With negotiations for a modern Canada-Caribbean community (CARICOM) trade and development agreement winding down, the Canadian business community with an interest in the region is being encouraged to seek opportunities with Caribbean producers.
The sixth round of negotiations concluded in Ottawa two weeks ago and Gail Mathurin, the director general of CARICOM’s Office of Trade Negotiations (OTN), said a deal is expected to be formalized by the end of June.
Speaking at a business forum at the Toronto Board of Trade last week, Mathurin said she hopes the new deal will lead to the promotion of trade, investment and the transfer of technology.
“We are hoping that the agreement will promote an opportunity for business-to-business match-making and joint ventures,” the former Jamaica high commissioner to the United Kingdom said. “The challenges will be many for CARICOM, but we are hopeful that we will have an agreement which both sides can use productively going forward.”
While the negotiations cover a wide range of trade and trade-related issues, Mathurin said provisions dealing with CARICOM’s trade in alcoholic beverages, specifically rum and beer, are a critical part of the process for CARICOM.
Under the current framework, heavy import duties are applied to alcohol entering Canada.
“There are barriers in the Canadian market, particularly at the provincial level, which we are trying to deal with,” she said. “Certainly our rum industry is a rapidly growing one and we see many of our export opportunities there. Our beer producers, particularly the smaller ones, see potential opportunities, especially in the diaspora market here in Canada. But, there are hurdles to be overcome with regard to the provincial regulations.”
Mathurin, a career foreign service officer since 1979, said CARICOM is also negotiating terms that will provide Caribbean service providers easier access into the Canadian market.
“Traditionally, countries can’t negotiate immigration and visa policies,” she said. “This negotiation is no different. But in reality, the visa requirements that Canada has in place for most CARICOM nationals really provide an additional barrier in accessing this market. We are hopeful that in the context of our discussions with Canada that, while we don’t expect them to change their immigration and visa policies, we do expect them to provide facilitative measures which can allow genuine service providers the kind of access that they need to do business in this market.”
The new proposed agreement will replace the Caribbean-Canada Trade Agreement (CARIBCAN) initiated in 1986 as a unilateral extension by Canada of duty free access to the Canadian market for most commodities originating from the Caribbean. The agreement ended last December 31 after an extended World Trade Organization (WTO) waiver for Caribbean countries’ tariff expired.
The waiver was necessary because, under the WTO’s Most Favoured Nation Principle, all members are entitled to receive the most beneficial tariff treatment offered by a member.
“When that waiver expired, the Canadian government determined it would not seek a new one,” said Mathurin. “So, right now, the trade from the Caribbean is somewhat in limbo, but the Canadian government certainly has not done anything to jeopardise the conditions under which our goods entered under CARIBCAN as of now. But it’s not a comfortable situation because, quite frankly, its ultra-virus to WTO at the moment.”
She emphasized that the CARIBCAN agreement was very limited in its scope.
“It only covered certain goods,” Mathurin said. “Things like training services were not covered and you may know that many of our economies in the Caribbean are predominantly service-oriented. Clearly, having some arrangement that allows our service providers access to the Canadian market is important. In addition, Suriname, which is a CARICOM member, was not a beneficiary under CARIBCAN and for that matter neither was Haiti which however benefits from some other provisions which Canada has in place as part of the least developed countries market access initiative.”
The CARICOM countries, with the exception of Montserrat which is a British colony, are included in the negotiation process. The British government didn’t authorize Montserrat to be part of the process.
With a vast difference in size between the two negotiating sides, Mathurin said CARICOM has argued that any agreement must be fused by development-related provisions.
“That’s because we are looking at a group of small vulnerable economies negotiating against one of the largest economies in the world,” she said. “This is the reality and so we have argued very strongly that any trade agreement, although it’s addressing liberalized trade – must recognize that reality. It must acknowledge the differences in development between Canada on the one hand and the member states of CARICOM on the other. The fact of the matter is, except for a few CARICOM member states, many still have to develop competitive export sectors. So what we have argued for is support in the agreement to back our implementation of many of the provisions.”
Michelle Lowe, the senior co-ordinator for hemispheric and bilateral negotiations in the OTN, and legal adviser Audel Cunningham accompanied Mathurin to Toronto.
While on a visit to Barbados seven years ago, Prime Minister Stephen Harper and CARICOM heads of state announced the launch of the Canada-CARICOM free trade negotiations that has the potential to enhance Canada’s bilateral economic relationships with the Caribbean and strengthen this country’s presence in the Americas.