Economy of the Caribbean

The Economy of the Caribbean is varied, but depends heavily on natural resources, agriculture and travel and tourism

Natural resources

By International standards, minerals most valuable on the international market are found in: Cuba, Jamaica, and Trinidad and Tobago. Several nations of the Caribbean are rich in natural resources; including Trinidad's natural gas reserves, Jamaican bauxite and most recently the discovery of a large oil field in Guyana. The resources that make significant contributions to domestic economies and regional job sectors include, but are not limited to: fisheries, agriculture, forestry, mining and oil and gas bauxite, iron, nickel, petroleum and timber. It has been noted by some that the Caribbean’s most important resources are its tropical island setting, which has generated a unique tourism sector. The attention by regional governments towards economic diversification in the early 1990s is often associated with increased production in tourism, oil, and nickel, spurred by foreign investment in these primary industries.

Agriculture

Along with contributing to the Caribbean’s GDP, agriculture also contributes to domestic food supply, and provides employment. While agriculture is the major economic land-use activity in many Caribbean countries, agriculture accounts for a declining number of most islands' GDP. However, unlike many developed countries, this trend may be accounted for by a growing tertiary sector, as opposed to industrial growth except for Trinidad and Tobago and Mexico. Some of the associations representing the agricultural industry in the region are: the Caribbean Food Crop Society (CFCS); the Windward Islands Farmers Association (WINFA), with some in Saint Vincent, representing the interests of FairTrade certified producers in Saint Vincent, Saint Lucia, Dominica and Grenada.

Globalization: challenges and prospects

While globalization in its modern context undoubtedly has changed the dynamic of Caribbean economics, it is worth noting that “the countries of the commonwealth have been passively integrated into the international economy for all of their modern history”. From foundations built on the plantation economy, the Caribbean economy has always involved reliance on one or several export sectors. While numerous attempts at market diversification have been made, the struggle to develop the political and economic infrastructure necessary to successfully respond to market fluctuations, and loss of competitiveness, in key export sectors remains a struggle. A recent example includes the dismantling of the Lome Convention, which provided Caribbean Banana exports preferential treatment from the EU, by the WTO in 1999.

Women and globalization

In 2010 the labor force participation rate in the Caribbean was 77% and in 2011 it was recorded that GDP per capita in the Caribbean communities average near $10,000. Due to the lack of economic opportunity and low GDP per capita levels, Caribbean people are travelling in large numbers to developed countries. Globally, Grenada has the third highest percentage of emigrate at 67.3%, St. Kitts and Nevis is fourth at 61.0% and Guyana is fifth at 56.8%. Most of these Caribbean emigrants are women.

Historically, the Caribbean’s banana industry has been the one of the biggest exports; however, agriculture is beginning to decline in the world economy. Now, it is the exportation of labor that is on the rise in the Caribbean. Caribbean women are migrating to developed countries for the opportunity to study particularly in nursing programs. Women in the Caribbean migrate in large numbers to developed countries such as the United States, Canada, the United Kingdom and France. These host countries have better education and resources that provide better health care knowledge and health care training. In these developed regions of the word, Caribbean women receive more on and off the job training as well. Educational opportunities for health care allow women in the Caribbean to receive advanced knowledge on nursing and their degrees are recognized in their host countries.

With advanced education come more career opportunities. In the host countries, there is a lot of demand for healthcare workers, which means more job opportunities for the women. Caribbean women also emigrate in such large numbers to developed countries to earn higher pay. Income earned in host countries is usually enough for a female immigrant from the Caribbean to live off of and still send remittances back home. Additionally, the currencies from host countries have more purchasing power than the domestic currency in the Caribbean. Money being sent back to Caribbean countries allows for individuals to set up for retirement accounts and provide financial support to the families that the Caribbean women left behind.

Disadvantages

The labor exportation from the Caribbean to the host countries is offering education and employment opportunities to women, but is also limiting the opportunities for the Caribbean. The educated women who want to learn advanced skills and have the potential to make a difference in and on their home countries are travelling abroad, and in large part are staying abroad to take full advantage of the education and the economic prospects. The health care education systems and quality of health care declines because the participants are leaving. Guyana is one of the top 10 countries that export labor. In the rural areas, 80% of their health care is provided by nurses. Lately, however, there been serious deficiencies and neglect in the health care market due to Caribbean nurses staying abroad after pursuing their education. Guyana’s economy is also heavily dependent of remittances. Guyana is one of the top countries to benefit from remittances from nursing labor. The country’s largest source of foreign exchange is remittances with there being approximately $218 million United States dollars counted in 2006 from remittances, money that did not include transfers from the informal sectors. This dependence on the developed foreign economy leaves Guyana vulnerable to any changes or crashes that the developed country may face. The remittances that Guyana is receiving are helping to sustain the economy but also have the potential effect of really crippling it, if nurses lose their jobs or receive pay cuts and can no longer send back a hefty amount of remittances.

