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Don't 'Fight Tooth And Nail' Against The Wto

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A FORMER Grand Bahama Port Authority (GBPA) attorney says the Bahamas must "embrace" full World Trade Organisation (WTO) membership rather than "fight tooth and nail" against it.

Carey Leonard told Tribune Business that Freeport, and the wider Bahamas, would "benefit tremendously" from the opening up of new export markets for Bahamian goods and services as a result of joining global trade's rules-setting body.

Besides providing certainty and protection for Bahamian exporters, Mr Leonard argued that acceding to full WTO membership would force this nation to into a long-overdue modernisation of its economy to "bring it into the 21st century".

He called on Bahamians to view WTO "from a more global perspective", rather than adopt an isolationist posture and treat any accession move as "something to hide from".

Tribune Business revealed last week that the Government is hoping to complete the WTO accession process by 2019, and Mr Leonard said: "There's a lot to be said for the Bahamas getting into the WTO and, quite frankly, the sooner the better.

"Government is going to have to upgrade our laws, and it's going to force the Bahamas into the 21st century. I think for Freeport that it's an excellent idea. The sooner we get there, the better.

"We need to look at this from a global perspective, rather than put our hands over our eyes and say we don't want to know. It's something we can embrace, not hide behind."

Full WTO membership would give Bahamian exporters greater protection, as it would mean foreign countries would be unable to erect discriminatory financial barriers - tariffs, subsidies and quotas - or regulatory obstacles, such as health and safety rules, to keep their goods out.

Such moves would violate WTO rules, and Mr Leonard recalled one instance where the Bahamas' non-membership had worked against a local exporter. "Polymers already had a contract to export and sell into Mexico until the Mexicans found out we weren't a WTO member and jacked up the import duty," he disclosed.

"They [Polymers] were ready to expand the factory here quite substantially and hire more Bahamians, but couldn't do it."

Mr Leonard, now an attorney with Callenders & Co, said joining the WTO would also require the Bahamas to introduce various standards/certifications to reassure other nations that its exports met the necessary quality and health qualifications.

This, he added, emphasises the importance of the Standards Bureau, while also mandating that this nation introduce a 'rules of origin' regime to authenticate that goods exported from the Bahamas are actually made in this nation.

Sanitary and phytosanitary measures (animal and plant health), and the Bahamas intellectual property rights protection regime, will also have to be enhanced to meet WTO rules.

"The WTO requires standardisation of just about everything you do, and there's an advantage to that for Bahamians," Mr Leonard told Tribune Business. "I know a number of people I've spoken to are concerned they have to comply with this regulation and that regulation.

"If you're going to export something, you have to have the ability to show someone's inspected it; that it's a fully standard product; that it's good, genuine and is what you say it is.

"The Bahamas is a small market, and a number of Bahamians can take advantage of certification and selling to the global market. There's a huge opportunity for Bahamians in all sorts of industries."

Mr Leonard suggested many such potential opportunities were currently closed to Bahamian exporters because they had "no way to show they meet any sort of standard".

"Once our Standards Bureau is recognised by other countries as being part of WTO, there's an advantage for Bahamians," he added. Improved export opportunities could also lead to the creation of new industries and greater economic diversification, Mr Leonard said, helping to reverse - or at least slow - the 'brain drain' and attract Bahamians living abroad to come back home.

The Callenders & Co partner added that WTO membership would also afford the Bahamas protection against the likes of the Organisation for Economic Co-Operation and Development (OECD), contrasting how the Bahamas was "walked over" in 2000 with how Barbados responded to its 'harmful tax practices' initiative by invoking global trade dispute procedures.

And, by limiting the subsidies that can be handed out to public corporations, Mr Leonard said WTO would also force the Government to operate more efficiently.

"I also like WTO because government cannot subsidise certain industries," he told Tribune Business. "They're only able to maintain them at a certain level, otherwise the Bahamas will be taken to Geneva for a breach of the rules.

"It will force government corporations to function more efficiently, which makes the place a better place for young Bahamians to stay or come back to, and increases foreign direct investment (FDI).

"It all depends on whether we, as a people, decide to embrace WTO, as I think we should do, and look at the advantages we can get from it, or fight it tooth and nail. If we embrace it, I think we will benefit tremendously."

Mr Leonard said Freeport, with its existing free trade zone under the Hawksbill Creek Agreement (HCA), was one of the biggest potential Bahamian beneficiaries from joining the WTO's liberalised, rules-based trading regime.

"Because of the standards and everything else I think it is an advantage to Freeport," he added. "People have often said that since Freeport is already duty-free, and going into the WTO will reduce all Customs duties, it won't have an advantage.

"But Freeport has the infrastructure, and if you're trying to export like Polymers wanted to do, there's an opportunity for industry to survive. Not only do we have to provide things like the Standards Bureau, but the infrastructure to make it work.

"Young Bahamians can set up businesses because the infrastructure will be here. We talk about increasing Freeport's industrial capacity, and this goes a long way

Mr Leonard, though, urged the Government to "look carefully at how Customs operates" in the context of WTO accession, warning that the agency could not keep "fining people left, right and centre" for relatively minor mistakes.

He added that this made it "very uncomfortable for people wanting to do business here".

Comments

DDK 6 days, 23 hours ago

"The Bahamas is a small market, and a number of Bahamians can take advantage of certification and selling to the global market. There's a huge opportunity for Bahamians in all sorts of industries."

I would imagine the comparatively small number of Bahamians and exports at this time would not justify the aggravation and cost of jumping into this aspect of the 21st Century! The coconut industry is not exactly booming!

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jonlucaya 6 days, 9 hours ago

I believe our largest export in dollar value is Tourism. How would joining the WTO improve this market?

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The_Oracle 6 days, 6 hours ago

WTO is much about bureaucratic "Rules unification" between countries as it is about trade. The Benefit to Bahamians will be the unlocking of all the self provided reasons why we "can't" (insert almost anything you can think of here) To some degree it will give Bahamians some oversight on Govt that we so desperately need. The sad aspect to all of this is our reactionary position to damn near anything that hits us. The private sector has a lot of catching up to do Perhaps the information will now be accessible from (dare I say it, Freely offered?) as opposed to sequestered by Government. If not, we are in for some real pain.

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Alex_Charles 6 days, 4 hours ago

Good but this reporting is purely one sided. I want to hear arguments for and against.

That aside, I don't stand against us ascending to member status but I think there should be considerable public consultation.

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DaGoobs 4 days ago

Be careful Freeport what you ask for, you just might get it. WTO membership pretty much puts an end to the monopolistic practices that abound in the Bahamas. Thus all those GBPA licensees with exclusivity in various economic activities will have to relinquish same and allow other Bahamians into the activity, as well as foreign companies.

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SP 3 days, 23 hours ago

Carey Leonard is obviously a simple lobbyist. Exactly what "tremendous benefits" will we gain and where are these exports we have to offer "export markets"? What the hell is this clown referring to?

Perhaps Carey Leonard can provide a few examples of developing countries that "benefit tremendously" after joining the WTO. I know of none!

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