INTERNATIONAL RELATIONSOF THE CARIBBEAN

Canada and the Caribbean

Dr. Jacqueline LAGUARDIA MARTINEZ

• History and cultural heritage as colonial possessions

• First colonies in Canada were founded in the early XVIII century

• Major links with the Anglophone Caribbean and, in a lesser extent, with the French Caribbean

Canada and the Caribbean

North America in 1750

Trade and military links

Port of Halifax

Its naval facilities served the British Navy to secure colonial control in the Caribbean islands and as a main door for Terranova cod exports to the British possessions in the Caribbean and to Cuba

Triangular Trade

Early XX Century: Poor trade exchange• USA hegemony in the continent: the Caribbean is

perceived as the next frontier

• Canada is immersed in a process of national construction

• Despite the benefits of the common relation due to the Preferential Tariff Regime within the Britain Empire (1898, 1900, 1904, 1907) and a Trade Agreement between Canada and the West Indies from 1920, the Caribbean-Canada trade was insignificant

• The Bank of Nova Scotia opened its first international branch outside the U.S. in 1889, in Kingston, Jamaica

• In 1926 two-thirds of Canadian branches abroad were based in the Caribbean

• Most of these branches were located outside the Anglophone Caribbean, in territories of major interest to the USA: Cuba, Haiti, Puerto Rico and the Dominican Republic (144 branches, only 44 in the USA)

But significant financial presence

Prime Minister Lester Pearson (1963-68)• Incorporation of the new independent states in

the Caribbean to the Commonwealth

• Traveled the Caribbean and invite the Caribbean states to the Conference in Ottawa in 1966:

a. To stimulate the relations with Canada

b.To promote trade (Commonwealth Caribbean Canada Trade and Economic Committee, First Meeting in February 1967 in Saint Lucia)

c. To channel aid funds to the Caribbean

Pierre Elliot Trudeau (1968- 1984) • Considered the Father of the Modern Canada• New principles and practice of the Canadian foreign

policy (independent from the USA and UK): Third Option / North-South instead of East-West

• 1970: Foreign Policy for Canadiansa. Europe, Latin American and the Caribbeanb.International Aid and Cooperation: creation of the

Canadian International Development Agency (CIDA) and the International Research Development Center (IRDC)

c. Middle power: Canada as “the largest of the smallest powers and the smallest of large powers”

Trudeau and the Caribbean• The Caribbean is a priority in Canada foreign policy• Special relation with leaders in the area: Manley and

Fidel• Increasing aid funds: transport, public healthcare,

scholarships • Military cooperation: training programs (coastguards,

military) and participation in the reconstruction of the Guyanese police force

• Opened Canada to Caribbean migration when UK enforced restrictions to receive Caribbean immigrants

• Canada joined the Caribbean Development Bank• 1979: Trade and Economic Cooperation Agreement

(Conference Canada –CARICOM in Jamaica)

• Alignment with the USA (Middle Power?)• Hemispheric projection (Open Regionalism)• Cooperation in neo-liberal economic reform• Main sectors:

a. Trade and economical relations (finance and banking)

b.Democratic Governability

c. Security (40% drugs in Canada enters from the Caribbean)

d.Disaster Management

Progressive changes since the late 80’s…

Mechanisms• Regional organizations

• Bilateral relations

• Special Programs

• Cooperation for Development (facing the South-South Cooperation)

• Caribbean diaspora in Canada

• Joint Trade and Economic Committee (JTEC)

• Canada-CARICOM Summits (last in 2007)

Canada’s interests on the Caribbean• To promote national interests• To avoid frictions with the USA• To promote economical relations (trade and

investment in the mining sector, banking)

• Main pillars of Canada’s International Development Cooperation

1.Democratic Governability2.Prosperity – Economic Cooperation (Single

Market)3.Security (Natural Disasters)

Source: Antonio Romero “Relaciones Económicas…” in Conexión Canadá-Caribe, 2013

Main actions in the XXI Century• July, 2007: Announcement of 600 millions CAN dollars for

ten years as regional aid and negotiate a FTA

• Increased presence in Haiti (no debt, cuota in the CDB)

• 20 millones CAN dollars assignation for the Program of Extreme Events Risk Management in the Caribbean

• Antidrug Program

• Creation of the Caribbean Public Health Agency (CARPHA) in 2011

• Inter American Regional Program (Economic Growth and Children and Youth)

