Politics
Canada-CARICOM trade talks appear shrouded in doubt
Negotiations on a trade agreement between Canada and Caribbean Community (CARICOM) countries have limped along for over five years. Unless political will and energy is now put into the process, the negotiations could fizzle out by the end of June – a ‘drop-dead’ date now accepted by both sides. Abandonment of these negotiations would not be good for Canada and certainly not for CARICOM countries. For, while the negotiations focus on trade and investment and rules that guide them, the relationship between Canada and CARICOM goes far beyond these considerations.
In Canada’s case, although its merchandise trade with all CARICOM countries is less than 1% of its total trade in goods, successive governments have enjoyed close relations with 12 of the Commonwealth Caribbean countries that are part of the 14 independent countries of CARICOM.
Until recently, Canadian governments have been able to rely on Commonwealth Caribbean governments for support on hemispheric and international issues reflecting their shared values and common interests. That there has been a rupture in that long-term support is the fault of both sides and is in the interest of neither. In recent years, both the Canadian and CARICOM governments have failed to maintain constructive and mutually beneficial engagement at high-levels, notwithstanding official visits to Canada by Prime Ministers Portia Simpson-Miller of Jamaica (October 2012) and Kamla Persad-Bissessar of Trinidad and Tobago (April 2013).
From a CARICOM viewpoint, Canada should remain a crucially important hemispheric, Commonwealth and international partner. Canada is the third largest market for exports of goods from CARICOM after the United States (over 50%) and the European Union (about 12%). And, although Canada represents only 4% of CARICOM’s market for the export of goods, it is the only developed country with which CARICOM enjoys a trade surplus.
Additionally, Canada is home to a significant number of CARICOM’s diaspora; it is a major source of tourists to the region; and Canadian private sector investment in the region in a variety of industries, including banking, tourism and mining, is huge – direct investment is in excess of US$75 billion, and trade in services is roughly US$3 billion annually.
Furthermore, Canada is a significant aid contributor to CARICOM countries. In 2007, Prime Minister Stephen Harper pledged US$600 million to CARICOM countries (except Haiti which attracts specific funding), about two-thirds of which has been allocated over the last six years.
To be fair to Canada, successive Liberal and Conservative governments tried for years to engage CARICOM in settling a Free Trade Agreement (FTA), but it was not until 2008 that the Caribbean governments agreed to engage Canada and then only when the CARIB-CAN agreement (established in 1986) was approaching its scheduled expiration in 2011. Under the CARIB-CAN arrangement, CARICOM goods, with a few exceptions, entered the Canadian market duty-free with no reciprocal benefits for Canadian exports to CARICOM.
