CARICOM member states must look at new ways of working to realise the full implementation of the Caricom Single Market and Economy (CSME), Dr. Justin Ram- Director of Economics at the Caribbean Development Bank has said.
Dr. Ram was at the time speaking at the opening of a two-day shareholder forum on CSME held at the Ramada Princess Hotel, Guyana, last week Friday. “So we need to move away from the old way of working to the new way of working,” he said, while calling on the region’s leaders to identify priorities for moving CSME forward. “Gather the best people from across the region, from government, private sector, labour, civil society and perhaps lock them in a room for about two months so that they can devise an implementation plan,” said Dr. Ram.
He said the implementation plan with attached budget must be effectively communicated to the region’s people so as to receive feedback. Persons must be identified as responsible for the implementation and a delivery unit for the CSME. Additionally, it was recommended that annual reports be presented on the progress made.
The economic director of the CDB told the gathering of regional officials, which included Prime Minister of St Vincent and the Grenadines, Dr. Ralph Gonsalves; former Prime Minister of Jamaica Bruce Golding and CARICOM Secretary-General Irwin LaRocque, that discussions on the CSME and its implementation are very important. He pointed to a blueprint for the Caribbean Economy which was recently published by the CDB and the many challenges facing the region.
Dr. Ram made it clear that while the region is plagued with several challenges, there is a need to “flip those challenges and boost the resilience of our region by implementing fiscal growth to have rainy day funds.” “The CSME is critical for our region,” he stated, while noting that “given our challenges it is time for us to step back in order for us to jump better.”
“We really need to step back and take a look at what we are going to do in the region, so that we can jump better into the future,” Dr. Ram opined. He said based on data compiled by the CDB, some countries have recorded average growth rate since the 2007 recession, while noting that the region’s economy grew by an average of two per cent. In 2017, he said Dominica recorded a negative 6.9 per cent given the effects of Hurricane Maria while Grenada recorded a positive 4.5 per cent growth. Dr. Ram said too that debts are at unsustainable levels again, not evenly distributed, while pointing to a low of six per cent of the Gross Domestic Product (GDP) to a high of 150 per cent of GDP at the end of 2017.
He reasoned that governments have been spending large amounts on wages and salaries and that foreign currency reserves are a threshold. There are however a few countries whose reserves are at an undesirable point. Turning his attention to productivity and competitiveness, the CDB Director said at a recent board of governors meeting in Grenada, it was disclosed that extra-regional travel increased significantly between 2006 and 2016 while intra-regional travel declined by 1.8 per cent. The Caribbean region, he said, has been ranked on average in 2008 at 59 out of 178 while in 2017 it ranked at 123 on average out of 190 countries.
Meanwhile, as it relates to social and human development, Dr. Ram disclosed that unemployment rates in the Caribbean are extremely high—as high as 25 per cent in some member countries and as low as three or four per cent. He said too that youth unemployment is even higher.
Moreover, the CDB official said that a look at the population trend, by 2100, it is expected that many countries in the region will have declining populations. He pointed to Jamaica, Trinidad, St Vincent and the Grenadines and Grenada as examples. In the case of Jamaica, it is predicted that that country’s population will decline by some 50 per cent while Trinidad’s will decline by 28 per cent.
St Vincent and the Grenadine’s population is expected to decline by 29 per cent while Grenada is expected to have less people than it had in the 1950s. Notwithstanding these predictions, Dr. Ram made it clear that population dynamics are changing rapidly globally. He questioned whether the Caribbean region is ready for the global changes while stating that many of the region’s countries have lost about 70 per cent of their labour in more than 12 years. “Europe will go from 10 per cent to six per cent and Asia will decline from 60 per cent to 43 percent,” he said while noting that North America, which now has 5 percent of the world’s population, is expected to decrease by four per cent by 2100. It has also been projected that Africa’s population will rise from 17 per cent to about 40 per cent.
