CARICOM & Preparation for Free
Trade Agreement Negotiations






Mr. Arthur Gray

Director
Foreign Policy and External Economic Relations
Caricom Secretariat




Paper was Presented at the Colloquium Entitled "Diplomacy After 2000 : Small States and Negotiating Space in the New International Trading Environment" Organised by the Institute of International Relations, UWI for the 8th and 9th of October, 1996.


Contents
Introduction
CARICOM's Participation in The Free Trade Area of the Americas (FTAA) Process
Proposals to Enhance the Effectiveness of CARICOM's Preparation for Participation in The Process
CARICOM & Preparations for Free Trade Agreement Negotiations with Selected Territories
Some Critical Issues: The Dynamics, The Negotiation Environment; Selection of Countries
Overview of the Machinery for Preparation & Undertaking of External Trade and Economic Negotiation by the Caribbean Community


Introduction

Since the signature of the Treaty of Chaguaramas in 1973, a number of epoch making changes have been registered in the intemationa1trading system. These changes include the establishment of economic blocs as the only meaningful operational units in all corners of the globe, the general development, consolidation and even intensification of integration processes as existing processes are revitalised and new ones created, the entrenchment of market forces as the only acceptable means for propelling the international economy- particularly after the collapse of the Soviet Union, itself a fundamental change, and the globalisation of production.

Another fundamental change refers to the establishment of the World Trade Organisation, in which all CARICOM members except the Bahamas and Montserrat are also members, with the principal tasks of:

(i) cooperating with the IMF and the IBRD with a view to achieving greater coherence in global economic policy-making-

(ii) Providing a forum for MTN'S and a framework for the implementation of their results;

(iii) administering dispute settlement procedures

(iv) administering a Trade Policy Review Mechanism

(v) facilitating the implementation of the results of the Uruguay Round of MTN'S

In the letter of invitation to this colloquium, the objective was indicated to be "to improve the understanding of how small states cam maximise their negotiating position in the new trading order by better preparation and strategies ". It is against that background that the ideas I now express have been formulated on the specific topic of "CARICOM and Preparations for Free Trade Area Negotiations".

Now, reflecting the recent nature of the evolution of the international trading system, CARICOM'S entry into the dimension of FTA Agreements is itself of very recent date. Like all other institutions: national, regional, hemispheric or global, CARICOM has had to adjust to the fundamental changes to which I have already alluded: changes which are ongoing and at a rapid rate.

On the question of this need for a major shift in the Region's trade policy, I am reminded of the admonition by the Prime Minister of Barbados, Hon. Owen Arthur, in the Distinguished Lecture Series sponsored by the Institute of International Relations on 15 April 1996.

In his lecture entitled "The New Realities of Caribbean International Economic Relations",the Hon. Prime Minister expressed the view that:

"the long run has arrived for the Caribbean because the economic policies and postures, deriving from our passive incorporation into the international economy as the recipients of preferences and concessional financial flows, have now been overtaken by powerful and irreversible international developments and it would be fatal for the region not to take cognisance and to accommodate the new realities in its contemporary international relations".

Implicit in what I am about to say would be an appreciation I think that the CARICOM Region is indeed taking cognisance of these new realities.

When I speak of "CARICOM and Preparation for Free Trade Negotiations"' I am really referring to the process by which the Member States of the Community arrange for or bring about, through conference and discussion with third countries and groups of countries, a desirable type of agreement or acceptable compromise in the area of trade. Specifically, the Region in its Trade Policy, is seeking to create a regional space within the wider regional and hemispheric space seeking more effective insertion with the promise of expanded and beneficial possibilities for trade.





In summary terms, this "effective insertion" is being pursued against the background of inter alia,:

* the changing Global Environment and the increasing lack of concern for, understanding of and interest in the needs of Small Developing Countries, especially the CARICOM countries which no longer hold a strategic place militarily, economically or geographically;

* a perceived loss of influence by the Region on Global Issues and in International Organisations and Forums and a real threat to its export trade and to its access to external financial and technical resources;

* the limited human resources available to the individual CARICOM States and to the Community to address the range and complexity of international issues;

* the need to take a more systematic and focussed approach to major international issues; the need to develop a broader diplomatic base and to coordinate positions with other developing countries and groupings with similar interests;

* the decision to liberalise the regional market by systematically reducing the Common External Tariff and to phase out the use of quantitative restrictions as a means of protecting regional production;

* the strong link between international developments and internal (national and regional) policies.

