Barbados Today: Caribbean Community (CARICOM)-based manufacturers have been urged to scale up their production capacity, even amid the COVID-19 pandemic, or risk losing important market share to outsiders. Read more

    New measurements legislation coming

    Barbados Today: Minister of Energy, Small Business and Entrepreneurship Kerrie Symmonds, speaking on Monday during a stakeholders’ sensitisation forum on the Bill via Zoom, said the new legislation is an important step to modernising the economy and enhancing the island’s export potential. Read more

    Gopee-Scoon: Let Caribbean pool its production resources

    Newsday: Trade Minister Paula Gopee-Scoon urged manufacturers across the Caribbean to pool resources for their mutual benefit, addressing the virtual signing ceremony of the Caribbean Manufacturers Association (CMA) on Wednesday. Read more

    Cuba and Jamaica strengthen trade ties in medical field

    Prensa Latina: Cuban and Jamaican companies from the medical sector held an entrepreneurial forum on Friday, under the auspices of the Chamber of Commerce of Cuba (CCC) and the Jamaican Embassy in Havana. Read more

    JSWIFT Exceeding Turnaround Time For Processing Trade Documents

    JIS: The Jamaica Single Window for Trade (JSWIFT) has been doing same day processing for approximately 50 to 70 per cent of documents submitted daily, thereby exceeding expectations of the online portal. Read more

    Jamaican businesses invited to participate in US virtual trade mission and networking event

    Jamaica Observer: The American Chamber of Commerce of Jamaica (AMCHAM) is partnering with the US Department of Commerce’s Commercial Service and the US Embassy in Jamaica to host a Caribbean region virtual trade mission on December 1. Read more

    Expanding and developing the Guyana economy

    Stabroek: When oil and gas production fields in Guyana are fully operational, the fossil energy sector is likely to be the predominant source of national economic activity through its direct contribution to foreign exchange earnings, government fiscal revenues, employment and labour incomes, and local purchases of goods and services. Read more

    Despite major oil discoveries World Bank still lists Guyana among poorest in South America

    Stabroek: Guyana’s multiple major oil discoveries beginning in May 2015 may have set the country on the path to realising a level of wealth not before seen in the Caribbean, but a recent World Bank Review still regards the country as being “one of the poorest in South America.” Read more

    Guyana, Suriname to deepen economic and social cooperation

    Jamaica Observer: President Irfaan Ali has pledged to deepen the bond between Guyana and neighbouring Suriname. Read more

    Guyana & Suriname sign MoU to bridge the Corentyne River

    LoopNewsCaribbean: Trade between Guyana and Suriname will soon have a new route as both governments finalised and signed a Memorandum of Understanding yesterday to construct a bridge over the Corentyne River. Read more

    Belize to benefit from new tax breaks in Chetumal

    Breaking Belize News: Тhе bоrdеrѕ аrе сurrеntlу сlоѕеd, but whеn thеу rеореn, Веlіzеаnѕ ѕhорріng іn Сhеtumаl, Quіntаnа Rоо, Мехісо wіll bеnеfіt frоm fuеl аnd tах brеаkѕ tо bе іntrоduсеd аnd ехраndеd аlоng thе ѕоuthеrn frоntіеr аѕ wеll аѕ thе nоrth, ассоrdіng tо Rеutеrѕ.  Read more

    Over 600 heads of cattle going to Mexico in December

    Breaking Belize News: Тhе trаdе оf lіvеѕtосk bеtwееn Веlіzе, Мехісо, аnd Guаtеmаlа, ѕtаllеd іn thе lаttеr dауѕ оf thе Dеаn Ваrrоw аdmіnіѕtrаtіоn, hаѕ bееn rеvіvеd іn еаrnеѕt bу ѕuссеѕѕоr Јоhn Вrісеñо аnd hіѕ Міnіѕtеr оf Аgrісulturе аnd Еntеrрrіѕе, Јоѕе Маі. Read more

    CDB, IMPACS and OECS partner to establish maritime single window

    Menafm: A maritime single window will be established in the Eastern Caribbean in the upcoming months says director of the projects department at the Caribbean Development Bank (CDB) Daniel Best. Read more