“We ultimately believe that building resilience must start at the household level; a resilient household means a resilient society and economy…I think that the integration movement is not only important for economic growth and social cohesion but is critical given the vulnerabilities we face in our region. Our people need the ability to move without restrictions and we need to trade freely,” said Dr. Ram who noted that the Region needs to be able to take advantage of the global population trends.
Stakeholders at the just-concluded Stakeholder consultation on the CARICOM Single Market and Economy (CSME) agree that there is value in, and benefits to be derived from the CSME.
The common thread of the two-day Consultation held in Georgetown, Guyana, was that the Caribbean Community (CARICOM) needed the CSME which seeks to create a single, enlarged, economic space by removing restrictions resulting in the free movement of goods, services, people, capital and technology. The Single Market component of the CSME was established on 1 January, 2006.
While there was progress, the CSME agenda needed to move along much faster, CARICOM Secretary-General, Ambassador pointed out in his opening remarks. The Secretary-General highlighted the slow pace of implementation of several decisions, including those related to Contingent Rights and matters related to Public Procurement. He warned that the slothful pace was having an impact on the private sector and on the credibility of the Community.
How to get it done
Where there is divergence, however, is what should be done to breathe new life into regional flagship programme which has been plagued by implementation issues and buy-in by the regional populace.
There was uncertainty about the effectiveness of the programme’s architecture. Participants expressed concern about how the disparities in economic development and unsustainable debt in the Region, unemployment and the heavy toll of natural disasters would impact the CSME. Other key matters that were raised at the Consultation that attracted more than 50 participants included the need for Member States to be held accountable for the commitments that they make at the regional level. Honesty with national populace, greater public awareness and advocacy, and acknowledgement that not all parties to the CSME will benefit in the same way, were also addressed.
The frank discourse benefited from the thoughts of high level panelists Dr. the Hon. Ralph Gonsalves, Prime Minister of St. Vincent and the Grenadines and Mr. Bruce Golding, former Prime Minister of Jamaica.
Much more to be done
Prime Minister Gonsalves pointed out that a lot more needed to be done to achieve the objectives of the CSME. He was not optimistic about the achievement of some of the CSME goals in the “foreseeable future” given the nature of the economies and the uneven though combined state of under-development, among other factors.
He offered a number of recommendations including strengthening the Revised Treaty of Chaguaramas to better serve disadvantaged countries, regions and sectors; improvement in functional cooperation, foreign policy coordination, security arangements and trade activities of the Single Market; restructure the CARICOM Secretariat and improve air and sea transport in “every conceivable way”. He also made the case for revamping the CARICOM governance structure to “accommodate, in a measured way, supranational initiatives in targeted areas of integration, including trade and economic integration”.
In introducing the high level panel, Mr. Joseph Cox, CARICOM Assistant Secretary-General Trade and Economic Integration also referred to supranationality. ” …In our Region, our model of integration is the most difficult construct of all integration models, where no supra-national authority exists and thereby the process of enforcement is limited. The job of forging a union is never finished, as economic, political and cultural tensions constantly nibble at the ties that bind. CARICOM is a collective of sovereign nations bound by common economic, social and political ideals as articulated in the Revised Treaty of Chaguaramas, where consensus is an imperative but is guided by moral suasion”, he said.
The need for supra-nationality also gained some traction from among participants given the situation the Community finds itself in terms of implementation.
Distressing and embarrassing
Former PM Golding acknowledged that there was progress in the CSME, but it lacked proper functionality as a result of decisions not being implemented.
“…like in building a house, you can’t live in it if the roof is not yet on, you can’t feel safe in it if it has no doors and windows, you can’t function properly in it if the plumbing and electrics are not installed and you certainly won’t be comfortable in it if the furnishings are not in place. It doesn’t have to be palatial or luxurious but it must be functional. We are still far away from that stage of functionality”, he posited.
The list of outstanding actions that Member States had to complete was “distressing and embarrassing”, he told participants.
He added that “we continue to be deceptive to each other and to the Caribbean people in repeatedly and so passionately proclaiming our commitment to the CSME as an integral part of the regional integration process while concealing the doubts and fears that prevent us from honouring that commitment.” He pointed out that stakeholders had to confront the perception held by some stakeholders that when fully operational, the CSME would do them more harm than good.