Further, the major objectives underpinning the future international economic negotiations to be pursued by the Region include:

* appropriate production and market diversification;

* effective market access for CARICOM exports;

* access to the most advantageous sources of imports;

* an environment conductive to regional and foreign investment; and

* a stronger role, as a supplier, in the international market for services.

The achievement of these objectives calls for skill, for strategy, for technique-in a word, for preparation. Adequate and thorough preparation.

The efforts of CARICOM as a bloc negotiating in the trade sector, as in others, is in accordance with Article 4 of the Treaty of Chaguaramas which identifies as one of the objectives of the Community, "the coordination of the foreign policies of Member States".

More recently at, its Special Meeting which convened in Port-of- Spain in October 1992, the Heads of Government Conference of the Caribbean Community in the issue of "CARICOM, the wider Caribbean and Beyond" agreed, inter alia, that:

(i) CARICOM Governments adopt a collective approach to current and potential changes in the international Community, including international political and financial institutions, and reflect this approach in common arrangements for international economic negotiations and diplomatic representation.

(ii) CARICOM seek to bridge the divide between its Member States and other states and territories of the Caribbean and Latin America, recognising the advent of an increasingly "Caribbean Basin" approach to international negotiations and development issues ....

For the purpose of this presentation, the preparations undertaken and being undertaken by CARICOM as a Group for the negotiation Free Trade Agreements will be reviewed with particular reference to the decision adopted at the Miami Summit in December 1994, for the creation of FTAA and to the decision by the Heads of Government of CARICOM itself to pursue the negotiation of FTA's with other selected countries of the hemisphere.

In the interest of brevity, the recently constituted ACS comprising all the States, Countries and Territories of the Caribbean Basin, will not be an area of focus. In any event, the ACS has not been designed as a free trade area 'even if by reference to the conclusions of the Inaugural Summit of the Association, some considerable degree of liberalisation is contemplated .Further, I am convinced that in presentations made later today, the ACS will receive adequate examination

 

CARICOM's Participation In The Free Trade Area Of The Americas (FTAA) Process

As has been indicated and as is generally known, the decision "to the conclude the negotiation of the Free Trade Area of the Americas (FTAA), no later than 2005" .

.....building ...... "on existing sub-regional and bilateral arrangements in order to broaden and deepen hemispheric economic integration and to bring the arrangements together, "has its origin in the December 1994 Summit of the America. At the first Trade Ministerial Meeting held in Denver, Colorado, U.S.A., on 30 June 1995, seven Working Groups were formed to advance the process. At the Second ministerial Trade meeting held in Cartagena de las Indias, Colombia, on 21 March 1996, four additional working Groups were established.

The Working Groups cover such areas as:

- Market Access. (El Salvador)

- Customs Procedures and Rules of Origin (Bolivia)

- Investment (Costa Rica)

- Sanitary and Phytosanitary Measures (Mexico)

- Smaller Economies (Jamaica)

- Government Procurement (USA)

- Intellectual Property Rights (Honduras)

- Services (Chile)

- Competition Policies (Peru)

- Standards and Technical Barriers to Trade (Canada)

From the outset, it was recognised that the Member States of CARICOM did not have the time, the financial and human resources and, in some cases, the expertise to adequately cover the activities of all the Working Groups. This situation has become even more acute with the increase in the number of Working Groups, the number of meetings, their frequency, as well as, the geographic spread of their venues. (Bolivia, Chile, Costa Rica, El Salvador, Honduras, Jamaica, Mexico, Peru, USA, and so on)

As we are all aware, the Working Groups, undertake, among other tasks, the examination of trade- related measures with a view towards identifying possible approaches to the eventual negotiations. They also seek to identify areas of commonality and divergence on the various issues.

While the reports of the Chairman of the Working Groups are widely circulated, the content of concept papers which inform the discussions tend to be limited to inputs from participants in a given Group. What this means is that absence from a particular Working Group will necessarily imply the risk that the Region's position or interest might not be protected or promoted.

In recognition of the difficulties presented by the situation as outlined, a decision has been taken that the Region's representation would operate on the basis of teams and that Member States would make an effort to participate in at least one Working Group apart from the Working Group on Smaller Economies.

