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13 Caribbean States OK Proposal for Economic Union

July 11, 1989|DON A. SCHANCHE | Times Staff Writer

ST. GEORGE'S, Grenada — After decades of disharmony and jealous squabbling, leaders of the 13 countries of the English-speaking Caribbean--mostly microstates smaller than the average American county--have adopted an ambitious plan for economic union that will brace their economies against the damaging side effects they expect when trade barriers go down in Europe in 1992.

Until their just-concluded summit meeting in Grenada, the pace toward unity among the members of the Caribbean Community and Common Market (Caricom) had been slower than the migration of sea turtles that breed on some of their beaches.

"But now, we are looking at what is happening in Europe and realizing that we are foolish to think that we as small countries can go along on our own when even large countries are realizing that they have to get together much closer," said Prime Minister Mary Eugenia Charles of Dominica, a banana-growing island of 82,000 in the Windwards chain.

Historically Languorous

According to Charles and other Caricom heads of state who concluded a week of anxious summit talks here last week, the threat of what will happen to their own tiny and fragile economies when Western Europe forms a single trading market in 1992 has finally forced the historically languorous Caribbean countries to accelerate their pace toward economic integration.

"We have to get down to the nitty-gritty now," said Prime Minister Michael Manley of Jamaica, Caricom's largest member, "because 1992 is just around the corner."

The free European market could have disastrous consequences for the former colonial possessions, which have enjoyed special trade protection on many exports--mainly bananas, sugar and rum.

England, for example, buys two-thirds of its bananas from Caricom producers who could not otherwise compete with cheaper and better-looking fruit from Central America and elsewhere. Unless special exceptions are made for them, the Caribbean countries will lose in free market competition.

Vulnerable Economy

"If the market 'went' suddenly in bananas, Dominica simply wouldn't be," lamented Charles, who has been one of the leading proponents of both economic and political integration in the Caribbean.

To forestall such a piecemeal battering of the tiny states--whose populations range from only 11,000 in the smallest, Montserrat, to a city-sized 2.3 million in the largest, Jamaica--the Caricom heads of state agreed upon a series of steps toward economic integration that they hope will allow them to speak in a single strong voice.

"With the single market in Europe coming into effect, with the United States-Canada single market arrangement and ultimately the Pacific Rim," said Deputy Prime Minister Lester Bird of Antigua, "I think it came clear to the heads of government that unless the Caribbean integrates its market and becomes a single market, then we are going to be marginalized and pushed aside."

Among other moves, the leaders agreed to level their varied and often restrictive import tariffs, move quickly toward customs cooperation and eventual union and remove all other existing barriers to trade by July, 1991.

Unifying Stock Markets

They also adopted a plan to unify the region's three stock exchanges--in Jamaica, Barbados and Trinidad and Tobago--with the eventual hope of creating a single Caricom stock market and a free flow of capital among the 13 countries.

Air and sea transportation among the hard-to-reach countries--all but two of them islands dotted across tens of thousands of square miles--would be coordinated by 1992, and the requirement for passports and work permits among Caricom citizens would be dropped.

The heads of government also agreed to establish an assembly of Caricom members of parliament as a small step toward creating a sense of cultural and political unity among their historically insular peoples. But they are wary of taking any direct steps, such as a call for an island-by-island referendum, toward political union.

"It's still very early days for that," said Manley, the only survivor among the four heads of government--from Jamaica, Trinidad and Tobago, Barbados and Guyana--who founded Caricom on Aug. 1, 1973. The four founding countries were later jointed by Antigua, the Bahamas, Belize, Dominica, Grenada, Montserrat, St. Kitts-Nevis, St. Lucia, and St. Vincent and the Grenadines.

Manley spearheaded several initiatives in the Grenada summit, including a unanimous call for a U.N.-supervised international organization to combat drugs and an international criminal court to prosecute major drug offenders. He said he was elated that the leaders moved as far as they did toward economic integration.

"For the last 10 years, the idea just collapsed," Manley said. "Everybody was so crisis-ridden by the debt problem, the oil-price problem, the terrible recession of the early 1980s, that all of the intellectual energy was absorbed in individual questions like 'Can the (U.S.) Caribbean Basin Initiative save us?' "

"It will take a long time before political unity," agreed Charles, the region's only female head of state. "But at last there's a real desire to get economic unity going."

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