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EDITORIAL - A cogent debate on CARICOM, please

Published:Tuesday | May 15, 2012 | 12:00 AM

In their understandable frustration over their inability to compete with Trinidad and Tobago in regional markets, including at home, it is the wont of Jamaican manufacturers to lash out at Port-of-Spain and/or demand protection from its products. There are calls, too, for this country's secession from the Caribbean Community (CARICOM), or its trade arrangements. Would-be policymakers, too, are often part of the rant.

What, though, tends to be absent from the debate is clear and coherent articulation of the issues, and specific, thoughtful and workable proposals for their resolution. While we would certainly not lump Mr Joseph Mahfood in this category, his criticism of Milton Samuda's sober observation on the issue suggests a charge, if not against windmills, perhaps against the wrong enemy.

The most vivid presentation of the Jamaica-Trinidad/CARICOM tension is to be found in this country's US$957.2-million trade deficit with the Community - more than 80 per cent of which is enjoyed by Port-of-Spain.

Of Jamaica's US$1.1-billion imports from the region, more than 80 per cent is mineral fuels, but manufacturers are still worth more than US$200 million. We, last year, exported a mere US$68 million to CARICOM.

Few specifics

It is against this backdrop that Jamaican exporters often complain about unfair treatment by Trinidad and Tobago. Specifics, however, tend to be few, except that Port-of-Spain uses domestic oil and natural gas to subsidise the energy input of its manufacturers.

Mr Samuda, the president of the Chamber of Commerce, which Mr Mahfood calls "margin gatherers", quite reasonably, urged Jamaican exporters to aggressively pursue in regional markets goods and services in which they have comparative advantage. He also suggested using the legal mechanism available in CARICOM, such as the Caribbean Court of Justice, to seek compliance with the treaty.

There is, too, shadow trade minister Gregory Mair's option of bailing out of CARICOM.

Mr Samuda maintained rationality in a discourse that has centred on the transference of blame and responsibility, rather than isolating and fixing the real problems. These mostly reside in Jamaica.

Bad policies on levies, energy

Mr Mahfood complains, for instance, of the 2.5 per cent environmental levy on raw materials imported in Jamaica, from which our Government expected in the last fiscal year to raise J$2.2 billion. Products from Trinidad and Tobago, he says, are not charged that levy.

The intricacies of the CARICOM single-market regime apart, the imposition of that levy, it should be reminded, was not from Port-of-Spain. It is an element of the Jamaican Government's fiscal and economic policy.

It may be true that Jamaican manufacturers pay six times as much for electricity than their Trinidadian counterparts, and that a chunk of the differential represents subsidies. However, it is our Government that for too long countenanced, and even encouraged, bad energy policies. Such policies pushed the domestic price higher than necessary.

In such a circumstance, should we stay in CARICOM - and even as we fix the domestic energy problem - it is up to us to make a cogent case for the treatment/pricing of strategic resources, like gas, in the context of a single market.

The fundamental point is that we may erect barriers to CARICOM/Trinidadian imports, or even leave the Community. But in the absence of more, we will merely transfer the deficit in favour of other suppliers.

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