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CARICOM SINGLE MARKET & ECONOMY

CARICOM SINGLE MARKET & ECONOMY. Programme Manager, Single Market and Economy Ivor Carryl. OVERVIEW. CARICOM SINGLE MARKET & ECONOMY. OVERVIEW OF THE CARICOM SINGLE MARKET AND ECONOMY(CSME): IMPLICATIONS FOR CARICOM By

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CARICOM SINGLE MARKET & ECONOMY

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  1. CARICOM SINGLE MARKET & ECONOMY Programme Manager, Single Market and Economy Ivor Carryl OVERVIEW

  2. CARICOM SINGLE MARKET & ECONOMY OVERVIEW OF THE CARICOM SINGLE MARKET AND ECONOMY(CSME): IMPLICATIONS FOR CARICOM By Ivor Carryl : Programme Manager CSME MAY 2004

  3. CARICOM SINGLE MARKET & ECONOMY BASIC CONDITIONS: We must remind ourselves why the enterprise of integration: • Globalisation and liberalisation • Debilitating force of smallness, vulnerability • Slow internal development • any significant achievement in the last 25 years in any field that propels development ? in economics, in law , in entrepreneurship, in invention? Why not? • Limited opportunities and growth • Continued outward migration, unemployment , social restlessness and lack of social cohesion; • Unnecessary obstacles among people to the natural development of markets and business activity

  4. CARICOM SINGLE MARKET & ECONOMY CHANGE IS INEVITABLE • ensure that people benefit from change • timing important but not always your own choice • resistance to change • cant do ; is not the way forward

  5. CARICOM SINGLE MARKET & ECONOMY THE RESPONSE OPTIONS: • Go it alone or, • Cooperate using following vehicles; • Common rights, law and rules in a regional economy • Integration of markets / • Access to resources • Common macro, sectoral and foreign policies • Common institutions • Collective governance responsibility

  6. CARICOM SINGLE MARKET & ECONOMY FUNDAMENTAL RATIONALE FOR INTEGRATION IN SUMMARY : Overpowering the limitations of ; • Individual small size( labour force ,consumer population, resources) • Vulnerability to economic shock, natural disasters, structure of economy • Economic viability of small economy/state • Rigid economic structure based on preferences • Separate action (Community political and social cohesion vital for progress)

  7. CARICOM SINGLE MARKET & ECONOMY Therefore The Global Strategy and World view of development into the 21 century : • Deepen Economic Integration • Widen economic mass of Community • Negotiate together to participate in other regional and multilateral rules based frameworks

  8. CARICOM SINGLE MARKET & ECONOMY Integrating Theatres FTAA COTONOU OECS CARIFORUM BI-LATERALS ACS CSME WTO

  9. CARICOM SINGLE MARKET & ECONOMY Integrating Theatres : Non linear, but rather multiple theatres : • Inner Core- OECS,CSME • Cariforum • Intermediate Structures (bilaterals,ftaa,cotonou,etc) • Outer circle is multilateral system (WTO)

  10. CARICOM SINGLE MARKET & ECONOMY THE CARIBBEAN COMMUNITY Membership of the Community : Fifteen Countries and Territories ; Antigua and Barbuda , The Bahamas, Barbados, Belize ,Dominica, Grenada, Guyana,Haiti, Montserrat, Haiti , Jamaica, St Kitts, and Nevis, St Lucia, St Vincent and the Grenadines, Suriname ,Trinidad and Tobago

  11. CARICOM SINGLE MARKET & ECONOMY THE CARIBBEAN COMMUNITY Other kinds of Memberships : • The Bahamas (full member but not of the CSME) • TCI and BVI (associate members) • Bermuda ( associate member) • Cayman Is.(to be associate member) • Anguilla

  12. CARICOM SINGLE MARKET & ECONOMY THE CARIBBEAN COMMUNITY • More developed (MDS’s) Bahamas , Barbados Guyana Jamaica Suriname,Trinidad and Tobago • Less developed (disadvantaged) Antigua/Barbuda, Belize ,Dominica,Grenada,Haiti, Montserrat, St Kitts/ Nevis, St Lucia, St Vincent/ Grenadines, • Issue - the concept of community is clear ; it however lacks enough substance and require further engineering, to give it common meaning and value ; in law, institutionally and practically

