is the FTAA?
All these are legitimate questions. The problem for many citizens of
the Caribbean is that they have absolutely no idea of the answers. In
that ignorance they are not unlike the vast majority of citizens of the
United States or Canada or Brazil. But, I would submit that citizens
of the small economies of the Caribbean have more of a need to know or
more accurately more of a stake in knowing because to a man or woman
they will be more effectively impacted than any of the larger countries
of the hemisphere. This article, and those which follow, will attempt
to fill the knowledge gap that currently exists.
GENESIS OF THE FREE TRADE AREA OF THE AMERICAS (FTAA)
The effort to unite the economies of the Western Hemisphere into a single free trade agreement began at the Summit of the Americas, which was held in December 1994 in Miami. Trade cooperation is but one element of the Summit of the Americas process. Other areas of cooperation, in and out of the public eye since 1994, relate to finance, transportation, health and education, drug control and governance.
As far as trade is concerned, our Heads of Government agreed to construct a Free Trade Area of the Americas, or FTAA, in which barriers to trade and investment will be progressively eliminated, and to complete negotiations for the agreement by 2005.
Since that time, the negotiations moved from a preparatory phase into the negotiation phase in 1997. The venue of the negotiations has moved from Miami to Panama City to its present site in Puebla, Mexico. Negotiators have therefore wracked up frequent flyer miles while working to complete an extremely complex series of mini-agreements knitted into a single larger Agreement. The objective is to facilitate the freer movement of goods, services and capital in the Western Hemisphere through rules governing that trade in the following areas:
Each Negotiating Group has a Chairman and a Vice-Chairman. Technical support is provided to the process by the Tripartite Committee (Technical experts from the Organization of American States, United Nations Economic Commission for Latin America and the Caribbean, and the Inter-American Development Bank). Administrative support for the negotiations is provided by the Secretariat of the FTAA.
In addition to the above, there is an overall Chair of the negotiations. The Chairmanship of the Negotiations: rotates every eighteen months, or at the conclusion of each Ministerial meeting. The following countries have been designated to serve as Chair of the FTAA process for successive periods: Canada; Argentina; Ecuador; as well as Brazil and the United States (jointly). The two largest countries in the hemisphere now share that responsibility.
Heads of Government have given their Trade Ministers authority to exercise the ultimate oversight and management of the negotiations. In turn, between Ministerial meetings, the Vice Ministers Responsible for Trade, acting as the Trade Negotiations Committee (TNC), have the central role in managing the FTAA negotiations. The TNC:
At the end of September 2003 the TNC will convene in Port of Spain.
It will have several crucial matters to decide and will pass
to the Ministers of Trade for consideration at the upcoming Ministerial
meeting in Miami in late November 2003.
GUIDING PRINCIPLES OF THE FTAA NEGOTIATIONS
In pursuing the negotiations, the participating countries decided to abide by a number of principles. These include, among others:
CARICOM initiated the idea that other FTAA members should provide special treatment to smaller economies and has played a leading role in the development of the idea over the last several years. The basic premise is that differences in size of economies of the FTAA will impact on the ability of countries to enjoy the fruits of the FTAA process and specific measures must be developed to redress these imbalances. A Consultative Group on Smaller Economies has been established to monitor the extent to which issues of concern to smaller economies have been taken into consideration in the nine Negotiating Groups. Some countries favour implementing this idea through the market access aspect of the negotiations. CARICOM considers that a multi-faceted approach is needed. In other words, there should be specific provisions applying specially to CARICOM in the text of the Agreement, preferential market access, and a cooperation element involving financial and other resources to address the special needs of smaller economies.
To date, FTAA members have not agreed on a wide-ranging development fund type of assistance. Instead, for the time being, countries have implemented what is being called a Hemispheric Cooperation Programme or HCP. The HCP is being developed and implemented by the Consultative Group on Smaller Economies and aims to strengthen the capacity of smaller economies to participate in and take advantage of FTAA. Ostensibly it will promote closer linkages with development imperatives and trade liberalization, strengthen institutions and build capacity for policy-making. At the moment, smaller economies have been engaged in the development of national strategies and CARICOM countries have received technical assistance from the OAS, IADB and UNECLAC as well as from private consultants. These strategies will define, prioritize, and articulate their needs related to strengthening the capacity for preparing for negotiations, implementing trade commitments, and adjusting to integration.
Meanwhile some guidelines have been developed for the specific measures that will implement the principle of special and differential treatment for Smaller Economies. Among the stipulations are that the measures should:
CARICOM participates as a group in these negotiations. Heads of Government gave to the Caribbean Regional Negotiating Machinery (CRNM) the responsibility for coordinating CARICOM participation. Ambassador Richard Bernal leads the CRNM. He is supported by a relatively small group of technical staff. Presently the CRNM includes technical experts on Services, Intellectual Property, Agriculture, Government Procurement and Market Access. In addition, the CRNM has received financial assistance to allow for the conduct of a number of technical studies in areas related to the negotiations. The CRNM also has held a series of Technical Workshops on areas being negotiated with public servants in the region. The CRNM is responsible for the negotiations at the World Trade Organization, the renegotiation of the cooperation agreement with Europe as well as negotiations with Canada and the FTAA.
At the FTAA negotiations, the CRNM has appointed a Lead Negotiator and an Alternate Negotiator for each body of the negotiations. This process has allowed CARICOM to be an active participant in all aspects of the negotiation of the FTAA.
CARICOM has held leadership positions in the past, including Chairing the Consultative Group on Smaller Economies, Investment and Services as well as Vice-Chairs of other groups such as Anti-dumping and Subsidies and Market Access. At the moment, the Bahamas chairs the Negotiating Group on Services and Trinidad and Tobago is Vice-Chair of the Negotiating Group on Competition Policy and the Consultative Group on Smaller Economies.
Currently, also CARICOM has endorsed the candidature of Port of Spain for the site of the Permanent FTAA Secretariat. Other candidates are Miami, Panama City and Atlanta.
Future articles will provide specific information on the various FTAA Negotiating Groups, discuss some of the issues of highest relevance to the Caribbean, and consider why Governments negotiate free trade agreements.
Director, International Trade Negotiations Unit
Trinidad and Tobago Chamber of Industry and Commerce