Trade liberalisation without co-operation a no-no
28 December 2005
The great commerce of every civilised society is that carried on between the inhabitants of the town and those of the country. It consists in the exchange of crude for manufactured produce, or of some sort of paper which represents money. (Adam Smith: The Wealth of Nations).
William Jefferson Clinton once said that “the opposition to globalisation in the world is rooted in people who feel left out, left behind and stepped on in other countries.” Apparently, having accepted our status as doormats, the developing world has once again sent our highest authorities to the other end of the world to continue to hammer out a trade deal that maintains our city-mouse/country- mouse dynamic.
Trade liberalisation on its own, particularly in a region such as ours, with varying sizes and levels of economic development, is unsustainable in the absence of cooperation. Not only do we not have the benefit of a head start, as others do, but we are saddled with the historical baggage of our colonial and neo-colonial heritage which has placed us with our backs to each other, looking for hope across the Ocean, instead of within our own Sea.
Comprehensive integration is the key to the strategies of our region, as it reinforces our ability to take part in globalisation. This has become an important theme at regional and sub-regional meetings in recent years and has broadened a political space that acknowledges the existence of differences and asymmetries and the need to overcome them, as well as the need to formulate clear common positions and strengthen dialogue and cooperation mechanisms at crucial forum, such as the Free Trade Association of the Americas and the World Trade Organization, as well as the ALBA1 alternative proposed by Venezuelan President Hugo Chávez.
Free trade agreements have come to be seen by many as the alpha and omega of integration. The focus on these agreements, however, sidesteps the acknowledgment that integration between countries with diverse cultures, languages and sizes which occupy a common space, is a complex and delicate affair that can be achieved only through mechanisms that go well beyond tariff liberalisation.
In renewing their commitment to multilateralism as the ideal mechanism for facing global challenges in a manner consistent with the founding principles of International Law, countries have come to accept that there is no contradiction between multilateralism and regionalism, including south-south co-operation.
The growing emphasis on the role of regional and sub-regional organisations is also one born out of logic and practicality, particularly in our corner of the world made up, in great part, by Small Island Developing States (SIDS). Regional groups are often better able to negotiate with development partners as they know the region’s strengths and weaknesses. They know of the region’s capacities and resources. They are also better placed to initiate and push ahead with projects and programmes with the governments of the region.
Regional and sub-regional organisations make logical and practical sense as an indispensable link in the chain as they, amongst other things, provide a forum for discussion and make it less costly for states to discuss issues with one another; allow governments to take a long-term perspective, making them less concerned about immediate results; provide economies of scale, maximising return on investment of international assistance as well as provide greater transparency and accountability for donors.
(Luis Carpio is the Director of Natural Disasters and Transport and acting Political Advisor to the Secretary General of the Association of Caribbean States. The views expressed are not necessarily the official views of the ACS.)