Mr. Chairman;
Minister of Finance the Hon. Harold Lovell; Members of the Diplomatic Corps; Members of the Steering Committee; Mr. Nirad Tewarie, Chairman of the Network of Caribbean Coalitions of Service Industries; Mr. Timothy Odle, Deputy Programme Manager, Services of the CARICOM Secretariat and other staff members of the CARICOM Secretariat; Ms. Cassandra Simon of the Institute of Chartered Accountants of Antigua and Barbuda; Visiting and specially invited guests; Officials of the Division of Trade, Industry and Commerce within the Ministry of Finance, Economy and Public Administration; Media Representatives; Ladies and Gentlemen:
First of all to our visiting guests – welcome to Antigua and Barbuda. It is my hope that outside of today’s activities you will find time to enjoy the uniqueness of Antigua and Barbuda.
The pleasure is mine to be associated with this important accomplishment which I consider a milestone in the history of Antigua and Barbuda and also to deliver the feature address at the launching of the Antigua and Barbuda Coalition of Service Industries.
This launch is significant, not only because it is the first of a long awaited homecoming of a group of coalitions, but because as lead head of government responsible for services, I can proudly say that my own house is now in order.
For some time now, I have been approached by representatives of the other existing coalitions to lobby my colleague Heads of Government about the need to provide support to the coalitions in the CSME. I could not have done that with a clear conscience, given that Antigua and Barbuda did not have a coalition.
Today changes everything.
We are now minutes away from launching the coalition and minutes away from CARICOM having a more determined advocate for services.
Today, I propose to speak on the subject – “Managing the Services Revolution – The Role of the Antigua and Barbuda Coalition of Service Industries.
Ladies and Gentlemen:
We are in the midst or more appropriately, the throes of a revolution. I am not speaking about what is happening in the Middle East. I am speaking of the revolution that was expected to follow the industrial revolution of the 18th Century: ‘The Services Revolution.’
The Industrial Revolution was based on change driven primarily by the machine. The services revolution is the change driven by the human intellect solely for the benefit of mankind.
The genesis of the services revolution can be traced back to 1975 when the United Nations Conference for Trade and Development reported that 4700 multinational corporations controlling 180, 000 foreign affiliates across the globe accounted for over 7 trillion dollars in sales. This was the first indication, at the surface level, of the globalisation process. At the more fundamental and structural level it was also the beginning of the services revolution.
Between 1986 and 1995 there was major investment in research and development especially in telecommunication and information technology which further fuelled the services revolution.
This revolution has brought both positive and negative effects on the economies of the Caribbean Community.
The positive effects include greater economic diversification, increased participation of women in the workforce, increased international competitiveness, improved and sustained standard of living and welfare.
The negative effects include the diminishing policy space available to governments, increased mobility of factors of production, loss of cultural identity, and increased unfair competition in domestic markets.
However, without exception, all of the small economies of CARICOM, especially those of the OECS have been able to by-pass the Agricultural and manufacturing stages of development and move directly to the stage of tertiary level development, that of services. This surprised many development specialists around the globe.
You see, Mr. Chairman, countries such as Antigua and Barbuda were able to move from a haemorrhaging agriculture-based economy straight to a service-based economy without passing through the manufacturing-based economy stage.
Throughout the years since independence, Antigua and Barbuda has enjoyed robust economic growth and development. Services account for more that seventy-five percent of employment, more than ninety percent of output, investment and exports.
Our economy is very resilient because it is services-based. It should be noted that the Antigua and Barbuda economy is the largest economy in the OECS. We have a well-trained workforce. We also have a social infrastructure which fosters the production of high quality services and attract a large number of consumers to our shores.
Ladies and Gentlemen:
I am very proud to say that our employment practices are very fair and transparent. Our women folk have equal opportunity to training and work. Indeed, some of the top jobs in our country are held by women.
Our financial services product is excellent. Our telecommunication network is second to none. We are among the first to attract online entertainment services in the Caribbean Community. Our tourism product is internationally known and competitive. We have been able to develop offshore medical services and yachting services and the list goes on.
All of this is as a result of the services revolution.
Sadly Mr. Chairman, this revolution has brought with it side effects of major proportions.
Keeping in mind that trade liberalisation is a major feature of this revolution, we have been forced to open up many sectors of our services market that were previously reserved for nationals. While there have been some dislocations, our people have shown their innovative capabilities and have rebounded. They have imitated their competitors and effectively adopted new technologies and innovations. There is now no activity that our locals will not pursue.
On the matter of the adverse effects of the revolution on our policy space, we have been confronting, for some time now, falling revenues from international trade and the widening fiscal deficits. We have had to introduce the Antigua and Barbuda Sales Tax as a revenue replacement measure to cushion the effects.
