By IPS Correspondents
BRIDGETOWN, Barbados, Oct 16 2008 (IPS)

The Caribbean region officially launched a new trade regime with Europe Wednesday with the signing of a controversial Economic Partnership Agreement (EPA) that one supporter said “marks, in a sense, the economic adulthood of the Caribbean”.

“We have moved on to another platform in participating in globalisation. We’re moving on to a platform where the expectation is that we have to boost our competitiveness so that in the world economy we will be making a more important dent,” said Henry Gill, director general of the Barbados-based Caribbean Regional Negotiating Machinery, which negotiated the accord on behalf of the 16 Caribbean Forum (CARIFORUM) countries.

Many Caribbean economists, civil society groups and others have long argued that the deal could leave small regional businesses unable to compete with massive European firms and would also lock the region into an agreement that will lose its relevance as world conditions change.

However, European Commission vice president Siim Kallas said that the agreement underscores the historic relationship between Europe and the Caribbean.

“At a time of uncertainty in the global economy, of scepticism about the very ability of trade to deliver for development, I believe this agreement sends a powerful message of commitment and of hope,” he said.

The signing took place amid fears that the EPA would continue to divide the 15-member Caribbean Community (CARICOM) grouping, particularly as Guyana and Haiti were not present at the ceremony. But Caribbean trade officials later insisted that the two countries “were on board”.

Haiti, which just installed a new government and is still grappling with the devastation wrought by a series of tropical storms that killed hundreds of people and left tens of thousands more homeless, said it intends to sign before the Oct. 31 deadline. Just this week, protesters gathered in front of the National Palace in Port-au-Prince to demand that the pact be submitted to a national referendum, with some describing it as a “rope around the neck”.

However, one of the agreement’s staunchest critics, Guyanese President Bharrat Jagdeo, said he now intends to meet the deadline, after Europe agreed to review the arrangement every five years to ensure it doesn’t unfairly punish CARIFORUM states.

According to a copy of the proposed Joint Declaration on the Signing of the EPA, a consensus was also reached to “pay due regard to the integration processes in CARIFORUM, including the aims and objectives of the CARICOM Single Market and Economy, as outlined in the Revised Treaty of Chaguaramas” governing regional trade.

The EPA, initialled last December in Barbados, replaces the Cotonou Agreement which expired at the end of 2007 and covers trade in goods, services and investments. It provides for development assistance to CARIFORUM countries.

Under the proposed reciprocal pact, these countries will have access to markets in the European Union (EU) and will also enjoy the duty-free right of entry to EU member countries.

For all products originating in CARIFORUM countries and exported to the EU, other than rice and sugar, the agreement has brought about a duty- and quota-free access regime from Jan. 1 this year.

Access for CARIFORUM rice will be duty- and quota-free after a transition period of two years ending on Dec. 31, 2009, while for sugar, access will be duty- and quota-free from Oct. 1, 2009, subject to a transitional automatic safeguard mechanism until Sep. 30, 2015.

But even at the eleventh hour, critics were urging regional governments to delay signing the accord.

Former Commonwealth secretary general and the region’s first chief negotiator, Sir Shridath Ramphal, said a delay was necessary since, as he put it, the agreement was “made in Europe within the framework of a crumbling economic order and the assumptions it imposed.”

“If concluded, it will define future economic relations with Europe on the basis of an imprint that is changing in fundamental ways,” warned Sir Shridath.

Guyana’s former ambassador to the EU, Dr Havelock Brewster, said some of the harmful provisions of the agreement include weak or non-existent development aid – which was promised as the centrepiece of the deal – and inequitable terms on investment, intellectual property rights, government procurement, e-commerce, and trade in goods.

Brewster had supported further meetings among the EU and Africa, Caribbean and Pacific countries at the end of this month, a proposal that Caribbean leaders rejected.

But as he signed the agreement on Wednesday, Barbados Foreign Affairs Minister Chris Sinckler said it was time for critics of the accord to move on.

“Our signature of this agreement today in my view represents a fundamental signal to the rest of the world that Caribbean countries are maturely and decidedly breaking with a long loved past that in fact has now past,” he said.

“Of course, there are those among us who prefer like Lot’s wife to look back at a life which we must have enjoyed and longed for to continue. We can have no quarrels with that, but surely they understand that we must move on,” Sinckler said.

But he acknowledged that “with this act today, we embrace an uncertain future” and urged the EU to meet its commitment to provide development support to buttress regional integration, facilitate implementation of EPA commitments and improve supply capacity and competitiveness.

Britain’s Trade and Development Minister, Gareth Thomas, told the ceremony a 46-million-pound sterling aid package would be used to help the countries design more effective ways to trade with Europe and the rest of the world.

“Ten million pounds has been earmarked for a regional development fund to help the area develop a single market economy – a larger EU-style domestic market which will be crucial in delivering growth and making local businesses more competitive internationally,” Thomas said.

CARICOM secretary general Edwin Carrington conceded that the signing of the agreement coincided with a major global financial crisis that undoubtedly would have a negative impact on CARIFORUM countries.

“The early determination and provision of an equitable share of the ‘aid for trade’ resources will be crucial,” he said. “Equally important is the commitment of the EC to consider modification to the agreement as necessary following our joint review taking into account our shared experience in implementation.”

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