Barbados was among the Caribbean countries represented at the 1989 Grenada Summit which decided to establish the CARICOM Single Market and Economy (CSME).
The CSME was intended to help the countries better respond to the challenges and opportunities globalization presents.
Thirteen countries including host Grenada signed the Grand Anse Declaration ushering in the CSME:
— Antigua and Barbuda
— St. Kitts and Nevis
— St. Lucia
— St. Vincent and the Grenadines
— Trinidad and Tobago
To date The Bahamas, Haiti and Montserrat, the latter still a British colony, have not signed the agreement.
Barbados, Belize, Guyana, Jamaica, Suriname and Trinidad and Tobago were the first six to implement the CARICOM Single Market (CSM) on January 1st, 2006.
Antigua and Barbuda, Dominica, Grenada, St. Kitts and Nevis, St. Lucia and St. Vincent and the Grenadines followed about six months later.
Besides the liberalising of trade in goods among the member states brought about by the Common Market, the Single Market and Economy element seeks to include services, while providing for the free movement of capital, skilled labour, and the rights to establish business enterprises anywhere in the 15 countries.
The CSME grants to any CARICOM citizen the right to establish a business in any member state and be treated as a national of that state.
This complements the opportunities which the CSME will provide for greater cooperation among businesses to improve and increase the quality and quantity of goods and services they produce and to do so at better prices.
According to the CARICOM Secretariat, 95 per cent of the goods produced in the region move freely across member states, confirming that a single market for goods already exists among the CARICOM member states.
To complete the Single Market, the member governments have agreed that the key focus of attention will be on the removal of restrictions on the right of establishment, the movement of services, capital and skilled labour.
The governments have also agreed that it will be necessary to enact new laws, create the appropriate institutions and adopt the relevant administrative and other facilitating measures.
In July 1995 CARICOM Heads of Government agreed that, with effect from January 1996, nationals of the community, who are university graduates, should be allowed to move freely in the region for work purposes, thereby eliminating the need for work permits and permits of stay.
Most countries in CARICOM, including Barbados, put the necessary systems in place to give effect to this decision.
The following year, the leaders agreed to expand the categories of individuals allowed free movement for work purposes. The additions include Artistes, Sports Persons, Musicians and Media Workers.
Although it’s been established, the CSME was expected to be fully implemented between 2008 and 2009, with the harmonization of economic policy. That has not taken place.
While member states envisaged the creation of a single currency as part of monetary integration, this proposal has been put on the back-burner.
Currently there are six different currencies in the CSME region, with three of them being fixed exchange rate currencies tied to the USA dollar.
Two others are floating and the other is a managed float that displays a mixture of both floating and fixed.
Moving towards a single currency presents some challenges with no agreement on how to accommodate Guyana and Jamaica, the two countries with floating currencies.
The Single Economy is expected to be implemented in two phases.
Phase 1 is to take effect between 2008 and 2009 with the consolidation of the Single Market and the initiation of the Single Economy.
Its main elements would include:
— The outline of a CSME development vision and strategy
— The extension of categories of free movement of labour and the streamlining of existing procedures;
— Full implementation of free movement of service providers;
— Implementation of Legal status for the CARICOM Charter for Civil Society
— Establishment of the Regional Development Fund to help the less well off member states;
— Approval of the CARICOM Investment Regime and CARICOM Financial Services Agreement, to come into effect by January 1, 2009
— Establishment of the Regional Stock Exchange;
— Development of regional policy frameworks for energy, agriculture, sustainable tourism, agro-tourism, transport, new export services and small and medium enterprises.
Phase 2 is to take place between 2010 and 2015. Besides a consolidation and completion of the Single Economy, phase 2 is expected to include:
— Harmonisation of taxation systems, incentives and the financial and regulatory environment
— Implementation of common policies in areas of agriculture, energy-related industries, transport, small and medium enterprises, sustainable tourism and agro-tourism
— Implementation of the Regional Competition Policy and Regional Intellectual Property Regime
— Harmonization of fiscal and monetary policies and
— Implementation of a CARICOM Monetary Union.
Author: Brett Callaghan