On March 11, 2005, Development Finance Ltd hosted an Investment Conference, the theme of which was Caribbean Investment and Business Expansion. Its objectives were to highlight the realities of the Caribbean business environment, to encourage change and co-operation through the exchange of news and knowledge and to discuss factors that influence investment and business expansion in the Caribbean.

Angella Persad, the country managing director of Ernst & Young Caribbean, chaired one of the sessions of the conference and set the tone in this way:-

“There can be no doubt that Caribbean co-operation is an imperative for the countries of the region, given the current environment of global trade and the size of the Caribbean region, let alone the size of each individual nation. The Caribbean Community (Caricom) Single Market and Economy (CSME) seeks to convert its 15 member states into a single, enlarged economic entity, as near as possible to a single market and single economy without political integration. It is intended to provide an open market without cross-border restrictions and therefore seeks to facilitate the free movement of final products, goods, labour and services.

The CSME, once fully implemented, will attempt to facilitate greater economies of scale and the creation of Pan-Caribbean companies and brands. But CSME, FTAA or otherwise—and there is still continuing debate about the probability of success of these initiatives—Caribbean companies must drastically change the way they do business if they are to survive globalisation. Individual industry product or service benchmarks and standards will surface, as the “level playing field” environment automatically weeds out the inferior goods and services and forces competition and price reductions, as well as service and quality improvements.

Companies must therefore reassess or redesign their business processes along all stages of the value chain, to step up to, or even exceed, these benchmarks. The cost of change and restructuring is significant, and no longer can our small individual local markets provide us with the economies of scale necessary for survival in certain sectors, once the protectionist trade barriers have been lifted. The manufacturing sector in Trinidad is a case in point. Only the best of brands will survive.

The situation is not all doom and gloom, however, as several of our local businesses have already pioneered the phase of regional expansion and consolidation, and successful examples are all around us—including RBTT, Republic Bank, the CL Financial Group, Bermudez, TCL, ANSA McAL and, of course, Ernst & Young Caribbean. These companies must be commended for their foresight in moving outwards to take advantage of a larger regional market, and many of them have raised the performance bar as they carried their flags across the region.

But the threat of globalisation is still a reality for many of our businesses in the region, and the imperative to change and expand calls for an effort. While some of the enabling infrastructure has been established, there are other factors, for example, easy movement of labour, a favourable trade regime, and legal impediments to be overcome if we are to have a successful CSME.

Some of these are systemic, for example, harmonisation of legislation and standardisation of regulatory frameworks. Some are physical, for example, business travel within the region. Hopefully, this will come before World Cup 2007! More emphasis on regional Caribbean communications, and in this context, CCN must be commended for its progress in investing in communication outside of T&T. But let’s face it, some of these impediments centre around our preoccupation with protecting our individual national sovereignties from each other, as opposed to strengthening our regional economy to take on the rest of the world.

Where do we fall as individual countries, individual sectors or even individual companies in an open market regime, bearing in mind that we need to cut our teeth on CSME before we approach FTAA, or, more accurately, before FTAA approaches us?

Should we be preparing Vision 2010 for the region, instead of a Vision 2020 for T&T? If we did that, how would the individual country strengths and weaknesses analyses look? What would be the regional growth sectors identified for long-term survival and self-sustainability? How would we seek to reduce our individual exposures, whether to tourism, the nutmeg or banana industry, and believe it or not, even to oil prices?

The enabling infrastructure therefore calls for taking an introspective and truthful view of where we are as individual countries versus where we need to be as a region. Integration is not easy. It took the European Union more than 30 years to achieve integration. Caribbean integration is still largely a dream. We have different cultures, different economic resources, different currencies of varying values, and different ethnic backgrounds, in some cases. In fact, outside of the formal framework of the CSME, which has already ruled out political unity and a single currency, our enabling infrastructure for Caribbean integration is not readily apparent.

The Chamber’s International Trade Negotiations Unit has been doing yeoman service to prepare our private sector and to provide support to the Government and Caricom, but as Caribbean people and members of the business community, we must coerce our governments to get the homework done and done right away. The CSME is miniscule compared with other trading blocs like Mercosur, Nafta, the EU, the ACCP and similar partners.