Speeches
Complexities, Opportunities, Benefits and Challenges for Employers
By CSME Unit of Trinidad and Tobago
Jan 29, 2005 - 5:59:41 PM

Address By His Excellency Jerry Narace, Ambassador Extraordinary and Plenipotentiary and Head, Caricom Single Market And Economy Unit at The ECA Programme on “CSME: Complexities, Opportunities, Benefits and Challenges for Employers”

January 20th 2005

Ms. Linda Besson - Executive Director, Employers’ Consultative Association (ECA)

Mr. Anthony Guiseppi – Trade Consultant, Trinidad and Tobago Manufacturers Association

Dr. Anthony Gonzales – Caribbean Regional Negotiating Machinery

Mr. Clarence Rambharat - Employers’ Consultative Association (ECA)

Mr. Dane Darbasie – Chairman

Distinguished Guests, Ladies and Gentlemen

Good Morning.

It is certainly a pleasure for me to be here at this very important Breakfast Seminar hosted by the Employers’ Consultative Association (ECA) and to speak on the state of readiness of Trinidad and Tobago for the CSME.

I wish at the onset, to state that the hosting of this Seminar - “CSME: Complexities, Opportunities, Benefits and Challenges for Employers” is indeed timely and appropriate. This Seminar, which marks the launch of the ECA’s 2005 programme is taking place on the heels of the eighteen (18th) Meeting of the Council for Trade and Economic Development (COTED), which was held two (2) weeks ago in Georgetown, Guyana and at which, the CSME was the subject of much discussion and deliberation.

These discussions and deliberations, I should state, were very much as a result of proposals made by Trinidad and Tobago which sought to create a more regulated single economic space that would better serve the Region’s developmental needs.
Added to this, is the fact that February 19th 2005 is a significant date for us in the Region. On February 19th, Trinidad and Tobago, Barbados and Jamaica are scheduled to engage in a signing ceremony in which instruments of CSME readiness will be placed in the depository in Guyana. As of the date of this signing, the markets of these three (3) Member States will be accessible to all participating Member States. This means that the citizens of all participating Member States would be treated as citizens of either Trinidad and Tobago, Barbados or Jamaica with respect to provision of services, goods, capital as well as the right of establishment. For other Member States, December 31st 2005 is set for the completion of CSME readiness. To all of us in the Region however, this year is the beginning of a journey towards greater prosperity.

In order for us to truly appreciate the state of readiness of Trinidad and Tobago for the CSME, it is imperative that we understand:

a. the mindset of Trinidad and Tobago with respect to integration;
b. our accomplishments to date at the creation of a Single Market; and
c. the acceptance of the CSME by the general public

Ladies and Gentlemen, a cursory glance into the background of the Trinidad and Tobago/ CARICOM relationship shows for some time now, Trinidad and Tobago has been ready for the creation of a single enlarged economic space. The fact that we have benefited from all attempts to deepen integration, whether it was CARIFTA in 1968 or CARICOM in 1973 or the timely implementation of the fourth phase of the Common External Tariff are all visible indicators of this country’s commitment to regional prosperity.

Further, since the late 1980s, we have come to realize and to accept the structure of the global economy - larger markets, intense competition and the free movement of capital. This realization and acceptance have led us to embrace the fact that the survival of our economy and those of our sister states depend on the creation of a programme that would provide not only a solid platform on which we could increase our competitiveness but also provide an employment base for our highly skilled labour force.

Our decision therefore, in 1989 at Grand Anse in Grenada, to join with other Caribbean Heads of Government, to create a Single Market and Economy is perhaps the most definitive step taken towards deeper integration and is clearly demonstrative of our recognition then and moreso now of the need to adjust to the external dynamics of the new world economy.

With this mindset, it therefore comes as no surprise that today, Trinidad and Tobago is playing a leadership role in the implementation of the CSME. Ever since we signaled our commitment to be Single Market ready ahead of schedule, the Government has sought to put in place all the necessary administrative structures to ensure the timely implementation of the Single Market. In early 2003, Cabinet not only approved the establishment of a Unit to oversee the implementation of the CSME in Trinidad and Tobago, but also agreed to the formation of two Committees: an Inter-Ministerial Consultative Committee comprising Government Officials and a Business and Labour Advisory Committee comprising both Government Officials and representatives of civil society (every group included), to act as advisory bodies as well as a medium of information exchange.

I wish to point out that the work of these two Committees, as well as the unwavering support of the Ministries of Foreign Affairs and Trade and Industry as well as other Ministries have enabled us to be well on course to achieve our stated objective. Today, fifteen (15) years after that infamous Grand Anse declaration, I am pleased to report that the region is on the threshold of realizing a Single Market. This signing ceremony on February 19th 2005 will indeed be symbolic, as it will signal the initial stage of the formation of a Single Market. Thirteen (13) Member States will now have access to the markets of the three MDCs .

