14 EU-Caribbean Relations
| (27327)
6129/06
COM(06) 86
+ ADD 1
| Commission Communication: An EU-Caribbean Partnership for Growth, Stability and Development (with Annexes and Addendum)
|
| Legal base | — |
| Document originated | 2 March 2006
|
| Deposited in Parliament | 8 March 2006
|
| Department | International Development
|
| Basis of consideration | EM of 14 March 2006
|
| Previous Committee Report | None; but see HC 38-xi (2004-05), para 8 (15 March 2005).
|
| To be discussed in Council | 10-11 April 2006 General Affairs and External Relations Council
|
| Committee's assessment | Politically important
|
| Committee's decision | Cleared, but further information requested
|
Background
14.1 As the Commission notes, Europe has strong historic ties
with the Caribbean. The Caribbean's role within the Africa, Caribbean
and Pacific (ACP) group of states and its inclusion within the
Cotonou Agreement[43]
is a further basis for what the Commission calls "its special
relationship" with the EU and which it says also needs to
be seen in the context of "the wider EU-LAC strategic partnership
forged between the EU, Caribbean and Latin American States at
their first joint Summit in Rio in 1999".
14.2 In addition to former colonies, there are also
the British and Dutch dependent territories (OCTs) and the French
"Départements d'Outre-Mer" (DOMs; Guadeloupe,
French Guyana and Martinique), which latter form an integral part
of the EU. But the present Communication relates only to the Caribbean
ACP states[44] —
"small mostly island states with small, open but fragile
economies, in many cases based on a small number of commodities,
and located in an area notoriously prone to natural disasters
[whose] insular nature … is perhaps the single most important
factor creating limitations to the efforts of integration in the
region and also adversely affecting the cost of energy, transport,
communications and trade".[45]
14.3 Though noting that the region has achieved significant
levels of human development, the Commission points out that the
average growth rate has been slowing down in each decade, and
paints a sobering picture:
"To varying degrees, all the countries in the
region remain vulnerable to both economic and natural shocks and
face common socio-economic and environmental challenges, including
reduced social cohesion and in some cases significant poverty
[Haiti, Guyana and some eastern Caribbean countries], unemployment
particularly of youths and displaced agricultural workers, migration
and brain drain, a relatively high rate of HIV/AIDS, slow rates
of diversification from traditional sectors and productivity and
competitiveness problems, high levels of indebtedness, the need
for economic reforms and restructuring of the public sector. Environmental
challenges include natural disasters, climate change and management
of natural resources. Behind economic and social problems security
and stability are also under threat from political and in some
cases ethnic tensions, criminality, drugs and related crime and
armed violence".
14.4 There is also the challenge of building and
sustaining the right balance in their relations with their hemispheric
neighbours, and particularly the USA, Brazil and Venezuela. All
in all, it is "a region at the crossroads", in which
leadership and local responsibility will be crucial.
14.5 And there is the additional challenge of building
a better relationship with the EU:
"Whereas the EU was seen as the answer to the
problems of the Caribbean ten years ago, today there is a perception
that the EU-Caribbean relationship is strained, a situation also
affected by unavoidable changes in preferential trading arrangements
and difficulties, both in the delivery and absorption, aspects
of development co-operation."
The Commission Communication
14.6 Against this background, the Communication (supported
by detailed annexes and a Commission Staff Working Document) sets
out "a shared vision" for future EU policy towards the
Caribbean, in which the "ultimate aim of the EU to assist
the Caribbean to positively respond to the challenges in the region".
A renewed and enhanced partnership at a political, economic and
developmental level would be grouped around three dimensions:
· shaping
a political partnership based on shared values;
· addressing
socio-economic and environmental opportunities and vulnerabilities,
including the promotion of trade; and
· promoting
social cohesion and combating poverty.
14.7 In the Caribbean, the EU will focus its relations
with CARIFORUM[46] on
issues of mutual importance including the consolidation of democracy,
human rights, gender equality, social cohesion and decent work
opportunities, security, stability, conflict prevention, migration,
drugs and regional integration.
14.8 The bi-annual EU-LAC Summit, which will take
place in Vienna on 11-12 May 2006, is seen as a major opportunity
for EU-Caribbean political dialogue at the highest level. It will
be reinforced by the introduction at the Summit of an EU-Caribbean
Troika meeting and, beyond, in enhanced co-operation in international
fora, particularly in addressing common security threats (terrorism,
non-proliferation of Weapons of Mass Destruction, illicit Small
Arms and Light Weapons).