Technology

The Caribbean governments are increasingly looking at the need for digital communications networks to help economic growth.[1]

See also

References

  1. ^ Mertzger, Geneive Brown; Stephen Metzger (2013-10-29). "Technology and Economic Integration". Science & Diplomacy. 2 (4).
African, Caribbean and Pacific Group of States

The African, Caribbean and Pacific Group of States (ACP) is a group of countries in Africa, the Caribbean, and the Pacific that was created by the Georgetown Agreement in 1975. The group's main objectives are sustainable development and poverty reduction within its member states, as well as their greater integration into the world's economy. All of the member states, except Cuba, are signatories to the Cotonou Agreement with the European Union.

The Cotonou Agreement (signed in Cotonou, Benin in June 2000) is the successor to the Lomé Conventions. One of the major differences from the Lomé Convention is that the partnership is extended to new actors such as civil society, private sector, trade unions and local authorities. These will be involved in consultations and planning of national development strategies, provided with access to financial resources and involved in the implementation of programmes.

Many small island developing states are ACP states; the fourth Lomé Convention was revised in 1995 in Mauritius and gives special attention to island countries in this agreement.

CARIFORUM

The Caribbean Forum (CARIFORUM) is a subgroup of the African, Caribbean and Pacific Group of States and serves as a base for economic dialogue with the European Union. It was established in 1992. Its membership comprises the 15 Caribbean Community states, along with the Dominican Republic. In 2008, they signed an Economic Partnership Agreement with the European Union, though Guyana and Haiti had expressed reservations and did not attend the signing ceremony. Tensions within the group have grown over issues of trade and immigration; the Dominican Republic, with the group's largest economy, has expressed reservations over its current structure.

Canadian mining in Latin America and the Caribbean

Canadian mining in Latin America and the Caribbean began in the 20th century. Latin America and the Caribbean's vast resources give the region great geopolitical importance, attracting foreign interest for centuries. From the colonial race of European empires, to the multinationals of today's neoliberal capitalist world, this region continues to draw interest. Canada's involvement in Latin America increased dramatically since 1989 with several landmark negotiations and agreements. By 2009, the Canadian larger-company mineral exploration market in this region was valued at US$1.7 billion. Currently, Latin America and the Caribbean are dominated by Canadian companies falling from a 49% to 32% held control over the larger-company mineral exploration market after the global recession of 2008. The Canadian share of the market is roughly US$59 million more than the amount domestic companies planned to spend in this region. Both Mexico and Chile have the most intense focus of Canadian mining companies; however, their interest and involvement in other Latin American countries is prevalent.

Caribbean Basin Economic Recovery Act of 1983

Caribbean Basin Economic Recovery Act of 1983 (CBERA) — P.L. 98-67 (August 5,

1983), Title II, authorized unilateral preferential trade and tax benefits for eligible Caribbean countries, including duty-free treatment of eligible products.

In pursuant of 97 Stat. 385, beneficiary countries qualified for duty-free treatment.

Often referred to as the Caribbean Basin Initiative (CBI). Amended several times, the last substantive revisions were made in the Caribbean Basin Economic Recovery Expansion Act of 1990 (P.L. 101-382, Title II, August 20, 1990). This made trade benefits permanent (repealing the September 30, 1995 termination date). The law gives preferential trade and tax benefits for eligible Caribbean countries, including duty-free entry of eligible products. To be eligible, an article must be a product of a beneficiary country and imported directly from it, and at least 35% of its import value must have originated in one or more CBERA beneficiaries. Slightly different import value rules apply to articles entering from Puerto Rico and the Virgin Islands. The duty-free import of sugar and beef products is subject to a special eligibility requirement intended to ensure that increased production of sugar and beef will not adversely affect overall food production. Preferential tariff treatment does not extend to imports of: textiles and apparel subject to textile agreements, specified footwear, canned tuna, petroleum and its products, and watches or watch parts containing any material originating in countries denied normal trade relations (most-favored-nation) trade status. Special criteria applied to the duty-free import of ethanol through FY2000. Import-sensitive products, not accorded duty-free tariff treatment, are eligible to enter at lower than normal trade relations tariff rates. These products include handbags, luggage, flat goods (such as wallets, change purses, and key and eyeglass cases), work gloves, and certain leather wearing apparel.

Caribbean Basin Initiative

The Caribbean Basin Initiative (CBI) was a unilateral and temporary United States program initiated by the 1983 Caribbean Basin Economic Recovery Act (CBERA). The CBI came into effect on January 1, 1984, and aimed to provide several tariff and trade benefits to many Central American and Caribbean countries. Provisions in the CBERA prevented the United States from extending preferences to CBI countries that it judged to be contrary to its interests or that had expropriated American property.

