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1. What is the Caribbean Single Market & Economy?

he CSME is an integration arrangement that allows for

the establishment of a single market and a single

economy for the members of the Caribbean Community

(CARICOM). The CARICOM member states are: Antigua

and Barbuda, The Bahamas, Barbados, Belize, Dominica,

Grenada, Guyana, Haiti, Jamaica, Montserrat, Saint Lucia,

St. Kitts and Nevis, St. Vincent and the Grenadines,

Suriname, and Trinidad and Tobago (see map of the

Caribbean Basin below).

T

C S M E

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2. What is the Caribbean Single Market?

It is an arrangement among the member states which will allow

CARICOM goods, services, people and capital to move throughout

the Caribbean Community without tariffs and restrictions, to

achieve a single large economic space, and to provide for a common

economic and trade policy. The Caibbean Single Market was

established among Trinidad & Tobago, Barbados and Jamaica in

2005. The remaining members of CARICOM should participate in

the single market in 2006.

3. What is the Caribbean Single Economy?

The Caribbean Single Economy is an arrangement that will further

harmonise macroeconomic management across all Member States of

the Caribbean Community, to underpin the sustainable development

of the Region. This will entail the coordination of the monetary,

foreign exchange and fiscal policies of the member countries in the

context of their economic convergence. It is anticipated that the

Caribbean Single Economy will be implemented in 2008.

4. Why the Caribbean Single Market & Economy?

The notion of a Caribbean region without borders, strengthened by

its collective resources and opportunities, has been a vision that has

inspired Caribbean integrationists since 1958 and which led to the

establishment of the British West Indies Federation.

Subsequently, globalisation and trade liberalisation have

crystallised the need to put in place the instruments and

institutions to facilitate further economic development in the

Region. This gave rise to the establishment of the Caribbean Free

Trade Association (CARIFTA) in 1965 and the Caribbean

Community and Common Market in 1973. In 2002, the decision

was taken to replace the Common Market with a Caribbean Single

Market and Economy (CSME), strategically positioning the

Community to participate in the globalised arena.

5. How will the Caribbean Single Market and Economy be

implemented?

5.1 The Treaty of Chaguaramas of 1973, which established the

Caribbean Community and Common Market, was revised.

This revised Treaty, which was signed by CARICOM

Heads of Government in 2002, now establishes the CSME.

5.2 The Treaty was amended by way of Protocols. There arenine Protocols which address (1) the Organs, Institutions,and Procedures of the Community, (2) the Right ofEstablishment, that is, the Right to provide Services andthe Right to move Capital by any CARICOM national in

5 6

the Community, (3) a Community Industrial Policy, (4)Trade Liberalisation, (5) the Community AgriculturalPolicy, (6) the Community Transport Policy, (8) the needsof Disadvantaged Countries, Regions and Sectors, and (9)Disputes Settlement and the Rules of Competition withinthe Region. These Protocols are now Chapters within theRevised Treaty.

5.3 National laws, policies and programmes of Member States

must be modified to accommodate the CSME.

5.4 Active interest in and participation of the Region’s people in

the Caribbean Single Market and Economy are essential.

6. What are some of the benefits of the Caribbean Single

Market and Economy?

Some benefits of the Caribbean Single Market and Economy should

be:

6.1 Increased production and trade in goods and services in a

combined market of 6.1 million persons, with land area of

approximately 421,000 km and an estimated gross domestic

product of US$14.8 billion (in 1996).

6.2 More competitive products of better quality and prices.

6.3 Improved services provided by enterprises and individuals, including transportation and communication.

6.4 Greater opportunity for “hassle-free” travel within the

Region.

6.5 Greater opportunities for nationals to study and work in

CARICOM countries of their choice.

6.6 Increased employment and improved standards of living.

6.7 A well-functioning, harmonised regional financial market

will facilitate economic activity and growth. There will be

increased opportunities to invest in companies region-wide.

The harmonisation of monetary and fiscal policy measures could

provide the platform for macroeconomic stability within the

region, resulting in continued regional growth and development.

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Further Reading

Chabrol, D., Caribbean Single Market timetable on track, Caricomview, May - June 2001, p. 15

Clayton, C. and McKoy, J., Employers and the CSME, CaribbeanAccountant 2004, p. 27-29

Field-Ridley, D., Caribbean Single Market and Economy: free movement and competitiveness, Port of Spain: UNDP, 2003

Inside the Caribbean Single Market & Economy, Jamaica business,vol. 5, no. 3, November 2004, p. 31-40

Iyare, O., Skilled labour and international specialisation in the Caribbean region, St. Kitts: CCMS, 2003.