    Working together vital

    Barbados Advocate: The challenges faced this year have highlighted the importance of closer integration and collaboration to help ensure that fragile regional economies can more effectively absorb and rebound from external shocks. Read more

    Grenada and Georgia sign Visa Waiver Agreement

    NowGrenada: Grenada‘s Ambassador and Permanent Representative to the United Nations, Her Excellency Keisha A McGuire, and her Georgian counterpart, His Excellency Kaha Imnadze, Ambassador and Permanent Representative of Georgia to the United Nations, executed agreements that would waive visa requirements, allowing nationals of Grenada and Georgia to travel between the 2 countries without a visa for stays not exceeding 90 days. Read more

    Security forces start planning for UNCTAD 15

    BarbadosToday: Members of the local and regional security cluster for the UNCTAD 15 Conference recently stepped up their preparation for the Conference with a training exercise at the Headquarters of the Regional Security System (RSS) at Paragon, Christ Church. Read more

    INTERNATIONAL NEWS

    Global tariff relief on medical goods urged by group of nations

    Livemint: The European Union said it would join forces with countries including Canada and Japan to push fellow World Trade Organization members to ease tariffs on medical equipment needed to fight Covid-19, the latest effort to bolster supply chains amid the pandemic. Read more

    China slaps tariffs of up to 212% on Australian wine imports

    CNN Business: Australian winemakers have been dealt a huge blow from China as tensions continue to spiral between the two countries. Read more

    PM warns economic challenges lie ahead as China’s wine tariffs hit

    The Sydney Morning Herald: Prime Minister Scott Morrison has warned of more economic challenges ahead, saying the age of certainty enjoyed before the coronavirus pandemic was an aberration with more disruption caused by global competition likely to feature in coming years. Read more

    China increases coal import quotas but Australia likely to be excluded

    The Guardian: China’s foreign ministry has warned Australia to handle the bilateral relationship with “mutual respect and equality” after it imposed “devastating” tariffs of up to 212% on Australia wines. Read more

    Australia prepares to escalate action against China to World Trade Organization over barley tariffs

    ABC (Australia): As tension grows over Beijing’s massive tariffs on Australian wine, the Federal Government is continuing with plans to take China to the World Trade Organization over barley exports. Read more

    Ngozi Okonjo-Iweala: how global and local experience would play out in WTO top job

    The Conversation: The global economy faces profound uncertainties, particularly in the face of the COVID-19 pandemic. In addition, faith in the efficacy of international bodies such as the World Trade Organisation (WTO) has been weakened by a power struggle between China and the US. Read more

    UK, France sign new deal to stop illegal migration across Channel

    Reuters: Britain and France signed a new agreement to try to stop illegal migration across the Channel on Saturday, upping patrols and technology in the hope of closing off a dangerous route used by migrants to try to reach the UK on small boats. Read more

    How close to a Brexit trade deal are we?

    BBC: With only just over a month to go before the transition period ends, the rumour mill keeps churning relentlessly. Runes are read out loud, and potential – though never confirmed – compromise solutions are leaked to the hungry UK media (the European press is rather more preoccupied by Covid-19 and Christmas plans).

    Brexit talks restart in person in London as clock ticks down

    Al Jazeera: Negotiators meet in last-ditch bid to secure deal before the UK’s transition period with the EU ends on December 31. Read more

    Last-ditch Brexit trade talks resume amid growing EU scepticism

    The Guardian: Michel Barnier has told bloc he is prepared for four more days of make-or-break negotiations. Read more

    UK-EU trade deal would avoid years of acrimony, says funds industry

    Reuters: A trade deal between Britain and the European Union would help open the door to cross-border financial services from January and avoid years of acrimony, industry officials said on Monday. Read more

    British, Irish prime ministers discuss EU trade negotiations

    Reuters: British Prime Minister Boris Johnson spoke with Irish Taoiseach Micheal Martin on Friday evening and discussed progress in UK-EU trade negotiations, the UK government said, at a time when differences remained with the EU on a Brexit trade deal. Read more

