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Wednesday, September 24, 2014
- By the time Wang Qishan, China’s vice premier, arrived in Trinidad for the Third China-Caribbean Economic and Trade Cooperation Forum earlier this week, Beijing had already ramped up its involvement with most countries in the 15-member Caribbean Community (CARICOM) grouping.
In the days leading up to the Sep. 12-13 event in Port of Spain, China signed cooperation and loan agreements for projects worth millions of dollars with Barbados, The Bahamas and Antigua and Barbuda. Before the forum ended, it had added Trinidad and Tobago and Guyana to the list of countries benefitting from Beijing’s largesse.
And if those agreements were not sufficient, Wang took the opportunity at the opening of the forum, also attended by nearly 50 Chinese business organisations, to announce that his country would be providing one billion dollars in loans and preferential treatment to Caribbean countries in support of local economic development.
China is also contributing one million dollars to the Caribbean Development Fund (CDF), designed to provide technical and financial assistance to the CARICOM-designated disadvantaged countries, regions and sectors.
And Beijing offered no less than 2,500 training opportunities for Caribbean countries and 30 opportunities for Caribbean professionals to study for master’s degrees in China.
Wang said China would also boost the ability of Caribbean countries to cope with natural disasters, including support in the building of seismic and tsunami early warning and monitoring networks.
Guyana’s President Bharrat Jagdeo, who was among a handful of regional leaders who came to Port of Spain for the forum, said it was necessary for CARICOM to pursue a non-reciprocal trade agreement or a partial scope agreement with China, similar to the one that exists between his country and Brazil.
Jagdeo said that because of the small size of the Caribbean’s economies, the top 30 or 40 export commodities could be imported into China on a duty-free basis, which would have a minimal effect on the Asian giant while generating significant wealth for the Caribbean.
Over the past two decades, bilateral trade between the Caribbean and China has grown a significantly, from 20 million dollars in 1990 to two billion dollars in 2008, he noted.
“In the last 10 years, China’s exports have consistently accounted for more than 70 percent of total trade,” Jagdeo said. “In 2008, 93 percent of Caribbean-China trade consisted of China’s exports to the region. The region itself exported significantly (over 60 million dollars in goods) to China in that year.
“China has a growing demand for the region’s raw materials including gas and asphalt in Trinidad and Tobago, bauxite in Jamaica and timber, bauxite and minerals in Guyana. In addition, Chinese companies have used the Bahamas’ close geographic proximity to the United States to manufacture and assemble products destined for the United States market, and to invest in the service sector such as tourism,” Jagdeo said.
Host Prime Minister Kamla Persad Bissessar noted that, “The challenge for us in the Caribbean as we welcome foreign direct investment inflows from China is to continue to improve the investment climate to ensure that the interventions contribute to linking domestic firms to the global economy.”
“It is also necessary to strive for the matching of financing injections into high-return projects,” she added.
Caribbean countries have struggled as a result of the global economic crisis, and regard the so-called BRIC countries – India, Brazil, Russia and China – as integral to the future development of the region.
Antigua and Barbuda’s Prime Minister Baldwin Spencer said that China must be commended for reaching out to the Caribbean region “at a time when countries are struggling to address the impact of the global financial crisis”.
The global economy has been undergoing very significant structural changes piloted by new drivers of global growth, said Guyana’s Finance Minister Dr. Ashni Singh.
“Increasingly what we see is Chinese companies, having grown rapidly as they have, driven by the domestic growth (are)… looking increasingly for a global presence. We see Chinese companies looking for investment opportunities throughout the world; we see that happening in the Caribbean, Latin America, Africa and elsewhere.”
The forum here had been billed as an ideal opportunity for Caribbean countries to discuss and establish blueprints for future cooperation in areas such as finance, infrastructure, tourism and agriculture.
Recent data indicate China is not only the third largest inbound tourism destination, but also the third largest source of outbound tourism.
Simplifying the visa process for Chinese tourists, or eliminating it entirely, will be a major step for business relations between China and The Bahamas.
“We are seeking a possible way to speed up the process or eliminate the process entirely,” said Brent Symonett, minister of foreign affairs, adding “we hope to have a resolution to this issue in short order.”
But not everyone is unreservedly enthusiastic regarding China’s growing economic influence in the Caribbean.
Economist Indera Sagewan-Ali said that Chinese officials came to the region with self-interest at heart as well.
“China has a lot of money and is looking for investment opportunities. It has a lot of capacity for construction and all these things and they want to send it out there, so they came out very well. The challenge is, has the Caribbean thought about what is in it for us?” she said.
The head of the Joint Consultative Council in Trinidad and Tobago, Afra Raymond, also urged caution regarding the recent Chinese investment thrust in the Caribbean.
“We had a terrible experience with what I call the ‘Manning Model’ (the former Patrick manning government) for the last eight or nine years, with huge unnecessary projects using the taxpayers’ money. Chinese contractors came here with Chinese labourers and Chinese fittings, and we still have to continue paying for those projects,” he said. “That was a failed model. ”