Proposals To Enhance The Effectiveness Of CARICOM's Preparation For Participation In The Process

At its Sixteenth Special Meeting, the Common Market Council recognised the urgent need for detailed preparatory work, consultations and coordination within the Region on both the technical issues and with respect to the broad principles. It also recognised the need for the social partners to play a more active role in the process. The Council therefore agreed to the establishment of a High-Level Working Group on the FTAA and to indepth consultations under the aegis of the Prime Ministerial Sub-Committee on External Negotiations. These proposals were endorsed in the Seventeenth meeting of the Heads of Government in July 1996.

With respect to the specifics of CARICOM'S participation in the process towards establishing the Free Trade of the Americas, the Prime Ministerial Sub-Committee at its Fifth Meeting in September 1996, agreed to accept the offer of four countries to lead eight of the FTAA Working Groups. Barbados will lead on Intellectual Property Rights and Services. Belize will lead on Sanitary and Phytosanitary Measures. Jamaica will lead on Small Economies and Investments while Trinidad and Tobago will lead on Market Access, Standards and Technical Barriers to Trade as well as, on Subsidies, Antidumping and Countervailing Measures.

The Sub-Committee also agreed that the Region's effectiveness in the process could be enhanced at the technical level, at the political level and at the level of institutional arrangements or modalities.

(a) at the technical level by strengthening the technical capabilities of the Secretariat, by developing a pool of expertise in the Region and by seeking technical assistance from international and hemispheric institutions such as UNCTAD, OAS, IDB, ECLAC and SELA. In this context, a proposal was made by Barbados that a specialised unit be created in the CARICOM Secretariat to focus on trade issues;

(b)at the political level by -


* coordination with Central America through Ministerial Consultation at the Third CARICOM/Central American Ministerial Conference currently scheduled for November 1996;

* discussions with the Ministers of the MERCOSUR countries, possibly preceding the Third Hemispheric Trade Ministers Meeting, May 1997. A Meeting of Officials of CARICOM and MERCOSUR was held in Brazil on 15 September 1996 on the eve of the First Meeting of Vice Ministers of Trade of the Hemisphere as a means of initiating contact between the two sub-regions and to engage in a preliminary exploration of possibilities, both in the context of the FTAA and elsewhere;

* the sensitisation of key persons in the USA through a Ministerial Mission to that country, possibly in early 1997, and the possible convening of a Summit between the President of the United States of America and CARICOM Heads of Government;

* the continued dialogue with Canada during the Joint Trade and Economic Committee Meeting in November 1996;

* discussions in the SELA Ministerial Meeting in October 1996 and the Ministerial Council of the ACS in December 1996;

(c) with respect to the improvement of the Institutional arrangements, the Sub-Committee:

* identified a lead country within each working group;

* recommended that once a country had been designated CARICOM leader in a particular Working Group or Cluster of Groups, that country would be expected to participate actively in the work of the Group or Groups;

* It also requested the Secretariat to participate and assist the lead countries in executing their functions in their respective Working Groups;

* and called on the lead countries to prepare a concept paper on the approach to the issues in their respective Working Groups;

* In addition the Sub-Committee also requested the lead countries to prepare reports of meetings, identify deadlines for submissions to the Working Groups, transmit background and working documents from the Group to the Secretariat for analysis and onward dissemination to other Member States, and inform the Secretariat of the scheduling of meetings of the Working Group;

* Wherever possible, copies of comments on working documents or submissions to the various Working Groups be provided to the Secretariat for the information of other member states

* At the national level, it was recommended that Member States identify a coordinator for the FTAA process and establish national committees on the FTAA;

It was also recommended that -

(a) the members of the Advisory Committee identify experts within their organisations who could be designated to provide advice on issues related to the FTAA; these Advisory Groups comprise the President of the CDB, the Vice Chancellor of the UWI, the Director General of the OECS, the Governor of the ECCB and the Secretary General of the Caricom Secretariat.

(b) Also, it was recommended that at the national level, private sector organisations be invited to develop positions on specific issues which could be fed into the national briefs;

* Finally Member States were urged to participate more actively in the Working Group on Smaller Economies.

These elements will be revisited after programmes for the FTA's with selected countries are outlined so that the overall structure and procedure of preparation might be better appreciated.

 

 

CARICOM And Preparations For Free Trade Agreement Negotiations With Selected Countries.