  13. CARICOM SINGLE MARKET & ECONOMY THE OBSTACLES, CONSTRAINTS ,CHALLENGES : • Resistant attitudes to change ; resistance to removing obstacles • Internal pressures, limited economic growth ,meager resources, national mindset not Community mindset • Policy anchored irrationally by type of economic structure and preferences in trade • The business organisation, the problem of cross border investment • Preparedness to compete

  14. CARICOM SINGLE MARKET & ECONOMY THE OBSTACLES, CONSTRAINTS ,CHALLENGES : • Single space , collective governance , but separate sovereigns • Instability in Haiti and lack if complete integration of some states • Capacity of small state to act : policy, law ,infrastructure, public administration reform • Inadequate understanding • Absence of Community • Financing the Community • Transportation , information and communication

  15. CARICOM SINGLE MARKET & ECONOMY THE CSME IS : • AN INTEGRAL PART OF THE COMMUNITY • A RULES BASED ENTITY • AN ECONOMIC SPACE a regional economy a market system

  16. CARICOM SINGLE MARKET & ECONOMY THE CSME IS , A Rules Based Entity LEGAL ARCHITECTURE • THE TREATY • INTER-GOVERNMENTAL AGREEMENTS • IMPLEMENTING LAWS • REGULATIONS,ORDERS AND RULES • DISPUTE SETTLEMENT REGIME • ENFORCEMENT UNDER DOMESTIC LAW • ENFORCEMENT UNDER CARIBEAN COURT OF JUSTICE ISSUE:: The rules in the treaty are inadequate to guarantee predictability, transparency and objectivity in respect of both enforcing rights and discharging obligations;

  17. INSTITUTIONAL ARRANGEMENTS • Governance and decision-making arrangements • Dispute Settlement • Bilateral Approach • Good Offices • Conciliation • Mediation • Arbitration • Judicial Settlement

  18. CARICOM SINGLE MARKET & ECONOMY THE CSME IS :A Regional economy/market ? YES :The Economic Theatre for Trade/ Business/Personal Development • 15 Million consumers spread over 2000 miles • When Bilaterals added, consumer population is over 75 Millions • Combined GDP, about EC 60 Billions • Total Export Trade in Goods EC 18 Billions • Intra-regional Exports in Goods EC 3.4 Billions • Services Receipts EC 4.9 Billions +Bahamas EC 2.0 Billions

  19. CARICOM SINGLE MARKET & ECONOMY THE SINGLE MARKET ECONOMY(CSME)? KEY PRINCIPLES UNDERPINNING CSME • EQUAL RIGHTS AND TREATMENT FOR ALL PERSONS OF MEMBER STATES IN THE MARKET • NON -DISCRIMINATION (i ) national treatment (ART 7) (ii) most favoured nation treatment (ART 8) • EXCEPTIONS • DIFFERENTIAL TREATMENT ; LDC’s /DISADVANTAGED • CARICOM ISSUES IN DEALING WITH THIRD STATES AND GROUPS OF STATES • DIFFERENTIAL TREATMENT FOR THE DISADVANTAGED , SIZE, VULNERABILITY , FLEXIBILITY, PROGRESSIVITY, SCOPE

  20. CARICOM SINGLE MARKET & ECONOMY HOW TO CREATE ONE MARKET -ECONOMY FROM 15 SEPARATE ECONOMIES :? WHERE ARE WE IN THE OVERALL IMPLEMENTATION Negotiate the treaty Entrenching CSME legal personality, in all states Install/build institutions Reforming governance structures Market liberalisation Economic integration Structures and procedures for external policy The built in Agenda

  21. CARICOM SINGLE MARKET & ECONOMY THE FINAL PRODUCT • Art 78(2) Full integration of national markets into single, unified, open market area • Differential Treatment of Disadvantaged • Common Policy On Treatment of Non- Members (Common External Policy)

  22. CARICOM SINGLE MARKET & ECONOMY THE FINAL PRODUCT • A fully developed and implemented legal framework which includes the Revised Treaty, additional amendments to include the Article 239 built in agenda issues , ;inter-governmental agreements, implementing laws and regulations. • A stronger collective governance framework which include increasingly effective implementation capabilities and new Community institutions with particular emphasis on the Caribbean Court of Justice, a Community Competition Commission , bodies to regulate educational standards and qualifications., and standards for agricultural and non agricultural goods and for services

