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Embracing ‘Mother India’: Some thoughts on prospects for enhanced India and Trinidad & Tobago trade

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Alicia Nicholls

I was quite delighted when I read in the news last week that the Prime Minister of Trinidad & Tobago, the Hon Kamla Persad-Bissessar, is currently on a ten day official mission to India at the invitation of Indian Prime Minister, the Hon Manmohan Singh. Though I am not Trinibagonian or Indian for that matter, the news piqued my interest, particularly because I am a firm believer in south-south trade and development.  Two weeks ago, I wrote about the prospects of enhancing Brazil-CARICOM trade. This week, the state visit by Prime Minister Persad-Bissessar serves as a good backdrop against which to consider the prospects for enhanced Trinidad & Tobago-India trade.

India-Trinidad & Tobago connection

Trinidad & Tobago proudly calls itself the land of steelpan, calypso and chutney. Successive waves of European colonialism, indenture-ship and later waves of migration have made the twin island republic one of the most multicultural societies in the Commonwealth Caribbean.

Trinidad & Tobago and India share more than just a deep passion for cricket. Though separated by many thousands of kilometers of land and sea, they are united by deep historic and cultural bonds rooted in the colonial experience. Indo-Trinibagonians are estimated to comprise 42% of that country’s population. Take a walk down the streets of Port of Spain on an average day and you can see restaurants and street vendors selling Indian-inspired local delicacies like roti and buss-up-shut. The uptempo rhythm of Chutney music shares the airwaves with soca and calypso and national holidays like Indian Arrival Day, Diwali and Eid-ul-Fitr are celebrated with reverence.

Prime Minister Kamla Persad-Bissessar, whose ancestral village is in Bihar in India, is the first woman and the second person of Indian descent to ascend to the reins of Government in Trinidad & Tobago. She is also the first woman of the wider Indian diaspora to become a Head of Government.  Accompanied on the mission by a high-level ministerial and business delegation which also includes cricketing legend, Brian Lara, Prime Minister Persad-Bissessar is the chief guest at the 10th Pravasi Bhartiya Divas (PBD) ‘Global India-Inclusive Growth’ in Jaipur and will be conferred the coveted Pravasi Bharatiya Samman Award.  The PBD is a prestigious annual event which unites distinguished persons of Indian origin across the world. The event is part of India’s wider efforts to court and harness the potential of its vast diaspora for socio-economic development in the homeland and Trinidad & Tobago has seized the opportunity with open arms.

Trinidad & Tobago-India Bilateral Trade

Trinidad & Tobago and India have long shared strong diplomatic ties, which have been cemented through formal and informal cultural exchanges over the years, including the establishment of the Mahatma Gandhi Institute for Cultural Cooperation in Port of Spain and the provision of Indian Technical and Economic Cooperation (ITEC) programme scholarships to  Trinibagonian students each year.

Trinidad & Tobago and India already do a fair and growing amount of bilateral trade.  According to a recent study published by the Export-Import Bank of India, Trinidad & Tobago is the leading country for Indian imports from the region, accounting for 79% in 2009-10 and is the second largest importer of Indian goods from the region (after the Bahamas).  The report reveals that manufactures of metals account for nearly half of Trinidad & Tobago’s imports from India followed by petroleum products, primary & semi-finished iron & steel, pharmaceutical products and plastic & linoleum products. Trinidad & Tobago is also the largest destination for Indian investment in the region, receiving 67.5% of these flows. The main sectors  for Indian investment in Trinidad & Tobago include finance, iron and steel and metal and food processing. Several major Indian multinational firms like Arcelor Mittal and the New India Assurance Co already have a presence in that country. India and Trinidad & Tobago also have a double taxation treaty.

Embracing ‘Mother India’

The move by Prime Minister Persad-Bissessar to capitalize on India’s overtures towards engaging its diaspora for homeland development is a smart and strategic one. Despite its current economic woes, India remains one of the most robust and dynamic economies in the world.  Currently the world’s tenth largest economy, India is predicted by the economic think tank the Centre for Economics and Business Research (CEBR) to become the world’s  fifth largest economy by 2020.   Besides the gains which Trinidad & Tobago-India trade present for south-south trade, Indian expertise and investment could help in Trinidad & Tobago’s export diversification, while greater trade links with India could help reduce the vulnerability associated with an over-reliance on too few export markets.