    Mercosur/EU trade deal: “time is pressing,” cautions Uruguay

    Mercopress: Uruguayan foreign minister Francisco Bustillo leaves this week for Spain the first of a round of European countries ahead of the coming Mercosur summit to be held next month, under the presidency of Uruguay. Finalizing the Mercosur/European Union trade agreement is the focus of the trip. Read more

    Europe ‘cannot afford’ to bow out of Mercosur agreement, says academic

    Euractiv: The crisis of multilateralism, driven by the competition between the US and China, and a lukewarm push from the current leaders of the EU and Mercosur, explains why the agreement between these two blocks is such a challenge, analysts say. Read more

    Ottawa unveils funding for poultry and egg farmers hurt by free-trade deals

    CBC: Canadian egg and poultry farmers who’ve lost domestic market share due to two recent free-trade agreements will soon have access to $691 million in federal cash, Canada’s agriculture minister announced Saturday. Read more

    EU Parliament Backs Lobster Deal And EU-US Mini Trade Pact

    VOANews: The European Union parliament on Thursday approved a mini trade deal with the United States, which includes the elimination of customs duties on U.S. lobster imports. The passage with 638 votes for, 45 against and 11 abstentions was the last major political step for the deal to come into effect. Read more

    Commons considers Bloc bill to end dairy concessions in trade deals

    CBC: When Canadian trade negotiators begin talks with the United Kingdom next year on a permanent bilateral trade deal, their hands could be tied when it comes to offering any future dairy, egg or poultry concessions — if Parliament passes a new private member’s bill that saw its first hour of debate on Tuesday. Read more

    New regional trade deals to help China ‘sustain its advantages’ in global supply chains

    CNBC: China is set to remain a key player in global supply chains, thanks to a combination of factors ranging from the coronavirus pandemic to new trade agreements. Read more

    Africa to welcome e-commerce to speed up trade

    Menafm: A virtual import and export meeting and exhibition opened on Tuesday, November 24, with the Zambian government advising African countries to welcome e-commerce in order to speed up trade. Read more

    AfCFTA: African Finance Ministers to discuss payments system for trade bloc

    Nairametrics: The African Union is set to discuss the launch of a payment system for the African Continental Free Trade Area (AfCFTA). Read more

    AfCFTA Secretariat rolls out ‘vision’ initiative

    Ghanaweb: With barely two weeks left to the Extraordinary Summit of African Union Heads of State on 5th December, 2020, ahead of the expected start of trading under AfCFTA on 1st January 2021, the AfCFTA Secretariat is pleased to announce AfCFTA Vision, an Initiative in partnership with the Sankoree Institute, an affiliate of AfroChampions. Read more

    Why India Refused to Join the World’s Biggest Trading Bloc

    Foreign Policy: On Sunday, Nov. 15, 15 Asian nations representing nearly a third of the global economy signed the Regional Comprehensive Economic Partnership (RCEP), forming the world’s biggest trading bloc. But one Asian economic giant was missing: India. Despite protracted negotiations, New Delhi refused to join the accord. Read more

    PM Modi, Johnson discuss ‘ambitious roadmap’ for India-UK ties in next decade

    Hindustan Times: A Downing Street spokesperson said Prime Minister Narendra Modi and UK’s Boris Johnson discussed joint efforts to find treatments and vaccines for coronavirus and welcomed the collaboration between the two countries’ leading scientists. Read more

    Dombrovskis: Deep and comprehensive trade deal with the US ‘not feasible’

    Euractiv: European Commission executive vice-president, Valdis Dombrovskis, believes that Joe Biden’s victory will bring a fresh start to the EU-US relations. But there are limits, as he considers that it would not be feasible to try again to negotiate a deep and comprehensive trade deal like the TTIP, he told EURACTIV in an interview on Wednesday (25 November). Read more

    France is pushing ahead with its tax on US Big Tech after a 10-month standoff with Trump, setting the stage for a trade war over makeup and handbags

    Business Insider: France has demanded US tech giants pay its new 3% digital services tax, in a re-escalation of a trade war with the White House that was put on hold in January. Read more

    STRAIGHT FROM THE WTO

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  • US Revises and Resubmits Draft Proposal on Special & Differential Treatment at WTO

    US Revises and Resubmits Draft Proposal on Special & Differential Treatment at WTO

    Alicia Nicholls

    On November 25, 2019, the US recirculated a Draft General Council Decision entitled “Procedures to Strengthen the Negotiating Function of the WTO” for consideration by the World Trade Organization’s General Council – that organisation’s highest decision-making body – at its upcoming December 9-11, 2019 meeting.

