International Trade

The role of the International Trade Section is to plan, coordinate and execute all activities related to international trade and the negotiation of trade agreements. The section also provides technical advice and policy recommendations to the Ministry and other public and private sector officials on trade issues and their implications for the agriculture sector.

The following are Trade Agreements to which Jamaica is currently a Party:

• The World Trade Organization (WTO) Multilateral Agreement

• The Economic Partnership Agreement (EPA)

• The Caribbean Basin Initiative (CBI)

• The CARICOM/Canada Free Trade Agreement

• The Caribbean Single Market and Economy (CSME)

• The CARICOM/Dominican Republic Free Trade Agreement

• The CARICOM/Costa Rica Free Trade Agreement

• CARICOM Venezuela

• CARICOM Colombia

  The WTO Multilateral Agreement The WTO Doha Round of trade negotiations, or preferably the Doha Development Agenda (DDA) was launched in 2000. The DDA is the most ambitious attempt at ensuring that the issue of development is firmly at the core of the multilateral trading system. WTO members have agreed that the Round must establish rules that can foster development and enable developing countries to benefit from further trade liberalization.

  Major issues of interest in the agricultural aspect of the negotiations for developing countries such as Jamaica include the following:

• Market Access;

• Tariff reduction;

• Special Products;

• Preference Erosion;

• Reduction of subsidies ;

• Special Safeguard Mechanisms (SSM).

 

[1] This does not include Fisheries Subsidies, as under the WTO Fish is not classified as an agricultural product

Modalities for all have been agreed except the SSM, which is one of many issues that remain contentious. The negotiations which involve other sectors such as Non-Agricultural Market Access (NAMA), Services and Trade Rules have been at a “standstill” for more than two years, as the divide among major nations is so wide that it risks jeopardizing the successful completion of the Round.

The Economic Partnership Agreement (EPA) The Economic partnership Agreement (EPA) between CARIFORUM (CARICOM and the Dominican Republic) and the European Union (EU) was concluded on the 16th December, 2007. The EPA is a comprehensive and development-oriented trading arrangement which is a consequence the Cotonou Agreement.

The EPA replaces the previous non-reciprocal trading arrangement between the EU and the African, Caribbean and Pacific (ACP) countries and is successor to the trade provisions of the Cotonou Agreement. The EPA is intended to provide improved, long term and more secure market access for CARIFORUM countries into the EU on a reciprocal basis, with provision for cooperation and development support for the Caribbean.

After the signing of the Agreement in December, 2007, CARIFORUM countries continued to enjoy duty-free and quota-free access to the EU’s market from January 1, 2008 under the EPA. Phased reduction of CARIFORUM countries tariffs should commence on January 1, 2011 as a three year moratorium was negotiated, however, to date only Guyana has indicated readiness to start reducing its tariffs. Jamaica is currently in the process of enacting the legislations that are necessary to facilitate this process.

Development Cooperation Provisions of the EPA

Development cooperation lies at the heart of success in implementation of the EPA, and is the catalyst in ensuring that benefits are to accrue to the region. The European Commission (EC) has committed its support for implementation of the Agreement through procedures outlined in the Cotonou Agreement, in particular the programming procedures of the European Development Fund (EDF) and other EU finance instruments. The Parties also agree to cooperate in order to facilitate the participation of other donors who are willing to support CARIFORUM’s integration activities.

The list of cooperation activities agreed to include the following:

• Technical assistance for human, legal and institutional capacity building;

• Support from tax reform;

• Support for private sector and enterprise development, and enhancing international competitiveness of CARIFORUM firms;

• Investment to promote diversification of CARIFORUM economies;

• Enhancing CARIFORUM Member states’ innovation systems, technological and research capabilities so as to facilitate the development and compliance with internationally recognized sanitary and phytosanitary measures, technical, labour and environmental standards;

• Support for the development of CARIFORUM’s infrastructure for the conduct of trade; and • Agreement on the benefits of establishing a Regional Development Fund to mobilize and channel EPA-related resources from the EDF and other potential donors.

Under the Development Cooperation provision the EC has committed to provide Jamaica with €2.25 million for EPA capacity building.

The Caribbean Basin Initiative

The Caribbean Basin Initiative (CBI) is a geographically targeted non-reciprocal programme between the United States and Caribbean Basin countries. The programme was launched in 1983 through the Caribbean Basin Economic Recovery Act (CBERA).