At the Sixteenth Meeting of the Conference of Heads of Government held in July 1996, a proposal was examined to the effect that consideration be given by the Caribbean Community (CARICOM) to negotiating enhanced trade arrangements incorporating the principle of reciprocity and based on a list of exceptions. Reciprocity would be based on the principle contained in the CARICOM/Colombia Agreement concluded in 1994 in which the Less Developed Countries (LDCS) of the Caribbean Community are not required to provide preferential treatment. In the presentation this item, it was argued that the one-way preferential arrangements which had been concluded with Venezuela and Colombia had not been conducive to the development of the expected increases in export capability and international competitiveness since those agreements provided access for an insignificant number of competitive CARICOM products. With respect to the issue of reciprocity, it was noted that the Region could no longer expect to effectively pursue one-way preferential trading arrangements with other countries in view of the economic philosophy which prevails in the contemporary liberalised global trading environment.

The Conference endorsed the need for CARICOM to pursue enhanced trade arrangements with selected third countries in Latin America and the Caribbean in order to achieve sustained growth in the face of the new global trading environment and accepted the proposals of the Government of Trinidad and Tobago.

The Conference took note of the elements contained in the proposals namely:

(i) a standard form agreement to be approved by Member States;

(ii) CARICOM MDC countries would provide reciprocity under the Agreement;

(iii) CARICOM LDC countries would be exempted from providing reciprocity;

(iv) all items may be traded between CARICOM and third countries party to these agreements except those items specified under an Exemption List;

Further, the Conference agreed inter alia, that:

(i) the Prime Ministerial Sub-Committee on External Economic Negotiations is to be designated as the body responsible for overseeing the conduct of negotiations between CARICOM and third countries with respect to the enhanced trade arrangements and will also be responsible for the establishment and composition of the negotiating team;

(ii) the CARICOM Secretariat will be integrally involved in the negotiation process with respect to these Agreements;

(iii) that draft agreements would have to be agreed by the Council and the Conference before they can be finalised".

In keeping with this mandate of the Conference, a Draft Model Free Trade Agreement was prepared, taking into account comments received from Member States.

At the Seventh Inter-Sessional Meeting held in Guyana on 29 February - 1 March 1996, the Heads of Government Conference accepted the recommendation of the Prime Ministerial Sub-Committee on External Negotiations, and approved a Draft Model Free Trade Agreement with the understanding the Draft would be used as a basis of negotiation taking into account the differences in the levels of development between the parties in the particular negotiations, and the implications for the application of reciprocity by CARICOM States.

Some Critical Issues: The Dynamics, The Negotiating,Environment;Selection Of Countries

In approving the Model Free Trade Agreement, the Conference had accepted that there would be an agreed list of products which would be excluded from the Free Trade Agreement. The Inter-Sessional Meeting of the Conference requested Member States to consult with their respective private sectors before submitting their lists to the Secretariat.

It is to be borne in mind that the negotiation of these Free Trade Agreements will be taking place concurrently with the discussions on the creation of the Free Trade Area of the Americas (FTAA). A critical issue for the Region in the content Of FTA'S and the choice of countries for negotiation is to ensure a consistent and reinforcing position. In the discussions towards the FTAA and, particularly, in the Working Group on Smaller Economies, the Region has been seeking, inter alia to:

(i) have the larger economies in the Hemisphere recognise that the smaller economies will require asymmetrical treatment in the early stages of the FTAA through among other measures, a longer time over which to admit products from larger economies duty flee;

(ii)have all the CARICOM countries classified as smaller economies; and

(iii)establish that the principle of special or differential treatment is provided for in almost all existing Free Trade Agreements.


It should be noted that the United States of America, Brazil and Mexico, among the larger economies, have been resisting the principle.

The conclusion by CARICOM of a fully reciprocal Agreement even if the reciprocity is limited to the MDCs, would provide very powerful arguments for the opponents in the negotiations of the FTAA and would in any event create practical difficulties. Presumably, the FTAA will have a provision relating to non-discrimination among members in the same category. In that situation, if a CARICOM State were to provide free access, say, to Brazil, which is categorized as a larger economy, the CARICOM State would not be able to deny that treatment to other larger states such as the USA and Canada. In the selection of countries for negotiation the CARICOM States would need to address significant attention to this issue.


Selection of Countries

It is agreed that the selection of countries should be guided, inter alia, by following criteria:

(i) the identification of opportunities for the export of CARICOM goods and services including tourism;

(ii) the identification of opportunities to obtain imports of quality goods at competitive prices, especially inputs for the manufacturing and tourism sectors;

(iii) possibilities for the flow of investments for joint-ventures;

(iv) availability of transportation services;

(v) the likely classification in the FTAA.


