A Cabinet minister has called for the Bahamas to receive grants and ‘soft’ loans to assist its integration into global trading regimes, arguing that an “imbalanced” criteria was being used to exclude it from such aid.
Addressing the World Trade Organisation’s (WTO) ninth ministerial conference, Ryan Pinder, minister of financial services, said the ‘per capita income’ means of assessing a nation’s eligibility for grant funding worked against the Bahamas, as this indicator was skewed by the relatively small number of high net worth expatriates.
The Bahamas is hoping to complete the process for accession to full WTO membership by end-2014, and Mr Pinder argued that when high net worth expatriates were stripped out from the calculation, this nation’s per capita income was similar to other Caribbean nations who benefited from grant funding.
“The process of accession remains a challenging one for my country because of limited technical domestic capacity and the exorbitant costs associated with the accession process,” Mr Pinder said.
“The Bahamas finds that it is largely excluded from eligibility for concessional loans and grants from bilateral and multilateral sources, which would assist with developmental plans, because of what is perceived as our relatively high per capita income, but which in reality, is not a true reflection of the average income of most Bahamians.”
He describing this as an “imbalanced means of judging” whether a country should receive grant funding and technical support, which agencies were using to ‘graduate’ nations from receiving assistance.
“Income distribution in the Bahamas is quite uneven and results from the presence of a small group of high income individuals who have chosen the Bahamas as a place of residence for personal financial planning, but who are not completely integrated into our economy,” Mr Pinder said.
“If one were to exclude this group from the calculation of net income, the per capita income of the Bahamas mirrors what is typical of other small island Caribbean states. Further, these theories ignore practical realities of archipelagic countries, which must provide infrastructure and necessary utilities to dozens of islands to support its citizens.”
Calling for the Bahamas to receive technical assistance and development funding, which would assist this nation with its WTO accession and integration with the wider rules-based trading system, Mr Pinder said help was being sought in areas such as import licensing, rules of origin, Customs valuation and agricultural support mechanisms.
Expressing hope that the Bahamas would could bilateral talks with individual countries over the terms of its WTO accession by next year, Mr Pinder added: “We continue to urge our trading partners to remember that our limited capacity as a small archipelagic state, and relatively small and vulnerable economy, dictates prudence in our negotiating stance on many issues.
“We are confident that we will be able to accede to the WTO on terms that are not too different from those granted to other members from the region in the course of their WTO accession negotiations. We merely ask for a level playing field in our accession process.”
Mr Pinder reiterated his, and the Government’s, position that full WTO membership would give the Bahamian economy “transparency and predictability” when it came to trade and investment.
This, he added, would be “the most effective way of securing access to foreign trade, attracting foreign direct investment and securing long-term market access to foreign markets”.
Noting that the Bahamas had remained outside the rules-based trading environment for 40 years, Mr Pinder again emphasised his intent to position the country as a ‘value added’ destination within the global supply/logistics chain, given its position at the hub of global shipping lanes.