Moreover, the move to embrace ‘Mother India’ is one which has global precedent. The Pacific island nation of Mauritius, which bears several similarities with Trinidad & Tobago including a large Indian diaspora, has strategically deepened its economic and cultural links with the sub-continent.  Mauritius is not only among the top direct investors in India, but the island is currently one of the preferred destinations for Indian outward FDI and serves a gateway for Indian investment in Africa.

Though Indian investment in foreign countries has slowed, closer economic ties between India and Trinidad & Tobago could make it easier for Indian businesses to invest in and do business in Trinidad & Tobago and vice-versa.  The Export-Import Bank of India study cited several areas of potential sectors of Indian investment in Trinidad & Tobago, chiefly energy, fish processing, film and ICTs.  Besides its low energy costs, well-skilled workforce and favourable investment climate and incentives package, the twin island republic’s geographic location  has also been touted by its Prime Minister as the perfect base for Indian investment in the Latin America and Caribbean (LAC) region and for Ayurveda and wellness centres specialising in traditional Indian medicine and healing.

In terms of Trinidad & Tobago-India services trade, there is much potential as well given the skills and know-how which Indian professionals could continue to bring to Trinidad & Tobago, particularly in the areas of engineering, traditional Indian medicine and information technology. This expertise sharing will not be one-way. As Prime Minister Persad- Bissessar  acknowledged, Trinidad & Tobago can provide to India over a hundred years of technical expertise in oil and natural gas production. Indeed, Trinidad & Tobago is already sharing this expertise with other developing countries, including Ghana.

There is also much scope for expanded cultural industries trade and tourism given the strong cultural affinity many in the Indo-Trinibagonian community feel with ‘Mother India’ and the popularity of Bollywood music and films in Trinidad & Tobago. Trinidad & Tobago has also signaled an intention to promote steelpan music in India. Despite the long distance and prohibitive costs of air travel, Indo-Trinidadians seeking to trace their Indian roots and to learn about their ancestral home could be a good target market for Indian tourism officials. In regards to Indian tourism in Trinidad & Tobago, the Trinidad & Tobago government has already waived visa restrictions on Indians visiting that country for tourism and business purposes within a 90 year period.

Indeed, the prospects for deepening Trinidad & Tobago and Indian trade are bright and exciting. According to the joint statement released by India and Trinidad & Tobago, bilateral agreements have already been signed on cooperation in the areas of air services, culture, technical education and traditional Indian medicine. Prime Minister Persad-Bissessar has also offered Trinidad & Tobago as a venue for hosting PBDs in the Caribbean. I think it would be useful for Trinidad & Tobago and India to encourage cooperation between their respective investment promotion agencies in order to better inform potential investors of investment opportunities in their respective countries and to facilitate the flow of investments between the two countries.  Just two more days are left in the official visit. I look forward to what other prospects they bring.

Alicia Nicholls is a trade policy specialist and law student at the University of the West Indies. You can contact her here or follow her on Twitter at @LicyLaw.

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Is the Caribbean Basin Initiative still relevant to CARICOM countries?

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Alicia Nicholls

For my latest article on CBI, click here.

In late December of last year, the United States Trade Representative (USTR) released its ninth report to the US Congress on the operation of the Caribbean Basin Initiative (CBI). As the CBI approaches almost thirty years in existence, it is worth pondering on whether the CBI, initially passed during the Cold War, is still relevant to CARICOM countries today.

The Caribbean Basin Initiative refers to the preferential trade concessions extended unilaterally by the United States under several key pieces of legislation to seventeen sovereign countries and dependent territories washed by the Caribbean Basin.  Instituted by the Reagan administration under the Caribbean Basin Economic Recovery Act (CBERA) in 1983, the CBI is said to represent a permanent commitment by the US to encourage the development of strong democratic governments and revitalized economies in the Caribbean Basin. The preferential treatment accorded under the CBERA includes duty-free treatment for most products, and in other cases, tariff rates which are much less than the most favoured nation (MFN) rate. Amendments to the CBERA and the passage of the Caribbean Basin Trade Partnership Act (CBTPA) in 2000 and the Trade Act of 2002 have increased the number of items eligible for preferential treatment and granted NAFTA-parity to some items.  Haiti benefits from additional concessions, primarily for apparel, under the  Haiti Hemispheric Opportunity through Partnership Encouragement (HOPE) Act of 2006,  the HOPE II Act of 2008 and the Haiti Economic Lift Programme (HELP) Act of 2010.

