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The Ministry of Foreign Affairs and Foreign Trade, is soliciting proposals and comments from public and private sector interests, to inform Jamaica’s position in preparation for negotiation of a new Free Trade and Development Agreement, between CARICOM and Canada.
This was disclosed by Senior Director of the Foreign Trade Department in the Ministry of Foreign Affairs and Foreign Trade, Marcia Thomas, in an interview with JIS News, today (October 14).
The new, two-way agreement, is needed to replace the present one-way (non-reciprocal) trading arrangement before a waiver, which was obtained in the World Trade Organisation (WTO), to facilitate continuation of the one-way trade, which expires in 2011.
“The English-speaking Caribbean had trade agreements with Canada, dating back to a 1912 Trade Treaty. Jamaica and Canada were members of the British Empire, and we also had preferential arrangements under the Commonwealth Scheme of Preferences,” Miss Thomas informed.
According to Miss Thomas, since 1986, “there has been a non-reciprocal (one way) preferential trading arrangement with Canada called CARIBCAN (the Canada-CARICOM Preferential Trade Agreement). It was extended to CARICOM and to its non-English speaking member states, if they so desired to participate.”
CARIBCAN allowed duty-free access to the Canadian market for a large number of products. However, Canadian goods exported to the Caribbean attracted duty.
“The arrangement was a development tool, aimed at assisting the countries in their development. In fact, most of the trading agreements with developed countries were development oriented,” Miss Thomas pointed out.
Citing the LOME Convention, the COTONOU Agreement to some extent, and the Caribbean Basin Initiative (CBI), among the major agreements, Miss Thomas explained that they were all non-reciprocal agreements, because they allowed the countries to retain import duties on goods coming in, while exporting their goods duty free.
“These non-reciprocal trading arrangements are discriminatory under the General Agreement on Tariff and Trade (GATT) and the World Trade Organisation (WTO), in that the preferential treatment of duty free access is given only to a small number of countries, and not the entire membership of the GATT/WTO,” or to all developing countries, as under the GATT/WTO sanctioned Generalised Scheme of Preferences (GSP).
Explaining the WTO Non-discrimination rule, Miss Thomas said that “the WTO operated on the basis of the Most Favoured Nation principle, meaning that all WTO members receive the same treatment. With the exception of the GSP, all other trade agreements, which are limited to only a specific group of countries, require a waiver approved by the WTO members.”
“Now, rules have changed since the days of the GATT and the inception of the WTO, and some of these waivers are no longer looked upon as favourably as they were before. So, in the case of CARIBCAN, Canada has received a waiver that continues up to 2011, but it is unlikely to be renewed,” Miss Thomas said.
She pointed out that the trade agreement with Canada must be WTO compatible. The trend is toward agreements which are reciprocal in nature and comprehensive in scope and coverage.
There is a down side to the new agreement with Canada, that could result from the loss of the duties on Canadian imports, she noted, stressing however, that Jamaica and the CARICOM countries involved would have more to gain from access to a larger market.
Persons and organisations wishing to make submissions to inform Jamaica’s negotiating positions, should write to the Ministry of Foreign Affairs and Foreign Trade, at Dominica Drive in New Kingston, or call 926- 4220-9 for the Foreign Trade Department.