The Political Economy of Caribbean Regionalism in the Twenty-First Century
Total Page：16
File Type：pdf, Size：1020Kb
The Political Economy of Caribbean Regionalism in the Twenty-first Century: Rebirth or Resuscitation? Curtis J. Raynold A Thesis in the Field of Government for the Degree of Master of Liberal Arts (ALM) Harvard University November 2012 © 2012 Curtis J. Raynold Abstract Although the states comprising the English-speaking Caribbean have much in common, integrating them politically and economically has proven to be an extremely challenging endeavor. All three integration initiatives since 1958 whether political or economic have failed to deliver their economic development and trade expansion goals. Uncompromising insular political interests of the key participants were at the heart of the demise of the West Indies Federation, the Caribbean’s first integration attempt. These interests have continued to be a dominant influence in the outcomes of the later attempts to integrate. Integration efforts have, been hampered by the absence of a strong political commitment to regionalization. Despite the chequered history of Caribbean integration, the Caribbean Single Market and Economy (CSME) were established in 2006. That arrangement essentially provided for a deeper form of economic integration, requiring a higher level of political commitment to integration than ever before. Specifically this paper seeks to answer the question: is this latest arrangement any different from its three predecessors in terms of its expected results? The following discussion shows that while the concept of the CSME is radically different, the current approach to its implementation is not fundamentally different to that of the three previous ventures. As such, it does not represent the rebirth of Caribbean regionalism but rather, an attempt to resuscitate a politically and structurally flawed development strategy. The renewed ambition to integrate is not matched by the requisite political will and commitment to effectively carry the new venture forward. I use a combination of historical, political, and economic analysis as the primary methodological approach to test this hypothesis. I conclude that while a renewed political will might have overcome some past hurdles, that commitment still falls far short of the unified force required to create a robust and deeper form of integration that addresses economic and other challenges and keeps the region afloat in the relentless tidal flow of economic globalization. Author’s Biographical Sketch Curtis J. Raynold is a 1978 graduate of the University of the West Indies (UWI) where he was awarded a Bachelor of Arts degree, majoring in Economics at the university’s campus in Cave Hill, Barbados. In 1980, he graduated with a Post-graduate Diploma in International Relations from the Institute of International Relations of the University of the West Indies in the Republic of Trinidad and Tobago. Mr. Raynold joined the Saint Lucia Government Service in 1978 and served in the Ministry for Foreign Affairs as a Foreign Service Officer from 1980 to 1985. In that capacity, he covered the Economic Affairs desk and participated in numerous CARICOM meetings and other regional and international conferences where he represented Saint Lucia’s economic and trading interests. In June 1985, he was recruited by the United Nations after successfully taking the United Nations’ National Competitive Examination in Economics, an initiative to recruit young professional staff from under-represented Member States of the United Nations. Mr. Raynold was subsequently assigned to the Office of the United Nations in Vienna, Austria. Since July 2004, he has been a Political Affairs Officer in the Office for Disarmament Affairs (ODA) at the Headquarters of the United Nations in New York. v Dedication I wish to dedicate this work to my family, in particular my wife, Dawn Edwards- Raynold, for her support, encouragement, and patience over the last few years as I pursued the Master of Liberal Arts (ALM) program. I dedicate this work also to my son and daughter, Dhelon and Derissa Raynold, for their encouragement, especially at times when this seemed an impossible and daunting task. Let the completion of this work also inspire my children and serve as an example of what they too can achieve through perseverance and hard work. Special mention must be made of my mother, Josephine Raynold, who, despite her own lack of an advanced education, fought tirelessly and, sometimes, against seemingly insurmountable odds, to ensure that I was able to obtain an education that gave me access to the career and academic opportunities with which I have been blessed with over the years. vi Acknowledgements Whatever positive contributions that can be derived from this work are due in no small measure to