    Background

    In recent times, the ability of WTO Members to self-designate as ‘developing countries’, and thereby be eligible for special and differential treatment under the WTO’s agreements, has become increasingly contentious. Thus far, the European Union (EU), Canada, the US and Norway have tabled proposals, which to varying degrees, call for a rethinking or reforming of the current eligibility model for special and differential treatment in the WTO. Developing countries, on the other hand, argue for a retention of the eligibility status quo, while noting that the focus should be on the Doha mandate of ensuring effectiveness of special and differential treatment.

    Earlier this year, the US took the call for reform a step further by not only tabling a lengthy paper in which it argued that self-designation risks condemning the WTO to institutional irrelevance, but followed this up with a draft General Council decision in which it proposed four non-cumulative, exclusionary criteria which would, if approved and implemented, exclude a large number of developing countries from eligibility from special and differential treatment in current and future WTO negotiations.

    Recall also that on July 26, 2019, United States (US) President Donald Trump signed a memorandum on reforming developing country status in the World Trade Organization (WTO). This memorandum mandated the United States Trade Representative (USTR) to secure changes to the current method of WTO members’ eligibility for special and differential treatment (S&DT) in the WTO. Failing this, it outlined specific steps the USTR should take.

    The resubmitted proposal

    The resubmitted proposal dated November 25, 2019 has been slightly amended. It still proposes four exclusionary and non-culminative criteria which, if approved and implemented, would preclude Members meeting any of the criteria from eligibility for special and differential treatment in current or future WTO negotiations or under any of the Agreements coming out of such negotiations. However, criteria three and four have been amended as follows (see bold text):

    i. A WTO Member that is a Member of the Organization for Economic Cooperation and Development (OECD), or a WTO Member that has begun the accession process to the OECD;
    ii. A WTO Member that is a member of the Group of 20 (G20);
    iii. A WTO Member that the World Bank has classified as a “high income” country for the three consecutive years immediately prior to the date of this decision or classifies as a “high income” country for a third consecutive year or any three consecutive years thereafter; or
    iv. A WTO Member that accounts for no less than 0.5 per cent of global merchandise trade (imports and exports) for the three consecutive calendar years immediately prior to the date of this decision or for a third consecutive year or any three consecutive years thereafter.

    It also added that “Nothing in this Decision precludes a Member seeking to address particular needs during a current or future WTO negotiation” .

    It is no secret that the US’ main targets are larger emerging economies, such as China and India, which continue to self-designate as developing countries. Indeed, the first two criteria are hardly problematic as a country which is an OECD or G20 member, or is acceding to the OECD, would have a level of economic clout that makes the argument for special and differential treatment unpalatable. Additionally, criterion 4 is meant to capture a number of emerging economies with shares of world merchandise trade of 0.5 percent or more.

    But much like the original proposal, criterion 3 of this revised proposal still unfortunately manages to potentially capture a few small States which really are deserving of special and differential treatment.

    Currently, four Caribbean countries (Antigua & Barbuda, Barbados, St. Kitts & Nevis and Trinidad & Tobago), and small States like Brunei Darussalam and Seychelles, which are presently classified as “high income” countries by the World Bank for lending purposes could potentially still be excluded from special and differential treatment if they have been classified by the World Bank as “high income” for a third consecutive year or any three consecutive years thereafter .

    The “high income” and the “upper middle income” classifications, have always been problematic for the Caribbean because they rely primarily on GNI per capita, an ineffective measure of development. It has been on this ineffective criterion that some Caribbean countries have been excluded from much needed concessionary financing.

    Introducing such a criterion into the WTO for the basis of determining development level would only continue this injustice. It would also be manifestly ‘anti-development’ because it would exclude these small countries from accessing flexibilities, such as longer transition times and technical assistance, needed in order to meet their WTO commitments under future WTO agreements.

