SOME ISSUES OF TRADE POLICY IN THE WEST INDIES

I. The Pattern of Trade Policy

As far as trading arrangements are concerned, the West Indies have, for almost their entire history, relied on securing protection for their exports in overseas markets, notably Britain and Canada. The Old Mercantilist system of trade (that is, the system which discriminated totally in favour of trade within the Empire) was essentially a West Indian system, since it operated largely in the interest of the West Indies; similarly, Commonwealth Preference today has been described as West Indian Preference. The only period in their history when the West Indies received no protection abroad was between 1846 and 1898, when Britain and the Empire embraced a policy of free trade with all countries.

The heyday of West Indian preference was the 1940’s. At that time, Britain introduced new forms of discrimination in favour of West Indian products. During the Second World War and in the early post-war years, Britain contracted to buy the entire exportable surplus of major West Indian exports such as sugar, bananas, and citrus. In cases where bulk purchase did not apply, West Indian products received additional protection from the quanti¬≠tative restrictions which the United Kingdom imposed on competing supplies of primary products from Non-Sterling Area countries.

Since 1952, however, there has been a gradual dismantling of these restrictions. The United Kingdom has relinquished its policy of bulk purchase, except in respect of sugar and orange juice. In general, since the mid-1950’s, Britain has resisted West Indian pleas for increased protection. The emphasis in British policy has shifted towards extending financial assistance for the creation of local price stabilisation schemes, and for projects aimed at in¬≠creasing agricultural productivity in the area

In the case of Canada, no additional protection has been extended to the West Indies since the war. In fact, Canada reduced some of the preferences which she extends to West Indian exports at various negotiating sessions of the GATT in 1950 and 1956.

At least two reasons can be advanced in support of the view that both Britain and Canada may continue in the future to reduce the protection which they extend to West Indian products. On the one hand, recent developments in both countries have tended to vitiate the rationale for a preferential policy; while on the other, there is likely to be an intensification of international opposition to the preferential treatment of primary products.