Ladies and Gentlemen, as we stand on this ‘threshold’, I wish to focus your attention on what we have accomplished here in Trinidad and Tobago with respect to the implementation of the Single Market component of the CSME. By the 19th, we would have established market access for citizens of thirteen Member States to Barbados, Jamaica and Trinidad and Tobago. By the end of 2005, you will appreciate that the establishment of the Single Market will lay the foundation for the creation of the Single Economy, which is scheduled to come on stream by December 31st 2008.

To date, I am particularly happy to state that we have fully completed work in the following areas.

1. Treaty Revision: Legislation to incorporate the Revised Treaty of Chaguaramas into domestic law has been passed in both houses and is currently awaiting assent by the President of the Republic.

2. Establishment of National and Regional Administrative Structures: As you are aware, Trinidad and Tobago has in place a Ministry with responsibility for CARICOM Affairs by way of the Ministry of Foreign Affairs and has established a CSME Unit which is mandated with the implementation of the CSME in the stipulated time frame.

3. Free Movement of Persons: There are two aspects to the Free Movement of Persons in the CSME – a. the free movement of skilled persons and service providers and b. Hassle Free travel.

With respect to the free movement of skilled persons, all the necessary legislative and administrative structures have been in place since June 2003 for the free movement of University Graduates, Media Persons, Sports Persons, Artistes and Musicians. As you would recall these persons are able to move freely by virtue of a Skills Certificate issued to them by the relevant authorizing agency in each Member State.

Essential in enabling the free movement of skills is the appointment of a National and Regional Accreditation Council. At the national level, this Council is expected to establish a quality assurance framework for the Registration and Accreditation of Tertiary Level Institutions. To this end, the Accreditation Council of Trinidad and Tobago was recently established by the passage of Act No.16 on May 21st, 2004 and assented to and proclaimed by the President on July 9th, 2004.

In terms of administrative arrangements, Cabinet has to date approved the appointment of thirteen (13) members to the Board of the Accreditation Council of Trinidad and Tobago. The preparation and signature of Instruments of Appointment by the President as well as the convening of the first Board Meeting are expected to take place shortly. The Secretariat for the Accreditation Council will be established after the Board meets.

In the case of the free movement of service providers, the Immigration Act, Chapter 18: 01 has been amended to remove the work permit requirement for all service providers subject to the Movement of Factors Act. In the interim, however, Trinidad and Tobago remains mindful of the fact that the free movement of service providers requires some type of monitoring system that would ensure that bona fide service providers are granted access. At the Tenth Special Meeting of the Conference of Heads of Governments, the Honourable Prime Minister of Trinidad and Tobago proposed and it was agreed, that an appropriate mechanism be introduced. As such, at the recently concluded eighteenth (18th) Meeting of the Council for Trade and Economic Development (COTED), a proposal was put forth by the Trinidad and Tobago delegation for the introduction of a register of service providers. A detailed proposal will be submitted by Trinidad and Tobago to the CARICOM Working Group on Services for review and consideration by February 8th 2005.

On the issue of Hassle Free Travel, since January 1st 2004, Trinidad and Tobago has introduced Common Lines at all ports of entry. The introduction of a CARICOM Passport is however a work in progress at the regional level and we await finalization before implementation.

With respect to Social Security arrangements also consequent on the free movement of persons, Trinidad and Tobago has enacted the agreement into domestic law since April, 1997 and the National Insurance Board has started payments under this arrangement.
It should be noted however that the only area which remains outstanding under the free movement of persons is the issue of Contingent rights.  This issue is dependent on the development of a regional policy. Trinidad and Tobago, through the Ministry of Trade and Industry has however prepared a draft policy paper which when finalized, would be forwarded to the CARICOM Secretariat as an input into the regional policy. The CSME Secretariat has also identified a consultancy project for this area in its Work Programme for 2005 – 2008.

4. Free Movement of Capital: Trinidad and Tobago has abolished foreign exchange controls and there are no restrictions to capital market activity.  Currently, Trinidad and Tobago, Jamaica and Barbados comprise the regional stock exchange. The Double Taxation Agreement as you are aware, was enacted into our national law since December 1994.

5. Right of Establishment: This is operational subject to the rules and regulations governing the establishment of businesses in each respective Member State. With the coming on stream of harmonized Companies’ legislation, companies and other business entities, which, once incorporated in one Member State, will be able to easily move to another Member State and establish a business presence, without the need for re-incorporation or registration.

