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Top Negotiator: Wto 'Won't Hurt' This Economy

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas' newly-appointed chief negotiator yesterday pledged this nation "cannot join the WTO on terms that injure" its economy or any major industries.

Zhivargo Laing, pictured, who replaces Raymond Winder, sought to reassure the private sector and Bahamian public that the Government would only become a full World Trade Organisation (WTO) member if the accession terms can produce "a net gain" for the country.

The former Cabinet minister, who first submitted The Bahamas' application for full membership back in 2001 under the then-Ingraham administration, also promised there was "no reason to fear" that WTO membership would result in an increased tax burden for consumers or businesses.

Speaking at a press conference to announce his appointment, Mr Laing said the need to eliminate or reduce numerous Customs duty lines merely meant a "shift" in where the Government obtained its revenues from - not an increase.

And, in response to arguments that The Bahamas should delay accession until it "puts its house in order" through energy and "ease of doing business" reforms, Mr Laing argued that WTO membership would provide a "platform" to achieve these goals by forcing this nation to modernise its economy.

The Bahamas has already submitted its goods and services "offers" to the WTO Secretariat ahead of the "Third Working Party" meeting on this nation's accession bid, which is scheduled to take place in Geneva on September 21.

The Bahamian delegation, headed by Mr Laing and Brent Symonette, minister of financial services, trade and industry and immigration, will go through this nation's positions and negotiate with both WTO officials and members of the working group - countries that have an interest in trading with this nation, such as the US, Canada, European Union (EU), UK and CARICOM members.

Mr Symonette said the delegation would include Marlon Johnson, acting financial secretary, given that some 6,000 tariff lines will be discussed to determine which will be reduced or eliminated, by how much, and over what timeframe. The Bahamas will also seek carve outs, or exemptions, for certain tariffs - such as those that protect local industry or retail./

Ministry of Agriculture and Fisheries officials will also be present in Geneva given the potential implications WTO membership has for those two sectors, but Mr Symonette said the Bahamas had long been preparing for tax reform and the need to reduce/eliminate Customs duties that were pared down from 1,500 to 29 categories under the last Ingraham administration.

The Minister added that the amount of revenue lost, and needing to be replaced, as a result of WTO accession was "a fear we don't know yet" given that it now depends on the skills of Bahamian negotiators to determine which tariffs this nation will give ground on. Yet he said many tariff lines generated "under $100,000 a year" for the Government, meaning the impact of their elimination will be negligible.

"There's no reason to fear WTO accession will cause an increase on taxation of the public of business community," Mr Laing said, arguing that it would merely cause "a shift" to other tax forms such as VAT.

"The WTO would represent a beneficial change to this extent," he added. "If businesses import goods they pay duty to the Government on those goods without a single item being sold. That's tying up cash flow."

With WTO membership mandating such "barriers to trade" be addressed, Mr Laing added: "From the business point of view, it's a freeing up of cash, capital for other purposes to allow this cash to be used more productively in the economy."

Many Bahamians, both in the private sector and outside, believe the case for the Bahamas to join the WTO - especially now - has not been made. Mr Laing acknowledged there were still "anxieties" over the move, but said they were much reduced compared to when he had ministerial responsibility for trade in the last two Ingraham administrations.

He pointed to a recent Bahamas Chamber of Commerce and Employers Confederation (BCCEC) seminar, where "at least half" of attendees signalled they either understood or supported the need to join WTO. "That could not have been the case when I started this process in 2001," Mr Laing said.

Mr Symonette yesterday said WTO membership would position the Bahamian economy such that it would lower the cost of business, reduce the price of consumer goods, enhance export opportunities and provide certainty for persons engaging in trade with this nation.

He added that this would lead to higher Bahamian GDP growth and employment, boost local ownership of the economy, and lead to "increased prosperity".

"If negotiations and the terms of WTO membership prove to be mutually beneficial, the Bahamas intends to join the WTO in late 2019 or mid-2020," Mr Symonette added. He indicated that the Bahamas could not afford to be isolationist as the only Western Hemisphere nation yet to become a full member of the body that oversees the world's rules-based trading regimes.

Mr Laing said the Bahamas would only advance to full membership if the accession terms "enhance the nation's development and economic prosperity", allow for a reasonable period for the economy to adjust and adapt, and provided "mutual satisfaction" for the Bahamas' trading partners.