Trade under the CBI

The US is the Caribbean’s main trading partner and trade under the auspices of the CBI accounts for much of the US’ imports from CBI countries.  The USTR report reveals that in 2010 total US imports from CBI countries was $10.1 billion, representing 0.5% share of total US imports from the world. CBI countries were the eighteenth largest market for the US exports to the world. Although there were originally 24 beneficiary countries, five Central American countries plus the Dominican Republic became parties to a free trade agreement with the US (CAFTA-DR), thus losing their beneficiary status. Panama has also recently signed an FTA with the US (Panama-US).

Some challenges

The CBI is a unilateral arrangement. The benefits are granted by the US to certain eligible goods from CBI beneficiary countries without reciprocal treatment being demanded for US goods. The CBI statutes outline several eligibility criteria which must be met before the president can grant such treatment to any beneficiary country. The CBERA was passed during the height of the Cold War and many of the eligibility criteria under the initial act and in subsequent acts have the objective of furthering US national security and foreign policy goals. In some cases, these eligibility criteria do work in the region’s interest. The recognition of internationally recognised workers’ rights and commitments to eliminate the worst forms of child labour, to combat corruption and to  promote the rule of law are things which most CARICOM countries would readily demand of their governments. However, some criteria like the stipulation that no communist country can be a beneficiary country and the requirement of beneficiaries to provide  ‘equitable and reasonable access’  to their markets and basic commodity resources are much less innocuous and could arguably limit policy space and the right of the beneficiary countries to choose their own political and economic path to development without fear of repercussions.

Unilateral preferential arrangements like the CBI also bring with them a measure of uncertainty due to their unilateral nature.  CBI concessions can  be unilaterally limited, suspended or withdrawn in the case of non-compliance by a beneficiary country with the eligibility criteria or where imports from the country or a group of countries is deemed to cause ‘serious’ injury to domestic producers. This uncertainty is heightened by the increased international hostility towards non-reciprocal trading arrangements which has cast a shadow on the future of CBI. Like the African Growth and Opportunity Act (AGOA), the CBERA does not qualify under the WTO’s ‘Enabling Clause’ because it discriminates among developing countries and thus requires a waiver. Although the CBTPA extends the CBI through to September 2020 or until an FTA is signed with the US, the WTO waiver expires in 2014. This means that the  CBI preferences would no longer be legal under the WTO rules after 2014 unless another waiver is obtained.

Besides these inherent structural problems with the arrangement, not all countries in the region have benefited equally from the CBI. Its benefits have tended to be concentrated in a few countries.  Since the inclusion of petroleum products for preferential treatment, Trinidad & Tobago has benefited the most thanks to its resource base and manufacturing capacity.  With the exit of the CAFTA-DR countries, that country is now the leading CBI exporter to the US with petroleum products and methanol now making up the bulk (76%) of CBERA exports (from non-CAFTA-DR countries) to the US market in 2010 and almost all exports of such products come from Trinidad & Tobago.  Another ‘winner’ is Haiti. After Costa Rica joined the CAFTA-DR, Haiti became the second largest exporter to the US under the CBI. According to the USTR report, apparel not only accounts for over 90% of Haitian exports to the US but almost all of Haiti’s apparel imports enter under the CBTPA and the HOPE Acts.

Once a leading exporter of ethanol and apparel to the US under the CBI, Jamaica’s ethanol and apparel exports to the US have declined.  The Bahamas has in fact now superseded Jamaica as the third leading source of US imports under the CBI.  For some countries like Antigua & Barbuda and Barbados, the majority of exports to the US enter under normal trade relations (i.e. at the MFN rate) as opposed to under CBERA or the CBTPA. Not only has there been concentration in the gains from the CBI but the CBI has led to little economic or export diversification in CBI countries. Petroleum products and apparel account for most CBI exports to the US. Moreover, even before the exit of the CAFTA-DR countries, CBI countries’ share of the US import market has been on a downward trend from 3.1% in 1983 to 1984, to just 0.5% in 2010, according to the USITC.

Through their lobbying efforts and the aid of some empathetic members of the US Congress, CBI countries have succeeded in getting some important additional concessions which have helped make the CBI more beneficial. However, the CBI is a goods-only arrangement, meaning that only designated goods exports, as opposed to services exports, benefit from preferential access. Most CARICOM countries are now services-based economies and stand to benefit more from an arrangement which also provides market access for their service providers, particularly through Mode 4 (temporary movement of natural persons).  The CBI’s utilisation by regional exporters and its effectiveness have been limited by stringent rules of origin requirements and conditions, remaining non-tariff barriers to trade and declining margins of preference as the US continues to sign FTAs with other more competitive developing countries.  Some of these challenges were highlighted in a recent report. The argument can also be made that the CBI is based on an outdated school of thought which posits that free trade and increased exports automatically foment development.