6. Common External Policy: Since 1999, Trinidad and Tobago has implemented the fourth phase of the Common External Tariff.

7. Public Education Programme: We have recognized that the successful implementation of the CSME hinges on a well informed and educated public. To this end, the Unit has embarked on a two- phase programme of Public Education. Phase I of the Programme, which was implemented during the period May to December, 2004 was successful in sensitizing the public on the CSME while Phase II which is currently under - way is seeking to educate the public at large on the opportunities that come with the CSME.

8. Free Movement of Services: Ladies and Gentlemen, much discussion has surrounded the Free Movement of Services. Services, as you know, form a distinguishing feature of the Single Market from that of the Common Market. In 2002, the Council for Trade and Economic Development (COTED) identified a total of twelve (12) restrictions or discriminatory measures in various pieces of national legislation. These restrictions or discriminatory measures which formed the Trinidad and Tobago Programme for the Removal of Restrictions were found to be inconsistent with the Revised Treaty of Chaguaramas and were therefore required to be removed either by legislative or administrative amendment.
In reviewing the Programme and in consultation with the various line Ministries, we have found that the restrictions or discriminatory measures identified in three (3) pieces of legislation were not restrictive or discriminatory and were in fact in place for prudential reasons. The other which involves the taxation of dividends paid to non- nationals on approved tourism projects was the subject of discussion at the Eighteenth (18th) Meeting of the Council for Trade and Economic Development (COTED). These measures were reviewed and together with a legal opinion will be forwarded to the Heads of Governments for approval.
The other remaining restrictions or discriminatory measures were amended either by the use of Caribbean Community Removal of Restrictions Act or by individual amendment to the respective piece of legislation.
With respect to services, there are two issues which remain outstanding and for which work is currently under way, namely the areas of Pilotage Services and the Movement of Factors legislation which impacts on the removal of work permit requirement for service providers. These two areas will however be amended in time for February 19th 2005.

9. Enforcement, Regulation and Supporting Institutions: In the area of enforcement and regulation, Trinidad and Tobago already has a National Bureau of Standards.
The only outstanding areas are the enactment of the Agreement establishing the Caribbean Court of Justice (CCJ) and the CARICOM Regional Organization for Standards and Quality (CROSQ) into domestic law and the establishment of a National Competition Authority.
With respect to CROSQ, I wish to assure you that this matter is expected to be brought to the Parliament in January 2005. It is to be noted however that this Agreement is currently being provisionally applied. You will recall Ladies and Gentlemen that CROSQ replaces the Caribbean Common Market Standards Council and its objectives are the establishment and harmonization of standards for the enhanced efficiency and improved quality in the production of goods and services in the Community.
In the case of the National Competition Authority, which is intended to facilitate the implementation of the rules of competition, Trinidad and Tobago has to date, drafted legislation in this area and the matter is expected to be on the Parliamentary Agenda for debate and enactment in January 2005.
The CCJ for which much concern has been expressed represents two important elements for Trinidad and Tobago and the Caribbean Community. Under its “original jurisdiction’’, the CCJ has exclusive and compulsory jurisdiction in all matters relating to the interpretation and application of the Revised Treaty of Chaguaramas. In its “appellate jurisdiction”, the CCJ will be the final court of appeal from decisions of national courts, thereby replacing the Privy Council in those Member States for which it is the final court of appeal. Government proposes to bring this legislation to Parliament shortly.

10. Harmonization of Laws: Except in the areas of Anti-dumping and Countervailing Duties, Standards and Technical Regulations and Sanitary and Phyto-Sanitary Measures in which, Trinidad and Tobago has compliant legislation. I wish to draw your attention to the fact that the Harmonization of Laws is dependent on the receipt of model legislation from the CARICOM Secretariat. While we await such legislation, the relevant Ministries are proceeding with the development of their respective policies in anticipation of the relevant drafts.

Ladies and Gentlemen, our success to date proves our readiness for the Single Market. Our action plan, which included:

1. Prioritizing the legislative agenda to ensure CSME-readiness,

2. A commitment to a non-partisan parliamentary approach to the CSME

3. Playing a leadership role in the region, thereby guiding other member states to do the same has and continues to provide the desired results for Trinidad and Tobago. The ‘buck’ however does not stop here. It is critical that we understand the role of the CSME in ensuring our future economic viability.

The Government has recognized this need and has sought to put in place the necessary support measures that would reap maximum benefits from this initiative.

Additionally, the Government is cognizant of the fact that:
1. open trade and investment policies are necessary for a market –driven and efficient domestic economy

2.  in the face of global competition, domestic firms need to become highly competitive and to meet international standards for quality and performance;

3. for businesses to prosper, it is imperative that there exists an investment friendly climate.
As such, a number of initiatives aimed at improving our competitiveness and positioning us on a solid platform are being pursued.

