Gonsalves urges OECS to support CDF

KINGSTOWN, St. Vincent (CMC) — Prime Minister Ralph Gonsalves is urging members of the Organisation of Eastern Caribbean States (OECS) to contribute to the CARICOM Development Fund (CDF), saying that his administration has always been supportive of the regional integration movement.

The CDF provided at least half of the US$60 million used to construct the 93-room Holiday Inn Express & Suites, which was handed over to the government over the weekend.

Gonsalves told the ceremony that Vincentians and other people have been very impatient about the 15-member regional integration movement, acknowledging, “… we have made very important strides”.

Gonsalves said that while the treaty that established CARICOM also established the CDF, the funding took some time to become operational.

“…. and every single CARICOM meeting I went to … I say, ‘But the treaty has created a fund to benefit the less-developed territories, and that fund has not yet been created. That fund must be created,” said Gonsalves, who came to office in March 2001.

“And that fund having been created has led to us getting a grant of US$700,000 for this project and a soft loan of 10 million, approximately, close to 50 per cent of the cost of this facility. It’s about $29 million we got from the CDF, and this project is $60 million.”

The CDF is an institution of the CARICOM whose mandate is to provide financial or technical assistance to disadvantaged countries, regions and sectors in the bloc.

In this capacity, the CDF is central to addressing the disparities among the member states of CARICOM, which may result from the implementation of the CARICOM Single Market and Economy (CSME) that allows for the free movement of goods, services, labour and finances across the region.

Gonsalves said there was a recent replenishment of the CARICOM Development Fund and that the Parliament here allocates money annually for Kingstown’s contribution to the Barbados-based CDF.

“And I urge everybody in the OECS to do so,” he said, suggesting that OECS countries stand to benefit most from the CDF. The OECS groups the islands of Antigua and Barbuda, Dominica, Grenada, St. Lucia, St. Vincent and the Grenadines, St. Kitts-Nevis and Montserrat.

“The ECGC (East Caribbean Group of Companies), whose chief executive officer is here, benefits from chapter seven, the protection of our flour inside of the OECS market, because if we don’t have these compensatory mechanisms, CARICOM will not be held together, because we will be unequally yoked,” he said, referring to the St. Vincent-based company that produces flour, rice and animal feed.

Gonsalves said that he told the Jamaica and Trinidad and Tobago prime ministers at a CARICOM meeting earlier this year “that if they do not put in the resources in accordance with the assessment, which is done for the second cycle, the replenishment we’re going to have problems”.

He said Port of Spain is supposed to contribute close to US$40 million to replenishing the CDF.

“Otherwise, how are we going to allow your products to come in from Trinidad duty-free?” Gonsalves said.

“You have cheap energy in Trinidad, you can out compete any country in the Caribbean, and certainly in the Eastern Caribbean, in the manufacturing sector, except for particular niches …” the prime minister said.

“But if you can enter our market duty free, because remember this, for the commodities which are coming from elsewhere, we put on an extra 15 per cent tariff, called the common external tariffs in CARICOM.

“If not, buy the product out of the Dominican Republic, probably cheaper, or out of Miami, which is probably cheaper. So, there must be compensatory mechanisms.”

He said Chapter 7 of the CARICOM treaty addresses the compensatory mechanism and article 158, in particular, addresses the CDF.

“You can wake me in the middle of the night, I’d be able to discuss every single aspect of Chapter 7,” Gonsalves said.

“That is part of the battle which we struggle for within CARICOM, which ends up in giving us the Holiday Inn Express & Suites.”