Introduction

The Florida-Caribbean relationship is both historical and strategic. The Caribbean benefitted in the World War II and post-World War II periods as significant numbers of Caribbean farm workers found employment building the Florida Sugar and Citrus Industries. The strong agrarian Florida economy laid the base for its current dynamic industrial and service-based economy. The new economy has attracted more highly skilled Caribbean migrant workers and professionals and stimulated a vibrant tourist trade.

The movement towards greater flows of commerce and tourism - cruise and land-based, investment and services whether through a further enhanced Caribbean Basin Initiative (CBI), a Free Trade Area of the Americas (FTAA), the CARICOM Single Market and Economy (CSME) or a CARICOM Free Trade Agreement with Central America - will increase the strategic importance of the relationship.

The Current Florida Caribbean Linkage

Florida and the Caribbean (the CARICOM Member States plus the Dominican Republic) have a total visible trade which peaked at US$8.9 billion in 2000, that is before September 11, 2001, and recovered from US$7.9 billion in 2002 to US$8.3 billion in 2003. The total trade, the import and the export trade, the trade balance and growth for 1999 to 2003 are all set out in Table 1.

Florida exported in 1999 almost as much to the Caribbean as it did to Europe and Asia combined. Florida accounts for about one half of the United States trade with the Caribbean. Florida accumulated a trade surplus with the Caribbean of US$8.9 billion or an average of US$1.8 billion per year for the 1999 to 2003 period, which while less than the US$10.74 billion or US$2.1 billion per year amassed during the 1995 to 1999 period, cannot be considered insignificant.

The Caribbean is host to approximately 50 per cent of the world's cruise berths. This percentage is likely to increase with instability in many areas of the world. The vast majority of these cruise ships have their home port in Florida, and procure the bulk of their stocks there. Florida has strong air and sea links with most parts of the world. It has more flights to the Caribbean than to any other Region of the world. In 1998, Florida had 88 per cent of all us flights from major Airports to the Caribbean. Asia is the fastest growing Region in the world and is set to replace Europe and the United States as the centre of world economic activity to four per cent, and with one of the fastest growing immigrant populations.

Caribbean's Future Growth Prospects

A major challenge confronting the Caribbean is how to create and sustain growth. This challenge will intensify under the FTAA as attention shifts to large markets and investment areas. Sluggishness and economic uncertainty in the Caribbean should be of interest to Florida, inter alia, because of the role of the Caribbean in Florida's visible and invisible export trade, including its financial services and land and cruise-based tourism, the potential for rapid inflow of migrants - legal and illegal, and for weakened border security.

Sustained growth in the small economies in the Caribbean will depend on the Region's ability to attract investment in, and find export markets for, products in which it has some comparative advantage. These product areas include -

(i)      Agro-industry, in particular exotic foods and drinks, nutraceutical products, condiments and spices;

(ii)      Services, including tourism, cultural services and products, training, consultancy: and

(iii)      Light manufacturers, including furniture, craft products and garments.

The challenge for the Caribbean is the infrastructure, organisation and the mental attitude to get and maintain these products in large markets competitively, and on a timely, as and when required basis. Infrastructure and logistics are among Florida's strengths.

From the perspective of Caribbean production and export business, Florida should be an asset.

Caribbean business should see Florida not only as a growing market, including an ethnic market, in its own right, but as an entry port to the vast market of the South East and West United States, Asia, Latin America, and the cruise ships among others.

Strategic warehousing, finishing and packaging of Caribbean products in bonded warehouses or free trade zones in Florida could significantly overcome the size, timeliness and transport constraints. This would also facilitate satisfying Internet orders and addressing issues of standardisation and quality. The ships and aircraft which currently leave the Caribbean with little backhaul cargo could become a central, inexpensive part of the transportation chain. The Florida Trucking System into other parts of the United States and its shipping and air linkage to Asia, etc. could complete the process.

There are French perfumes positioned in Florida for the re-export trade; why could not Caribbean rums, liqueurs, other exotic drinks and condiments?

Caribbean cultural products could be similarly "displayed" in Florida and a stronger linkage established with the movie and entertainment industry.

The investment opportunities are for both Caribbean and Florida-based investors. These opportunities could preferably be exploited through joint ventures, strategic alliances and partnerships, including on the production side, in the Caribbean.

In addition to the economic, the relationship with Florida has political and social strategic value from a Caribbean perspective.

The United States is the Caribbean's largest trading partner - visible and invisible trade; has the largest number of Caribbean nationals resident outside the Caribbean; and exerts the greatest influence on Caribbean policy directly and through its dominance in multilateral Institutions and organisations. Whilst the Caribbean is one of the few areas in the world with which the United States enjoy a consistent trade surplus, knowledge of the Caribbean in Washington is low.

Florida, as the fourth largest state, has significant political weight in Washington - even without the coincidence of family relations in the "State House" and the "White House". Florida has a greater knowledge of and interest in, the Caribbean. Strategically, the Caribbean can increase significantly its influence in Washington by way of Tallahassee.

The Caribbean has a large concentration of nationals in Florida, second only to New York. These nationals are not only taxpayers, they are potential voters. Strategically, the Caribbean can influence the politics of Florida. The Caribbean needs to begin to see this as an asset, and to organise and use it.

Closing Remarks

From the Caribbean perspective, the Florida-Caribbean relationship is a vast unexploited resource. There is much potential for mutual benefit. Among the ways to begin to exploit that potential is for Caribbean businesses to begin to make Florida an economic entry port. Florida should seek to maintain investor interests in the

Caribbean. One way of maintaining North and South American interest in the Caribbean is to place the Headquarters of the FTAA there. Officials and business people will still travel through Florida, stop there, and do their shopping and other business.

A "win-win" formula.

TABLE 1   

FLORIDA/CARIBBEAN¹ TRADE
(Millions of US$)

Source: The data is provided by Greenheart International LLC.
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¹     CARICOM Member States and the Dominican Republic