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Wto ‘No Silver Bullet’ For Gdp Growth Woes

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Full World Trade Organisation (WTO) membership “is not a silver bullet” for solving The Bahamas’ economic growth woes, a Chamber of Commerce executive argued yesterday.

Darron Pickstock, who heads the chamber’s trade and investment division, told Tribune Business this nation needed to “take a broader approach beyond WTO” to addressing its inadequate GDP growth rate and getting the economy “back on track”.

Arguing that the Bahamian economy is “simply not growing” fast enough to generate the quantity, and quality, of jobs required, Mr Pickstock said this nation needed to determine “how we get to the next level” regardless of whether it became a full WTO member or not.

The Glinton, Sweeting & O’Brien attorney, who will be attending this week’s fourth Working Party meeting on The Bahamas’ accession bid as the chamber’s representative, reaffirmed that the private sector body was presently maintaining its “neutral” stance on whether becoming a full WTO member is the right approach for the country.

He added that the imminent completion, and release, of the study it commissioned from Oxford Economics on WTO membership’s likely impact on the economy and specific industries will “cement” the chamber’s position on whether it comes out in favour of - or against - the move.

Mr Pickstock, though, said it was clear that the government had already decided completing an 18-year long accession process was in The Bahamas’ best interests as it seeks to become a full WTO member by mid-2020.

A government delegation headed by Brent Symonette, minister of financial services, trade and industry and Immigration, and Zhivargo Laing, The Bahamas’ chief WTO negotiator, has already headed to Geneva for the fourth Working Party meeting and bilateral discussions with individual countries. Mr Pickstock and the Chamber have observer status.

Expressing the organisation’s gratitude for being given a direct glimpse into the negotiations, the Chamber’s trade chief said: “It’s important for us to see what’s being advocated and advanced on behalf of the private sector.

“By being involved we get to see first hand what is being said, and not rely on third party sources, so we can come back and brief our members on what exactly has transpire at this meeting. It’s extremely important we’re involved at this level. It’s the private sector that trades, and the Government advocates on behalf of the private sector.”

The fourth Working Party meeting will likely review revisions made to The Bahamas’ initial market access offers on goods and services, which were submitted last year. The Government held a new round of consultations with specific industries earlier this year to obtain clarification, or address issues raised by WTO members, before this week’s discussions to ensure it is fully informed on what the private sector is seeking.

The latest WTO filings show member states of the Working Party have been focusing on so-called “national treatment” issues, which is the concept that foreign companies can be treated no less favourably than their Bahamian counterparts.

They are asking questions about the level of subsidies provided to Bahamian farmers by the Government, including those targeted at agricultural exports. An eight-page questionnaire on “state trading” has also been issued, which likely focuses on the level of government involvement in the Bahamian economy through state-owned enterprises (SOEs) such as Bahamasair and the level of subsidies/support extended to them.

The Minnis administration sees full WTO membership as a key component of its liberalisation and deregulation strategy, and effort to ensure the Bahamian economy breaks out of the low growth/high unemployment straitjacket that has restrained it for the past decade.

It also views membership in the world’s rules-based trading regime overseer as aiding its bid to diversify the economy by developing new industries, with both tourism and financial services under pressure, and opening up overseas markets.

Mr Picktsock, though, said WTO membership will not be a panacea that cures all The Bahamas’ economic ills. Turning to the long-awaited Oxford Economics assessment, he added: “This is not a one-shot report but encompasses the entire economy.

“It’s not a WTO report; it will say here’s an analysis of your economy and where it needs to improve. WTO is only one part of our economy. Whether we become a WTO member or not, we have to look seriously at our economy. If we don’t become a member what are the solutions? What are we going to do to improve our economy and spur growth without the WTO?

“That’s why it’s important to take a broader approach to how we’re going to get our economy back on track beyond the WTO,” Mr Pickstock continued. “In some respects it’s a larger conversation, but a conversation we must have.

“We cannot talk about whether to join the WTO without talking about our economy, and it’s not growing. It’s simply not growing. How do we get to the next level and grow our economy?”

Should The Bahamas ultimately join, the Chamber’s trade and investment division head said the private and public sector still had much collective work to do to improve the economy’s GDP growth and job prospects.

“If we become a member it’s important that the WTO is not viewed as a silver bullet where, all of a sudden, we have growth,” Mr Pickstock told Tribune Business. “We don’t want to get ahead of ourselves in thinking that if we become a member of the WTO the economy is going to explode and we’re going to be in the money, so to speak.”

He added that there remained “a long way to go” in the accession process, with “a lot of back and forth” anticipated between The Bahamas and the Working Party and individual member states as they thrash out the terms of this nation’s membership.

The Working Party, which will lead negotiations to determine The Bahamas’ WTO accession terms, consists of member states who have an interest in trading with The Bahamas. These include the likes of the US, Canada, the European Union (EU), China, the UK, members of CARICOM and, possibly, Latin American nations such as Brazil.

Confirming that the Chamber holds “a neutral position” for the moment on whether to join the WTO, as it awaits the Oxford Economics report’s conclusions, Mr Pickstock added: “I would say it’s clear that the Government’s position is that it intends to join WTO. That’s a fact. I agree the Government is pushing forward, although there are people who hold the opposite view.

“Consultation has to be continuous as this is the only way

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