Lavern Clarke, Staff Reporter
THE REGION appears euphoric about concessions for special treatment of smaller economies secured so far under the Free Trade Area of the Americas (FTAA). Talks, as well as the synergies within CARICOM are credited as the catalyst to getting there.
"On the whole we have operated effectively as a group," said Ambassador Richard Bernal, chief technocrat for the Regional Negotiating Machinery.
The concessions secured in regionalised talks have taken on a multiplier effect, gaining recognition for poorer countries even at the level of the World Trade Organisation, he said.
But, privately, some are seething at how effectively the super-trading nations have been able to "secure" the loyalties of the Caribbean's immediate neighbours in their opposite push for 'equal treatment' status for large and small economies, and in doing so making the fight that much harder for developing states.
But CARICOM also faces internal challenges. Ambassador Bernal refused to discuss the current financial health, and the amount of resources the RNM has at its command, but it is an open secret that the negotiating body is not as well supported as its work requires, and so faces constraints.
2002 is set to be the busiest negotiating year in recent years, but the RNM only has about 10 technical people, described as an 'excellent' team, but nevertheless a limited resource that is stretched attending numerous meetings.
"The region does not fully understand yet what it takes to deal with this," sources tell Sunday Business. "The financing support is not realistic."
The RNM survives on donor support. Regional business interests, while agreeing that they need to pitch in, have not yet worked out the degree of assistance.
Meantime, businesses themselves are benefiting from the 'technical assistance' (TA) that the multilateral and world trade bodies have agreed to give the developing and least developed states.
The large economies and agencies brag about the levels of technical assistance they provide, but countries with less resources say TA has become a facade.
"It's a game. Sometimes the technical assistance does not materialise and sometimes its not in a form that is useful. They run a 2-day seminar and then say 'you're ready now', but it's not that simple."
Prime Minister P.J. Patterson spoke directly to the issue last Wednesday during discussions with the Jamaica Chamber of Commerce (JCC) said it was not the cure to the adjustments that countries like Jamaica have to make.
"Technical assistance we welcome. It is useful, but not a panacea," he said. "So in the negotiations we have to include 'special and differential' treatment for small economies and small firms."
One of the challenges facing the poorer countries is determining where their core strengths lie. To establish what those comparative advantages are, and from there to set strategies to compete globally, the countries need the resources to collect base data on various industries.
"Countries with limited capacity need technical assistance to decide on what technical assistance they want," say trade experts.
Ambassador Bernal would only concede that there is a lobby for a more efficient means of assistance. But the source of that help is the very countries with which small economies will have to compete.
Mr. Patterson, who chairs the Prime Ministerial Sub-Committee on Trade Negotiations, was critical of the world's largest trading nation, the United States, for what he indicated as double standards in trade issues.
The U.S. continues to protect its industries, including steel and agriculture, but decry the assistance that others give their own, Mr. Patterson noted.
"How can those countries least able, be expected to pursue such policies when the developed countries are not."
Arguing for special financing assistance atop whatever technical assistance is given, Mr. Patterson said the differentiated treatment for the small would not be a distortion of trade, as some argue, as they have an "insignificant" share of the market.
Trade talks
In an update on the various trade negotiations, Bernal said the FTAA talks which got under way again this month, are among the most critical to CARICOM's future. Mr. Patterson has again urged businesses to take the CSME seriously.
Preparatory meetings ahead of those talks have already agreed to a base year, 2004, for the implementation of base tariffs. But what those base tariffs will be continue to be a matter of contention.
The new negotiations are looking at the 'methods and modalities' of market access, and the talks are expected to go beyond the negotiated positions arrived at the level of the WTO in the area of investment for example, and agreeing on a competition policy.
Caribbean countries have more groundwork to do in these areas.
"The big-3 went through it under NAFTA. They have their positions already," said the RNM head. "CARICOM doesn't have a common competition policy. We're getting ready, but they are ready!"
For this reason the region is now lobbying for a slow down in the negotiations, but the larger countries are offering technical assistance instead.
The other important talks which resume in September are the EU/ACP Cotonou Agreements to roll back preferences between now and 2007. The EU has proposed 'partnership' agreements that will move the groups into reciprocity and free trade.
Still to be decided is the form the partnerships will take. On the table, is a suggestion for Regional Economic Partnerships, or REPAs, but there is concern on the ACP side that it would "dismember the ACP alliance" which is the power base of the over 70 member countries, says Ambassador Bernal.
Alongside that concern is the uncertainty that the REPAs would be efficient where varying economies exist. The counter proposal is a generic alliance.
"We see value in keeping the ACP coalition together," said Mr. Bernal. But, "the Caribbean is preparing for all eventualities."
Of more immediate concern is the next WTO Ministerial meeting set for 2003 in Mexico. Developing countries continue to feel left out of the WTO process, and are dissatisfied that the promised stimulation of growth is yet to materialise for smaller economies.
A WTO committee is examining 'special and differential' treatment for smaller economies, but there is no certainty that the deliberations will be concluded before 2003.
There is continued resistance by some of the more developed countries in having any more distinctions drawn between large and small economies.
But, "our only chance is to build something into the (free trade) rules - that's what special and differential is," said Mr. Bernal.
