The St. Lucia Chamber Of Commerce, Industry And Agriculture
Home Up The Joint Session Of The St. Lucian Parliament Joint Statement By The Prime Minister Of St. Lucia And The Prime Minister Of Jamaica The St. Lucia Chamber Of Commerce, Industry And Agriculture Students Of The Sir Arthur Lewis Community College The Occasion Of The Dinner Hosted By The Hon. Prime Minister Of St. Lucia


FRIDAY, JULY 2, 2004


I must begin by expressing my distinct pleasure at being given this opportunity to speak with you - the key members of the St. Lucian business community - about one of the most ambitious initiatives undertaken in our Region – the establishment of the CARICOM Single Market and Economy (CSME).

It is therefore my hope that I will not only shed light on the subject but will also advance the ongoing Regional dialogue on this issue.

Let me pause here, to pay tribute to the leadership and members of the St. Lucia Chamber of Commerce and the entire business community. Your efforts have seen excellent results in a number of areas of your economy, even as you grapple with the challenges of globalisation. Your interest in the subject of the CSME is indicative of your realisation that new times call for new solutions and that your minds are open to the new possibilities of the CSME.

Within the last 30 years, we have witnessed the evolution of the Region’s efforts towards economic integration.

We have come a long way since our early efforts at political union and but readily acknowleged that economic development for small countries, such as ours, required an integrated approach. This led to the creation of the Caribbean Free Trade Area (CARIFTA) in 1967.

The Treaty of Chaguaramas, which established CARICOM in 1973, retained provisions for the liberalization of trade in goods. It also included a common external tariff, limited provisions for the removal of restrictions on the movement of capital and services, and modest commitments for the co-ordination of economic policy.

The traditional tools of economic management associated with the separate inward looking, model which the Caribbean countries adopted for most of its history, retarded the economic progress of the Region in many fundamental ways.

CARICOM, at that stage, did not address the array of restrictions on cross-border economic and financial transactions. Nor did it address the constraints on the use and mobility of factors of production and the differing basic macro-economic policies practised by the respective Caribbean States. It allowed us to cling fiercely to our perceived differences and individual identities which have, over time, reinforced the tendency to under-development in the Region.

The Regional integration process, as conceived in the Treaty of Chaguaramas, did not collectively lead to major transformation of Caribbean economies during the period of its existence.

Yet it was becoming evident that there was need for deep transformation. In addition to its perennial difficulties in maintaining stable growth, the Region, like the rest of the world, was confronted by a rapidly changing international order – a new phenomenon called globalisation – a new order designed to remove the very barriers on economic activity which the Region had traditionally pursued, a new order which was clearly going to provide benefits for larger economic entities, whether firms or countries, at the expense of the smallest.
The decision, in 1989, to deepen the integration process even further, by the establishment of a CARICOM Single Market and Economy, can clearly be justified by our relatively difficult economic past and an even more challenging economic future.

This further step towards integration is no easy task.

The CSME will see the participating Caribbean nations, which have functioned as 15 separate entities with distinct markets and economies, each governed by its own rules and divided by each other’s barriers, coming to terms with beginning to organise and operate future effectively as one market and one economy - free of restrictive barriers and governed by common rules, policies and institutions.

The CSME will allow for the unrestricted movement of goods, services, skills and capital throughout the Region, resulting in a single market, leading ultimately to a single economy. A prerequisite will be the harmonisation of the economic, monetary, fiscal and trade policies of all participating Member States, the objective being to mobilize sustainable economic development throughout the Region. Indeed, the advent of the CSME will result in unprecedented opportunities.

These new opportunities will result in a highly competitive marketplace, one that encourages economic efficiency, innovation and higher standards for quality and service delivery. The “level playing field” throughout the Region will mean that previously protected markets will be opened and producers, manufacturers and business entities will be subject to common rules and policies.

The expectation is that the CSME will encourage investment and by so doing, create jobs, thus enabling our mostly small and micro businesses (by world standards) to take root and improve their efficiency. It is also expected that businesses will also hone their competitive skills to tackle the challenges of globalisation and the changing international order.

