The Week in Europe
By David Jessop

If you are small, relatively powerless and faced with a threat, you react.
Sometimes it is with anger or aggression. But more usually if you are unable
to overcome difficulty through dialogue, a better approach is to seek
alliances with friends or those more powerful who can help or protect you. 

This is a theme as old as history and applies equally to individuals as it
does to states. Survival in the medieval world centred on alliances cemented
by marriage, mutual defence or payment. Then as now, treaties or other
arrangements between states were designed to deter aggression. This process
reached a zenith of subtlety during the cold war when both sides sought to
maintain a balance of power or threat through measures that ranged from
defence through institution building to hearts and minds campaigns. 

The consequence was that most development assistance became a tool that
provided smaller nations with support in return for food and energy security
or other requirements. In this process, the strength and orientation of
institutions such as trade unions, the private sector and non-governmental
organisations came to be regarded as a central part of the success of one or
another power bloc.

Today much of this has gone. Development assistance for all but the poorest
has become in a globalising world, largely a function of trade. The argument
most commonly used to justify this policy change towards regions such as the
Caribbean is that by liberalising markets and competition, trade will
increase, growth rates will improve and everyone will prosper, eventually. 

It is, of course, a flawed argument and one that says nothing about the
capacity of small, vulnerable nations ability to compete. It provides few
answers as to how nations move rapidly from an agricultural or industrial
base to a service led economy. And it says even less about the source of
investment needed for transformation, or how a position of equity can ever
arise between, nations as different as the United States and Dominica. The
new trade-driven approach to development seems also to ignore the logical
conclusion of the process. Which is, that it gives a relatively few nations
with very large companies the ability to buy, control or sell unprofitable
production in small economies and by extension have the power to close the
economies themselves.

Over the last ten days there have been two very different opportunities to
consider how institutions in the Caribbean might adapt and survive in this
rapidly changing world. Interestingly, answers common at both events pointed
to the vital importance of creating at an industry, trade union, local
government or NGO level, strategic alliances (sometimes called smart
partnerships) with non-traditional partners. 

The first of the two meetings, held in Grenada on September 29 and 30 looked
at alternative approaches to development.  Representatives of regional
private sector organisations, NGOs and others, considered whether there
might be newer models of development able to increase the pace of change.
What emerged from the case studies presented and a particularly interesting
presentation from Mauritius' Joint Economic Council, was that grass roots
and market driven approaches based on partnerships might provide the key to
creating new approaches to development.

At the meeting, organisations like Guyana's Institute of Private Enterprise
Development, which has created more than 30,000 new jobs, described how
their success originated in a non-traditional alliance between Guyanese big
business, some local philanthropists and small business, when faced with a
crisis in the local economy. The Dominican Republic's Agri-business
Institute (JAD), noted that in their case it had been the production of high
value agricultural produce, linkages to tourism and agricultural
diversification that had stimulated farmers to forge an alliance with large
foreign agri-business enterprises able to help develop and market local
produce. Another example was that of CAST, a subsidiary of the Caribbean
Hotel Association (CHA). They had provided technical assistance and funding
for environmental programmes associated with small hotels by inviting onto
their advisory board international companies who stand to benefit from any
growth in regional tourism. While Mauritius explained how their industry,
academic and technical institutions and government had all come together in
clusters to deliver new development solutions.

The meeting in Grenada was followed closely by another in Barbados that
emphasised the value that non-traditional strategic alliances have also had
in trade negotiations. 

On October 4, the West Indies Rum and Spirits Producers Association (WIRSPA)
had their third formal exchange with representatives of the rum industry in
the French DOM. Once sworn enemies, the two industries now work together in
a strategic alliance, despite remaining in commercial competition. In
practical terms the two industries support each other's positions in their
separate negotiations with the EU; make representations jointly on matters
of trade policy or technical concerns; and seek through debate, consensus on
common positions. As a result, ACP rum producers have inside the EU an
organisation able to help raise joint concerns in ways that were thought
previously impossible. 

What all this points to is the need for new or lateral thinking about
problem solving through alliances. For instance, the rice industry might
progress their concerns in Europe by seeking, where possible partnerships
with their EU counterparts or by developing strategic ties with major
industrial consumers of rice. Similarly, Caribbean agriculture might obtain
more benefit and retain its independence if it sought strategic alliances
with major supermarket groups selling organic produce rather than continuing
to pursue joint ventures.
 
There are now a small but significant number of regional alternatives to the
traditional role models funded by grants or multilateral agencies. They are
invariably low cost vehicles aimed at achieving solutions to immediate
problems. Their success is often based on the drive and vigour of the
individual that runs them. All are short of funding, but are unsure how much
they want by way of support from multilateral institutions. They suggest
instead that there is the need for some new type of venture capital fund
able to provide the funding that their self-help programmes need if they are
to have wider relevance. 

Alliances need thought and can only proceed on the basis of mutual respect.
Despite this, they offer a real alternative to the often bureaucratic,
inflexible solutions proposed by most development agencies. What is still
far from clear is whether such alliances can or should be promoted or
whether they are simply needs-driven and represent a mature Caribbean
response to pressing problems. What is striking, however, is that in
contrast to Mauritius where Government and social partners actively work
together with alliances, governments in the Caribbean have so far been
unable to engage with or use either domestic or external partnerships as a
tool to rapidly move forward regional economies. Why this should be requires
an answer.

David Jessop is the Executive Director of the Caribbean Council for Europe
and can be contacted at [log in to unmask]
October 6th, 2000






 




%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%