These include:
1. A new Investment Policy designed to promote and encourage private investment from both domestic and foreign sources and predicated on the desire to diversify the economy, increase competitiveness and achieve sustainable growth and development. This Policy is also consistent with our current international and regional obligations in the various negotiating theatres. Once approved by Cabinet, the tenets of this policy would be articulated in a new Investment Promotion Act, which will replace the Foreign Investment Act.

2. Services Trade Policy: Added to the new Investment Policy, is the strengthening of the business environment, through the development of the Services Trade Sector. This will be accomplished through the creation of a Services Trade Policy for Trinidad and Tobago and the establishment of the Trinidad and Tobago Coalition of Service Providers.

3. CARICOM Trade Support Programme (CTSP): Ladies and Gentlemen, Trinidad and Tobago is cognizant of the role and importance of the business sector to foster economic growth and development. It is against this backdrop that the Government recently launched the CARICOM Trade Support Programme. This Programme involves the use of a TT$100 million revolving loan to be disbursed on an interest free basis to firms in the CARICOM region to procure the services of regional consultants for projects. This facility is accessible by firms in other Member States apart from Trinidad and Tobago. The Business Development Company of Trinidad and Tobago, which is this country’s development agency responsible for the continuous growth and empowerment of all sizes of businesses, in conjunction with the Trinidad and Tobago Manufacturers Association (TTMA) has embarked on a Trade Assistance Programme with the singular mandate of assisting our local companies in specific sectors to expand, through its Loan Guarantee and Sector Development Programme.

4. CSME Attachment Programme: In an effort to assist Member States in becoming CSME ready by January 1st  2006, the CSME Unit of Trinidad and Tobago, in collaboration with the CARICOM Secretariat, has embarked on an attachment programme. This programme exposes participants of other Member States to the implementation process in Trinidad and Tobago. The CSME Units in Antigua and Barbuda, Jamaica, Montserrat, Belize and Suriname have to date benefited from this programme.

Apart from our accomplishments with the implementation of the Single Market and Government Support Measures, our state of readiness can also be measured by the acceptance of the CSME by the general public. In a Survey conducted during the period 1st to 14th September, 2004 by Market Facts and Opinion revealed that four (4) out of every ten (10) persons knew of the CSME. At the same time seventy –six percent (76%) of respondents had seen CSME advertisements and sixty – eight (68%) believed that employment benefits would accrue to Trinidadians and Tobagonians from this arrangement. It is moreover interesting to note that overall, eighty percent (80%) of the respondents had positive comments on the CSME.
In another Survey conducted by a second set of Consultants, eighty percent (80%) of those polled, indicated an awareness of the CSME.
It should be noted that these Surveys were conducted within four (4) to six (6) months of the launch of the National Public Education Programme and these results are evidence of our people’s preparedness to confront the challenges of the new world economy.

It is also important that we recognize, Ladies and Gentlemen, that as I speak, some aspects of the Single Market are in operation and benefits are being accrued from this arrangement. Our manufacturers, for quite some time now, have been operating within a Single Market framework despite the fact that there are still some barriers to be removed by other Member States in respect of the trade in goods. Capital is moving freely and cross listing and trading are taking place on the Regional Stock Exchange, which as we know comprise Barbados, Jamaica and Trinidad and Tobago. Other Member States will join as soon as they have the necessary legislative and administrative structures in place.   Further our skilled persons are capitalizing on the greater opportunity for work. As of November 5th 2004, Trinidad and Tobago had issued four hundred and thirty five (435) Certificates of Recognition of CARICOM Skills Qualification and the Ministry of Foreign Affairs continues to receive applications on a steady basis.

In closing Ladies and Gentlemen, I wish to assure you that the outstanding areas, few as they may be, which Trinidad and Tobago is required to complete, will be fully instituted by February 19th 2005.

Our commitment to be ahead of schedule should not be misinterpreted as a race to the finish line but rather as the commencement of a new era towards regional prosperity. The European Union to which the CSME has been compared, represents forty eight (48) years of efforts while the Single Market, when fully implemented by the end of 2005, will represent a total of thirty two (32) years of efforts by the Caribbean Community to deepen integration. While the EU contemplates twenty five (25) members with a combined population of four hundred and fifty four million as compared to six million people of the thirteen Member States of the CSME, the CSME is yet the second bloc to reach this level of integration.

This is our policy instrument to face the harsh realities of globalization and to achieve greater prosperity for all CARICOM citizens.

I Thank You!