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Dr Baugh: The Trade Policy Review was a Good Stocktaking Exercise for Jamaica

February 10, 2011

The Key Point:

Deputy Prime Minister and Minister of Foreign Affairs and Foreign Trade, Dr. Kenneth Baugh, on Wednesday reported on Jamaica’s Third World Trade Organization’s (WTO’s) Trade Policy Review (TPR) exercise, at a press conference held at the Ministry’s Dominica Drive Offices.

The Facts

  • Under the TPR Mechanism, small, developing countries like Jamaica are reviewed every six years to; in essence, analyze the country’s trade policies and practices and progress towards its integration into the Multilateral Trading System (MTS). In so doing, the compliance with WTO rules and the level of transparency in trade policy are considered.
  • The four largest traders, i.e. the European Union, the United States, China and Japan are reviewed biennially, and the next 16 largest traders are reviewed every four years.

The Full Story

Deputy Prime Minister and Minister of Foreign Affairs and Foreign Trade, Dr. Kenneth Baugh, on Wednesday reported on Jamaica’s Third World Trade Organization’s (WTO’s) Trade Policy Review (TPR) exercise, at a press conference held at the Ministry’s Dominica Drive Offices.

Under the TPR Mechanism, small, developing countries like Jamaica are reviewed every six years to; in essence, analyze the country’s trade policies and practices and progress towards its integration into the Multilateral Trading System (MTS). In so doing, the compliance with WTO rules and the level of transparency in trade policy are considered.

The four largest traders, i.e. the European Union, the United States, China and Japan are reviewed biennially, and the next 16 largest traders are reviewed every four years.

As Dr. Baugh explained, the TPR was important for Jamaica because it not only offered a detailed analysis of Jamaica’s performance within the MTS, but it doubled as a marketing opportunity for Jamaica.

“The TPR was a good analysis activity for Jamaica, as while they commended us on progress made since 2005, they highlighted our limited export baseand low productivity,” said the Minister. According to Dr. Baugh, the progress referred to by WTO members was the achievement of macro economic stability, the 2010 implementation of the Jamaica Debt Exchange (JDX) and the government’s divestment of non-profit making public enterprises such as Air Jamaica and the sugar factories.

He continued; “The TPR was important because we were being reviewed by possible business partners, some of whom testified about our tourism product, informing us that they honeymooned in Jamaica.”

As Dr. Baugh explained, the Review had three segments; one in which two reports were prepared – a report on Jamaica’s macro-economic and trade performance by the WTO Secretariat and one prepared by the Government of Jamaica; second, a meeting of the Trade Policy Review Body at the WTO Headquarters in Geneva and third, a question and answer process, through which Jamaica fielded some 96 questions.

At the meeting in Geneva, 19 nineteen members spoke. These were: India; the European Union; the United States; China; Japan; Colombia; Chile; Turkey; Mexico; El Salvador; Mauritius; Chinese Taipei; Nigeria; Dominica (on behalf of the OECS); Barbados; Morocco and Trinidad and Tobago.

TPR Indentified Strengths and Structural Weaknesses

The Foreign Minister also made the point that in the Review process, Jamaica was commended overall on: its general market openness; the stabilization of the financial sector; the liberalization of the air transport sector; the liberalization in the financial services and telecommunications sectors. They also spoke highly of Jamaica’s Vision 2030 and National Export Strategy; its initiatives in the agricultural sector; its leadership role in the Caribbean Single Market and Economy (CSME) integration process and its active participation in the WTO.

However, they also identified structural deficiencies that have, over the decades, stunted Jamaica’s economic growth.

“They are of the view that we made progress since 2005, although our non-traditional exports need to be increased.  They also indicated that we suffer from structural weaknesses, such as high energy cost; high interest rates; inability to meet international quality standards and a complex tariff and tax regime, which impedes investments,” explained the Minister.

Jamaica’s susceptibility to natural disasters and our large public debt were also other impeding factors identified by our trading partners.

On the subject of Jamaica’s high energy cost, Dr. Baugh noted that Brazil, at the review, commended Jamaica on its introduction of E10 gasoline to the Jamaican market – a project on which Brazil and Jamaica collaborated. As the Minister puts it, they were also impressed with Jamaica’s biofuels projects.

He also made the point that China commended Jamaica on its South/South partnership, highlighting both countries’ joint road work programme.

Dr. Baugh also used the press conference to brief the media representatives on other activities of the Ministry, such as the recently concluded Regional Aid for Trade (AFT) Forum in Barbados geared towards developing a regional AFT Strategy for the July, 2011 Third Global Review on Aid for Trade.

As he explained it, most of the resources under the AFT initiative, which Jamaica intends to use to diversify exports, have gone to the Asian region, and those that have come to the Latin America and Caribbean region, have gone mostly to Latin America.

According to Dr. Baugh, the Caribbean region has submitted proposals for AFT funding for the following projects:

Maritime Transport

Sanitary and Phystosanitary Measures

Infrastructural, Institutional and Productive Capacity Building

The Minister of Foreign Affairs and Foreign Trade highlighted to the media that external, global market events have always affected the Jamaican economy from as far back as 1865.

“The British Sugar Duties EqualisationAct, which equalized sugar duties from the British Colonies, including Jamaica precipitated the 1865 Morant Bay Rebellion,” He also listed the Jamaican 1938 riots and the 1980s failure of the Jamaica Freezone as local fallouts as a result of externalities.

Despite Jamaica’s vulnerability to external market activities, Dr. Baugh insists that, “Jamaica must and will continue to maintain a strong presence and voice in the WTO meetings.”

Disclosing that WTO’s Director General, Pascal Lamy lauded Jamaica for “punching above its weight” in the WTO, Dr. Baugh made the point that : “WTO is governed by consensus, and a small country can block a decision; that’s why we’ll continue to fight for capacity building in developing countries.”

In that connection, he reiterated the importance of the Doha Development Round of negotiations, making the point that 2011 is earmarked for its completion.

While disclosing to members of the media fraternity, the intention of making Jamaica a regional strategic hub, the Minister of Foreign Affairs and Foreign Trade described the Ministry as being responsible for “taking charge of external frontiers to bring investors to Jamaica.”

Last Updated: February 24, 2020

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