“The plain truth that we must now accept is that the CSME is stuck on a hill. It can’t be allowed to remain there. Tinkering will not solve that problem. We must make up our minds either to move it up or roll it back. But that decision depends on whether we believe that what lies at the top of the hill is worth climbing to reach”, Mr Golding said.
Jump better into the future
Earlier in the Stakeholder Consultation, Dr, Justin Ram, Director, Economic Department, CDB, made a presentation in which he said that integration was critical for the Region, not only for economic growth and social transformation, but to build resilience as well.
Using the analogy of an athlete who “rocks back” before completing a long-jump, Dr. Ram advised that “it is time for us to step back in order to jump ahead”.
“We really need to step back today and take a look at what we are doing in the Region so that we can jump better into the future”, Dr. Ram said.
In the current environment, he said the Region needed to boost integration, create “rainy day funds” such as sovereign wealth funds; ensure all children have quality education and are ready for the labour market; and begin building resilience at the household level. He identified gender equality, digital integration, regional integration, and implementation as cross-cutting themes. He recommended the identification of priorities to move the CSME forward; gather the best minds from government, private sector, labour, civil society so that they could devise an implementation plan for the CSME; determine who was responsible for implementation and set key performance indicators; publish annual reports on progress; and increase the level of accountability.
The Consultation was guided by panelists who addressed the objectives and priority measures of the CSME; private sector and labour perspectives; free movement; and public awareness.
The two-day Consultation was hosted by Secretary-General LaRocque, with support from the CDB. The findings and recommendations from the Consultation are intended to be considered by the Council for Trade and Economic Development (COTED) and also to inform the review of the CSME being undertaken by the CARICOM Conference of Heads of Government which will continue in a Special Session at its upcoming meeting next month.
To blame the Caribbean Community (CARICOM) Secretariat for the gaps in implementation of the Single Market and Economy was unfair, a former Prime Minister of Jamaica has said.
Mr. Bruce Golding, former Jamaica Prime Minister, addressed the matter frontally as a member of a high level panel that discussed the CSME during a stakeholder consultation in Georgetown, Guyana on Friday.
The two-day Consultation, hosted by the CARICOM Secretary-General, Ambassador Irwin LaRocque, with support from the Caribbean Development Bank (CDB), continued on Saturday at the Ramada Princess Hotel.
Mr. Golding gave credit to the CARICOM Secretariat, the Community’s administrative arm, for the considerable effort it was making to push the process and its assistance to Member States. He said it was unfair that the Secretariat and the Secretary-General were being made scapegoats for the lack of implementation of the Region’s flagship programme.
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Implementation, he pointed out, was primarily the responsibility of national governments.
“… credit must be given to the Secretariat for the considerable efforts it has made to push the implementation process and assist Member States to fulfill their obligations. The Secretariat is often made the scapegoat for CARICOM’s failures. It is unfair to the Secretary-General and his staff. I would not want his job for five times his salary; the frustration that it must certainly cause would be hazardous to my health.
Implementation is primarily the responsibility of national governments. The Secretariat dare not even appear to be inserting itself in the decision-making or implementation process of Member States”, he told the well-attended session which was live-streamed.
He added that “hardly any excuse or explanation”had been proferred by Member States on their tardiness with respect to implementation.
“What is the primary cause of this malaise? Capacity or resource constraints? Lethargy? I think not! Is it lack of political will? That would suggest acceptance of the merits and necessity of doing something but an absence of the courage to do it. I think not, as well.
“We continue to be deceptive to each other and to the people of the community if we conceal doubts and fears of honouring our commitments while we speak so passionately about the CSME”, Mr. Golding said.
He advised, however, that there had to be an acknowledgement that implementation action required of Member States, in some cases, were complex and required far-reaching policy changes, legislative processes and executive action. He pointed out also that many Member States were challenged by resource and capacity constraints.