  23. CARICOM SINGLE MARKET & ECONOMY THE FINAL PRODUCT • The full enjoyment of national treatment by citizens and nationals of all Member States in respect of production and trade in goods, the provision of services, the movement / transfer of capital for the purposes of investment and current payments throughout the market area , • The freedom to move around to seek work and compete for employment in any geographical part of the CSME : by university graduates, media workers, sportspersons, musicians, artistes, managerial, technical and supervisory persons (including their spouses and dependants) associated with establishing entities; and by entitled persons qualifying as self employed industrial, commercial, artisanal, professional and agricultural service providers.

  24. CARICOM SINGLE MARKET & ECONOMY THE FINALPRODUCT • The freedom to create a company or other legal entity and establish and operate such an entity in any part of the CSME • The freedom of nationals of Member States to travel within the Community ,benefiting from national treatment at ports of entry and using machine readable travel documents including a Common Community Passport and embarkation/ disembarkation documents.

  25. CARICOM SINGLE MARKET & ECONOMY THE FINAL PRODUCT • Functioning institutional arrangements, procedures and practices for the effective coordination of macroeconomic ,sectoral and foreign trade policy, • An informed public which understands and supports the CSME and demonstrate this understanding and support by their active participation /competition in the markets of individual interests. • Stronger presence of the elements of Community and social cohesion

  26. CARICOM SINGLE MARKET & ECONOMY THE RESULT AND THE OPPORTUNITY MUST BE MARKET LIBERALISATION: FREE ESTABLISHMENT OF PRESENCE

  27. CARICOM SINGLE MARKET & ECONOMY Right of Establishment Obligations: • Permit establishment in all areas • Do not introduce new restrictions • Remove existing restrictions

  28. CARICOM SINGLE MARKET & ECONOMY Establishment : Who has right? art 32 • natural persons ; citizens nationals residents • natural persons ;self employed ,agricultural, industrial, commercial, artisanal and professional • companies and other legal entities ; agencies , branches and subsidiaries

  29. CARICOM SINGLE MARKET & ECONOMY Establishment: Issues • Does Common Regime mean single legal framework for establishment that extend beyond Articles 32,33 and 34? • How to transform concept that, an entity established in one state is simultaneously in the CSME.

  30. CARICOM SINGLE MARKET & ECONOMY Establishment: Elements of regime; • Company Law, incorporation, registration of business name • Competing presence (direct foreign investment) • Establishment includes presence and ownership (Articles 31, 32) • Monopolies (Art 31) • Access to land, buildings and property (art 34f) • The protection of the interests of partners, members and other persons with financial interests in companies and other entities

  31. CARICOM SINGLE MARKET & ECONOMY When can right be denied • monopoly established or maintained (art 31) • qualification origin criteria not met (art32) • exception approved by Community Organ • balance of payments action (Art 43) • safeguard invoked (art 47) • disadvantaged situation justified according to Community Organ (chapter 7)

  32. CARICOM SINGLE MARKET & ECONOMY RECIPROCAL ENFORCEMENT OF JUDGENMENTS • Draft Legislation in progress

  33. CARICOM SINGLE MARKET & ECONOMY THE RESULT AND THE OPPORTUNITY MUST BE MARKET LIBERALISATION: FREE MOVEMENT OF NATURAL PERSONS

  34. CARICOM SINGLE MARKET & ECONOMY SUMMARY ON FREE MOVEMENT OF NATURAL PERSONS (i) There are two Regimes : (a) Facilitation of Travel (Art 46) • Movement of Skills (Art 32,34(d),3637)

  35. CARICOM SINGLE MARKET & ECONOMY SUMMARY ON FREE MOVEMENT OF NATURAL PERSONS (a) Facilitation of Travel (Art 46) • Common travel documents • Common landing documents • National treatment at ports of entry

  36. CARICOM SINGLE MARKET & ECONOMY SUMMARY ON FREE MOVEMENT OF NATURAL PERSONS (b) Movement of Skills : (i) Companies and Non-Wage Earners(self employed persons) (ii) Wage Earners: University Graduates , Musicians, Artistes, Sports Persons Media workers; Managerial, Technical and Supervisory Staff of establishing entities