Our no tax and low tax regimes have been criticised and we have been threatened with blacklisting by major players in the world market.
You may also recall the global financial crisis and the economic recession which we all are recovering from.
One important lesson learnt is that no amount of stringent regulation of the financial markets at the national level is enough to prevent a global financial crisis. It requires global regulation and enforcement. Indeed, the services revolution has a global spread, its benefits are felt globally and its costs and adverse effects also have a global reach.
In my view, small states such as Antigua and Barbuda should not be expected to bear the full costs of these adverse effects originating, for the most part, outside our jurisdiction. We should, therefore, be able to readily tap into resources for remedial action.
Ladies and Gentlemen:
In light of what I have just mentioned, the question is what has been CARICOM’s response?
We should note from the outset that the economies of the CARICOM Single Market and Economy are primarily service-based economies. Services account for more than two-thirds of investment, employment, output and trade.
Therefore, there is now a relatively comprehensive legal framework in the revised treaty dealing with services.
In addition, a mechanism has been put in place to ensure greater regional coordination and regulation to deal with the financial crisis.
As Lead Head of Government with responsibility for services, I am pleased to be overseeing the preparation of a regional strategic plan for services. The Administrative arrangements have been put in place and the community has agreed to focus on the preparation of strategies for seven sectors including, Financial Services, ICT, Tourism Services, Education Services and Cultural, Entertainment and Sporting Services.
Work is expected to commence during the second quarter of this year.
Ladies and Gentlemen:
The creation of National Services Coalitions is part of the overall plan to develop the services firstly at the level of member states and secondly at the regional level.
The region’s brand of coalitions is of pure stock. It represents the actual coming together of service providers and not sectoral interests, such as banking and special business interests as is the case with most of the other coalitions that are being formed. All service providers within the region have agreed to form national coalitions and to work together through these coalitions for the purpose of trade.
I must emphasise trade because the identity of professional associations, for example the Bar and Medical Associations will remain intact to deal with issues such as standards and discipline. This will not be the work of the Coalition.
I am advised that specifically the objectives of the Antigua and Barbuda Coalition of Service Industries include providing Antigua and Barbuda service providers with knowledge of export opportunities, organise trade missions to identify and exploit market opportunities and promote the further development and competitiveness of Antigua and Barbuda’s services sector.
Antigua and Barbuda today will become the ninth coalition in the member states of the CSME.
In a few minutes you would have two sets of roles to play: One at the national level and the other at the regional level.
At the national level, it is expected that the Antigua and Barbuda Coalition of Service Industries will, among other things, begin sensitizing the stakeholders on their role in increasing the economic contribution of this sector; mobilising the stakeholders to organise themselves into associations; improving the quality and standards of service providers here in Antigua and Barbuda and facilitating the generation of detailed data on the economic contribution of each sector.
At the regional level, you are entering a family of coalitions. Each coalition has its weaknesses and strengths. Identify your strengths and weaknesses. Tap into the strengths of the other coalitions and work with them to address weaknesses.
On the regional level, you will be called upon to increase the exports of services within the CSME, between the CSME and member countries of the EU and between the CSME and member countries of the WTO.
Specifically, I expect the Coalition to share ideas on how to solve the problems existing at the regional level; help stakeholders here to become more participatory in the CSME; contribute to the deepening of the regional integration movement and participate in the establishing of new coalitions.
Ladies and Gentlemen:
The road ahead will not be an easy one. However, the challenges ahead are not insurmountable. As the lead person responsible for Services in CARICOM, you have my support. You can rest assured that matters relating to your challenges will receive prominence at regional and international meetings I attend.
Finally, I wish to take this opportunity to thank you, the private sector partners. By your attendance today, this reflects your commitment to be a part of an organisation that has the capacity to transform the services sector in Antigua and Barbuda.
My Government firmly believes in private sector led development and sees your commitment to the coalition as a step in that direction.
Now that the government through the division of Trade, Industry and Commerce has begun the groundwork, I expect that you, the private sector, will steadfastly give your full support and take ownership of this process.
This launch is but the first step in a long journey. I urge you to remain focus. In the final analysis it is in our collective interests to make this coalition a success. It is for all of Antigua and Barbuda.
I pledge my full support and that of my government.
I commend you all and it gives me great pleasure to officially declare the Antigua and Barbuda Coalition of Service Industries duly launched. I commend Permanent Secretary Murdoch and his staff for a job well done.
May God bless each and every one of us and our efforts.
May God bless the nations of CARICOM. Thank you.