At the Seventeenth Meeting held in July 1996, the Heads of Government identified for priority attention, the negotiation of Free Trade Agreements with Colombia, the Central American Common Market (or Costa Rica), the Dominican Republic and Venezuela.

When the Prime Ministerial Sub-Committee on External Negotiations convened in Jamaica some three weeks ago, on 17-18 September 1996, it agreed that efforts will be made during the CARIFORUM Ministerial Meeting in mid-October 1996 in the Dominican Republic, to explore with that country, the scheduling of negotiation of a Free Trade Agreement. The results of that process are to be reported to the Inter-Sessional Meeting of the Conference in early 1997.

Three Member States, Dominica, Grenada and St. Kitts and Nevis have transmitted lists of items proposed for exclusion from any free trade agreement . Jamaica is expected to submit a list shortly, and Barbados is reportedly consulting with the private sector towards developing a list. In an effort to accelerate the Region's preparation for the relevant negotiations, the Committee called on the other Member States to transmit their exclusion lists Secretariat as soon as possible so that, when the Draft Free Trade Agreement is made available to the identified States, the Region's comprehensive list of proposed exclusions could also be presented. Agreement was also reached on the need to incorporate the social partners - organised labour, the private sector and the NGS'S to the core negotiating team agreed by the Conference while accepting that, where the other State(s) participating in the negotiations have difficulty with the presence of personnel other than government officials, the Region would be flexible in its approach.

Negotiating Teams

As regards negotiating teams, a recommendation of the Prime Ministerial Sub-Committee for the establishment of a CARICOM negotiating team was accepted by the Inter-Sessional Meeting in February-March of this year. The core team would comprise a representative from each MDC Member State, Belize, the CARICOM Secretariat, the OECS Secretariat and the CDB. In addition, there would be two representatives from the OECS countries (LDC'S)

 

Overview Of The Machinery For Preparation And Undertaking Of External Trade And Economic Negotiation By The Caribbean Community

At its Seventeenth Meeting held in Barbados in July 1996, the Heads of Government of the Caribbean Community gave in-depth consideration to the question of the effective regional coordination and the execution of a number of forthcoming external negotiations. These negotiations related particularly to:

(1) The Region's relations with Europe on the expiry of Lomé IV in 2000;

(2) The Free Trade Area of the Americas (FTAA)

(3) The expansion of the Community's trade relations in the Caribbean Basin;


The guiding principles that inform this initiative are the need to:

(1) draw on the widest possible repertoire of skills available to the Region;

(2) ensure a measure of representation of and participation by all Member States in the process;

(3) invite all major sectors of the regional economy

(4) draw, as necessary, on the work of other institutions, especially those designed to serve the Region.

In the context of preparation for negotiations, three aspects have been identified as being of critical importance, namely:
(i) The Machinery;
(ii) The Working Procedures;
(ill) the Resources - both human and financial

The Machinery :

(a) The Political level

As will have been gleaned from my earlier remarks, a significant element of the necessary machinery is already in existence. At the political level, the specific mechanism established to direct the external negotiations of the Community is the Prime Ministerial Sub-Committee on External Negotiations. The Sub-Committee comprises the Hon. Prime Minister of Jamaica (Chairman), the President of Guyana, and the Prime Ministers of Barbados, Saint Lucia and Trinidad and Tobago. By virtue of his position as Chairman, the Prime Minister of Jamaica is the principal Community spokesman on external negotiations. At the Meeting of the Prime Ministerial Sub-Committee last month, a decision was taken to make the Committee's membership open-ended..

(b) Now for The Technical level

The second part of the existing structure established by the Conference is the Technical Advisory Group which comprises the President of the CDB, the Vice-Chancellor of the University of the West Indies, the Director-General of the OECS, the Governor of the Eastern Caribbean Central Bank (ECCB) and the Secretariat of CARICOM.

From the deliberations of the Seventeenth Meeting of Heads of Government (July 1996), it was clear that for the purposes of the negotiations, this body would need to be enlarged, particularly to provide for a greater role for the private sector, labour and Non-Governmental Organisations.

The need was also perceived for the establishment of a dear nexus between the Technical Advisory Group and the Community's Ministerial Councils of Finance, of Trade and Economic Development, and of Foreign and Community Relations.