Contemporary Relevance ?

Despite its many drawbacks and weaknesses, it is submitted that the CBI still remains relevant for CARICOM countries today even though some countries clearly benefit more than others and the developmental impact has been largely disappointing. It remains relevant because, for all its flaws, the CBI still provides a margin of preference for the region’s exports in a world where such non-reciprocal preferences are quickly shrinking away in favour of greater competition and a more ‘level’ playing field. The majority of the region’s exports which receive preferential treatment in the US market still enter under the CBI, as opposed to the Generalised System of Preferences (GSP) which has less favourable preferences than the CBI. For some countries like Barbados, no exports to the US entered under the GSP for the past few years and exports enter either at the MFN rate or under the CBI. Moreover, the CBI’s continued attractiveness is evidenced by the fact that according to the USTR Report, Suriname has indicated its interest in receiving beneficiary status and is currently in talks with the US to this effect.

Though the extension and reform of the CBI to address the challenges outlined would be the preferred option for the region, it is unlikely that WTO members would be willing to grant another waiver, especially given the opposition that the current waiver encountered. With the Free Trade Agreement of the Americas (FTAA) off the table for the foreseeable future and the US actively engaged in pursuing FTAs, it is inevitable that CARICOM will at some point have to pursue an FTA with the US.  A CARICOM-US FTA which has a trade and development focus could be beneficial to CARICOM countries if it provides market access for the region’s  service providers, allows for special and differential treatment (especially for lesser developed CARICOM States) and includes technical and capacity building assistance to help the region meet its commitments and develop its export capacity to better capitalise on the market access gained. However, given the asymmetry in bargaining power between the US and CARICOM and the US approach to FTAs, it is probably unlikely that CARICOM would be able to gain from the US all of the concessions which it had gained from the EU with the Dominican Republic under the CARIFORUM-EC Economic Partnership Agreement.

For my latest article on CBI, click here.

Alicia Nicholls is a trade policy specialist and law student at the University of the West Indies. You can contact her by email and follow her on Twitter at @licylaw.

Barbados is not immune to the anti-incumbent fever sweeping the region

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Alicia Nicholls

Another one bites the dust!  The Peoples National Party (PNP) has won the Jamaica elections, defeating the incumbent Jamaica Labour Party (JLP) by 41-22 seats. Former Prime Minister, Portia Simpson-Miller, has gotten the nod of approval from the Jamaican people and adds another female face to the CARICOM Heads of Government.

There is no doubt that by tomorrow this latest defeat of another one-term incumbent government in the region is going to set the call-in programmes in Barbados ablaze, and everyone with an opinion is going to be speculating on what if anything this latest defeat means for the current Democratic Labour Party (DLP) administration. My take on it is that Barbados is not immune to the anti-incumbent fever stirring in the region.

Indeed,these are interesting times in our political landscape. I do not even plan on delving into the letter debacle or so-called attempted coup within the DLP, which to my mind was completely blown out of proportion. Putting that aside, strong parallels have been drawn by many political pundits between the election in St Lucia and what they believe to be similar political conditions in Barbados. In the St. Lucia election, the one-term Stephenson King administration was defeated by the St. Lucia Labour Party led by then former Prime Minister Kenny Anthony. Like Mr. King in St. Lucia after the death of Prime Minister John Compton, Prime Minister Freundel Stuart assumed office following the unfortunate death in office of Prime Minister David Thompson from pancreatic cancer last year. Although the circumstances of Mr. Andrew Holness’ rise to power in Jamaica differs from in St Lucia and Barbados, many will rightly see the Jamaica election as further cause for the DLP to be worried.

It is worth noting that at the time when Mr. Stuart became Prime Minister, some learned pundits argued that Mr. Stuart should have sought his ‘own mandate’ from the people. I disagreed with that argument then and still do for two main reasons. First, as prime  ministers are not directly elected, mandates are given to a party, not to a party leader. The Barbadian electorate gave a mandate to the DLP in 2008, which logically extends to Mr. Stuart whether or not he was  party leader at the time. Second, elections are expensive undertakings and I do not think spending money on another election so soon after the last would have been justified, especially in these harsh economic times.

