The Week in Europe
By David Jessop

In St Kitts, in March, Sir Shridath Ramphal, the Chief Negotiator for the
Regional Negotiating Machinery (RNM), told Caribbean Heads of Government
that their hard fought battle for new trade arrangements with Europe was far
from over. Speaking after the successful conclusion of the negotiations for
a new partnership agreement between the European Union (EU) and the ACP, he
made clear that the region was "not in a rest period". Rather, he suggested
it must use the time to September 2002, when the next negotiations with
Europe begin, to develop realistic options for a future long-term trade
regime.

Despite this it is sometimes remains difficult to convey just how important
this seemingly obscure next set of negotiations will be. For the majority of
people in the Caribbean and at times it seems, many in government, the need
to worry about trade with Europe in the next decade is remote.  This is
understandable as only those involved in negotiations have any reason to
think beyond an annual or electoral time horizon. Despite this in Europe and
beyond, consideration is being given to such matters which will seal the
fate of the region if it does not work now to set its own agenda. 

In early July, in Cotonou, Benin, the new partnership arrangement between
the ACP and the EU was signed.  It contained what in effect was a defence of
the ACP's existing trade provisions and established a first road map to
guide the ACP and EU out of the preferential arrangements that have governed
their trade relationship more or less since independence.  Thus the new
Convention extends most existing preferential trade arrangements for ACP
products up to 2008. It sets out the basis on which further negotiations
will aim to bring the ACP into conformity with World Trade Organisation
(WTO) rules. And it suggests, but does not state, that there will be two way
free trade in goods and services between the regions of the ACP and Europe
phased in over a period of around 12 years ending in 2020. 

These issues are complex but go to the heart of whether in the future the
Caribbean will be able to provide jobs for its people; a good standard of
living; the ability to manufacture and provide services; economic, social
and political stability; and the ability to retain control over sovereignty.
This is why a strategy has to be crafted by Governments working with the
RNM, with the involvement of all social partners, will determine whether the
region has a future.

Put more practically if your livelihood depends either directly or
indirectly on manufacturing, sugar, bananas, tourism, rum, rice, the music
industry or financial services then the success or otherwise of the next
negotiations with Europe will mark the difference between the survival or
demise of your industry. 

To characterise the issue still further it means that whether you are the
Chief Executive Officer or a clerk in companies such as Goddard Enterprises,
Grace Kennedy, CL Services, Demerara Distillers, Jamaica Producers, Cable
and Wireless or Barclays Bank, the negotiations will determine whether your
company will be able to survive in the region. That is to say whether it can
compete in market that up to now has remained largely untouched by
competitors from elsewhere in the Americas, Europe or in other parts of the
world.

The next negotiations threaten almost all existing trade arrangements with
the region yet it is clear that few have given much thought to the type of
Caribbean which will emerge in a world in which there are virtually no
barriers to trade. 
To put it another way, how many companies, let alone governments have
undertaken an audit of the implications of the threats they face? How many
monitor or understand the details of what is happening or will occur in
Brussels or Geneva that materially affects their interests?

Almost everyone has a rudimentary idea of what is happening to bananas. But
even then few non-banana related companies have considered in detail the
economic and practical impact of the demise of much of the industry on their
commercial interests. 
 
The way in which changes to trade policy affects diverse regional interests
is the tip of an iceberg. Although the new partnership agreement between the
ACP and EU contains a declaration which seeks to protect ACP nations during
the period up to 2008 against Europe changing the basis of its trade
relations with third countries, changes are being made almost every week.

For example the impact of EU enlargement and the negative impact that any
decision to allow the Czech Republic or Hungary to continue to produces a
product called rum may bring Caribbean rum producers into dispute with
Brussels. The EU's proposals to change its rice regime and the tariff on
rice entering from Guyana and Suriname will require formal representations
being made. Negotiations in Geneva on services, which for example threaten
to enable large international companies or tour operators to undertake
within the region many of the services presently provided by small Caribbean
companies, and are beginning to concern both the Caribbean Tourism
Organisation and it private sector counterpart, the Caribbean Hotels
Association. And WTO reviews of national legislation presently underway may
result in holders of trademarks or other forms of intellectual property
rights in the entertainment industry for example, discovering they do not
have the protection they previously believed they had.

In Brussels the EC is already developing its approach to the next ACP/EU
trade negotiations. Most of those who will be involved are not those with
whom the region has previously worked. The reason in that this time Europe's
views will be informed not by concerns about development but about trade
liberalisation and the need to harmonise its terms of trade with the regions
of the ACP with those it has with the rest of the world. To make matters
more difficult, the fall out from the banana war is such that when these
negotiations begin all EU states seem determined that future arrangements
for all Caribbean commodities including sugar will be in conformity with WTO
rules from the outset. Thus the EC's Trade Directorate rather than the
Development Directorate, with which the ACP has been in dialogue for over 20
years, will undertake the next negotiations.

For their part the RNM is preparing alternative strategies and investigating
new and innovative ideas. In due course these will be put to Heads of
Government and a strategy achieved. Yet this will be of little effect if the
private sector in particular and others in organised labour do not also try
to determine their own longer-term requirements. Trying to hold on to the
past will no longer be a valid response. This is the moment when all of the
social partners need to analyse, prepare and enunciate their requirements so
that a clear strategy for each industry, company and social partner can be
inserted into the region's negotiating mandate. 


David Jessop is the Executive Director of the Caribbean Council for Europe
and can be contacted at [log in to unmask]
14th July 2000



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