As we reflect several days after Grenada celebrated its 46th anniversary of Independence, reminiscing on the ilk of Sir Eric Matthew Gairy and the heroes that went before him, one name that comes to the fore is T.A Marryshow, the Father of West Indies Federation. Strengthening Regional integration in the Caribbean has seen a lackluster performance from participating countries and according to a recent International Monetary Fund article, it has restricted the region from witnessing an increased growth in its GDP.
A crisis of will is also attributed for the slow pace of implementation of regional integration. According to the latest IMF research, further loosening trade and labour mobility can generate significant economic benefits. The International Monetary Fund’s country focus article emphasized by a photo of the Carenage in St George’s highlights that the region’s Gross Domestic Product can potentially grow by over 7 percent. The IMF has proposed a 25-percent reduction in non-tariff barriers and trade costs within CARICOM which can boost trade and improve welfare gain for all members—at about $6 billion, or 7.6 percent of the region’s GDP. It can also help restructure economies from contracting to expanding sectors, resulting in a net employment gain across the region.
The article dated February 4th says while policymakers of the Caribbean Community (CARICOM) remain committed to further integration and progress has been made, the implementation of integration initiatives and policies toward the goal of a regional economic union has been slow and needs to be accelerated. Compared to other well-integrated regions, like the ECCU and EU, the Caribbean lags. Financial integration has proceeded faster with tightly-interconnected financial systems across the region, but capital markets remain underdeveloped and fragmented.
Harmonizing economic and structural policies to support a single economic space is still work in progress, with lacking harmonization and coordination of investment codes, tax incentives, and macroeconomic policies.
T.A Marryshow may be lamenting the present predicament as the blame lies according to the IMF to a combination of institutional, political economy, and structural factors which underlie the slower implementation of integration policies. The article also denotes the lack of a regional body with powers and accountability that can help transform community decisions to binding laws in individual jurisdictions as a key impediment. Citing the absence of a facilitating regional architecture, IMF believes that cooperation must rely on well-aligned national interests and shared goals. However the IMF is also of the opinion that national incentives do not seem to be well-aligned for integration.
While the Caribbean countries have broadly agreed that integration should remain a top priority and greater collaboration is critical to tackle common challenges. The IMF believes it is important to capitalize on this momentum.