From Caribbean360

GENEVA, Switzerland, Friday June 20, 2014, CMC – Six years after the onset of the global economic crisis, there is evidence that the economies of the sub-regional Organisation of Eastern Caribbean States (OECS) is showing signs of rebound, a senior Grenada diplomat has said.

Grenada’s Ambassador to the World Trade Organization (WTO), TO, Dr. Patrick Antoine, addressing the Third Trade Policy (TPR) on behalf of the OECS member countries, said however, the outlook still remains uncertain and the threats of economic reversal and downside risks remains strong.

“The performance among the OECS has not been uniform. GDP (gross domestic product) growth statistics indicate that the region contracted for two consecutive years in 2009 and 2010, with high disparities across the grouping,” Antoine told the two-day meeting that ended on Thursday.

He said these disparities ranged from in excess of 15 per cent in the case of Antigua and Barbuda to a contraction of approximately 2.7 per cent in the case of St. Vincent and the Grenadines.

“One OECS country suffered a contraction in services growth, while other OECS economies demonstrated tremendous slowdown led by tourism and construction and virtually no growth in other services owing to a large of domestic services capacity,” he told the TPR.

Antoine said that over the past decade, every OECS country experienced a significant fall in the rate of growth compared with the previous two decades and that there were rapid declines in export competitiveness resulting in severely contracted foreign exchange commodity earnings.

He said real GDP contracted annually by 1.1 per cent on average over the period 2008-2012, in sharp contrast to an average expansion of 5.1 per cent for the five years just prior.

Antoine said that in responding to the crisis, the OECS economies committed to an “Eight Point Stabilization and Growth Programme” and that at the level of individual states, a myriad of fiscal measures and reforms have been instituted, including the introduction of value added tax (VAT) and debt restructuring, which have become staples of the stabilization programmes.

“Economic recovery in the OECS following the crisis continues to be sluggish, and the forecast for return to pre-crisis growth levels now suggest 2016-2017. Notwithstanding, notable progress has been made on some aspects of our Millennium Development Goals (MDGs).

“However, low growth and a high debt and rising unemployment continue to threatening the region’s developmental and social progress,” Antoine said.

The Grenadian official said that the OECS WTO members remain committed “to a fair, equitable, rules-based transparent and inclusive multilateral trading system that meets the needs of all its members and in particular developing countries”.

He said the OECS-WTO member states maintain the position that trade negotiations between developed and developing countries must be premised in asymmetry and special and differential treatment for the latter of the two parties.

“The OECS member states remain committed to the successful conclusion of the Doha Development Agenda negotiations in accordance with the mandates and Members¡¦ decision to place development at the core of the outcomes.

“For this reason the OECS remains concerned at the ongoing impasse in the DDA. The limited outcomes at Bali provided a welcome impetus to the negotiations,” Antoine added.

Antoine said the OECS countries – Antigua and Barbuda, Dominica, Grenada, St. Lucia, St. Vincent and the Grenadines, St. Kitts-Nevis -.have participated meaningfully in the DDA negotiations and have contributed to the leadership shown by the African Caribbean and Pacific (ACP) and the wider G90 in the negotiations on trade facilitation.

He said the conclusion of the free trade agreement now require that developed countries and developing countries with the capacity to do so provide the needed and additional financial and technical assistance for effective implementation by developing countries.

“It is also imperative that the Post Bali work programme be developed to conclude the outstanding areas under the DDA as mandated by Ministers. For the OECS it is important that we build on progress already made and that the flexibilities negotiated for SVEs are entrenched.”

But Antoine said that one of the continuing challenges in the trade policy of Antigua and Barbuda and by extension all OECS member states is the current failure to reach a satisfactory resolution to the case on internet gaming with the United States.

“This case is a decade old, and it pits the world¡¦s largest economy against one of the world¡¦s smallest and vulnerable. Despite having won a favourable decision of the Dispute Settlement Board, Antigua and Barbuda is yet to receive a reasonable offer from the USTR that could bring this matter to a successful conclusion.

“Antigua and Barbuda believes that this case presents several systemic challenges to the dispute-settlement mechanism of the WTO, and has the potential to undermine the credibility of the Organization.

“Antigua and Barbuda is of the view that there ought to be more flexibility in possible options for arriving at a resolution of a case such as this,” Antoine said, adding “Antigua and Barbuda is willing to put forward its ideas on these matters in the appropriate WTO forum, and calls on like-minded states to assist in reforming the dispute settlement system of the WTO”.

Antigua and Barbuda has criticised the United States since 1998 of breaching its commitments to members of the WTO under the General Agreement on Trade in Services (GATS) by enacting laws that prevented foreign-based operators from offering gambling and betting services to its citizens.

In 2005, the WTO ruled that Washington had violated international trade agreements by prohibiting operation of offshore Internet gambling sites. Antigua claimed that it lost US$3.4 billion a year due to the US action, but the WTO awarded the island US$21 million.

But in its final ruling, the Geneva-based WTO has allowed Antigua and Barbuda to suspend certain concessions and obligations it has under international law to the United States in respect of intellectual property rights.

In his address to the WTO, Antoine said the OECS remains “fully committed to the Aid for Trade initiative in all of its dispensation.

But he said the designation of OECS members states as high middle income developing countries however can make access to many aid for trade opportunities increasingly challenging even though the region remains vulnerable and faces structural economic challenges not captured by per capital economic indicators.

“This is particularly true when the downside risks or downside disasters and ballooning unemployment particularly among the youth are taken into account.”

Antoine said the Caribbean Community (CARICOM) Regional Aid for Trade Strategy developed in 2013 identified, a number of projects with a sub-regional focus. They include projects to upgrade key economic infrastructure; enhance competitiveness of the private sector and facilitate trade expansion and diversification as well as deepen regional integration and maximise gains from external trade agreements.

“The premise of this strategy is geared toward developing a modernized trade policy framework with a broad focus on sectoral issues and cross cutting measures such as information technology and renewable energy initiatives,” Antoine said.

For more on this story go to: http://www.caribbean360.com/business/wto-told-oecs-economic-recovery-continues-to-be-sluggish