Formation of CARICOM

Overview

Let start by defining “CARICOM”. It stands for the Caribbean Community and Common
Market. It was establish by the treated of Chaguaramas, which was signed by four
countries, Trinidad and Tobago, Barbados, Jamaica and Guyana and came into effect on
August, 1973. However after, many years of existence CARICOM has extended to
sixteen (16) members and eleven (11) CARICOM observers.

The sixteen CARICOM members are Antigua and Barbuda, Belize, Grenada, Montserrat,
St. Vincent and the Grenadines, Turks and Caicos Islands, The Bahamas, British Virgin
Islands, Guyana, St. Kitts and Nevis, Suriname, Barbados, Dominica, Jamaica, Saint
Lucia, and Trinidad and Tobago. The eleven CARICOM observers are Anguilla, The
Cayman Islands, Haiti, Puerto Rico, Aruba, Colombia, Mexico, Venezuela, Bermuda,
Dominican Republic, and Netherlands Antilles.

The formation came about when the initial four countries governments saw the need for
an integration of its members and economies, and the creation of a common market.

History

The establishment of CARICOM was a result of a 15-year effort to fulfil the hope of
regional integration which was born with the establishment of the British West Indies
Federation in 1958.
When the West Indies Federation came to an end in 1962, came the beginning of what is
now called the Caribbean Community.
Remember both Trinidad and Tobago and Jamaica establish independence during that
same year and with the power to control their own domestic and external affairs.

To discuss the concept of the formation of a single market among Caribbean Community,
the prime minister of Trinidad and Tobago convened the first heads of government
conference in July 1963, in Chaguaramas Trinidad. At this Conference, the leaders of the
four (4) Caribbean Countries all spoke clearly of the need for close cooperation with
Europe, Africa and Latin America.

The first Heads of Government Conference proved to be the first in a series of

Conferences among the leaders of Commonwealth Caribbean Countries. In July 1965,
talks between the Premiers of Barbados and British Guiana and the Chief Minister of
Antigua on the possible establishment of a Free Trade Area in the Caribbean resulted in
the announcement that month of definite plans to establish such a Free Trade Area. This
was carried further in December that year (1965), when the Heads of Government of
Antigua, Barbados and British Guiana signed an Agreement at Dickenson Bay, Antigua,
to set up the Caribbean Free Trade Association (CARIFTA).

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In the interest of common action and close cooperation among all the Commonwealth
Caribbean territories, the actual start of the Free Trade Association was deliberately
delayed in order to allow the rest of the Region, Trinidad and Tobago and Jamaica and all
the Windward and Leeward islands to become members of the newly formed Free Trade
Association.

The Fourth Heads of Government Conference agreed to establish CARIFTA formally and
to include as many Commonwealth Countries as possible in a new agreement of
December 1965. It was also agreed that the Free Trade Association was to be the
beginning of what would become the Caribbean Common Market which would be
established (through a number of stages) for the achievement of a viable Economic
Community of Caribbean Territories.

It was at the Seventh Heads of Government Conference in October 1972, that the
Caribbean Leaders decided to transform CARIFTA into a Common Market and establish
the Caribbean Community of which the Common Market would be an integral part.

At the Eighth Heads of Government Conference of CARIFTA held in April 1973 in

Georgetown, Guyana the decision to establish the Caribbean Community was brought
into fruition with the consideration of Heads of Government of the draft legal instruments
and with the signing by 11 members of CARIFTA (the exception being Antigua and
Montserrat). The Accord provided for the signature of the Caribbean Community Treaty
on July 4 and its coming into effect in August 1973, among the then four independent
countries: Barbados, Guyana, Jamaica and Trinidad & Tobago. The Georgetown Accord
also provided that the other eight territories - Antigua, British Honduras, Dominica,
Grenada, Saint Lucia, Montserrat, St. Kitts/Nevis/Anguilla and St. Vincent which signed
the Accord would become full members of the Community by May 1, 1974.

One of the principal issues currently on the regional agenda, was the restructuring of the
intergared process in the Community through the formation of a Single Market and
Economy. Where it was at the eight CARICOM Heads of Government Meeting in 1987
that the Prime Minister of Barbados presented the concept establishing a representative
and deliberate institution which associates the people of the Region through their chosen
representatives, with the task of promoting the Regional development process.

However, two years later in 1989 at the 10th Conference of Heads of Government in
Grenada, Barbados presented a discussion paper outlining a proposal for the formation of
CSME, and in Marchc1990 an agreement was reached on a draft Inter Governmental
Agreement providing for the establishment of the proposed body.

A Revised Treaty of Chaguaramas, establishing the Caribbean Community including the

CARICOM Single Market and Economy (CSME) was signed by the Heads of
Government of the Caribbean Community on July 5 2001 at their Twenty-Second
Meeting of the Conference in Nassau, Bahamas.

