INTRODUCTION
European Union Trade Commissioner, Pascal Lamy, Chairman of ACP Ministerial Trade Committee, Ministerial Chairman of the European Union, Minister for External Affairs, International Trade and Civil Aviation, Hon. Julian R. Hunte, Excellencies, Invited Guests, Ladies and Gentlemen, Good Morning.
The Government of Saint Lucia is very pleased to be hosting this Fourth Meeting of the ACP/EU Joint Ministerial Trade Committee. Many of you have traveled long distances to come to this special part of our global village, and it is my distinct honour to welcome you to Simply Beautiful Saint Lucia. While I know it is matters of trade that occupy your attention during this visit, I hope you will find the time to discover a few of the many treasures that have made our country a favourite destination for visitors.
We are also very proud of our association with the ACP/EU grouping, cognizant of the important role that this alliance played in fighting off the challenge to our very important banana industry, and which it continues to play in facilitating vitally needed trade opportunities for our country. Although I had the pleasure of expressing my gratitude earlier this month to Commissioner Glenys Kinnock when she visited Saint Lucia , I wish, once again, to place on record our nation’s appreciation for the support that the ACP/EU group has provided to Saint Lucia and the Windward Islands ’ banana industry. I express similar gratitude to the European Union for its support to our efforts to commercialize the banana industry, while creating new spheres of economic activity for our people.
The European Union remains Saint Lucia ’s largest single source of development financing, and our success in navigating through the difficult waves of transition from a banana-dependent economy to a more diversified economic base is due, in no small part, to the collaborative support that has been provided by the European Union. I am also pleased to be able to thank you personally, Commissioner Lamy, for the sterling work that you accomplished on our behalf. Our banana farmers owe you a great debt of gratitude.
I now want to focus on a subject that is of keen interest to my Government and to all of you in this room: the ongoing trade negotiations.
TRADE NEGOTIATIONS
We are currently in the midst of the Doha Development Agenda – that “politically correct” name for the current WTO sponsored round of multilateral trade negotiations that is aimed at accelerating the process of trade liberalization and bringing more areas of international and domestic commercial activity under the regulatory jurisdiction of the WTO. Any judgement as to whether or not these negotiations actually deserve a “development” title must await their completion. Unfortunately, to date, they have been fueled more by the traditional market-opening agenda than by any genuine concern to understand and effectively tackle the needs of the weakest, most vulnerable and marginalised members of the trading community of nations.
Regrettably, to the extent that any recognition is paid to developing countries, the agenda has largely focused on the more advanced and conspicuous members of the grouping. We ought to appreciate, however, that facilitating the stronger might not automatically help the weaker. More canned tuna exports to the EU from developing countries like Thailand might not help exporters from the Seychelles or Senegal ; giving Brazil what it wants in sugar will not help Fiji or Mauritius . Neither would more bananas entering Europe from Panama or Ecuador help Cameroon or Saint Lucia . Indeed, in all of these scenarios, success for these countries would be at a cost to the weaker trading nations, which in the cases just mentioned, all happen to be members of the ACP group.
The signs coming out of Geneva are quite ominous. The modalities for agriculture reform presented last month for negotiation at the WTO are seeking merely to reduce import tariffs and accelerate the elimination of subsidies of all kinds. Shorn of all its technicalities and complex formulae, liberalization lies naked on the table. By contrast, many of us have advocated reforms that must secure the right of all countries, even the most vulnerable, to produce and trade on a viable and sustainable basis. We have argued that agricultural production plays a fundamental role in human existence, which transcends commercial considerations. For many of us, viable agricultural production is essential for the survival of our rural and national economies. It is agriculture that provides employment and rural income, and permits the generation of export earnings essential for funding our imports and domestic investment activities.
Unfortunately, although it acknowledges our concerns regarding, among other things, safeguarding preferences and the need for injecting equity into the system, the Report makes no specific recommendations beyond those emanating from a blind adherence to the imperatives of liberalization and market opening. This is a completely unacceptable basis upon which the Doha negotiations should continue. Our countries, already marginalized by the implementation of Uruguay Round Agreements, now face the risk of becoming the “rejects” of the international trading system if the current reforms do not secure and introduce concrete measures to halt and reverse our marginalisation.
FAIR TRADE FOR GROWTH AND DEVELOPMENT
What we in the ACP want, and I am certain that this sentiment is shared by our colleagues in Europe, is a fairer trade regulatory system that contributes more to our economic growth and development and pays less lip service to the aims of the WTO.
If we are to secure the needed changes, we must work with like-minded countries. Is not Europe , with whom we have had such a long relationship, the obvious partner for us? Should we now not pursue with Europe the attainment of a common vision and common objectives? Not just for ourselves, but generally to inject equity into the system and to safeguard the interests of all vulnerable countries. Is this not our collective responsibility now that the rules are being reformed? Should we not look beyond the immediate, to engage in the construction of the type of world we need? Is it not necessary that we determine how this trade should be regulated, and together work to bring it about?
We can only do so if we have remarkable courage; the courage to work together across the north-south divide. For Europe , the choice will be between simply working with your big business interests towards the obvious though selfish aim of prying open foreign markets; or allying yourselves with those other major trading nations whose economies more fully mirror your own? For us in the ACP, there will be the pressure, which we must resist, of falling in line behind the broad banner of “developing countries” in pursuit of an agenda, which was not devised with our interests in mind.