Jackson, J., Assessing the distribution of costs and benefits in the Caribbean Single Market and Economy (CSME), St. Kitts: CCMS, 2003, p. 29

Progress made in the implementation of the Caribbean Single Market and Economy, United Nations Economic Commission for Latin America and the Caribbean/Caribbean Development and Cooperative Committee (UN ECLAC/CDCC), series 1, 2003.

Rainford, R.G., Towards an integrated single market in the Caribbean Community, An address to the South Trinidad Chamber ofCommerce, 1989.

109

CSME Facts & Figures

CSME Member

States

Antigua & Barbuda Barbados Belize

Head of

Government

Hon. Baldwin Spencer The Rt. Hon. Owen

Arthur

Hon. Said W.

Musa

Population (year)

72,310 (2000) 250,010 (2000) 232,111(2000)

Currency Eastern Caribbean

Dollar (EC$)

Barbados Dollar

(Bds$)

Belize Dollar

(Bz$)

Exchange rate

regime

Fixed peg

EC$2.70 = US$1.00

Fixed peg

Bds$2.00 = US$1.00

Fixed peg

Bz$2.00 =

US$1.00

Per capita GDP US$9,244.34 US$9,988.83 US$3,792.75

Area 442 km2 (170 miles2) 431 km2 (170 miles2) 22,966 km2

(8,866 miles2)

Capital St. John’s Bridgetown Belmopan

Dominica Grenada Guyana Jamaica

Hon. Roosevelt

Skerritt

Dr. the Hon. Keith

Claudius Mitchell

H.E. Bharrat

Jagdeo

The Rt. Hon. Percival J.

Patterson, Prime Minister

71,443 (mid-2000 est.) 100,700 (1999) 772,759 (mid-

1999)

2,605,787 (1999)

Eastern Caribbean

Dollar (EC$)

Eastern Caribbean

Dollar (EC$)

Guyana Dollar

(G$)

Jamaica Dollar(J$)

Fixed peg

EC$2.70 = US$1.00

Fixed peg

EC$2.70 = US$1.00

Float

G$194.90 = US$1.00

(2002)

Managed Float

J$61.39 = US$1.00 (2004)

US$3,275.23 US$4,384.58 US$962.63 US$3,074.55

750 km2 (290 miles2) 345 km2 (133 miles2) 214,970 km2

(83,000 miles2)

10,991 km2

(4,243.6 miles2)

Roseau St. George’s Georgetown Kingston

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CSME Facts & Figures

CSME Member

States

Montserrat Saint Lucia Saint Kitts & Nevis

Head of

Government

Hon. John Alfred Osbourne, Chief

Minister

Dr. the Hon. Kenny D. Anthony, Prime

Minister

Hon. Dr. Denzil L. Douglas, Prime

Minister

Population (year) 10,608 (1995). 5,274 persons live on the island (mid-2000)

153,624 (1999) 39,529 (1999)

Currency Eastern Caribbean Dollar (EC$)

Eastern Caribbean Dollar (EC$)

Eastern Caribbean Dollar (EC$)

Exchange rate

regime

Fixed peg

EC$2.70 = US$1.00

Fixed peg

EC$2.70 = US$1.00

Fixed peg

EC$2.70 = US$1.00

Per capita GDP US$2,974.81 (1999) US$4,722.37 US$9,114.72

Area 103 km2 (150 miles2) 616 km2 (238 miles2) 269 km2 (102 miles2)

Capital Plymouth Castries Basseterre

Saint Vincent & the

Grenadines

Suriname Trinidad & Tobago

Dr. the Hon. Ralph E. Gonsalves, Prime Minister

H. E. Drs Runaldo R. Venetiaan, President

Hon. Patrick A. M. Manning, Prime Minister

112,014 (1999) 418,921 (mid-1997) 1,290,400 (mid-1999)

Eastern Caribbean Dollar (EC$)

Guilder Trinidad & Tobago Dollar

Fixed pegEC$2.70 = US$1.00

Managed FloatSf$2,550 = US$1.00 (2004)

FloatTT$6.3 = US$1.00 (2004)

US$3,135.80 US$2,204.12 US$8,331.32

389 km2 (150 miles2) 163,820 km2 (63,251miles2)

5,182 km2 (1,980 miles2)

Kingstown Paramaribo Port-of-Spain

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CSME Brain Teaser

1. What is the name of the Treaty that establishedCARICOM and was subsequently revised to allow for the establishment of the CSME?

2. When will the Caribbean single economy beimplemented?

3. Which 3 countries are members of the Caribbean SingleMarket in 2005?

4. True/False. The Caribbean Single Economy will allow for the further harmonisation of economic, monetary andfiscal policies among its members.

5. True/False. National laws, policies and programmes ofmember states must be modified to accommodate theCSME.

International Department Research and Economic Programming Division

Bank of Jamaica13 January 2006