 
 RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/REG155/M/1 
19 November 2004 
 
 (04-5043) 
Committee on Regional Trade Agreements 
Thirty-Seventh Session  
 
 
 
EXAMINATION OF THE CARIBBEAN COMMUNITY AND COMMON MARKET, 
SERVICES 
 
Note on the Meeting of 7 October 2004  
 
Chairman: Mr. R. Saborío Soto (Costa Rica) 
 
 
1. The meeting was convened in document WTO/AIR/2393. 
2. Under Agenda Item B.VI of its Thirty-Sev enth Session, the Committee on Regional Trade 
Agreements (hereinafter CRTA or  the Committee) took up the first round of examination of the 
services aspects of the Caribbean Community and Common Market (CARICOM) Agreement. 
3. The following topics were discussed: 
 A. General Provisions of the Agreement 
 B. Trade Provisions 
 
4. The Chairman  said that the services aspects of the Caribbean Community and Common 
Market Agreement had entered into force on 1 July 1997 and had been notified to the WTO on 19 February 2003 as document S/C/N/229, with the te xt of the Agreement appearing in document 
WT/REG155/1.  The terms of reference for the exam ination of this Agreement had been adopted on 
28 February 2003 by the Council for Trade in Servi ces and were contained in document S/C/M/65.  
He proposed to use the Standard Format containe d in document WT/REG155/2 to guide the debate.  
He drew the Committee's attention to document WT/REG155/3, which had been recently distributed 
and contained statistics provided by the Parties to the Agreement.    
A. G
ENERAL PROVISIONS OF THE AGREEMENT  
5. The representative of Jamaica,  speaking on behalf of the members of CARICOM (Antigua 
and Barbuda, Barbados, Belize, Dominica, Grenada, Gu yana, Haiti, Jamaica, St Kitts and Nevis, Saint 
Lucia, St Vincent and the Grenadines, Suriname and Trinidad and Tobago), said that all CARICOM 
countries, with the exception of Haiti which was a l east developed country, were classified by the 
WTO as developing countries.  He added that the countries of CARICOM were  all small, vulnerable 
economies.  The Caribbean Free  Trade Area (CARIFTA) had been established in 1968, and the 
Caribbean Common Market in 1973.  The CARICO M Agreement had been notified to the GATT in 
1974, and examined by a Working Party which ha d found that it constituted an interim Agreement 
leading to the establishment of a customs union and that  as such it was consistent with the provisions 
of Article XXIV.  Since that time, there had b een major developments in the world economy and 
CARICOM countries had responded by moving toward s closer economic integration and extending 
the scope of liberalization amongst themselves, with third countries, and groups of countries, while at 
the same time striving to adhere to the disciplin es of the multilateral trading system.  In 1989, five WT/REG155/M/1 
Page 2  
 