The Caribbean Basin Economic Recovery Expansion Act of 1990, known as "CBI II", made the CBI permanent. However, once the United States entered into the North American Free Trade Agreement (NAFTA) in 1994 with Mexico it became easier for Mexico to export its products to the United States. CBI countries had lost their advantage relative to Mexico, a major competitor in industries such as textiles and apparel, so they sought to increase their own preferences and achieve "NAFTA parity". Those efforts were not successful until the 2000 Caribbean Basin Trade Partnership Act, which was broadened in 2002. Several exports from the region continue to receive preferential status in the United States, however those preferences will likely be replaced by bilateral free trade agreements, and possibly by the proposed Free Trade Area of the Americas.

Caribbean Basin Trade Partnership Act

The Caribbean Basin Trade Partnership Act (CBTPA) is a United States legislative act signed into law on May 18, 2000 by President Bill Clinton as part of the Trade and Development Act of 2000. This latter act, which also included the Africa Growth and Opportunity Act of 2000 (AGOA), was intended to advance U.S. economic and security interests by strengthening American relationships with other regions of the world then viewed to be making significant strides in terms of economic development and political reform.

The 23 independent countries of the Caribbean basin region together form the sixth largest export market for U.S. goods, totaling $19 billion and absorbing 2.7 percent of U.S. exports in 1999. However, the devastation of hurricanes Mitch and Georges in 1998 set the regional economy back. In addition, the U.S.'s signing of the NAFTA with Mexico in 1994 had caused Caribbean basin countries to lose the preferential treatment they had previously enjoyed.

The CBTPA, an expansion of the 1983 Caribbean Basin Initiative (CBI), sought to address those issues. In particular, the CBTPA extended preferential tariff treatment to textile and apparel products assembled from U.S. fabric that were previously excluded from the program. American policy makers hoped that this would encourage additional U.S. exports of cotton and yarn and U.S. investment in the region, thereby improving the global competitive position of the U.S. textile industry.

The CBTPA was also intended to encourage the diversification of CBI countries’ economies, viewed by American policymakers as a key step towards economic development that would decrease the region's dependence on aid and reduce illegal immigration into the United States as well as the trafficking of illegal drugs. American lawmakers also hoped that CBTPA would send a signal to the other countries of the Caribbean basin and elsewhere of American commitment to promoting trade-expanding policies.

Caribbean Community

The Caribbean Community (CARICOM or CC) is an organisation of fifteen Caribbean nations and dependencies having primary objectives to promote economic integration and cooperation among its members, to ensure that the benefits of integration are equitably shared, and to coordinate foreign policy. The organisation was established in 1973. Its major activities involve coordinating economic policies and development planning; devising and instituting special projects for the less-developed countries within its jurisdiction; operating as a regional single market for many of its members (Caricom Single Market); and handling regional trade disputes. The secretariat headquarters is in Georgetown, Guyana. CARICOM is an official United Nations Observer.CARICOM was established by the English-speaking parts of the Caribbean, and currently includes all the independent anglophone island countries plus Belize, Guyana and Montserrat, as well as all other British Caribbean territories and Bermuda as associate members. English was its sole working language into the 1990s. The organization has become multilingual with the addition of Dutch-speaking Suriname in 1995 and Haitian- and French-speaking Haiti in 2002. Furthermore, it has been suggested that Spanish should also become a working language. In July 2012, CARICOM announced that they were considering making French and Dutch official languages. In 2001, the heads of government signed a revised Treaty of Chaguaramas that cleared the way to transform the idea of a common market CARICOM into a Caribbean (CARICOM) Single Market and Economy. Part of the revised treaty establishes and implements the Caribbean Court of Justice.

Caribbean Congress of Labour

The Caribbean Congress of Labour (CCL) is a regional trade union federation. It represents 500,000 members in 33 affiliated unions across 17 Caribbean nations.

The federation represents trade union concerns to the Caribbean Community (CARICOM), as well as the Association of Caribbean States (ACS), and the Organisation of Eastern Caribbean States (OECS).

The CCL works with both the International Trade Union Confederation (ITUC) and the Inter American Regional Organisation (ORIT).

Caribbean Food Crops Society

The Caribbean Food Crop Society is the regional trade association serving agronomists and agriculture for countries bordering on the Caribbean Sea. Agriculture is the largest sector of the economy of the Caribbean and it affects every nation and territory within the region. The Caribbean Food Crop Society is the organization through which people in the field have the opportunity to meet to discuss research and shared concerns and objectives.

The society was founded by Richard Marshall Bond, the Director, and Arnold Krochmal Assistant Director of the United States Department of Agriculture's Experimental Station on St. Croix, United States Virgin Islands. The association had its first annual meeting at the Sandy Lane Hotel in Barbados in 1964.