Some New Elements

An issue that has given rise to heightened and widespread concern with the Community and even beyond, relates to perceptions of the Region's capacity and readiness to adequately deal with the numerous, major, forthcoming negotiations in which it must participate. In this regard, there is the clear inadequacy of the existing technical organs in particular the CARICOM and OECS Secretariats, to provide all the required technical, legal and other negotiating inputs. From this it follows that any approach to deal with this deficit must aim to draw on a wider catchment of skills. At the same time, it is recognised that the mechanism must be focused, structured, and inter-connected to ensure thrust, consistency and cross fertilisation. It was also recognised that the mechanism must be affordable.

Negotiating Working Groups

The Prime Ministerial Sub-committee also agreed that, for the preparation of the technical and political inputs for the negotiating brief and for support to the execution of the negotiations in the different areas, it would be necessary to establish a number of specialised Negotiating Working Groups. Among the areas in respect of which the establishment of such Groups have been identified are the Free Trade Area of the Americas (FTAA) and the Region's trade expansion initiatives in the Caribbean Basin.

The composition of these Groups would include, in addition to Government officials, officials from the CARICOM and OECS Secretariats, skilled personnel from regional institutions, the private sector, labour and Non-Governmental Organisations. The Groups will be charged with the preparation of technical briefs which will be coordinated by the Secretariat, reviewed by the Technical Advisory Group and decided upon by the Prime Ministerial Sub-Committee. The negotiator to spearhead a given area of negotiation would be determined by the Prime Ministerial Sub-Committee. taking into account the recommendations of the Technical Advisory Group.

The Community's Ambassadors in relevant diplomatic centres will also be actively involved in the process and, in this regard, a more effective system of communication is to be established.

The Prime Ministerial Sub-Committee also agreed to appoint a full time Chief Negotiator to inter alia, spearhead the entire negotiating process and to coordinate the sectoral negotiations providing advice and resolving issues. It is envisaged that the appointee will be accorded Ambassadorial rank and be a person of political stature.

Financing

As regards financing, the Prime Ministerial Sub-Committee agreed to establish a group involving representatives from the CDB, Eastern Caribbean Central Bank (ECCB), the Private Sector, and the CARICOM and OECS Secretariats to prepare a two-year budget for the approved machinery. Against the declared willingness by the CDB to make a contribution towards the "start-up" of the machinery, a decision was taken to approach the Inter-American Development Bank for a similar contribution. Funds will also be sought from donor countries and agencies to supplement the contributions of CARICOM Member States.



Training

Yet to be mentioned is a critical element in the maximisation by CARICOM Member States of their negotiating positions in the new trading order. This refers to the need for continuous training at all levels of the negotiating process, not only in Ministries of Trade but also in Ministries of Foreign Affairs and elsewhere. The contemporary international trade agenda touches on the activities of all Government Departments. This agenda is also recognised to be extremely complex and incorporates new issues, many of which are nothing if not controversial. The modem legal approach and the consequent incursion. en masse, of lawyers into what had traditionally been the preview of economists adds to the complexity. The development of negotiating capacity is therefore vital. The need to develop adequate negotiating technique, quite apart from profound knowledge of subject matter, is also worthy of mention as a separate issue.

Subsumed under the concept of "negotiating capacity" is the need to be thoroughly familiar not only with the juridical-technical aspects of the areas to be negotiated, but also with the knowledge of internal political structures and developments in the interlocutor countries coupled with a thorough knowledge of all relevant integration processes. Nor can the relevance of foreign language capability and other transcultural aspects be over emphasised.

The existence of a deficit in these areas within the Region has long been recognised. Training, whether in the form of seminars, more structured arrangements, attachments to relevant institutions, apprenticeships and other modalities are seen as the key to overcoming the situation. While some achievements have been made in this regard, there is no denying that very much remains to be done.

A final comment with implications for the negotiation of FTA's by CARICOM member states relates to the differing degrees of readiness for such undertaking that is observable among them. This comment is as relevant to the ' economic' aspect as it is to the aspect of negotiating capacity. Perhaps these two go together. Unless this situation is effectively managed the implications for the overall conduct and coordination of negotiations at the regional level could be adverse.

I trust the foregoing comments have permitted an appreciation of the approaches being used by Caricom toward negotiations for FTA'S. I have looked at the context-the new international trading context- in which these approaches have been developed including a fairly detailed exposé of the mechanisms now contemplated. The need for training as a means of enhancing negotiating capacity was also emphasised. I look forward to a lively exchange on what are, after all, newly minted, though in some instances, recently revamped, approaches and mechanisms which are to serve Caricom in its preparations for Free Trade Agreements.

I thank you.

25 September 1996