To make an enlightened choice, we will need courage to see beyond our immediate concerns and differences, to see the bigger picture in its true historical perspective.
The only way our economies can grow and begin to tackle the blight of endemic poverty and bring hope of a better life to our citizens, is for us in the ACP to be able to expand domestic production, improve export earnings and increase capital inflows. For Europe , economic progress in the ACP is clearly in Europe ‘s own interest. Naturally, if our economies expand, so will our capacity to import. We will become more attractive as markets for goods and services and technology from Europe . But there is another equally important issue. Obviously, the European Union cannot possibly be interested in inducing further poverty. Much of the political instability and social unrest in some of our countries is the direct result of poverty and deprivation. Until these ills are addressed, we will not have the peace and stability that is of importance to us, to Europe and indeed the world.
Finally, we need the courage to defy the currently fashionable orthodoxy, which advocates that trade liberalization will bring about development. Our growth and development can come only from the complex interplay of a range of favourable factors. The efficient allocation of resources through the free market system is just one presumption of that complex.
THE NEED FOR GENUINE PARTNERSHIP
Europe and the ACP need to be genuine partners, not only in the WTO, but also in our dealings with each other, particularly as we negotiate economic partnership agreements (EPAs). Statements made by Commissioner Lamy and reported in the press demonstrate the appreciation of the European side of how we should proceed. We are not pursuing a traditional FTA. Rather, EPA negotiations are about jointly seeking new ways of bringing our economic relations into line with changing realities; realities which promote our development and facilitate our further cooperation. The agenda cannot be driven merely by the need to pry open markets at any cost or to spread the ideology of liberalization for its own sake. Our challenge, however, is to weave this realization into our negotiations at all levels.
For these EPA negotiations to have meaning, they must make a net contribution to our economic growth and development. Unfortunately, this is not always appreciated because the negotiations are centered on trade. The simple reality though is that ACP countries can only conclude trade and other economic agreements, which they believe, will contribute to their economic growth and development. We want development to be the focus of the negotiations – we are not simply calling for financial and technical assistance, but for recognition from our partners, and for those various instruments, whether they be in market access, financial cooperation, agricultural cooperation or otherwise, which will advance our development. This criterion is the ultimate acid test of the utility of whatever we negotiate.
THE FTAA NEGOTIATIONS
I turn now to the other major regional economic negotiations in which we are involved, the FTAA. Let me be frank, the FTAA was not the Caribbean ‘s idea, but rather we found ourselves in a position where negotiations and participation provided the only prospect of securing and possibly developing our export trade with the US and Canada . We in the Caribbean had since the 1980s enjoyed duty-free access for some of our products to the US market under the CBI, and for even longer to Canada under Caribcan. With Mexico ‘s entry into NAFTA under more favourable conditions than CBI or Caribcan, our exports took a battering. With the emergence of plans for the FTAA in which all of the Americas would enjoy more favourable market access than ourselves, we would therefore be largely excluded.
To avoid such an eventuality the only option would be to seek FTAA membership ourselves. The serious downside is the requirement for reciprocity under WTO rules, as they now stand. We are faced with a “Hobson’s Choice”. If we stay out, we lose our North American markets, and if we join, we lose our domestic agricultural and manufacturing production to unrestricted imports from the likes of the US and Brazil , compounded by the negative fiscal impact of the loss of import duties. The real dilemma that faces Saint Lucia is the following: do we take our manufacturers by the hand and shepherd them, like a group of lemmings, to certain annihilation in the FTAA?
We must find a third way, and this we believe is through the appropriate application of the principles of special and differential treatment, which would be amply justified in our case. But we need the WTO rules to be adjusted to accommodate our requirement, which is that small vulnerable countries like ours should not have to provide reciprocity in FTAs with larger, more advanced countries.
It is worth noting that when Lomé I was being concluded, the original idea was that the ACP would have to provide reciprocal market access to European goods, but the US was opposed because of its concerns over trade diversion. Will we therefore be able to count that country as an ally as we seek more favourable WTO rules governing regional trade agreements?
This, of course, is of more than passing importance because given our countries’ relative weak supply capability in an FTA with larger, more advanced and competitive suppliers, any possible benefit to us from market opening will be overshadowed by the negative impact on our domestic production and revenue base. This concern applies to the FTAA and equally to EPAs.
We are negotiating in the FTAA arena and the ACP-EU because we hope that agreements reached will address our inadequacies. If the price that we have to pay for the agreements is too high, resulting in net economic loss, then the remedy will be more damaging than the ailment itself.
Of course, the understanding in the FTAA is that each country will decide to enter or not, only when the full package has been negotiated. But none of us wishes to be faced with accepting or walking away from a bad deal. What we need is a satisfactory package, which adequately takes account of our size and vulnerability by providing appropriate special and differential treatment. This too is also our position on EPAs with Europe .
Excellencies, Ladies and Gentlemen, I have attempted to provide you with my country’s perspective on the position that must be adopted and agreed if we are not to see the economic obliteration of developing countries by an unsympathetic and callous global trade regime that conveniently attempts to treat everyone equally, when it is aware that we are not all created equal.
These issues are of serious concerns to our country, as they are, I am sure, to all of you. It is my fervent hope that we can work together to make the world a better place, not just for the stronger and more developed, but for all of us.
I thank you.