    Moreover, these countries are too small to have any appreciable ability to affect or distort global trade. Perhaps it may be best to either remove the “high income” criterion from the US proposal, or at the very least, link it with another criterion like criterion four.

    On another note, the General Council will also, inter alia, be considering a draft decision on the functioning of the Appellate Body in a last ditch effort to save the WTO’s appellate jurisdiction.

    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.

  • Sustainable Infrastructure Investment Indispensable for Caribbean Competitiveness and Growth

    Sustainable Infrastructure Investment Indispensable for Caribbean Competitiveness and Growth

    Alicia Nicholls

    Earlier this week, Barbadians experienced something that for many of us was a lifetime first – two consecutive days of island-wide electrical blackouts. While this phenomenon has made international news, it should be noted that such occurrences are very rare in Barbados, a country which has long boasted of a high level of human development which belies its small size.  It should also be remembered that similar events have happened in much more resource-endowed countries.

    According to information released by the island’s lone electrical company, the Emera-owned Barbados Light & Power Company (BL&P), the blackout was caused by an unfortunate combination of aging equipment and bad fuel. The blackout also had several spinoff effects. It led to water outages in many parts of the island due to the reliance of the Barbados Water Authority’s pumps on electricity. Moreover, some customers also had issues with their mobile service perhaps due to the heavy reliance on data caused by the unavailability of wifi.

    In the aftermath of ‘powergate’ in Barbados, there will be much discussion about the impact the two-day blackout has had on productivity, private sector profits and the Barbadian economy. What it reiterates, though, is that sustainable public and private infrastructure investment is indispensable for Caribbean competitiveness, trade and growth.

    Sustainable Infrastructure

    From the roads on which we drive, the ports and airports, the telecommunications network on which we depend for our daily communications, sanitation networks and the like, infrastructure comprises the physical building blocks of our countries. Infrastructure, for example, is what helps to connect suppliers with consumers, and exporters with foreign markets. It is needed for our daily work, play and comfort. Spillovers for the economy include increased productivity, economic inclusion, job creation and growth.

    Increasingly, owing to the need to build climate resilience, the conversation is turning towards sustainable infrastructure. CRC Research defines sustainable infrastructure as “the designing, building, and operating of these structural elements in ways that do not diminish the social, economic and ecological processes required to maintain human equity, diversity, and the functionality of natural systems.”

    The need for sustainable infrastructure is mentioned throughout the Sustainable Development Goals which comprise the United Nations’ Agenda 2030. For example, SDG 9 speaks to building resilient infrastructure. A report produced by The Economist magazine also highlighted the critical role of infrastructure in achieving sustainable development.

    Sustainable Infrastructure key to building competitiveness

    It is little wonder, therefore, why infrastructure is among the indicators of a country’s competitiveness, as seen with the World Economic Forum (WEF)’s Global Competitiveness Index. Countries, such as Singapore, New Zealand and Denmark, which rank high on that index, as well as on the World Bank’s Doing Business Index, almost always score high for their infrastructure. Jamaica, which currently leads the region in ease of doing business, has, among other things, made substantial investments in improving its infrastructure. The Transjamaica Roadway and the new Single Window for trade are two examples.

    Capital expenditure projects, such as for the upgrading of port facilities, hospitals and road infrastructure, are often costly for cash-strapped governments. As such, many governments turn to multilateral development agencies for loans for infrastructure development. It is also why the China-initiated Belt and Road Initiative (BRI) has become so attractive to many governments, including some in the Caribbean, which have signed Memoranda of Understanding with China on this.

    Private sector has role to play

    However, it is not only Governments which have a role to play in ensuring sustainable infrastructure. Private sector entities are increasingly taking over functions once believed to be the domain of the State, including the provision of utilities. As such, these private entities also have a duty to ensure that they continuously invest in upgrading their infrastructure in order to meet international best practices for efficiency and environmental sustainability. To do otherwise would be detrimental to the customers which rely on them, as well as the economy and society as a whole.

    Alicia Nicholls, B.Sc., M.Sc., LL.B. is an international trade and development consultant. Read more of her commentaries here and follow her on Twitter at Licylaw.