Further, the creation of the Caribbean Court of Justice (CCJ), is an integral part of the development of the CSME. The CCJ will be charged with the interpretation and application of the Revised Treaty and to exercise exclusive jurisdiction with respect to dispute settlement, including mediation, consultations, conciliation and arbitration.

The CCJ will therefore provide legal certainty that Members States will be bound to adhere to the principles and obligations embedded in the Revised Treaty. It will also serve to boost consumer and investor confidence in the predictability and fairness in the application of the measures relating to the operation of the CSME.

Having then presented the broad overview of the CSME, what does it therefore mean for you as members of the private sector here in St. Lucia and indeed for the private sector Regionally?

Firstly, the CSME is critical to the future prospects of businesses of all sizes and peoples of all occupations in the Region. I urge those of you have not yet done so to devote some time to acquainting yourself with the important aspects of the CSME.

As an unrepentant regionalist, I am fully convinced that the CSME is the only viable way forward if we are to keep pace with the changes in the international economy, which, if understood and applied too our businesses in the region can pay tremendous dividends.

The CSME offers an opportunity to escape from the limitations imposed by small size, whether it be land, population or availability of natural resources.

While many large firms in the Region already treat CARICOM as a single market, opportunities will open up for smaller, efficient and innovative firms, as harmonized procedures throughout the Region will lower the cost of doing business.

Provisions for the free movement of skilled persons will widen the pool of expertise available in improving competitiveness and innovation.

Entrepreneurs will be able to trade freely, establish branches, service markets and clients in other parts of the Region, attract capital, invest in, or utilize funds from, another State.

Of course, the CSME will lead to greater competition within the Region and there will be challenges for all of us, especially the smallest. However, the developments at the global and hemispheric levels have clearly signalled that it cannot be business as usual.

We are in a new world economic environment are operating in Protectionism is collapsing. Trade preferences are fast disappearing.

You in St. Lucia know well what is going on with regard to bananas. I am no prophet of doom, just a realist. It is clear that sugar is next; Official development assistance continues to dwindle. Small and fragile economies are under constant threat. The message is clear – compete, in order to survive.

We have an opportunity through the CSME to pool our collective resources to concentrate on selected areas of economic activity. This will bring tangible benefits to the peoples of the Region, producing at world class levels.

May I suggest a few areas, some of which we are already involved in:
Tourism, including ownership in the cruise ship business;
• Manufacturing targeted at the tourism sector;
• Financial services which provide innovative services for our Region;
• Music and entertainment, including the management services associated with their activities;
• Food and agriculture – designed to produce identifiable Caribbean products.

We must position ourselves to face greater competition from our CARICOM partners with the implementation of the CSME but we must also prepare to meet the even greater challenges of liberalization at the global and hemispheric levels.

The common platform which the CSME provides, has allowed us to speak with a common voice in crucial trade negotiations in which the countries of the Region are involved: the World Trade Organization, the Free Trade of the Americas, the new arrangements through Economic Partnership Agreements with the European Union.

Through our common voice, supported by the Regional Negotiating Machinery, we argue for treatment in various trade agreements, which will give us the policy space to solidify our regional undertaking, the CSME, and to liberalize our economies vis-à-vis the rest of the world, in a manner that allows an orderly adjustment.

The need for unity, underpinned by the CSME, in these various negotiating theatres, is absolutely crucial if our concerns are to be addressed by the wider international community.

At the same time, the CSME provides opportunities for our private sectors to pool resources to penetrate external markets in a combined way.

A shared history and culture have provided a strong foundation for the process in which we are involved. Implementation of the CSME is taking place at a defining moment in the history of the Region’s trade and economic development. We all have a role to play in ensuring that the Region continues to provide good leadership in advancing the cause of the CSME, thereby enabling us to reap the benefits of economic integration that our counterparts in the European Union have long been enjoying.

We have faced challenges in the past. We are all familiar with the Chinese word which translates both as “crisis” and “opportunity”.

It is up to each of us to see the new global economic environment and the necessity to institute the CSME not as a crisis but an opportunity, an opportunity to thrive as individual entrepreneurs and achieve the long sought-for development of our Region into a zone of prosperity and financial security.

To borrow a phrase from a famous advertising slogan –“You can do it. The CSME will help!”


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