(CARICOM Secretariat, Turkeyen, Greater Georgetown, Guyana) January 2011 marks the fifth anniversary of the coming on stream of the CARICOM Single Market aspect of the CARICOM Single Market and Economy (CSME), the most ambitious initiative undertaken by the Caribbean Community.

The fledging enterprise has so far made significant strides in fulfillment of the vision of a seamless market space that better positions small vulnerable countries to meet the challenges of the current international environment. It has been compartmentalized into the Single Market that began in January 2006, and the CARICOM Single Economy which is targeted to become operational in 2015. Of the 15 CARICOM Member States, The Bahamas and Montserrat have not signalled their intention to participate in the CSME.

Haiti, though not yet on board, benefitted in December 2010 from a temporary trade concession arrangement under which it will be able to export within the Single Market on a non-reciprocal preferential basis for three years. The agreement at the last Meeting of the Council for Trade and Economic Development (COTED) for 2010, was a demonstration of the spirit of unity and community, in support of the French-speaking Member State which continues to suffer the effects of the devastating 12 January 2010 earthquake and the cholera outbreak that followed later in the year.

Over the five years since the CSM became operational, the free movement of skilled CARICOM nationals has moved from five initial categories to ten including the most recent - domestics. The ten categories under which skilled nationals can move without the need for work permits and visas are: university graduates; media workers; artistes; musicians; sportspersons; nurses; teachers; artisans; persons who are holders of Associate Degrees or equivalent; and household domestics who are holders of Caribbean Vocational Qualifications.

The number of Skilled National Certificates issued by Member States participating in the CSM act as a gauge on the status of the free movement of skills regime. Available statistics indicate that by 2009/2010, about 9 000 persons were issued Skilled National Certificates – the instrument that allows eligible categories to move – though not all may have used the Certificate. The majority of movers are women and the vast majority are university graduates

It is anticipated that there will be movement this year on the Contingent Rights, which are granted to a CARICOM national, his/her spouse and immediate dependent family members if the principal beneficiary has exercised the right of establishment, provision of services, movement of capital or free movement of skills.

With regard to movement of capital, data is limited but there have been some cross-border capital flows during the five years of the CSM, particularly in the equity markets and for investment in the manufacturing sector.

A steady increase in intra-regional trade had also been recorded between 2006 and 2008 from $2.2 billion US to $3.2 billion US. However, in 2009, due to a decline in the value of exports from the major trading Member State, Trinidad and Tobago, total trade appeared to decline, according to preliminary figures which do not include those for three Member States. The preliminary figure put total regional trade in 2009 at US$1.9B.

The achievements under the CSM are due in no small measure to a number of regional institutions that have been established to support the initiative. Among them are:

the Caribbean Court of Justice (CCJ)

the CARICOM Regional Organisation for Standards and Quality (CROSQ)

the Caribbean Agricultural Health Food Safety Agency (CAHFSA)

the CARICOM Competition Commission

the CARICOM Development Fund (CDF)

The Board of the CDF recently authorised the provision of one-time grants of US$60,000 to the Government of Saint Lucia and US $30,000 to the Government of St Vincent and the Grenadines under its Emergency Disaster Assistance (EDA) facility. The emergency grants were to be applied to trade-related activities which were dislocated after the passage of Hurricane Tomas.

In July 2010, the CDF Board approved a CAP of US$6.1 million for the Government of Saint Lucia and in September approved US$4.2 million for St Vincent and the Grenadines. The Government of Belize has also been approved to receive US$3.2 million.

The Barbados-based CARICOM Development Fund, which began operations inn 2009, was established under Article 158 of the Revised Treaty of Chaguaramas to address the disadvantages arising from the implementation of the CARICOM Single Market and Economy (CSME) process.

In addition to the institutions above, national accreditation bodies to ensure common standards and measures for accreditation and equivalency, and national and regional regulatory and administrative structures were also established as part of the support mechanisms for the CSM.

While the CSME has not yet attained the level its framers had envisaged when it was put on the table at Grand Anse, Grenada in 1989, the initiative is working. Stakeholders at a Convocation held two years ago under the Chairmanship of then Prime Minister of Barbados the late Hon David Thompson, Lead Head of Government with responsibility for the CSME, acknowledged progress on the CSME, but also recognized that there was need for greater involvement of the private sector and labour. They conceded that there were national capacity limitations to drive some of the processes critical to the effective functioning of the CSME.

An audit that formed the basis of discussions at the Convocation identified five basic challenges that were affecting the pace at which the CSME was progressing. Those areas were:

surviving the current global economic downturn and emerging from it as a transformed and more resilient Community committed to its original purpose;

strengthening the market integration process and stimulating increased cross-border activity, especially in favour of the Member States with negative trade balances;

increased investment to build up the general infrastructure and for increased production and job creation;

mobilizing adequate resources for implementing effective Community sectoral and other progammes to sustain the supply of skills and for export expansion;

reaching agreement on mobilizing adequate resources and execution of a scheduled plan of action for implementation of the macroeconomic and other measures to establish the single economic space.

The Community is moving to address these and other challenges such as in the areas of the provision of adequate transportation services for goods and persons; in addressing regional concerns about crime, drugs and energy prices; financial and capacity constraints; and matters of governance.

However this year, we look forward to the continued gradual reduction of the number of challenges that hinder the maturity and effectiveness of the CARICOM Single Market and Economy.

The objectives of the CSME are:

Improved standards of living and work

Full employment of labour and other factors of production

Accelerated, coordinated and sustained economic development and convergence

Expansion of trade and economic relations with Third States

Enhanced levels of international competitiveness

Organisation for increased production and productivity

The core components of the Single Market are the free movement of goods, services, capital, specified categories of skilled CARICOM Nationals and the Right of Establishment.

CONTACT: piu@caricom.org