THE CARICOM SINGLE MARKET AND ECONOMY
On January 1 2006, the CARICOM Single Market came into being, with its twin component, the Single Economy scheduled to come on stream by December 2008. The CSME was conceived by the 15 Heads of Government of the Caribbean Community as the Region’s response to the challenges of globalisation which has eroded almost all segments of the traditional export markets of Member States.
The CARICOM Single Market & Economy (CSME) seeks to transform Member States of the CARICOM Community into a single, seamless integrated economic space of some fifteen million people.
It is intended to provide an open market without cross-border restrictions and therefore seeks to facilitate the free movement of critical factors of production including: Goods, Skilled Community Nationals, Capital and Services
The full introduction of the Single Market will see the free movement of goods, services, labour and capital being fully implemented in all participating CARICOM Member States.
At the official ceremony held at the University of the West Indies in Jamaica on 30th January 2006 to signify its formal launch, the first six of the twelve participating Member States signed on to the CARICOM Single Market. These include Barbados, Belize, Guyana, Jamaica, Suriname and Trinidad and Tobago. The remaining six, Antigua and Barbuda, Belize, Dominica, Grenada, St. Kitts/Nevis, Saint Lucia, and St. Vincent and the Grenadines signed on within six months.
We welcome this opportunity to share with you the tremendous benefits which will accrue to you and every citizen of each Member State in the implementation of the CARICOM Single Market & Economy.
Truly, the CSME signifies the greatest accomplishment of CARICOM Member States in achieving regional cooperation and the deepening of regional integration.
The 1989 meeting of the Conference of Heads of Government in Grenada was a crucial milestone in the resolve of CARICOM leaders to advance the process of Regional economic integration. This process records its genesis with the initial establishment of a Caribbean free trade area – CARIFTA, which subsequently matured with the coming into being of the Caribbean Community and Common Market established by the TREATY OF CHAGUARAMAS in 1973.
The COMMON MARKET involved mainly intra-regional free trade in goods, a common protective policy the centerpiece of which was the external tariff, and the coordination of Macro- Economic and Sectoral policies.
The Common Market’s focus on trade in goods, to the exclusion of labour, capital and services, limited the capacity of that arrangement to generate acceptable levels of economic growth for the Region.
Accordingly, there was firm determination by Member States to deepen and widen the economic integration process which was seen as the essential lifeline for the fledgling economies of the Region. This determination was guided by both regional developments and sweeping changes in the international business environment. Among the regional considerations which informed the current strategy were the internal economic and social dynamics of Caribbean Economies as reflected in poor economic growth rates, declining foreign investment flows, rising levels of unemployment and negative trade and social indicators.
On the international front, the varied challenges to Member States posed by globalisation made deeper integration an imperative. The biggest threat was the possible extinction of the Region’s business base due to prevailing multilateral, regional and bilateral trading arrangements including the World Trade Organisation and the Free Trade Area of the Americas.
With the advent of trade liberalisation, the Region’s Private Sector found itself in an intensely competitive environment. Businesses did not only have to defend their domestic markets, but they also had to do battle to keep their share of export markets.
All of these developments were taking place against a background of CARICOM nations being Small countries with small economies, Countries with limited domestic markets and bearing largely inefficient production levels and therefore uncompetitive.
Survival therefore became a priority concern, and most businesses realised that staying in business meant becoming competitive.
The CSME is therefore the Region’s most important integration strategy intended to be one of the pillars which will facilitate its economic survival, and at the same time create an economic environment conducive to competitive production.