  • Prospects for deepening Caribbean-Africa Trade and Economic ties

    Prospects for deepening Caribbean-Africa Trade and Economic ties

    Caribbean and African countries share an extensive history forged from the scars of the egregious 300-year long Trans-Atlantic slave trade, the abuses of colonialism and the anti-colonial/independence struggle. As such, Africa’s imprint on the Caribbean is not just phenotypical, but its unmistakable genetic markers course through many of the rhythms, music and culinary delights which characterise the Caribbean cultural DNA.  

    Last week, President of Ghana, His Excellency Nana Akufo-Addo, visited five Caribbean countries: Barbados, Guyana, St Vincent and the Grenadines, Trinidad and Tobago, and Jamaica. Aiming to build on the shared historical and cultural ties between his continent and the Caribbean, President Akufo-Addo took the opportunity to sign bilateral cooperation agreements with these countries and to encourage Afro-Caribbean descendants to take part in Ghana’s Year of Return which marks 400 years since the commencement of the Trans-Atlantic slave trade which officially ended in the early nineteenth century.

    President Akufo-Addo’s visit presents an opportune occasion to consider the prospects for deepening Caribbean-African trade and economic ties, particularly in light of the recent entry into force of the African Continental Free Trade Area (AfCFTA) which will transform 52 out of 55 African countries into the world’s largest free trade area.

    Current Caribbean-Africa trade

    The Caribbean Community (CARICOM) comprises 15 Member States and territories in the Caribbean. Africa is one of the few trading partners with which the region enjoys a trade surplus. According to data from ITC Trade Map, CARICOM countries exported US$449 million worth in goods to Africa in 2017, representing 2.6% of CARICOM’s total exports to the world. Whereas, the region imported US$258 million worth of goods from the continent in that same year. Africa’s exports to CARICOM represented a mere 0.06% of its total world exports in 2017.

    On an international relations front, CARICOM countries and many African countries are both members of the Africa, Caribbean, Pacific (ACP) grouping and the Commonwealth of Nations and cooperate in multilateral fora, such as the World Trade Organisation and the United Nations. While CARICOM currently does not have a free trade agreement with any African country, some individual CARICOM Member States have bilateral investment treaties (BITs) and double taxation agreements (DTAs) with individual African States, not all of which are in force.

    Tourism between Africa and the Caribbean remains underdeveloped due to the lack of direct air links. Getting to Africa from the Caribbean or vice versa requires going through a major international gateway, usually London or New York City.

    Prospects for deepening Caribbean-Africa trade

    There are several developments which are promising for an expansion of Caribbean-Africa trade.

    1. Caribbean push for export partner diversification

    Caribbean countries have stepped up their attempts to diversify their export partners, particularly through promoting south-south trade. Thus far, among CARICOM Member States, Guyana, Haiti, Jamaica, Trinidad & Tobago and Suriname have a diplomatic mission in at least one African country. Barbados may soon join that list after announcing an intention to establish an embassy in Ghana by the end of 2019.

    Maintaining a diplomatic presence is often a costly exercise for small resource-constrained countries. Establishing a joint diplomatic mission in strategic African capitals, similar to what the Organization of Eastern Caribbean States (OECS) has done in key international capitals, is something CARICOM may wish to consider. Trade and investment liaisons could be attached to the missions to assist in promoting business and investment. Since it is firms which trade and not countries, building linkages between chambers of commerce and investment promotion agencies in the Caribbean and African countries would also be key.

    • Africa is on the rise

    Africa is home to some of the world’s fastest growing economies and according to the United Nations (UN), the world’s youngest population, comprising one fifth of the global youth population (aged 15-24). Despite challenges related to unemployment, Africa’s youth has the potential to unleash positive change and are an asset in a rapidly digitalizing global economy. The perceived lack of opportunities for youth in Africa may be the Caribbean’s gain leading to the export of high skilled services. Ghana, for example, which has a surplus of nurses, has agreed to assist Barbados with its nurses shortage. Indeed, there is already a small but growing ‘recent’ African diaspora in many Caribbean countries making sterling contributions in diverse fields, such as education, medicine, law and the like. There are also prospects for Caribbean-Africa trade and economic cooperation and sharing of expertise, particularly in the areas of education, renewable energy and health. Deepening and expanding links between universities in the Caribbean and those in African countries would allow for student and faculty exchanges.

