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Guyana Has No Regrets over Holding Out on EPA

Peter Richards

MONTEGO BAY, Jamaica, Jul 12 2010 (IPS) - Two years after 14 Caribbean countries signed a wide-ranging and controversial Economic Partnership Agreement (EPA) with Europe, Guyanese President Bharrat Jagdeo still maintains that his country was right in holding out until the last minute to get a “better deal” for the Caribbean.

“I don’t regret it. In fact today we feel more vindicated than ever before that many of the things we said came to pass and the agreement is haunting us in our negotiations with others,” Jagdeo told reporters during the just concluded Caribbean Community (Caricom) heads of government summit here.

Under the EPA, the European Union allows the 15-member Caricom grouping plus the Dominican Republic (known as CARIFORUM) duty- and quota-free access to its market in all goods and services, with the Caribbean agreeing to open 80 percent of its market to the Europeans. Haiti signed in 2009.

Guyana, which did not attend the October 2008 signing ceremony, had argued on a number of fronts, including concerns that the “Most Favoured Nation” clause in the accord – which commits CARIFORUM to grant Europe the same treatment it grants to any ‘major trading economy’ in subsequent free trade agreements, including developing countries like China and trade blocs like Mercosur – would affect Caricom’s cooperation with South-South partners that has been a feature in development economics for decades.

“Our holding out to the last day before the signing in the face of threats of sanctions against Guyana brought us two things – a mandatory five-year review in the document and a provision that the EPA must not conflict with the revised Treaty of Chargauramas” that governs the regional integration grouping, he said.

“If we had held out more together, I think we could have gotten much more,” Jagdeo added, pointing out that African countries which signed a similar EPA were now complaining that “Europe does not want to offer them the five-year review that we got and that is because we held out to the last”.

At last weekend’s meeting here, the new Caricom chair, Jamaican Prime Minister Bruce Golding, conceded that there have been “implementation shortfalls”, some of which have to do with capacity.

“It is a very, very complex agreement that requires a considerable amount of work to be done,” he said, urging a greater involvement by the region’s private sector.

“Governments, as far as I know, with one or two exceptions …do not export anything. It’s the private sector that does,” he said, adding that Caribbean countries “also have to submit specific projects for funding under the EPA development arrangement”.

Last December, the EU announced that it would launch a 15- million-dollar support programme this year aimed at enhancing the competitiveness of Caribbean exports.

“We are hopeful that based on the consultations that we have had with Brussels that we will be able to get approval at an early point so that disbursement can be made,” Golding said.

While key EPA institutions, such as the Joint CARIFORUM-EC Ministerial Council, were finally launched this year, a Caricom communiqué noted that given the weak global economy “and the actions taken by the EU since the signing of the agreement in 2008, heads called for an assessment of the impact on the projected benefits under the agreement”.

Antigua and Barbuda’s Prime Minister Baldwin Spencer told IPS that one of the one of the challenges confronting the region is how to “extract from the European Union the billions of dollars that they have available for the Caribbean, and for some unknown reason or reasons known only to themselves we have been unable to access those funds”.

“Our contention right now is to find modalities that would allow us to access European funding because it is there … and so we have been making the argument to the extent that we need to improve upon our capacity in terms of human resources and our ability let’s say to put projects together that are bankable and so on.”

The Caribbean has already signalled that it would be looking to Europe to help finance the operations of the Trinidad- based Caribbean Public Health Agency (CPHA), which will integrate the functions and administration of the Caribbean Epidemiology Centre, the Caribbean Food and Nutrition Institute, the Caribbean Environmental Health Institute, the Caribbean Regional Drug Testing Laboratory and the Caribbean Health Research Council.

St. Kitts and Nevis Prime Minister Dr. Denzil Douglas told IPS that “there is a substantial amount of money” available to the Caribbean under the European Development Fund (EDF), and that the CPHA would need 54 million dollars to launch.

Last weekend, the head of the EU delegation to Barbados and the Eastern Caribbean, Ambassador Valeriano Diaz, vowed Europe’s continued support, particularly as Caricom continues to deal with the negative fallout from the global financial and economic crisis.

“We are aware that the effects of the global crisis have been transmitted to the regional economies with declines in tourist arrivals and foreign direct investments and migrant remittances,” Diaz told a two-day joint EU-CARIFORUM conference in Antigua on the financial services sector in the Caribbean region.

“We are also aware that regional governments have been working hard to mitigate the effects of the crisis on their economies and societies in general,” he said, noting that the EU was able to respond quickly and adequately to the impact of the financial and economic crisis on the developing countries through initiatives such as support to the International Monetary Fund and the grouping’s own Vulnerability Flex Mechanism.

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