• Announcement of representing the Caribbean interests in the G-20 Meetings

Canada-CARICOM: Exports and ImportsCanada Exports 2006 2007 2008 2009 2010

Rest of the World (%)

99,85 99,84 99,81 99,79 99,80

CARICOM (%) 0,15 0,16 0,19 0,21 0,20

CARICOM (thousands USD)

593.044 676.835 854.591 661.379 755.256

Canada Imports 2006 2007 2008 2009 2010

Rest of the World (%)

99,71 99,64 99,63 99,62 99,60

CARICOM (%) 0,29 0,36 0,37 0,38 0,40CARICOM (thousands USD)

1.020.718 1.373.703 1.531.254 1.226.222 1.570.445

Source: Antonio Romero “Relaciones Económicas…” in Conexión Canadá-Caribe, 2013

Canada CARICOM: Trade Balance (thousands USD)

Canada Export Destinations in CARICOM (%) 2010

Source: Antonio Romero “Relaciones Económicas…” in Conexión Canadá-Caribe, 2013

Canada Import Origins in CARICOM (%) 2010

Source: Antonio Romero “Relaciones Económicas…” in Conexión Canadá-Caribe, 2013

CANADA-CARICOM Trade• Canada exports: manufactures, foodstuffs,

and processed materials (newsprint, meslin /wheat, medicaments, telephone equipment, salt fish, copper wire, electrical equipment, potatoes)

• Canada imports: gold, petroleum and alumina (75 % of the total). Also ferrous products, rum, roots and tubers, beer, bakery products, liqueurs, sauces and condiments, nutmeg, and frozen fish

Canada – CARICOM trade instruments• 1979: CARICOM-Canada Trade and Economic Co-

operation Agreement and its Protocols• 1998: Protocol on Rum• 1985: Caribbean-Canada Trade Agreement

(CARIBCAN): grants unilateral duty free access to eligible goods from beneficiary countries in the Commonwealth Caribbean (waiver of WTO)

• General Preferential Tariff of Canada• WTO Most Favored Nation (84% CARICOM

exports!!!!!! in 2007)• Negotiation of a FTA!!!

Canada – CARICOM FTA: issues to considered• Major implementation costs for CARICOM• Canada exports to CARICOM duty free affects the

fiscal income and could replace domestic producers in sector where Canada has more competitiveness

• Services: tourism and international financial services do not need an FTA

• New framework for bilateral economic, political, social and cultural relations (not only aid but development)

• The EU would be entitled to invoke the EPA’s MFN clause to demand similar treatment than Canada

Pushing in the negotiations for:• Duty free facilities for agricultural products, clothing, rum,

cultural and creative services, workers, etc.

• More generous rules of origin (only 60% in CARIBCAN)

• Advocate in favor of economic and sustainable development and the validity of the principle of special and differential treatment through:

• Asymmetrical obligations in favor of CARICOM states;• Progressive liberalization of goods and services trade; and• Cooperation including technical and financial assistance to

facilitate adjustment to liberalization, and trade facilitation, notably to build capacity for exports by the predominantly small firms in the CARICOM region

Source: Antonio Romero “Relaciones Económicas…” in Conexión Canadá-Caribe, 2013

Source: Antonio Romero “Relaciones Económicas…” in Conexión Canadá-Caribe, 2013

Canadian Investments• Bilateral Foreign Investment Protection

Agreements (FIPA)Trinidad & Tobago (July, 1996) Barbados (January, 1997)

• November 2008, Canada CARICOM Business Forum: Few CARICOM firms attended

Limits to Canada-Caribbean relationsThe close relations with the USA: Tension between sovereignty and strategic interests

•40% of the GDP generation depends on the economical links with the USA)

World Economic Crisis

•More selectivity criteria to aid resources allocation•More selectivity in accepting immigrants (qualified work force)Tendency to promote “assistancialism” rather than capacity building

Bibliography in English1. Ramesh Chaitoo, “Time to Rethink and Re-

energize Canada-CARICOM Relations”, in Caribbean Journal of International Relations & Diplomacy, Vol. 1, No. 1, February 2013: pp.39-67

2. Norman Girvan, The Caricom-Canada FTA: What’s the hurry?, March 23, 2009

3. Winston H. Griffith, “CARICOM Countries and the Caribbean Basin Initiative”, in Latin American Perspectives, Vol. 17, No. 1, Caribbean Crisis and Global Restructuring. (Winter, 1990), pp. 33-54.