14.9 This new political dialogue will also strengthen
engagement with regional civil society and non-state actors. It
will support good governance including through support to institution
building — such as parliaments, the judiciary and public
financial management systems — at both national and regional
levels, along with promoting appropriate economic and social policies
and adequate legal and regulatory frameworks to fight corruption
as well as corporate and financial malpractices. The EU will encourage
the adoption and implementation of international standards relating
to money laundering, terrorism, tax fraud and tax avoidance, and
address the limited institutional and technical capacity of Caribbean
countries to deal with organized crime and drugs.
14.10 To address economic and environmental opportunities
and vulnerabilities, the EU will provide support for the completion
of the Caribbean Single Market and Economy (CSME). It will support
regional integration — "of strategic importance to
the future of the economy of the Caribbean region" —
at the Caribbean Community (CARICOM)[47]
level and strengthened regional co-operation at the CARIFORUM
level. It will work to conclude the EU-CARIFORUM Economic Partnership
Agreement[48] (EPA) negotiations
by 2008. The EPA process will help increase competitiveness, diversify
exports and create regional markets, thereby contributing to sustainable
economic development. It will also facilitate adjustment, including
its social dimension, to trade policy reforms and address the
high levels of budgetary dependence upon import revenues. The
EU will aim to support the creation of the right environment for
business development as well as for research and development and
ICT (Information and Communication Technologies) in the region.
Development aid will include commodity-specific instruments, including
sugar and bananas, to promote competitiveness, assist economic
diversification and provide for the social fallout from major
changes in these traditional sectors.
Finally, the EU will provide support for addressing
natural disasters and other specific environmental challenges.
14.11 Social cohesion and poverty reduction will
be prioritised in development actions. In particular, the EU will
support Caribbean national strategies aimed at improving sustainable
basic livelihoods encompassing social safety nets and income generation
for the poor. Support will be provided to fight HIV and AIDS,
tuberculosis, malaria and other health challenges. Enhanced co-operation
will be provided to combat the supply of and demand for drugs
and drug-related crime. Focus will be placed on education and
human resource development to support economic diversification
and reduce poverty and social exclusion. "All of these efforts
must be pursued in a coordinated fashion within a coherent strategy".
14.12 A strong emphasis is placed on improving the
effectiveness of EU assistance, which has hitherto been at times
"a source of tension in EU-Caribbean relations". Evaluations
of earlier engagement suggest there has been insufficient coherence
and complementarity of actions, with a proliferation of small
projects in a wide range of sectors. A new approach based on development
best practice is proposed, which includes:
- Regional and National Support
Strategies to be more coherent, leading to mutually reinforcing
Regional and National Indicative Programmes;
- Budget support at national level and contribution
agreements at regional level to be the general rule;
- Improved coherence across all EC instruments
aligned behind a single national development strategy;
- Simplified donor procedures for improved aid
delivery and joint programming between the EC and Member States;
- The establishment of pre-committed, faster disbursing
funds for rehabilitation, recovery and reconstruction efforts
following natural disaster; and
- Development of synergies between development
programmes to the independent Caribbean States, DOMs, and OCTs;
and with Latin American countries where relevant.
The Government's view
14.13 In his 14 March 2005 Explanatory Memorandum,
the Secretary of State for International Development (Hilary Benn)
says that he welcomes the strategy outlined in the Communication,
which he says "effectively addresses a number of the structural
problems which have negatively affected the impact and disbursement
of EC aid to the region and been a source of tension in the EU-Caribbean
relationship". He continues as follows:
"We agree with the aim to seek an enhanced
political dialogue with the Caribbean. The region is facing a
number of challenges, some of which result from changes in
the global economy and political environment. A stronger coordinated
regional approach, working in partnership with the international
community, will be to help counter these challenges.
"We agree that regional integration, and particularly
the completion of the Caribbean Single Market and Economy is critical
to improving the competitiveness of the region and that this should
be a key focus area for EU support. In this context, support for
regional institutions will be vital, as will efforts to enable
the Caribbean to work more closely with Latin America.
"We particularly welcome the recognition that
this political dialogue needs to include a stronger engagement
with Caribbean civil society and non-state actors. The proposed
focus on strengthening effective governance, including public
financial management systems, is critical in a region with 14
of the 30 most indebted countries in the world.
"We welcome the aim of concluding the Economic
Partnership Agreements (EPAs) negotiations by 2008 and support
the objective of providing trade related assistance. EPAs must
be designed as development instruments; they should reduce intra-regional
trade barriers and provide improved access to EU markets;
they should ensure rules of origin are simplified and development
friendly; and be closely monitored so that they help achieve development
objectives.
"Changes to the EU preferential trade regime
for sugar will have potentially dramatic effects for some countries.
