The Saint Lucia delegation was led by Minister for External Affairs, International Trade and Civil Aviation, Honourable Alva Baptiste, and included the Minister for Commerce, Business Development, Investment and Consumer Affairs, Honourable Emma Hippolyte OBE, and other officials from the respective ministries.
The meeting was convened to discuss a number of trade-related matters requiring urgent attention of Council.
These matters include:
* The treatment of CARICOM exports of rum to the United States.
* The way forward in the negotiations with Canada for a trade and development agreement with CARICOM
* The prospects for the Doha development round of negotiations under the WTO multilateral system
The meeting was dominated by discussions surrounding the threat of CARICOM exports of rum to the United States of America as the trade ministers grappled over a workable strategy to forestall the potential demise of the region’s longstanding rum industry.
The threat to the industry emanates from what is believed to be the discriminating use of US federal excise taxes generated under the US rum ‘cover-over’ programme. The initial intent of that programme was for the US to provide budgetary support to its territorial governments.
However, the use of these transfers of excise tax by certain US territories, in particular Puerto Rico and the United States Virgin Island (USVI), to subsidize multi-national rum producing companies, are deemed to be trade-distorting. Moreover, the granting of such subsidies is likely to displace the market share of Caribbean rum producers in the US and elsewhere.
This issue has been on the region’s agenda since 2011. CARICOM governments, in collaboration with the West Indies Rums and Spirits Producers Association (WIRSPA), have had bilateral engagements with the US through the Congress, and the United States Trade Representative (USTR). However, the matter remains unresolved.
Nonetheless, the COTED agreed that all possible approaches should be pursued in seeking to resolve the matter. This amounts to a two-track approach involving actions at the bilateral and multilateral levels.
Whereas the demarche has started at the bilateral level, the multilateral approach will involve taking the matter through the World Trade Organization’s (WTO) dispute settlement mechanism. Such actions are deemed necessary to avert potentially irreparable harm to the region’s vital rum sector.