The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas could negotiate its own bilateral trade agreement with Canada if CARICOM fails to achieve a regional deal by the June 30 deadline, a Cabinet Minister yesterday reassuring that exporters’ duty-free market access was not under threat.

Ryan Pinder, minister of financial services, who has responsibility for trade, said he was “pretty confident” the Bahamas could switch to ‘Plan B’ and negotiate its own trade agreement with Canada if a regional replacement for the existing CARIBCAN accord failed to materialise on time.

And he added that Bahamian exporters would not lose their preferential, duty-free access to Canadian markets while the new trade agreement was being worked out, thanks to an arrangement he concluded back in December 2013.

“I’m still optimistic it could happen,” Mr Pinder told Tribune Business on the possibility of CARICOM and Canada agreeing a new, World Trade Organisation-compliant agreement, by June 30.

“But, in any event, if it does not happen, I’m optimistic some negotiations between the Bahamas and Canada could be facilitated where we have some bilateral accord to protect industry,” the Minister added. “There’s always a Plan B.”

Mr Pinder said the Bahamas would seek to secure market access for its goods and services sectors in any bilateral trade talks with Canada, plus establish the “parameters for investment”.

“I’m pretty confident they would,” Mr Pinder replied, when asked whether Canada would ‘bite’ on any Bahamian offer to negotiate a country-to-country trade deal.

“We have a positive working environment with the Canadian authorities. I’m not fearful.”

The Bahamas has a $147 million goods export business to Canada, with companies involved in this trade including the likes of BORCO, Polymers International, Morton Salt and the fisheries industries.

Despite fears that Bahamian companies could lose their duty-free market access to Canada until a new agreement is worked out, Mr Pinder last year sealed an ‘agreement in principle’ to preserve this until a new regional deal is concluded.

“We have an understanding with Canada on that,” he confirmed yesterday. “There’s precedent to that in that Canada held duty-free access for China pending accession to the WTO. Canada demonstrated precedent in that regard, and I’m confident they’ll be accommodating for us.”

Without that agreement, which was reached with Canada’s High Commissioner for the Caribbean, Mr Pinder previously said all Bahamian exports had ultimately faced being hit with a 35 per cent duty rate “across the board:” because this nation was not a WTO member.

The Bahamas and other Caribbean nations have long enjoyed the benefits of CARIBCAN, which sees all trade preferences flow one way - in favour of the Caribbean.

But such ‘one-way’ trade preferences agreements have now been effectively outlawed by the World Trade Organisation (WTO), which is pressing for their elimination and replacement by ‘two-way’ preference agreements, as has happened with the Economic Partnership Agreement (EPA) with the European Union.

Canada recently accused CARICOM of “lacking ambition” in the trade talks, but Mr Pinder yesterday said he “absolutely respectfully disagrees” with that position.

He added that the Caribbean’s thinking was that “a political intervention at the highest level, the Prime Ministerial level”, might break the deadlock.

And Mr Pinder said Canada had indicated that provided some agreement was reached with CARICOM by June 30, it would be willing to let talks “roll” past that deadline until completion.

Canada remains an important trading market for the Bahamas, not just from an export/import of physical goods sense, but also due to the presence of numerous Canadian banks, investors and tourists in this nation.

Mr Pinder said the main issues dividing CARICOM and Canada included the scope of the agreement, especially on the investments side, and market access for Caribbean rum and alcoholic beverage producers.

He added that Canada wanted a ‘negative list’ approach on investment categories, with the Caribbean telling it what industries and sectors it could not invest in, while the region was seeking a ‘positive list where it identified where Canadian firms could invest.