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The work of the CSM&E includes the negotiation of Protocols which will effectively
amend the Treaty of Chaguaramas.

The first of these, which provides for the restructuring of the Organs and Institutions of
the Community, and redefining their functional relationship entered into force
provisionally on July 4, 1997.

Protocol II, on the rights of establishment, Provision of Services and Movement of

Capital will enter into force upon signature by all Member States.

Formation of CSME

CSME stands for CARICOM Single Market and Economy. It is a single economic system
that is designed to facilitate the pooling of the region’s financial, human and natural
resources in order to build the economic capacity required to effectively respond to
globalisation and the emergence of mega trading blocs.

In 1989, the tenth meeting of the Conference of the Heads of Government of the
Caribbean Community recognised the need to deepen the integration process in response
to the changing world economic environment. This led to the decision to establish a
Single Market and Economy.

Of to date there are 13 member states, they are namely:

− Antigua and Barbuda
− Barbados
− Belize
− Dominica
− Grenada
− Guyana
− Jamaica
− Monsterrat
− St. Kitts and Nevis
− St. Lucia
− St. Vincent and the Grenadines
− Suriname
− Trinidad and Tobago

Mission Statement

We envision a Caribbean Community in which every citizen has the opportunity to realise
his or her human potential and is guaranteed the full enjoyment of their human rights in
every sphere; in which social and economic justice is enshrined in law and embedded in
practice; a Community from which poverty, unemployment and social exclusion have
been banished; in which all citizens willingly accept a responsibility to contribute to the
welfare of their fellow citizens and to the common good; and one which serves as a

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vehicle for the exercise of the collective strength of the Caribbean region, and the
affirmation of the collective identity of the Caribbean people, in the world community.

The CSME will be implemented in two phases; the first phase is CARICOM Single
Market which is expected to be fully implemented by 1st of January 2009. The
CARICOM Single Market is an arrangement which allows CARICOM goods, services,
people and capital, also movements throughout the Caribbean Community without tariffs
and without restrictions which would assist in achieving a single, large economic space,
and provide a common economic and trade policy.

The basic implementation actions are:

− Extension of free movement of labour to teachers, nurses and domestic workers.
− Streamlining of procedures for free movement of labour including contingent rights
and transfer of social security benefits.
− Implementation of free movement of service providers, with streamlined procedures.
Implementation of Legal status for the CARICOM Charter for Civil Society.
− Implementation of recommendations of the Technical Working Group on Governance
along with the preparation and agreement of a regional Human Resource
Development.
− Establishment and commencement of operations of the Regional Development Fund.
− Agreement among Central Banks on common CARICOM currency.
− Establishment of the Regional Stock Exchange.

The second phase is carded to take place between 2009 and 2015 which includes
CARICOM Single Economy. The CARICOM Single Economy is an arrangement which
further harmonises economic, monetary and fiscal policies and measures across all
Member States of the Caribbean Community to strengthen and support the sustainable
development of the region. This would mean the coordination of foreign exchange and
interest rate policies, the harmonisation of tax regimes and of laws and the convergence
of economic performance, common policies on agriculture and the energy sectors
among other measures.

The basic implementation actions for phase two are:

− Implementation of common policies in Energy-related industries, Agriculture,
Sustainable tourism and agro-tourism, Transport, and Small and medium enterprises.
− Harmonization of taxation systems, incentives, and financial and regulatory
environment.
− Harmonisation of fiscal and monetary policies.
− Implementation of Regional Competition Policy and Regional Intellectual Property
Regime.
− Implementation of CARICOM Monetary Union.

Some benefits of the CARICOM Single Market and Economy are:

− Increased production and trade in goods and services in a combined market of over
approximately million persons and for the world beyond

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− Competitive products of better quality and prices
− Improved services provided by enterprises and individuals, including transportation
and communication
− Greater opportunity for travel
− Opportunities for nationals to study and work in CARICOM countries of their choice
− Increased employment and improved standards of living

The targeted areas of development are economic, social, environmental and

governmental.

The economic sector of the CSME offers an accelerated economic growth through
adjustment and transformation of regional economies and an improved global
competitiveness through sustained innovation and productivity. The main drivers of
economic growth and transformation are expected to come from the goods and services
industries in the area of the energy sectors, agriculture, forestry and fishing,
manufacturing, tourism and some exports services. This would be achieved by a
harmonising of the foreign trade policies, human resource utilisation, monetary
incentives, transport, investment, financial services, capital market integration, quality
infrastructure and functional corporate cooperation.

