The View from Europe
  By David Jessop
   
   
  A short while ago I was asked to participate in an informal discussion on the ways in which the foreign trade policy of one Caribbean nation might be adapted to meet changing global circumstances. The perspective was the next twenty years.
   
  It was a challenge. 
   
  As an outsider, I could only proceed on the basis of informed guesses about that nation’s point of departure, the way that its government might seek to direct its future economic development and the extent to which its present regional, hemispheric and global preoccupations might be amenable to review. 
   
  While all that was sought was an opinion, what emerged was a common recognition that the unipolar world that has predominated since the end of the cold war was gradually coming to an end. 
   
  Europe was less important other than for investment and security support; regional and hemispheric relationships mattered more; and there was the need to change the weight and location of representation in order to respond to emerging markets in South America, South East Asia and the Far East.  
   
  The conversation paralleled discussions that have been taking place for a decade or more in most European capitals where there is a ready understanding of the implications of the rise of Brazil, China and India. However, my Caribbean interlocutors did not touch on more recent European considerations about the sense that the US has squandered much of its global political capital in Iraq or the possibility that within two decades it may lose its absolute financial and technological advantage.  Nor did they seek to take into account Russia’s newly assertive global role on the basis of its burgeoning energy revenues or the coming economic race for the Artic. 
   
  In an important and detailed speech to French diplomats, France’s President, Nicolas Sarkozy, recently described this process of changing priorities. He identified the importance of accommodating the emerging powers, the growing global competition for energy supplies, the threat from climate change, the need to adjust relations with the US, and the challenge of the new Russia. All of which he coupled with the need to avoid an ideological confrontation with Islam. These were he said the challenges facing France and Europe in the next decade. 
   
  In Europe, thinking on these issues is already advanced. The focus now is on how best to incorporate the advanced economies into the developed world’s opinion forming and decision making structures, how best to rebalance relationships, and the ways in which the European private sector should be mobilised to access the markets and capital in emerging markets
   
  In the Caribbean responding is much more complex. While the region is easily able to reach the same conclusions the devil comes in the detail. This is because the region options for action are for the most part limited, its economies are small, its transport links are poor, it nations are at different levels of economic development and the capacity of governments and the private sector is limited. 
   
  The effect is to promote national interest over regional objectives and cause nations to see external developments and relationships in very different ways. The consequence is a series of contradictions in foreign trade policy that suggest that national rather than regional responses to the changing global power may be the norm for the foreseeable future. 
   
  Put more specifically. The region usually finds it easy to agree on general political principles but far more difficult to follow through on the economic detail. While regional agreement is possible on issues that challenge shared political values or sovereignty - the integrity of Belize of Guyana’s borders for example - it is much more difficult to deliver on a political consensus on foreign trade policy.
   
  An outstanding example of this is the inability of the region to put forward a comprehensive schedule of tariff reductions in the negotiations with Europe for an Economic Partnership Agreement. Another is the continuing emphasis on sugar and bananas in political exchanges despite the pressing need for external discussions on issues such as climate change, airlift or taxation on carbon emissions: issues that touch on the competitiveness of the regional tourism economy.
   
  To complicate matters further some nations have much more global leverage than others. In this four nations stand apart: Trinidad because of its wealth and its importance as an energy supplier with related downstream manufacturing operations; the Dominican Republic because of its economic weight and ability to project it interests in key capitals; Cuba because of its geopolitical stance; its internationalism and ability to survive in the face of hostility; and Barbados because of its solid economic development and carefully thought through and delivered policies.
   
  In contrast those with less clout seem to find it difficult to separate current budgetary concerns from longer term realities or to determining how leveraged concessions today might result in long term harm.
   
  At its most absurd this approach is represented by the games being played between Government and Opposition in some Eastern Caribbean nations over relations with China and Taiwan. These should be shaming to anyone who places a high value on the sovereignty of a nation. Moreover, they fly ultimately in the face of the reality that Beijing is a global superpower and unlikely in the longer term to forget such short term expediency.
   
  There are also many other inter-regional divergences. These include differences over the future weight to be give to relations with the US or EU; the extent to which the region should focus more on individual states such as Canada and Spain; whether the ACP group has much value beyond promoting solidarity; the extent to which Latin ties should be cultivated; and how Washington and Europe’s emphasis on security over economic development should best be challenged.
   
  At one level all of this may seem academic but it is not. The pace of global change is not being matched by the Caribbean’s response. Whether it is in the EPA negotiations or the slow pace of progress towards a Caribbean Single Market and Economy, day by day the region’s business sector is being disadvantaged. 
   
  Most governments in the region have accepted that it is the business sector that generates wealth. Without the right regional economic environment, trade agreements and new international relationships, the region’s companies and industries will cease to prosper. While a few of the region’s nations can afford to pursue an independent path, most of the rest can not. 
   
  David Jessop is the Director of the Caribbean Council and can be contacted at [log in to unmask]
  Previous columns can be found at www.caribbean-council.org
  September 6th, 2007
   

       
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