The Bahamas and FTAA. What is the Point?

First Published: 2003-02-08

Since 1992 The Bahamas has been engaged in negotiations in consideration of joining The Free Trade Area of the America’s and it is fair to say that as a nation we have no better understanding of governments position than at the outset.

Surely, our “negotiators” should be in a position – after some two years of intense discussion – to apprise members of the public of the issues under discussion and the positions taken?

The U.S. Position

Mr. Dan A. Clune, Charge d’Affaires, of the US Embassy in recent remarks reported in The Nassau Guardian of Saturday, September 29, 2001, suggested that:

“In my view, the challenges and opportunities that the FTAA brings to The Bahamas are different from most countries in a couple of important respects.”

The fact that our economy is primarily service based and these industries are open to foreign competition as pointed out by Mr. Clune, suggests there is no need for us to complicate our trading regime with more governmental red tape.

Furthermore, Mr. Clune very eloquently pointed out that a mere 3 percent of our economy is based on manufacturing. This is hardly a threat to world or regional trade.

In other words, it appears the Bahamas is a round peg being put into a square hole.

What about the threat of sanctions?

As if understanding and preparing for FTAA is not enough for a small nation to consider, the US Congress is being encouraged to incorporate labour and environmental standards into future trade agreements. In this regard, Mr. Daniel T. Griswold of The Cato Institute’s Center for Trade Policy (www.Freetrade.org) recently released Trade Policy Analysis No. 15.

In the Executive Summary he points out that:

“Progress on trade liberalisation has been stymied by the current controversy over whether labour and environmental standards should be enforced through trade sanctions. Advocates of sanctions insist that future trade agreements, including trade promotion authority, contain such standards enforced by the threat of sanctions, but the use of sanctions would be counterproductive and would virtually rule out future regional and multilateral trade agreements.”

The IEF’s Position

The IEF is committed to:

1. A free market economy as being the best way of achieving continual progress for the country, and

2. Government should not sign on to the FTAA agreement without open and honest dialogue.

This issue is far too important to be left to sound bites from the Prime Minister, Minister of Finance, Minister of Economic Development or our Ambassador for Trade. Details of the on going discussions should be reported to the nation each month so the business community, outside of the financial and tourism sectors, can become mentally and practically prepared for increased competition.

When this is done, government can then say they have been transparent as the FTAA Declaration of Principles and Plan of Action specify.

Finally, reducing trade restrictions in the country and leaving businesses to make their own decisions as to how to run their operations in response to changing market conditions is the old and proven formula. America wants to sell, and we want to buy…no more…no less.

So would someone please answer the question…The Bahamas and FTAA. What is the point?

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