 years prior to the establishment of the WTO, CARICOM Member States had agreed to advance 
beyond the common market towards more compre hensive economic integration.  CARICOM 
countries recognized that while they had achieved si gnificant liberalization of the market for goods,  
further development of the region's economy require d measures to encourage the movement of, and 
access to, factors of production, the provision of services and the establishment of business.  Over the 
last decade, much emphasis had been placed on the creation of a Single Market and Economy.    
Specifically, the CARICOM Single Market and Economy would allow for the free movement of services, capital, labour and freedom of community nationals to establish enterprises anywhere in the 
Community and was expected to be fully operationa l by 1 January 2006.  The original (1973) Treaty 
of Chaguaramas had been revised to give legal effect to the establishment of the new regional 
arrangements and the revisions were now provisi onally applied by CARICOM Members.  The 
services sector was of critical importance to the development of the regional economy, accounting for 
approximately 75 per cent of the GDP in CARICOM.   Tourism and financial services were the major 
contributors in that regard.  It was felt that the liberalization of services therefore would contribute to substantial increases in the earnings of CARICOM Me mber States.  It was against this background 
that CARICOM had been rapidly advancing towards the full liberalization of services at the regional 
level as provided for in the Revised Treaty of Chag uaramas.  The provisions of the services regime 
were in keeping with Articles IV, V, and V bis of  the GATS and were consistent with the multilateral 
trade agenda to liberalize trade in  services.  They were intended to assist the region in becoming more 
internationally competitive and responsive to the em erging global environment within the context of 
bilateral, plurilateral and multilateral trade ar rangements.  A special mechanism, called the 
Programme for the Removal of Restrictions, had b een developed and agreed upon.  This Programme 
outlined:  (a) the CARICOM country imposing a restri ctive measure;  (b) the United Nations Central 
Product Classification (UNCPC) Code (version 1);  (c) the services affected;  (d) a summary description of the measure;  (e) the mode(s) of supply affected;  (f) the type of restriction, (whether 
legal, administrative or other) and;  (g) the time frame for the removal of these restrictions (a 
maximum period of 3 years and 9 months from 1 March 2002 to 31 December 2005).  As indicated 
earlier, the revised Treaty also provided for the progr essive integration of the regional labour market.  
While Member States were not yet fully cognizant of the implications of some of the fundamental 
changes which had taken place in the world economy ove r the last two decades, the impact of two of 
the most important ones was clear:  the twin phe nomena of globalisation and trade liberalisation and 
their effects.  Globalisation had led to a loss of  competitive advantage in factors of production in 
CARICOM economies and trade liberalisation had le d and continued to lead to the erosion of 
preferential market access which CARICOM economi es had hitherto relied upon to earn much needed 
foreign exchange.  It was estimated that over one  thousand jobs would be lost in CARICOM as a 
result of the WTO ruling on bananas and now the EU sugar regime from which CARICOM countries 
benefitted was under threat.    In the area of fi nancial services, the OECD harmful tax competition 
initiative had also had some negative effects on the economic development of CARICOM Member 
States.  These were some of the many challeng es which were faced by CARICOM countries in the 
region while, at the same time, they strove to pa rticipate in the multilateral trading system.  In 
addition, the Caribbean region was particularly vuln erable to changing clima tic conditions which were 
being experienced worldwide. Within the last two months, several CARICOM countries had been 
ravaged by four of the worst hurricanes ever recorded  in their history.  One Member State, Grenada, 
had suffered damage to 95 per cent of its housing stock and a similar picture had been reported in 
relation to its agricultural sector . These hurricanes had further hi ghlighted the vulnerabilities of 
CARICOM's small economies and their concerns about  the sustainability of development and growth 
of the regional economy in the prevailing global environment.   
6. The representative of Jamaica continued, saying th at the revision of the Treaty in relation to 
services was WTO compatible.  None of the WTO obligations of CARICOM Member States would 
be compromised.  The statistical data should confirm this fact, despite gaps at this stage.  CARICOM countries would continue to report periodically to the CRTA in the future.  At this juncture, he 
stressed that the requirements of GATS Article V,  namely substantial sectoral coverage, the non a  WT/REG155/M/1 
 Page 3 
 