Most products that are manufactured or grown in CBI beneficiary countries are eligible for duty free access into the United States. Below are the agricultural products that have duty free access:

- Fresh & Frozen seafood;

- Tropical fruits products and winter vegetables;

- Ethnic specialty foods such as sauces, spices, liquors , jam and confectionery;

- Ornamental horticulture;

- Sugar;

- Banana; - Ackee;

- Yams (tubers);

The CARICOM/Canada Free Trade Agreement

Trade between Jamaica and Canada is governed by the CARIBCAN Agreement, which is a Canadian government programme established in 1986, the Agreement provides duty free access to Canadian markets for most commonwealth Caribbean Countries on a non reciprocal basis. All primary agricultural products, which are grown in a CARIBCAN beneficiary country, such as Jamaica are eligible for duty free access to this market.

However, in 2001, CARICOM Heads of Government proposed to their Canadian counterpart the negotiation of a “more mature trading relationship which builds on and enhances existing arrangements and fulfils the objective of the economic development of CARICOM countries.

The CARICOM/Canada Free Trade Agreement Trade between Jamaica and Canada is governed by the CARIBCAN Agreement, which is a Canadian government programme established in 1986, the Agreement provides duty free access to Canadian markets for most commonwealth Caribbean Countries on a non reciprocal basis. All primary agricultural products, which are grown in a CARIBCAN beneficiary country, such as Jamaica are eligible for duty free access to this market. However, in 2001, CARICOM Heads of Government proposed to their Canadian counterpart the negotiation of a “more mature trading relationship which builds on and enhances existing arrangements and fulfils the objective of the economic development of CARICOM countries.” CARICOM’s broad objectives in negotiating a Trade and Development Agreement with Canada are:

i. to build on and broaden the scope of the current instruments and programmes of trade and economic co-operation;

ii. to deepen disciplines to improve market access for CARICOM exports of goods and services, while providing a more secure and predictable foundation for bilateral trade;

iii. to stimulate increased flows of Canadian investment into the Region; and iv. to provide a comprehensive framework for development co-operation initiatives.

The CARICOM/Canada negotiations commenced in 2009 and are on-going.On completion CARICOM/Canada will replace CARIBCAN for an Agreement which is similar to the EPA, i.e. Jamaica and other CARICOM countries will now be required to gradually reduce the tariffs on the majority of their goods to facilitate easier access to their markets for Canadian goods. The Caribbean Single Market and Economy The Caribbean Single Market and Economy (CSME) is a single enlarged economic space in the Caribbean created in July 2001 through the removal of restrictions on trade to ensure the free movement of goods, services, persons, and capital. It grants CARICOM nationals the right to establish business in any CARICOM Member State and to be treated in the same way as a national of that State. The CSME is comprised of the CARICOM Single Market (CSM) and the CARICOM Single Economy (CSE). Agricultural goods that are deemed to be of Community Origin are traded duty-free in the Community. Unfortunately, Jamaica has a massive food trade deficit within CARICOM as over the years we have not been able to capitalize on the opportunities that are available in this market. The CARICOM Venezuela Agreement The fundamental objective of this Agreement shall be to strengthen the economic and trade relations between the Parties through: (a) The promotion and expansion of the sale of goods originating in CARICOM through, inter alia, one-way duty-free access to the Venezuelan market; (b) The stimulation of investments aimed at taking advantage of the markets of the Parties and strengthening their competitiveness in world trade; (c) The facilitation of the creation and operation of regional joint ventures; and (d) The encouragement of mechanisms for the promotion and protection of investments by nationals of the Parties. The CARICOM Colombia Agreement The fundamental objective of this Agreement shall be to strengthen the trade and economic relations and technical cooperation between the Parties through: a. the promotion and expansion of the sale of goods originating in CARICOM and Colombia with particular emphasis on exports from CARICOM States in the early stages of the implementation of this Agreement; b. the promotion and protection of investments aimed at taking advantage of the opportunities offered by the markets of the Parties and strengthening their competitiveness in the international market; c. the facilitation of the creation and operation of regional joint ventures; d. the development of technical and scientific cooperation activities which may be agreed upon between the Parties; e. the promotion of private sector activities, including business exchanges between the Parties.