The recent announcement by Brazilian President Lula da
Silva that negotiations for the Free Trade Area of the Americas
have all but fallen off his governments negotiating
agenda is indicative of the state of the FTAA.
In the wake of that announcement, the planned restart of
the talks at a March ministerial meeting was postponed to
Dismay over the FTAA negotiations has reached the US Government
Account Report, a congressional document which indicts the
co-chairs, Brazil and the US, for failing to bridge what
seems an unbridgeable gap between the two countries.
The US is not prepared to negotiate away subsidies and protection
for its farmers. Brazil says until those non-tariff barriers
are removed, it will not negotiate the so-called Singapore
Issues requiring Brazil and others to liberalise financial
markets and the procurement of government services.
The FTAA has seriously fallen behind the 2005 schedule to
have the hemispheric free trade market function to the benefit
of all members, from the US and Brazil to Antigua/Barbuda
and El Salvador.
The international community and international trade are
breaking up into regional and now, with the FTAA, hemispheric
blocs. To be outside those blocs would be to be without
the possibility of developing trade in goods and services.
It is therefore not to the benefit of any country, especially
a group of small, relatively underdeveloped countries such
as Caricom, to be without a broader trading base than the
one amongst member states.
The Brazilian President made that point quite clearly by
indicating that his government would now spend its time
attempting to broaden Mercosur, the trading bloc of the
southern cone of South America. Moreover, he says his government
will invest time and effort in attempting to give real life
to the South American Community of Nations.
At the moment, T&T businessmen predominate in the Caricom
trade group, and many have reached saturation point, with
the regional market offering no more than a possible six
million consumers. Expansion outside of Caricom is therefore
vital for the local business community; it is going to be
even more vital for a large external market as the Single
Market and Economy begins to take on life and regional businessmen
are combining their resources to produce for markets of
hundreds of millions of consumers.
The deadlocked talks on the FTAA are therefore bad news
for all countries of the hemisphere.
In the circumstances, Caricom must follow the example of
Brazil and the other South American giants that are going
ahead with alternatives, at least in the short term. Indeed,
the United States has entered into a series of bilateral
trade arrangements with Central American countries to ensure
itself a trading base.
Caricom has a number of bilateral arrangements in various
stages of implementation with countries such as Venezuela,
Colombia, Costa Rica, the Dominican Republic and Cuba. In
many ways, those markets are far more compatible with production
levels and capacity in Caricom compared with the high-technology
production of the more sophisticated North American markets.
The Association of Caribbean States has not fulfilled
its potential. But T&T and the region must quicken the
process in order to survive in international trade.