"If these cannot be addressed, membership cannot be achieved," Mr Laing said, promising to promote and protect Bahamian interests first. Emphasising that the process must result "in a net gain" for the Bahamas, he added: "The Bahamas ought not, and cannot, join the WTO on terms that injure this economy, injure significant business parcels in this economy."

Mr Laing, who oversaw the Bahamas' entrance to the Economic Partnership Agreement (EPA) with the European Union (EU) during 2007-2008, the only rules-based trading regime of which it is currently a member, said fears about that agreement's impact on the economy and private sector had proven unfounded.

With the WTO accession process "less stringent" than the EPA, Mr Laing suggested there was "really very little reason for people to believe" the former would have an impact that the European agreement did not.

He added that the Government would again meet with the Chamber of Commerce and private sector before heading to Geneva, with Mr Symonette saying further consultations had addressed concerns that businesses had been unable to properly advise on the negotiating positions the Bahamas should take.

The Minister added that the Government was addressing concerns over energy reform and the 'ease of doing business' "simultaneously" with the WTO accession process, rather than delaying the latter until the former had been achieved.

Comments

DDK 1 week, 3 days ago

Exactly how many officials have been blessed with an all expense paid visit to the Swiss Alps by The People, whose Government is so broke it had to impose more taxes on them? I am sure Messrs. Laing and Symonette require a huge entourage to ensure the best possible terms from the monetary sharks are achieved for our island nation.

"There's no reason to fear WTO accession will cause an increase on taxation of the public of business community," Mr Laing said, arguing that it would merely cause "a shift" to other tax forms such as VAT. AH, the VAT genie is out of the bottle, there's no putting the stopper back in.

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CaptainCoon 1 week, 3 days ago

Why are we joining this antiquated organization? Trump has already shown the world the flaws with the WTO and how China breaks WTO rules left and right. We should NOT be joining this organization, if anything, we should be actively moving to undermine it, the same as the United States does!

This is going to destroy our country economically. SAD!

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The_Oracle 1 week, 3 days ago

So he has gone from clogging up the airwaves to somewhere he can really screw up and do damage! The problem is that his team in 2001 although small, was competent. Do we even have a team anymore? When told by Ministry of finance people that "we can't tell you too much because then other countries will know our positions" in one of their brief and vacuous meetings I knew we were screwed.

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BahamaPundit 1 week, 3 days ago

I am not convinced. First get your house in order. It's like entering a boxing match without training -- you ga lose for sure. How can you expect to negotiate with other, much more organized, nations, when you can't even keep the lights on? The end result is obvious: little benefit, more corruption, more division between rich and poor and, perhaps, a complete loss of soverignty. In order to join the WTO, Bahamians' should demand a referendum! The true reason the Bahamas wants to join WTO is because the FNM and PLP lack leadership and are looking to be lead by 1st world countries. Once a slave, always a slave it appears. They just seeking out a new Master.

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Sickened 1 week, 3 days ago

Agreed. They can't even tell us, in dollar terms, how we and our economy will benefit from joining this gang.

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Porcupine 1 week, 3 days ago

"It is difficult to get a man to understand something, when his salary depends upon his not understanding it." Upton Sinclair. Being told to do things by someone else may work as a child, but a brief look at history would show that rarely does the little guy, (see The Bahamas) come out alright in the end. How can the economic trends in the world today, after the last 50 years of listening to these financial and economic gurus, still not convince anyone paying attention that OUR welfare is NOT anywhere on their agenda? You have to pay someone pretty well to ignore the reality around them, selling out country and countrymen for the sake of your salary. But, it does happen every day. I mean, look at all the jobs the web shops provide, and the amount of revenue they pay to government. What a good thing the web shops are.

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Sickened 1 week, 3 days ago

Spot on. Whoever actually takes the time to look at the effects of joining the WTO will undoubtedly realize that it is not an organization that has your best interests at heart.

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TheMadHatter 1 week, 2 days ago

Nobody cares. In the Bahamas, we "Thank God for Life" and just keep Vaseline in good supply.

Burma Road is ancient history.

The chemtrails in the sky, the peoples dem is pacify.

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John 1 week, 2 days ago

Don’t know the benefits of the country becoming a WTO member but there will have to be a lot more work to be done to make the country ready. Right now you have a financial imbecile, who probably cannot even spell finance or economics. He is causing one set of merchants to pay duty on certain items while another set go duty free. This will not be allowed under the WTO, who seeks to level the playing field on trade. But the idiot is creating a skewed economy that will cause even more erosion of government revenue.

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