What the elections in St. Lucia and now Jamaica make clear is that no government is immune to the anti-incumbent fever sweeping through the region. In two-party systems like ours in most of the Commonwealth Caribbean, third parties have little if any chance of winning or making a real impact on election results. Therefore, voters like myself are stuck with and taking a hard look at the limited political options before us. If this Government wants to inoculate itself from the anti-incumbent fever and the one-term plague, it has to listen to the people. It is not just about colourful manifestos and pretty campaign speeches. We want real ideas and a clear and cogent vision and plan of action for fostering development and prosperity for all Barbadians. As far as I am concerned, in these upcoming elections, whenever they are called, both political parties (DLP and BLP) have to come good if either gets my vote.

Alicia Nicholls is a trade policy specialist and law student at the University of the West Indies. You can contact her by email and  follow her on Twitter at @licylaw.

Jamaicans go to the polls tomorrow

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Alicia Nicholls

It is election season in the Caribbean! Just a few weeks ago both Guyana and St. Lucia went to the polls, the first time two countries in the Caribbean held elections on the same day. Here in Barbados our elections are not constitutionally due until January 2013, although the Prime Minister can call elections any time before that.  Tomorrow (December 29th), it is Jamaica’s turn.

Like most Commonwealth Caribbean countries, Jamaica has a two-party system: the incumbent Jamaica Labour Party (JLP) led by the current Prime Minister, Mr. Andrew Holness, and the Opposition, the People’s National Party, led by former Prime Minister, Mrs. Portia Simpson-Miller. This election brings some interesting dynamics.  The 39-year old Mr. Holness, who formerly served as that country’s Minister of Education,  is not only the youngest person to ever lead Jamaica, but he only took office in  October of this year after the sudden resignation of then Prime Minister, Mr. Bruce Golding. This election also comes on the heels of the election in St Lucia in which the Stephenson King-led United Workers’ Party government was voted out of office in favour of the return of the St Lucia Labour Party, led by former (and now current) Prime Minister, Mr. Kenny Anthony.

From their rhetoric, both the JLP and PNP appear confident of a victory for their respective side in tomorrow’s polls. Although the Gleaner political team has predicted that the incumbent JLP will win 34 of the 63 seats, many argue that the polls are too close to predict a winner.

Elections are always a big thing in the Caribbean, but in these current  economic times they take on even greater importance. Whichever party comes to power will have to find a way of dealing with that country’s rising  unemployment and sluggish economic growth. What we Caribbean people want from our leaders is not rhetoric or empty promises, but solutions to pull our economies out of the doldrums and set us on a path to development and prosperity for all.

Here’s wishing all Jamaicans a peaceful and productive elections process tomorrow and may the better party win!

Alicia Nicholls is a trade policy analyst and law student at the University of the West Indies. You can follow her on Twitter at @licylaw or email her.

Courting the Latin Jaguar: Brazil as the world’s 6th largest economy and what this means for CARICOM

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Alicia Nicholls

One of the biggest news headlines to grab my attention this past week is that Brazil, the roaring king of the Latin America jaguar economies, has overtaken the United Kingdom to become the world’s sixth largest economy according to the Center for Economics and Business Research (CEBR). Brazil’s increased economic prowess is part of a general  tectonic shift in the global economic configuration in which emerging economies are becoming more powerful  political and economic players on the world stage. This  phenomenon has led to increased discussion of what this global reconfiguring means for the enhancing of south-south trade, particularly as many developed countries, traditionally the main export markets for developing countries, continue to reel under the global recession. On this occasion, it is worth reflecting on what Brazil’s growing economic prowess means for the countries of the Caribbean Community (CARICOM) and what potential opportunities our relationship with Brazil presents for our region, particularly from a trade perspective.

CARICOM-Brazil Relationship

Brazil and the countries of CARICOM have long enjoyed a healthy political relationship. In recent years there has been increased commitment by Georgetown (seat of the CARICOM Secretariat) and Brasilia towards deepening  political, economic and cultural ties and collaboration. The year 2010 was a pivotal year for the CARICOM-Brazil relationship as it saw the hosting of the  inaugural CARICOM-Brazil Summit which was  held in Brasilia in April of that year. The summit, hailed as a success by all, led to the signing of the Brasilia Declaration, which was bolstered by several bilateral technical cooperation agreements and Memoranda of Understanding which focused on visa exemptions and technical cooperation in several areas of critical importance to the region, including agriculture, health, tourism, energy and civil defence. Brazil has also called for a CARICOM-Mercosur free trade agreement, which would help to foment greater trade and investment links between the two regions.