The regulation for the EC transitional assistance was published
on 1 March and the allocation levels for ACP sugar protocol countries
for 2006 have now been agreed. The suggested approach for transitional
assistance for sugar, also reflected in the Communication, draws
on lessons learned from the problems with transitional assistance
for bananas by linking the sugar assistance better to national
sugar adaptation strategies; ensuring this support is linked to
the relevant EC regional and national strategies; and proposing
that funds are disbursed as direct budget support where possible
to speed up impact and disbursement.
"We welcome the aim to enhance the effectiveness
of EC assistance to the region. In particular, the aim of having
all EC assistance articulated around a single national development
strategy encompassing all EC aid instruments should lead to improved
coherence and complementarity, and thus enhance the delivery of
Community programmes.
"In light of the potentially dramatic transitions
due to the changes in EU preferential trading regimes, the proposed
support to Caribbean national strategies to improve the sustainable
basis of livelihoods, social safety nets, and income generation
for the poor will be essential.
"We welcome the proposed support to fight HIV
and AIDS, tuberculosis, malaria, and other health challenges given
that the Caribbean currently appears to be off-track in reaching
the related Millennium Development Goal.
"We will aim to ensure that discussions on this
communication in Council reflect the principles and commitments
as laid out in the European Consensus on Development."
Conclusion
14.14 Elsewhere in this Report we consider the
EU's new "Aid Effectiveness Package". [49]
The approach proposed in this Communication is consistent with
it, and needs to be: our earlier consideration of the implementation
of the Special Framework of Assistance for Traditional Suppliers
of Bananas[50]
demonstrated how important good development practice will be to
a more productive EU-Caribbean relationship. There are also other
potential flashpoints, particularly regarding the ambitions of
some CARICOM members to diversify from traditional commodities
into financial services (which in recent times has been the subject
of considerable mutual recrimination) and over the next stage
of the EPA negotiations (which are currently somewhat overshadowed
by delays in making progress in the WTO "Doha Development
Round", suggestions of differences in the Commission between
those responsible for trade and those responsible for development
assistance, and uncertainties over how much funding will be available
under the 2007-13 Financial Perspective for the transitional process).
14.15 The question, as always with such strategies,
concerns how genuine the commitment is, especially on the European
side, and the consequential danger of further false dawns, disillusionment
and recrimination. As ever, the proof of the pudding will be in
the eating. But the strategy set out in the Communication at least
provides a solid basis for a new beginning with a region with
which many millions of UK citizens have both personal and sentimental
attachments, and where the attainment, or absence, of security,
stability and sustainable development will affect major UK interests.
14.16 It is therefore important that it gets off
to the right start, with clear indications in the Conclusions
adopted at the 10-11 April General Affairs and External Relations
Council at which the Communication will be discussed, and then
at the May meeting in Vienna, that all parties are fully committed
to this "shared vision". When we cleared the "companion"
Communication on EU-Latin America relations on 1 March 2006, we
asked the Minister to write to us after the May EU-LAC summit
with the outcome.[51]
We should also be grateful if the Secretary of State would do
likewise with regard to the Caribbean dimension.
14.17 We now clear the document.
43 The ACP-EU Partnership Agreement signed in Cotonou
on 23 June 2000, succeeding the several Lomé Agreements,
and revised in 2005. Back
44
Antigua and Barbuda, Barbados, Bahamas, Belize, Dominica, The
Dominican Republic, Grenada, Guyana, Haiti, Jamaica, St Kitts
and Nevis, St Lucia, St Vincent and the Grenadines, Suriname,
and Trinidad and Tobago, who are signatories to the Cotonou Agreement,
and Cuba which is a member of the ACP group but is not a signatory
to Cotonou. Back
45
COM(06) 86, page 4. Back
46
Caribbean Forum of ACP States: Members are all the members of
CARICOM, except Montserrat, plus the Dominican Republic and Cuba. Back
47
CARICOM : Caribbean Community. Members are Antigua and Barbuda,
Barbados, Bahamas, Belize, Dominica, Grenada, Guyana, Haiti, Jamaica,
Montserrat, St Kitts and Nevis, St Lucia, St Vincent and the Grenadines
, Suriname, and Trinidad and Tobago. Back
48
EPA negotiations were launched in 2004 with the objective of bringing
commercial relations between the EU and all 77 ACP countries (divided
into four African, one Caribbean and one Pacific region) in line
with WTO rules, resulting in the liberalisation of previously
protected markets. Regional commercial integration is a central
goal. Back
49
See para 15. Back
50
HC 38-xi (2004-05), para 8 (15 March 2005). Back
51
HC 34-xx (2005-06), para 16 (1 March 2006). Back
|
