Home' Trinidad and Tobago Guardian : August 27th 2015 Contents The Caribbean regional integration
project is often described and crit-
icised almost entirely on the uneven
benefits of trade to member countries.
But, important as it is, there is more
to the Caribbean Community and
Common Market (Caricom) than trade.
While the failure to progress the Caricom Single
Market and Economy (CSME) is a cause for consid-
erable regret, there are other aspects of integration
that have benefitted the 15 member states in the past
and that should be vigorously pursued now to advance
their prospects in the international community. One
of them is joint bargaining. By joint bargaining I mean
the pooling of the resources of all member states to
negotiate with other countries or groups of countries
on issues in which Caricom states have a shared
There are a multiplicity of such issues. In relation
to the United States of America alone, Caricom coun-
tries share great concerns about several matters.
Among those matters is the cost to each country s
treasury of complying with the Foreign Account Tax
Compliance Act (FATCA), a law passed in 2010 by
the United States that has been imposed on Caribbean
countries. Under the terms of that law, financial
institutions in the Caribbean are required to provide
information to the US Internal Revenue Service (IRS)
about accounts held by US taxpayers or foreign entities
in which US taxpayers hold a substantial ownership
In a sense, financial institutions in the Caribbean
have become agents of the IRS and have to spend
money to satisfy the burden imposed upon them or
risk being penalised in the US, including by the seizure
of any assets that they may have there. By extension,
Caribbean governments have also become IRS agents
because they have to make sure that the regulatory,
investigative and enforcement machinery is in place
to monitor financial institutions within their juris-
dictions to ensure compliance with FATCA. The cost
of this machinery comes at a cost to Caricom gov-
ernments, many of which are already cash-strapped
There is a case to be made to the US government
for compensation for the financial burden that FATCA
places on Caribbean governments to help the IRS
collect US taxes.
While each Caricom country would have a sound
basis for engaging the US government for compen-
sation on this matter, all of them would be better
placed to make their arguments with the US Gov-
ernment and Congress if they did so together.
Dealing with the harmful allegation made by the
US government that some countries of the Caribbean
are involved in human trafficking also requires a joint
Caricom approach. What the allegation implies is
that governments have knowledge of and are complicit
in such human trafficking. It is an allegation lacking
in substance and evidence.
There may be rings of human trafficking in some
Caricom countries, organised by unscrupulous persons
who take advantage of desperate persons to make
money. But to infer government involvement at an
institutional level is a stretch too far.
In Caricom countries, where governments have
been provided with evidence of such human traf-
ficking, they have acted to break them up. It is true
that, in many Caricom countries, legislation on human
trafficking has to be strengthened and penalties for
offenders have to be made tougher.
There is also room for effective Police machinery
to gather intelligence and deal with trafficking rings.
But, Caricom states, already buffeted by poor terms
of trade, decreased aid, no access to concessional
financing and myriad demands from large countries
to expend scarce resources on curbing money laun-
dering, tax evasion and drug trafficking need help.
They also have to continue to provide education
and health services, roads and other infrastructure,
employment and pensions, and safety and security
for their people.
Caricom governments need help with information,
intelligence and technical assistance for law enforce-
ment agencies to break-up the rings. Richer and more
advanced countries, such as the US, should contribute
to the solution and not just identify the problem.
A joint approach to this would also be a positive
benefit to being part of the Caribbean Communi-
ty.Then, there is the overarching problem of US agen-
cies labelling the Caribbean as an area of "high finan-
cial risk". The Caribbean Association of Banks (CAB)
has publicly stated that this "unfair" categorisation
"is resulting in the disturbing threat of loss of cor-
respondent banking relationships to banks in the
More tellingly, the CAB states that "correspondent
banking relationships are critical in enabling key eco-
nomic and financial transactions, such as, remittances,
foreign direct investments and international trade in
goods and services, which constitute some of the
key drivers for sustaining the region s growth and
Consequently, the loss of these vital relationships
can render our region unbankable and ultimately
destabilise all sectors of our economies. The CAB
considers this issue to be a threat to national security
for the various islands in the region".
This matter was raised with US President Barack
Obama at the Summit of the Americas in Panama
by Antigua and Barbuda Prime Minister, Gaston
Browne, in Panama last April.
The President promised to look into the issue. But,
again, joint Caricom action on a regular and sustained
basis is necessary if this serious problem, shared by
all member countries, is not to simply fade from the
US agenda to the detriment of the region.
Caricom has been at its best in delivering benefits
for its peoples when its member states have acted
together purposefully and with sound arguments
backed up by empirical evidence.
When Caricom has done so, it has demonstrated
that the measure of the integration project s success
is not only intra-regional trade, but collective bar-
gaining for economic justice as well.
The same approach is needed to rectify the non-
delivery to the Caribbean of the Economic Partnership
Agreement with the European Union, the protestations
of its representatives notwithstanding.
(The writer is an Antigua and Barbuda Ambas-
sador and senior fellow at the Institute of Com-
monwealth Studies, London University and Massey
College, Toronto University. He is also a candidate
for the post of commonwealth secretary-general).
AUGUST 27 • 2015 www.guardian.co.tt BUSINESS GUARDIAN
COMMENTARY | BG19
Caricom: A collective
bargaining unit for rights
Jamaica is on course for
a ninth drawdown of funds
from the International
Monetary Fund (IMF).
This is based on the
country's positive perform-
ance for the first quarter of
the fiscal year under the
Extended Fund Facility
(EFF), despite the effects
of severe drought.
Head of the IMF mission
to Jamaica, Dr Uma Ra-
makrishnan, said the coun-
try has met all the
quantitative targets under
the four-year EFF for the
April to June quarter.
As a result, the country
is expected to receive an
additional US$40 million
under the EFF, when the
IMF board reviews the pro-
gramme in September.
at a press conference to
signal the completion of
the Fund's 9th review of
the country's programme,
said Jamaica's implemen-
tation remains strong and
structural reforms are
broadly on track.
She highlighted reduc-
tion in the unemployment
rate in April, historical low
levels of inflation, signifi-
cant reductions in the cur-
rent account deficit and
improvements in the coun-
try's international reserves,
as positive developments
in the economy.
She informed that the
IMF is now projecting a 1.4
per cent growth for the
2015/16 fiscal year.
Finance and Planning
Minister Dr Peter Phillips,
said the positive assess-
ment from the review
team, shows that the
country continues to
ance despite the impact of
the drought on growth.
The minister noted the
significant work being
done to implement tax,
labour and financial sector
reforms, and public sector
He noted that that a
number of initiatives are
also being undertaken to
help the country achieve
greater levels of growth.
"The progress being
made in agriculture, the en-
ergy economy, business
process outsourcing, and
the tourism sectors will
have an even sharper posi-
tive impact on the Ja-
maican economy over
time, as development pro-
ceeds in these areas," he
of IMF funds
Links Archive August 26th 2015 August 28th 2015 Navigation Previous Page Next Page