Similar to CARICOM’s relationship with China, Brazil’s growing international presence presents opportunities for international collaboration on key issues of importance to the region, such as climate change. However, it also presents opportunities for trade. If there is one thing that can be said about the havoc that the global economic and financial crisis has wrecked on Caribbean economies is that it has reinforced to us the region’s entrenched vulnerability to external shocks, exacerbated by our reliance on too few goods and too few markets for our exports and  tourist arrivals.  CARICOM countries have been forced to accelerate their efforts at export and market diversification. South-south trade has long been mooted as a way of weaning our dependence on our traditional developed country export partners. Brazil, now the world’s 6th largest economy, presents an attractive alternative market for CARICOM. It represents a potential export and tourist market of nearly 200 million people and is Latin America’s largest source country for outward FDI.

CARICOM-Brazil Trade and Investment

CARICOM-Brazil trade has been on the increase. Despite a drop in 2009, it picked up in 2010. However, while Brazil’s imports from CARICOM tripled between 2009 and 2010, the region still registers a large deficit in its trade with Brazil. Moreover, despite the Guyana-Brazil Partial Scope Agreement (2001) which grants tariff preferences on selected items between the two countries, and the completion in 2009 of the Takutu Bridge linking the state of Roraima in Brazil to the town of Lethem in Guyana, trade flows between Brazil and Guyana remain low and highly skewed in Brazil’s favour. Besides the obvious disparities in economic size and export capacity between Brazil and CARICOM, several other factors most likely account for CARICOM’s low penetration of the Brazilian market, including limited private sector capacity and/or will to tap into new markets, language barriers and high shipping and transportation costs.

This huge trade in-balance was one of the issues raised in the inaugural CARICOM-Brazil Summit and several initiatives were proposed to improve it, including agreements on facilitating trade missions. There have been steps taken to address some of these issues. Barbados has sought to tap into the Brazilian tourism market and now receives weekly direct flights between Barbados and São Paulo on GOL Airlines. In July 2011, there was the official launch of the Guyana/Brazil Private Sector Integration Project which seeks to improve trade and investment between the two countries in a more mutually beneficial way.

As Latin America’s largest outward investor, Brazil brings the prospect of investment in our capital scarce economies, with the potential of bringing much needed capital, technology and know-how.  According to the UNCTAD World Investment Report (2011), Brazilian companies have invested in African LDCs, primarily in the extractive industries, but also increasingly in manufacturing and agriculture. However, Brazilian investment in the region is low and there are currently no bilateral investment treaties between Brazil and any CARICOM country.

The future?

Increasing trade and economic engagement with Brazil is not the panacea for our economic problems, nor will it completely solve our vulnerability. However, it is submitted that as emerging economies like Brazil become  greater actors on the world stage, CARICOM countries should court these economies or risk being left even further behind. Brazil represents a key potential export market which should be and is being targeted by the region. Courting this Latin jaguar should be part of our export diversification strategies, with the ultimate goal of parlaying the gains from trade into national and regional development.

Developed countries are jostling with each other to tap into the Mercosur market via free trade agreements. A potential free trade agreement (FTA) between CARICOM and Mercosur could create greater market access for regional goods and services exporters into the Brazilian and Mercosur markets, while also helping to facilitate inward investment. Regional governments, through their investment promotion agencies (IPAs), should take a targeted approach to the promotion of inward Brazilian investment, by seeking to attract and channel investments to strategic growth sectors in their economies. In addition to the standard investment liberalisation and protection provisions, the investment chapter of any potential CARICOM-Mercosur FTA could perhaps contain strong investment promotion provisions, including commitments by the parties to promote cooperation between their respective IPAs.

Regional business support organizations (BSOs) play a key role in developing the export capacity of the region’s firms and in helping export-ready producers to tap into the Brazilian market and convert any market access into market penetration.  Part of this export capacity building should involve language training and cultural awareness. Although a growing number of Brazilians, particularly in large cities, speak English, the learning of the Portuguese language (Brazilian Portuguese) should be encouraged in the region. Fortunately, Portuguese is now offered as a course at several academic institutions, and several local hotels in Barbados have provided language training in Portuguese for their staff.

Alicia Nicholls is a trade policy specialist and a law student at the University of the West Indies. You can contact her by email and follow her on Twitter at @licylaw.