 
 priori exclusion of any mode of supply, and the elimination of all barriers, had been met by the 
services regime.  In other words, all sectors were s ubject to the provisions of liberalization.  He 
further stressed that the regime addressed the re quirements of GATS Article V bis dealing with labour 
market integration, given that work permit re quirements on CARICOM nationals would be removed 
by 31 December 2005.  In summary, he commended the revised services regime to the Committee for 
its approval and stood ready to assist with any clarifications. 
B. TRADE PROVISIONS  
7. The representative of the United States  congratulated CARICOM countries for concluding 
and notifying their Agreement on services.  She said that her delegation had met bilaterally with 
several CARICOM countries in the GATS negotiations for several years and during that time, some 
of them had indicated that they would submit a joint offer with other CARICOM countries once they 
had concluded this Agreement.  She noted that  two CARICOM countries had already submitted their 
initial offers under the GATS negotiations.  No w that CARICOM countries had notified their 
Agreement on trade in services, she wondered if  the remaining CARICOM countries intended to 
submit a joint GATS offer or if they intended to  continue the policy of submitting offers on an 
individual basis.  If CARICOM countries proposed to submit a joint initial services offer, she 
wondered how that might affect the offers tabled by Suriname and St Kitts and Nevis.  She hoped that 
CARICOM countries would help strengthen the go odwill following the July meetings and submit 
initial offers expeditiously, especially given the gr eat importance of services to the region.  As 
mentioned by the representative of Jamaica, 75 per cent of CARICOM countries' GDP derived from 
services.  She concluded by saying that her delega tion needed more time to examine the document 
WT/REG155/3.   
8. The representative of th e European Communities  thanked the representative of Jamaica for 
his helpful introduction to the Agreement.  She said that document WT/REG155/3 had arrived a bit 
late to enable Members to study it in depth a nd she asked to revert to it at a later stage. 
9. The representative of Chile  thanked the CARICOM countries fo r the statistical information 
they had provided.  It was interesting to see that small, vulnerable, devel oping economies seemed to 
provide more complete information than some more  developed and larger Members.  She thanked the 
Parties for the information on GDP which she found extremely useful as it gave an idea of the 
potential of certain services sectors.  As regards future commitments (for example, the acceptance of 
diplomas and certificates in the area of recognition and the programme for liberalization), she wondered how much progress had been  made, particularly in the area of liberalization and elimination 
of restrictions, given that the Agreement had been in force for some years.   
10. The representative of Japan
 said his delegation had not yet ha d time to examine the statistical 
information contained in document WT/REG155/3, a nd reserved its right to make further comments.  
As for the information contained in WT/REG155/2, he had two specific questions.  The first one was 
whether the commitments in the Ag reement had been made on the basis of a positive or negative list.  
Secondly, he asked how the level of commitments  made by CARICOM countries in this Agreement 
compared with the level of commitments made under the GATS. 
11. The representative of Australia  asked if the Parties could provide a further elaboration of the 
Programme for the Removal of Restrictions mentioned by the representative of Jamaica. 
12. The representative of Jamaica  said he would provide a preliminary response to some 
questions and respond in writing to others.  In resp onse to the question by the representative of the 
United States regarding a joint offer in services, he said that CARICOM countries would submit a 
regional offer with common elements.  This was in  the process of preparation and should be submitted 
soon.  Though he was not in a position to speak on behalf of the two CARICOM countries which had WT/REG155/M/1 
Page 4  
 
 already submitted offers, he expected that these o ffers would remain valid.  In response to the 
question by the representative of Chile regarding how  much progress had been made, particularly with 
regard to the mutual accreditation of qualifications , he remarked that although the revised Treaty had 
not been in force very long, as its provisional application dated back to 2002, some CARICOM 
countries had put in place measures to facilitate the acceptance of qualifications; he added that more 
information in that regard would be submitted at a later stage.  In response to the question of the 
representative of Japan on the positive versus ne gative list approach, he said that CARICOM 
commitments had been prepared on the basis of a ne gative list, which was more comprehensive than a 
positive list approach.  In response to the questi on of how CARICOM commitments compared with 
those made under the GATS, he said that this c ould be judged more accurately once initial offers 
under the Doha Round had been ma de.  He undertook to make the Programme for the Removal of 
Restrictions available to WTO Members at a late r date.  He asked delega tions to provide their 
questions in writing and agreed to provide a written response.  
13. The representative of the United States
 said she looked forward to  seeing the initial offers of 
CARICOM countries and looked forward to the furt her engagement of CARICOM countries in the 
services negotiations.  She agreed to submit further questions in writing. 
14. The Chairman said that the first round of examination of the services aspects of the Caribbean 
Community and Common Market had allowed the Co mmittee to clarify certain aspects, but others 
remained pending.  He asked delegations wishing to  submit written questions to  do so by 29 October 
and for the Parties to provide written replies by 3 December.  The examination of this Agreement 
would continue at a future Session of the CRTA.   
15. The Committee took note  of the comments made.  
__________ 
 