The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

THE Government's second offer to the World Trade Organisation (WTO) provides for a 40 per cent reduction in the average peak tariff on goods, said Financial Services Minister Ryan Pinder, who noted that protective tariffs were maintained in an effort to safeguard the production of local goods.

Addressing Parliament yesterday on The Bahamas' WTO accession, Mr Pinder noted that this nation's first trade in goods and services offers made to the WTO in March 2012 were "extremely conservative" and "did not reflect the existing levels of liberalisation". Those offers he said were also "less liberal" than the commitments in the Economic Partnership Agreement (EPA) between CARIFORUM and the European Union (EPA) and the National Investment Policy.

"The second goods offer provides for an average peak tariff of approximately 15 per cent, a reduction from 55 per cent. Protective tariffs were maintained in response to sensitivities related to local production and associated job creation. Protective tariffs were retained on agricultural and non-agricultural goods produced in The Bahamas and the recommended rates were informed by submissions made from the Ministry of Agriculture, dialogue with agro-industry participants, and consultations with and written submissions from light manufacturers. Submitting revised trade in services and goods offers advances the WTO accession negotiation process. From the tenor of negotiations to date and based on accession trends, the Ministry of Financial Services is cognizant that demands for greater liberalisation in both trade in services and goods will be made following the next round of negotiations," said Mr Pinder. Mr Pinder said that the third WTO working party meeting is anticipated to be held in November of 2013.

Mr Pinder told Tribune Business: "When you look at the highest tariffs and you take the average, we have reduced some of the peak tariffs to bring our average down which is a significant matter. Instead of cross the board reductions so that everything is the same way, we see that we have to protect certain domestic interests and that those domestic interests have higher tariff rates to protect industry. We look to reduce some of the peak tariffs especially in areas that are not domestic industry sensitive and areas that are not necessarily high revenue items for the government to reduce the average peak tariff rate down to a 15 per cent make while still trying to preserve matters related to domestic industry and revenue concerns for the Government."

Mr Pinder told Parliament that the second WTO services offer seeks to;

• maintain by horizontal commitments the existing regulatory regimes as regards Exchange Control, National Economic Council and Investments Board review and approval procedures, Business Licence, Real Property Tax, and Immigration;

• reflect in the Sector Specific Commitments the levels of liberalisation which exists in the tourism, financial services, manufacturing, and telecommunications sectors;

• align the WTO offer with the commitments made under the EPA;

• address the requests for market access by our international trading partners, while preserving the positions in the National Investment Policy of The Bahamas.