    •  Increased Caribbean-African awareness

    Caribbean people are becoming better aware of the continent through for example, Nollywood/Gollywood movies, African music, traditional African dance and the Africa Channel broadcast in the US and the Caribbean. The potential exists for collaboration in the creative industries, particularly in film production, dance, the visual arts and music. Caribbean musical genres such as reggae, dancehall and soca are becoming quite popular in some African cities. For instance, renowned Nigerian artiste Timaya and famous Trinibagonian soca artiste Machel Montano have collaborated on several songs.

    In the area of tourism, Caribbean persons of African descent are increasingly interested in travelling to West African countries like Ghana, from which the majority of persons enslaved during the Trans-Atlantic slave trade were derived, in order to trace their ancestral roots and explore the Motherland.

    Barbados recently announced visa waivers for several African countries, including Ghana, which would facilitate greater tourism and investment. The lack of direct air or modern day sea links between the Caribbean and the African continent is a challenge. It is therefore refreshing to hear the current Barbados Prime Minister speak to the possibility of negotiating an air services agreement with Ghana. President Adufo-Addo and Prime Minister Mottley also spoke of Barbados being a gateway for Africa-Caribbean trade. Barbados, because of its location as the most easterly island in the Eastern Caribbean, was one of the first stops in the Trans-Alantic Slave Trade, the island would geographically make a logical hub for any direct Caribbean-Africa air links.

    • AfCFTA – a single African market

    At a time when some major world powers are retreating to protectionism and isolationism, all but three countries on the African continent (except Benin, Eritrea and Nigeria) have formed a continental-wide single market, a step towards a continental customs union.

    The AfCFTA was signed in March 2018 and entered into force on May 30, 2019, thirty days after The Gambia became the 22nd country to sign. It represents the world’s largest free trade agreement with a collective GDP of $2.5 trillion and a population of 1.2 billion people. The AfCFTA will eliminate tariffs on 90% of goods trade within the countries party to it. Once implemented, the AfCFTA is estimated to boost intra-African trade (which currently remains less than 20% of total African trade), promote economies of scale, industrialization, improve the competitiveness of African companies and lead to wider welfare and income gains.  

    While there is still much unfinished work to be done, as well as political, legal and regulatory hurdles to overcome before the ambitious agreement can be rendered operational, some of the potential benefits of the AfCFTA are apparent. Firstly, it aims to transform what is currently a disjointed and fragmented grouping of disparate regional markets and spaces with a maze of regulatory and legal barriers into one single continental market, making for a potentially more appealing and navigable market for investors. A company which establishes in one African State would not have to navigate a perplexing labyrinth of complicated rules of origin, regulations and other non-tariff barriers in order to trade across the continent.

    Secondly, the vast African continent currently has several regional economic groupings based primarily on geographic region and with varying levels of integration. Though these groupings are not replaced by the AfCFTA, the AfCFTA means that CARICOM and other third parties seeking to secure a free trade agreement with Africa could negotiate with one grouping as opposed to several.

    Thirdly, the AfCFTA and the Protocol on the Free Movement of Persons are potentially welcomed news for third parties seeking to establish a business in Africa as it could make sourcing inputs and hiring staff from other parts of the continent easier and much cheaper.  

    Additionally, both Africa and the Caribbean, which each comprise countries separated by language and geography, are in the midst of creating regional integration movements. CARICOM, and in particular the OECS sub-grouping which has evolved into a deeply integrated sub-region, can share its own experience as it seeks to consolidate its own CARICOM Single Market and Economy (CSME). It can also learn from any successes of the AfCFTA.

    In summary, Caribbean-Africa trade is small but there is potential for growth given Caribbean countries’ export partner diversification efforts, Africa’s economic rise and increased Caribbean-African cultural awareness. Additionally, the single African market contemplated by the AfCFTA is an exciting development which makes the prospects all the more alluring for deepened Caribbean-Africa trade based on a shared history, friendship and the potential for mutual benefit.

    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.