  37. CARICOM SINGLE MARKET & ECONOMY SUMMARY ON FREE MOVEMENT OF NATURAL PERSONS Wage Earners Liberalisation ,Removal of Work Permit: (a) Skilled Nationals Act ( University Graduates , Musicians, Artistes) Sports Persons Media workers (b) The programme to remove Chapter III restrictions ( Managerial, Technical and Supervisory Staff of establishing entities)

  38. CARICOM SINGLE MARKET & ECONOMY THE RESULT AND THE OPPORTUNITY MUST BE MARKET LIBERALISATION: FREE MOVEMENT AND TRADE IN GOODS

  39. CARICOM SINGLE MARKET & ECONOMY CSME TRADE POLICIES IN THE REVISED TREATY CSME MFN APPLICATIONS • Origin of goods Art 84 • Freedom of Transit Art 86(2) • Export Drawback Art(89) (1) • Quantitative Restrictions Art 91(3) CSME NATIONAL TREATMENT APPLICATIONS • Community Origin Art 84 • Internal Taxes and Charges Art 90

  40. CARICOM SINGLE MARKET & ECONOMY PROHIBITIONS : Import duties Art (87) Quantitative Restrictions Art (91) Governmental Assistance to Economic Development Art (93) Public Undertakings Art (94) Export Subsidies Art 99 ACTIONABLE Subsidies causing , nullification ,impairment or serious prejudice Art (105 Subsidies causing serious adverse effects Art (111) Agricultural Subsidies Art 121 Dumping Art 125

  41. CARICOM SINGLE MARKET & ECONOMY EXCEPTIONS : • Balance of Payments Art 43 • Difficulties Occasioned by Particular Imports Art 92 • Under the Special Regime For Less Developed Countries -Import Duties Art 160 -Community Origin Art 161 - Promotion of Industrial Development Art 164 - Public Undertakings Art 165 What remains to be done; Free Circulation , trade involving free zones

  42. CARICOM SINGLE MARKET & ECONOMY THE RESULT AND THE OPPORTUNITY MUST BE MARKET LIBERALISATION: FREE MOVEMENT AND TRADE IN SERVICES

  43. CARICOM SINGLE MARKET & ECONOMY LIBERALISATION REGIME APPROACH • GATS ARTICLE V COMPLIANT • NEGATIVE LIST FOR CSME MEMBERS • UNIFORM LEGAL REGIME FOR TRADE IN SERVICES • POSITIVE LIST IN THE CASE OF THIRD NON MEMBERS

  44. CARICOM SINGLE MARKET & ECONOMY LIBERALISATION REGIME : SCOPE : FREE MOVEMENT AND TRADE IN SERVICES • Provision of services as a right (ART 30) • All services will be open to competition except ;(a) those involving the exercise of governmental authority Art 30 (b) those where there is a monopoly Art 31 • Non Discrimination apply to all laws, rules administrative measures and service industries

  45. CARICOM SINGLE MARKET & ECONOMY LIBERALISATION REGIME : SCOPE OF : FREE MOVEMENT AND TRADE IN SERVICES • Services supplied by any of four modes (ART 36) Mode I : Cross Border Mode 2 : Consumption Abroad Mode 3 : Commercial Presence Mode 4 : Presence of Natural Persons

  46. CARICOM SINGLE MARKET & ECONOMY LIBERALISATION REGIME : PROCESS • STANDSTILL Art 36 • ROLLBACK Art 37 • Existing restrictions law and in effect must be removed in by 31 December 2005: • As a general undertaking (ART 37) • As a specific undertaking ; in accordance with the Programme to Remove Restrictions established by the Thirteenth Inter-Sessional Meeting of the CONFERENCE

  47. CARICOM SINGLE MARKET & ECONOMY LIBERALISATION REGIME : PROCESS (CONTD) IN SPECIFIC CASES removed restrictions include ; • Those restricting a company • Those restricting Non-Wage Earners(self employed persons) industrial, agricultural, professional, commercial and artisanal providers • Those restricting managerial, technical and supervisory persons • Those restricting the Spouse and dependant persons

  48. CARICOM SINGLE MARKET & ECONOMY LIBERALISATION REGIME : Number of Restrictions

  49. CARICOM SINGLE MARKET & ECONOMY LIBERALISATION REGIME : Number of Restrictions

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