SOME ISSUES OF TRADE POLICY IN THE WEST INDIES

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One of the more striking features of West Indian development is, that the progress made towards political independence has not been accompanied by any parallel advances in the economic field. Over the decade ending in 1961, territories such as Jamaica, Trinidad, and Antigua, have achieved very impressive rates of economic growth. The West Indian territories are, nevertheless, still regarded as outstanding examples of dependent economies. They are heavily dependent on the rest of the world for markets for their production; they import the wide variety of goods which they require, and they rely on other countries for transfers of both income and capital, for banking and financial services, for business and technical skills, and even for ideas about themselves.

Uncharitable observers have gone as far as to characterise these territories as mendicant economics, which are always begging in the rest of the world for tariff preferences, for financial aid, or for opportunities for emigration. For instance, British journalists vie with one another in coining terms of opprobrium for West Indian delegations going abroad in search of economic assistance. One example of this was furnished by one leading London newspaper which described a recent West Indian delegation to London as a “beggars’ opera”.

There are few who would deny that such an image is damaging to the developing of countries which are assuming political independence. Jamaica and Trinidad are now independent nations, and the remaining territories are likely to follow a similar course. Nothing is more urgent for the Caribbean, than for their leaders to think out in precise terms what sort of external relationships are compatible with their new constitutional status. The question is particularly urgent for Jamaica and Trinidad, since they have already achieved formal independence. This paper will therefore confine itself to these two territories, though much of the argument will be applicable to the rest of the West Indies as well.

One must not overstate the picture of Caribbean dependence on the rest of the world. For few countries (if any) can benefit from a policy of economic isolation, least of all tiny economies like Jamaica and Trinidad. Their dependence is therefore due in large part to their smallness. But it may also be due, if only in minor degree, to their choice of economic policies. In other words, one must distinguish between structural dependence- the dependence that arises because of the size and structure of the economy and cannot be helped, and functional dependence – the dependence which arises as a result of the particular policies chosen and can therefore be avoided if alternative policies[1] are pursued. In what follows, the problem will be considered solely in relation to functional dependence.

In considering the matter from the point of view of policy, the analysis will be restricted to the field of external trade policy. This represents only a partial attack upon the problem, because of the inter-relationships between policies pursued abroad and those pursued at home. However, it can be argued that trade policy deserves special attention, since it is one of the spheres in which the dependence of the Caribbean is most apparent.