the influence of a small number of dedicated and supportive people. I wish to acknowledge the contribution of Dr. Donald Ostrowski, Lecturer in Extension at the Harvard Extension School, who served as my Thesis Advisor. I appreciated very much his meticulous review of my research proposal and thesis and, most of all, his continued support throughout the entire process. I wish to thank my Thesis Director, Professor David E. Bloom, the Clarence James Gamble Professor of Economics and Demography at the Harvard School of Public Health (HSPH) for taking time from his very busy schedule to evaluate my work. Finally, I would like to thank my immediate family: my wife, Dawn, my son, Dhelon, and my daughter Derissa for their love, patience and support. They tolerated my frequent absences and travel to Cambridge to attend classes and to conduct research, without question, even though their own lives were sometimes disrupted by all of this. Needless to say, any failings of this work are entirely my responsibility. vii Table of Contents Author’s Biographical Sketch. .. v Dedication. .vi Acknowledgements. .vii List of Tables. x I. Introduction. 1 II. A Historical Perspective on Caribbean Regionalism. .. 17 Geography and Demography. 18 The Early Federations of Convenience. .21 The West Indies Federation, 1958 to 1962. 24 Lessons Learned. .35 III. The Theory of Economic Integration in the Caribbean. 38 Economic Integration Theory. 38 Economic Integration and Development. .49 Dependence and Economic Integration. ..54 IV. The Caribbean Economic Context: An Overview, 1965-2005. .63 Intraregional Trade Relations. 66 Employment. .69 Conclusion. .71 V. The Caribbean Free Trade Association (CARIFTA) and the Caribbean Community and Common Market (CARICOM) . .. .. .73 ….Caribbean Free Trade Association (CARIFTA) . .. .. ..74 viii Caribbean Community and Common Market (CARICOM) . .80 VI. The Caribbean Single Market and Economy (CSME) . 88 Establishment and Implementation of the CSME . .90 Community Governance. 97 The Critical Role of Awareness and Support. .. .111 Foreign Policy Coordination. .113 CSME Economic Overview. 114 Intraregional and Extra-regional Trade. .. 115 The Flow of Investment. .119 Economic Convergence. ... .124 Conclusion. .. 131 Appendix. .137 Bibliography. 148 ix List of Tables Table 1 Total Caribbean Investment in LDCs as Percentage of Investment from All Sources: 2003 – 2008 . .120 Table 2 Foreign Direct Investment as a Percentage of Gross Capital Formation . 122 Table 3 CARICOM Growth during the Economic Crisis . 126 Table 4 Average Per Capita Income of CARICOM Member States Compared with Average Per Capita Income of OECD Countries for 1995, 2000, 2005 and 2008 . .. .. 127 Table 5 Number of CARICOM Countries Meeting Convergence Requirements. .129 Table 6 CARICOM GDP by Sector (% of GDP) . .. .136 Table 7 Value of Intraregional Imports and as Percentage of Total Imports from All Sources: 1980-1996. .. .. .. .. 138 Table 8 Value of Intraregional Domestic Exports and as Percentage of Domestic Exports to All Destinations: 1980-1996 . .. 139 Table 9 Percentage Distribution of Intraregional Domestic Exports by CARICOM Countries: 1980-1996. .. .140 Table 10 Balances of CARICOM’s Intraregional Trade Disaggregated by CARICOM Member States: 1981-1996 . .. .. 141 Table 11 Intra-Bloc Trade as a Percentage of Their International Trade. .. 145 Table 12 CARICOM Petroleum Imports as a Percentage of Intraregional Imports: 2004-2008. .. 146 x Chapter 1 Introduction Although the English-speaking Caribbean states share a common language, similar cultures, colonial heritage, and have each adopted largely homogeneous political institutions, integrating these states politically and economically has proven to be an extremely challenging endeavor. All three previous integration schemes, beginning with political integration under the West Indies Federation (1958-1962), followed in 1968 by economic integration through the Caribbean Free Trade Association (CARIFTA), and subsequently deeper economic integration under the Caribbean Community (CARICOM) in 1973, have, to a significant extent, failed to fulfill their political and economic goals. The uncompromising insular political interests of the key participants of the West Indies Federation have continued to be a dominant influence in the outcomes of future integration initiatives. Since the collapse of the West Indies Federation in 1962, Caribbean political leaders have largely avoided any further discussion of a future political union but have, instead, pursued economic integration in order to achieve sustainable economic development. The small size of the individual units of the former federation has severely stunted their economic growth and made it difficult to reap the benefits of economic integration. Integration efforts have, however, also