He recommended on Friday that “we need to delve deeper than the quantitative and qualitative assessment of the progress or lack thereof of the CSME implementation. It seems to me that among most – if not all – member states (including my own), there are deep misgivings about some of the CSME provisions and requirements. It seems to me that some Member States are of the view that full implementation of the CSME is likely to do them more harm than good”.
The matter of perception and the benefits of the CSME also resonated with other participants at the Consultation. From the floor, questions were raised, for example, about whether Member States wanted to cede their financial independence; conflict of interest positions that may occur in the area of national interest versus regional obligations.
Former Prime Minister Golding chaired a Commission to Review Jamaica’s Relations within the CARICOM and CARIFORUM Frameworks. The Commission was charged with evaluating the effects of Jamaica’s membership in CARICOM on the country’s economic growth and development, with particular reference to trade in goods and services, investment, international competitiveness and job creation. Prime Minister of Jamaica, the Hon. Andrew Holness earlier this year tabled the Report of the Commission in the House of Representatives.
Is the architecture on which the CARICOM Single Market and Economy (CSME) was built appropriate today? Is the CSME overly ambitious? Is there political will and courage to continue the progress on the CSME? Why is there a deficit in the implementation of decisions?
Is the Region taking account of the global context? Are we ready for the changes that are coming? Is the capacity of Caribbean Community (CARICOM) Member States adequate to put in place the infrastructure necessary for the CSME?
These were some of the questions that were raised on Friday as the Stakeholder Consultation on the CARICOM Single Market and Economy (CSME) began at the Ramada Princess Hotel in Georgetown, Guyana.
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CARICOM Secretary-General, Ambassador Irwin LaRocque, and Director, Economics Department at the Caribbean Development Bank (CDB) Dr. Justin Ram set the tone of the two-day Consultation. They positioned the CSME as critical to the sustainable development of the Community and honed in on implementation as one of the major elements that needed to be tackled.
“The major focus should be on implementation”, Dr. Ram advised.
He added that new ways and a greater level of accountability needed to be found to tackle the implementation deficit. There also needed to be planning laboratories, and plans and budgets had to be communicated to the regional populace to elicit feedback and buy-in, he underscored.
Ambassador LaRocque said that while there was progress on the regional flagship programme, the agenda needed to move along much faster.
The time it was taking to get things done was a cost to the Region’s private sector and to the credibility of the Community, he pointed out. He advised that regional positions had to be adopted rather than national stances. He said the Consultation needed to produce concrete recommendations to put to Ministers and Heads of Government
A high level discussion on fixing the CSME featured presentations by Prime Minister of St. Vincent and the Grenadines, Dr. the Hon. Ralph Gonsalves and former Prime Minister of Jamaica, Mr. Bruce Golding. (More details to follow).
The Consultation is being held with the support of the CDB.
The well-attended opening session that was live-streamed drew reactions from persons across the Region and in the Diaspora who weighed in on what they considered the challenges to the CSME and regional integration.
Panels throughout the day examined matters such as what the CSME objectives and priorities should be and the private sector and labour. Tomorrow, the Consultation will focus on free movement of persons and public awareness.
The Caribbean Community (CARICOM) Secretary-General Ambassador Irwin LaRocque is hosting on behalf of the lead Head of Government for the CARICOM Single Market and Economy (CSME), a Stakeholders consultation on the CSME on 8-9 June 2018 in Guyana. State and non-State stakeholders will examine the CSME and its implementation as currently configured and identify what is necessary to make it more effective and used.
The findings and recommendations from the Consultation are intended to be considered by the Council for Trade and Economic Development (COTED) and also to inform the review of the CSME being undertaken by the CARICOM Conference of Heads of Government which will continue in a Special Session at its upcoming meeting next month.
he two-day activity will engage, via a series of panels, on what the CSME objectives and priority measures should be; a more and effective CSME; the Free Movement of Persons and Public Awareness.
Almost fifty participants are expected to gather at the venue – the Ramada Princess Hotel in Guyana for the Consultation. The event is being facilitated with assistance from the Caribbean Development Bank (CDB).