In the face of an uncertain future, many Caribbean nations are advocating integration as an attempt to cope with the perceived impediments to growth, namely: small size, economic fragmentation and dependence on extraregional markets. The rationale behind integration being that by pooling local resources and markets, greater economic and social development can occur as opposed to "going it alone". It is also envisaged that through integration, the Caribbean will develop a stronger bargaining position relative to the global economy (Chernick, 1978, p.5).
Economic integration takes place when a group of countries in the same region combine together to create an economic alliance with a common tariff barrier towards non-members while allowing free trade among members. The system works best when participating nations are relatively equal in size and stage of development and have a strong commitment to coordinate and rationalize their joint industrial growth patterns (Todaro, 1989, p. 454).
Caribbean leaders are seemingly convinced that integration is the system of the future drawing support from the momentous unification of Europe as well as the North American Free Trade Agreement (NAFTA) between the U.S.A. and Canada with Mexico on the verge of becoming a third major partner in this historic alliance. In his article entitled "The West Indies Beyond 1992", the then Prime Minister of Trinidad and Tobago, A.N.R. Robinson pointed to this global
restructuring and writes:-
... against this background of historic change and
historic appraisal, the Caribbean could be in danger
of becoming a backwater, separated from the main
current of human advance into the twenty-first
century... (The Report of The West Indian
Commission, 1992, p.3).
Prime Minister Erskine Sandiford of Barbados, in his opening remarks at the eleventh summit in 1990, expressed his concept of integration and its significance for the Caribbean:-
For me, the Caribbean Community, the Integrated
States of the Caribbean of which I have spoken, is
much more than the efforts to secure free internal
trade, or a common external tariff, or the
harmonization of fiscal incentives or a common
industrial, agricultural or transportation policy, or the
establishment of a common market, or even the
formation of a full economic union. For me, the
Caribbean Community is nothing more and nothing
less than the efforts of the Caribbean people to create
a new and unique political entity that respects the
national sovereignty of each individual territory, while
at the same time pooling aspects of that sovereignty
and pooling aspects of their resources in order to
promote and preserve peace, promote and preserve
democracy, promote and preserve fundamental
human rights and the rule of law, and promote and
preserve economic and social development among
Caribbean people (The Report of The West Indian
Commission, 1992, p. 467).
Lester Thurow expresses the view that the system that governs the world economy is changing and by the first half of the twenty-first century, a new system of quasi trading blocks utilizing managed trade will emerge (1992, p. 16). In addition, Hazel Johnson argues that regionalization is a strong force that has and will continue to effect standards of living throughout the world (1991, p. 1).
With regard to integration reducing the dependency on developed countries, Arthur Lewis supports increased trade between less developed countries on the basis that:-
a) less developed countries possess all the necessary requirements for growth,
b) less developed countries have enough land to feed themselves if properly cultivated,
c) less developed countries are capable of acquiring manufacturing skills and accumulating much needed capital for modernization.
Thus, development in the long run does not have to be dependent on the assistance of developed countries (1978, pp. 69-71).
Michael Manley also supports integration on the grounds that unless there is greater cooperation between developing countries, Third World countries are at risk of losing their political independence due to economic reality. He argues that it is impossible to develop internally and in isolation. Given that the First World has no interest in reforming the way the world economy functions, Third World countries have no choice but to attempt development from within their own resources and create its own opportunities (1991, pp. 101-104).
The allegation that the Bahamas government is stalling on the Caribbean Single Market Economy (CSME) and characterized as “defrauding” the proposed economic bloc is tantamount to a slap in the face of the country. The Bahamas, as one of the most prosperous countries in the region, has been a significant contributor to the progress of the Caribbean region. Our immigration policy has been very accommodative of our Caribbean neighbours; however, we cannot officially, through any trade or regional integration, open the doors to our economy that would allow for the free movement of labour.
The concept of free market is conceived with the intention to advance the interest of each member of the proposed trading bloc as first priority. The Bahamas, as a member of the proposed trading bloc, cannot afford to negotiate an integration policy that runs counter to its national economic, social and political interests. Nations all over the world agree to integration agreement only to the extent that its domestic economic, political and social structures are safeguarded from the impact of such integration, hence not compromising our national sovereignty. The United Kingdom is a prime example of a country that has so far limited the level of its integration with the European Union on the basis of its national realities, without an alluded insinuation that its policy position is selfish and deceitful in its commitment to the EU.
The Bahamas has made its position glaringly clear both by the previous and present governments regarding its concern for the clause allowing the free flow of labour within the Caribbean, because of the unique nature of our economy. Despite the Bahamas' significantly high level of employment, coupled with the high per capita income (the third best in the Western Hemisphere), our economy is not comfortably durable and sustainable in the face of potential high influx of labour that the ratification of the CSME as it is currently demanding. In essence, and of necessity, members of the proposed CSME must understand and appreciate the uniqueness of each member's economy, the political structures and its social demographics vis-à-vis the base of each country’s economic sustainability.
Any government policy, irrespective of the basis of formulation, that creates imbalance on its social structure, particularly in the level of unemployment, will certainly create negative social and economic externalities that will impact the sustainability and growth of its economy, hence, defeating the purpose of the CSME. The CSME can only strive and help to elevate other member countries' economies if the economies of its member states are progressive and structurally developing: anything short of that achievement negate the intent of the integration effort.
There is absolutely nothing wrong with the Bahamas stalling in the agreement of the free movement of labour clause for as long as the economy remains unviable for such clause to be implemented within the Bahamas' territory. Though it is acceptable and necessary that CSME be concluded in due time to allow for a stronger Caribbean voice in the negotiation for the Free Trade Areas of the Americas (FTAA), the Bahamas still cannot assent to a clause that is clearly evident will not support the government's policy towards the consolidation of its economic policies, particularly at this time of global economic uncertainties, and constant international threats of terrorism that could at moment's notice undermine the tourism-based economy of ours.
The Caribbean leaders, in pursuit of the introduction of the CSME, must exercise good sense of judgement in understanding the practical reality of the fact that the Bahamas' economy is not sustainably strong enough to allow for the free movement of labour. This is similar to the context which most of the Caribbean countries are agitating against - the inclusion of the FTAA clause allowing the free flow of investment and services. The leaders of the CSME must undertake a study of the various countries within the region to understand each country’s potential economic latitude to enable them to appreciate grey areas where there are genuine concerns to allow for concessions. The act of blindly insisting on the general acceptance of the entire agreement in the integration charter is inconsistent with the ideals of the region's integration, as this would have dire consequences on many professions in the Bahamas, namely: medical/pharmacy and legal, among many others.
Integration must be constructive and provide the enabling environment for each country to grow without imposing significant inhibiting factor(s) that would impede the growth and development of any member country within the region. Therefore, it is frivolous for leaders of the CSME to slam the Bahamas about procrastinating or stalling the labour agreement. The Bahamas is not stalling, but opting out of the labour agreement, because it is not in the best interest of the Bahamas, at least at this time.
July 3, 2006
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