Caribbean Programme for Economic Competitiveness

The Caribbean Regional Human Resource Development Program for Economic Competitiveness known as (CPEC) for short is a programme funded by the Canadian International Development Agency (CIDA). The agency is a recent manifestation of historical good-relations and cooperation between the Commonwealth-Caribbean and the nation of Canada.

Central banks and currencies of the Caribbean

This is a list of the central banks and currencies of the Caribbean.

There are a number of currencies serving multiple territories; the most widespread are the East Caribbean dollar (8 countries and territories), the United States dollar (5) and the euro (4).

Surrounding countries and territories

Eastern Caribbean Central Bank

The Eastern Caribbean Central Bank (ECCB) is the central bank for the Eastern Caribbean dollar and is the monetary authority for the members of the Organisation of Eastern Caribbean States (OECS), with the exception of the British Virgin Islands and Martinique. Two of its core mandates are to maintain price and financial sector stability, by acting as a stabilizer and safe-guard of the banking system in the Eastern Caribbean Economic and Currency Union (OECS/ECCU.) It was founded in October 1983 with the goal of maintaining the stability and integrity of the subregion's currency and banking system in order to facilitate the balanced growth and development of its member states.

The bank is headquartered in Basseterre, St. Kitts, and is currently overseen by Mr. Timothy Antoine, the Bank Governor. Prior to assuming his post in February 2016, the bank was overseen by the late Sir K. Dwight Venner. In early 2015, the bank announced plans to phase out the production of the 1 and 2 cent pieces. The date was finalised as July 1, 2015. When a motive was sought, it was stated that it takes about six cents to make one cent pieces and about eight cents to make a 2 cent piece.

Fishing industry in the Caribbean

Although the West Indies has limited resources in terms of developing a large-scale fishing industry, the value of fish and sea products as a source of food has long been recognized. All Caribbean territories therefore have fishing industries.

Most Caribbean fishermen ply their trade from small boats (4–11 meters). These small craft, often without protection from sun or rain, are forced to remain very close to shore, seldom going more than 16 kilometers offshore.

Great Recession in the Americas

North America was one of the focal points of the global, Great Recession. While Canada has managed to return its economy nearly to the levels it enjoyed prior to the recession, the United States and Mexico are still under the influence of the worldwide economic slowdown. The cost of staple items dropped dramatically in the United States as a result of the recession.

Latin American debt crisis

The Latin American debt crisis (Spanish: Crisis de la deuda latinoamericana; Portuguese: Crise da dívida latino-americana) was a financial crisis that originated in the early 1980s (and for some countries starting in the 1970s), often known as "La Década Perdida", when Latin American countries reached a point where their foreign debt exceeded their earning power, and they were not able to repay it.

Organisation of Eastern Caribbean States

The Organisation of Eastern Caribbean States (OECS; French: Organisation des États de la Caraïbe orientale, OECO) is an inter-governmental organisation dedicated to economic harmonisation and integration, protection of human and legal rights, and the encouragement of good governance between countries and territories in the Eastern Caribbean. It also performs the role of spreading responsibility and liability in the event of natural disaster.

The administrative body of the OECS is the Commission, which is based in Castries, the capital of Saint Lucia.

Petrocaribe

Petrocaribe is an oil alliance of many Caribbean states with Venezuela to purchase oil on conditions of preferential payment. The alliance was launched on 29 June 2005 in Puerto La Cruz, Venezuela. In 2013 Petrocaribe agreed links with the Bolivarian Alliance for the Americas (ALBA), to go beyond oil and promote economic cooperation.

Susu (informal loan club)

A susu or sou-sou (also known as a merry-go-round) is a form of rotating savings and credit association, a type of informal savings club arrangement between a small group of people who take turns by "throwing hand" as the partners call it. The name is used in Africa (especially West Africa) and the Caribbean. The basic principle is that each member of the group makes a standard contribution to a common fund once per time period. Then each period the total contributions are disbursed to a single member of the group. The recipient changes each period in a rotating fashion such that all the members of the group are eventually recipients.

United Nations Economic Commission for Latin America and the Caribbean

The United Nations Economic Commission for Latin America and the Caribbean, known as ECLAC, UNECLAC or in Spanish and Portuguese CEPAL, is a United Nations regional commission to encourage economic cooperation. ECLAC includes 46 member States (20 in Latin America, 13 in the Caribbean and 13 from outside the region), and 13 associate members which are various non-independent territories, associated island countries and a commonwealth in the Caribbean. ECLAC publishes statistics covering the countries of the region and makes cooperative agreements with nonprofit institutions. ECLAC's headquarters is in Santiago, Chile.

ECLAC was established in 1948 as the UN Economic Commission for Latin America, or UNECLA. In 1984, a resolution was passed to include the countries of the Caribbean in the name. It reports to the UN Economic and Social Council (ECOSOC).

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