By Nicholls, Colin
Antigua and Barbuda--Statistics
Saint Vincent and the Grenadines--Statistics
British Virgin Islands--Statistics
Saint Kitts and Nevis--Statistics
St. Vincent and the Grenadines
Virgin Islands, British
Caribbean Free Trade Association countries--Economic aspects
Caribbean Sea--Economic aspects
The Caribbean community THE quest for economic integration in the English-speaking Caribbean started in the 1960s after the collapse of the ill-fated Federation of the British West Indies in 1962. After a vain attempt to revive the federalist idea of political unity, leaders turned increasingly to the concept of economic integration as a means fo preserving ties between the islands and the mainland territories of British Honduras (Belize) and British Guiana (Guyana). The federalist venture, which was singularly encouraged by the colonial power, foundered on the rock of personality clashes, conflicting notions of weak federalism versus strong central federalism, freedom of movement between territories and insular notions of nationalism.
According to Dr. Eric Williams, noted historian and late Prime Minister of Trinidad and Tobago, writing in 1970, "the Federal experience as well as the post-independence situation in the Commonwealth Caribbean showed that the quest for identity and solidarity among the ex-British possessions in the Caribbean had to be pursued by other means--namely, the method of regional economic collaboration and the working out of complementary rather than competitive strategies of economic development."
It was self-evident in the early 1960s that Caribbean countries were linked economically more closely to the metropolitan countries (in particular the former colonial power) than to each other. This factor in itself produced and perpetuated vertical, bi-lateral trading relations between each country on the one hand and countries outside the region on the other hand. As a result, intra-regional, horizontal economic relations, the development of multilateral commerce and the reationalization of fiscal and excise policies were non-existent, thereby contributing to the continued economic isolation of individual countries.
In 1965, then, the leaders of Antigua, Barbados and British Guiana concluded an agreement to establish a Free Trade Area. By 1967, other territories had accepted the principle of such an association and at the Heads of Government Conference in Barbados in October 1967 adopted a number of resolutions aimed at establishing a Caribbean Free Trade Association (CARIFTA); creating a Caribbean regional development bank; and furthering the integration process. The CARIFTA Agreement, ratified by the three founding members at St. John's, Antigua, entered into force on 1 May 1968. At the same time, other territories signed a Protocol of Interest and pledged to become members.
It may be useful at this point to place this initial integration effort in perspective. One cannot underestimate the economic legacy of three centuries of colonialism which assigned to the Caribbean territories the role of producers of primary commodities and suppliers of cheap labour for metropolitan consumption. The pattern of single-crop industries led to the neglect of diversification and accentuated dependence on favoured treatment by the colonial power. Agricultural production for the domestic market and the gradual expansion of the industrial base received scant attention, resulting in the increased vulnerability of national economies of the Caribbean.
Nor can one underestimate the considerable prestige and influence of Sir Arthur Lewis on West Indian economic thinking in the 1950s and 1960s. In the 1950s the future Nobel Prize-winner in Economics, a citizen of Saint Lucia, produced two seminal works which left their impact on economic policy in the region for some time. In an article published in 1950, Sir Arthur argued that: "A poor people spends a very high proportion of its income on food and shelter, and only a small proportion on manufactures. At their present low standard of living, the number of persons for whom West Indians can provide employment in manufacturing by their own purchases is extremely small."
The apparent anti-industrialization slant was later to be echoed in a classic article in which Lewis shows that in a dualistic economy the sector offering higher wages will attract labour without necessarily depressing those of the rival sector when the labour supply is precisely "unlimited". …