The social element is targeting an investment in the human capital of the member states,
reasserting the role of culture by through education, preservation and presentation of
cultural heritage, the use of Information and Communication Technology (ICT) which
would focus on skills for employment for both national and regional level and a public
policy in labour-management relations all sectors of the work force, inclusive of a decent
minimum wage and conditions agreement.

The environmental dimension is this harmonization includes the adoption of a common

Environmental Regulatory Regime which protects preserves and manages the natural
environment to ensure sustainable development, so that investors and other economic
agents can operate across the entire space of the CSME on the basis of the same policies
and regulations. Also, sponsoring the preparation and publication of a regular State of the
CARICOM Environment reports, including the status of implementation of national laws
and international commitments relating to the environment with particular attention to
priority issues such as the coastal and marine environment, forestry and watershed
management, 17 waste disposal and recycling, climate change impact analysis and
adaptation, and natural disasters impact and management.

CSME is not a political union but is trying to implement the automatic application of
decisions of the Conference of Heads of Government at the national level in certain
defined areas, the creation of a CARICOM Commission with Executive Authority, the
automatic generation of resources to fund regional institutions, the strengthening of the
role of the Assembly of Caribbean Community Parliamentarians.

Although the CSME is overflowing with possibilities it should not be regarded as the
overall cure for a country’s economic problems.

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The Conference of Heads of Government consists of the Heads of Government of the
Member States. Any Head of Government may designate a Minister or other person to
represent him or her at any Meeting of the Conference. The Conference is the supreme
Organ of the Community and determines and provides policy direction for the
Community. Except where otherwise provided in the Revised Treaty of Chaguaramas
establishing the Caribbean Community including the CARICOM Single Market and
Economy, the Conference is the final authority for the conclusion of treaties on behalf of
the Community and for entering into relationships between the Community and
international organisations and States and may take decisions in order to establish the
financial arrangements necessary to defray the expenses of the Community and is the
final authority on questions arising in relation to the financial affairs of the Community.

The Conference may establish such Organs or Bodies as it considers necessary for the
achievement of the objectives of the Community and issues directives of a general or
special character to other Organs & Bodies of the Community, in regards to achieving of
the objectives of the Community.

Contributing Community Organs and Bodies

Some major contributing bodies are the Organisation of Eastern Caribbean States
(OECS), the Council for Trade and Economic Development (COTED) and the Caribbean
Court of Justice (CCJ).

The Organisation of Eastern Caribbean States (OECS) is an inter-governmental

organisation dedicated to economic harmonisation and integration, protection of human
and legal rights, and the encouragement of good governance between countries and
dependencies in the Eastern Caribbean. It also performs the role of spreading
responsibility and liability in the event of natural disaster, such as a hurricane.

The Council for Trade and Economic Development (COTED) shall be responsible for the
promotion of trade and economic development of the Community. In particular, COTED
shall promote the development and oversee the operation of the CSME, evaluate and
establish measures to enhance production, quality control and marketing of industrial and
agricultural commodities, establish and promote measures to accelerate structural
diversification of industrial and agricultural production, promote and develop policies
and programmes to facilitate the transportation of people and goods, promote measures
for the development of energy and natural resources, establish and promote measures for
the accelerated development of science and technology, promote and develop policies for
the protection of and preservation of the environment, promote and develop policies for
the enhancement of external economic and trade relations of the Community, and
undertake any additional functions remitted to it by the Conference, arising under this
Treaty.

The Caribbean Court of Justice will serve two main roles. To act as a court that can
handle trade disputes amongst CARICOM member states (Original Jurisdiction). A Court

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that will eventually serve as a court of final appeal, replacing the Judicial Committee of
the Privy Council in London.
The reasons given for the establishment of a supreme appellate court are many and
varied, including a perceived regional disenfranchisement with the British Judicial
Committee of the Privy Council.

The Treaty was revised through a series of protocols - legal instruments setting out the
new rules - and in 2001, these protocols were integrated into the Revised Treaty of
Chaguaramas establishing the Caribbean Community including the CARICOM Single
Market and Economy. The following is the institutional structure of the Community as set
out in the Revised Treaty:

Principal Organs
− The Conference of Heads of Government (and its Bureau)
− The Community Council of Ministers (The Community Council)

The principal organs are assisted by four 'Organs', three 'bodies' and by the CARICOM
Secretariat - 'the Principal Administrative Organ'. The organs are:
− The Council for Finance and Planning (COFAP)
− The Council for Trade and Economic Development (COTED)
− The Council for Foreign and Community Relations (COFCOR)
− The Council for Human and Social Development (COHSOD)

The bodies are:

− The Legal Affairs Committee: provides legal advice to the organs and bodies of the
Community
− The Budget Committee (examines the draft budget and work programme of the
Secretariat and submits recommendations to the Community Council)
− The Committee of Central Bank Governors: provides recommendations to the COFAP
on monetary and financial matters

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