W T O

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RESTRICTED
WORLD TRADE
WT/TPR/G/42
29 September 1998
ORGANIZATION
(98-3082)
Original: English
TRADE POLICY REVIEW
JAMAICA
Report by the Government
Pursuant to the Agreement Establishing the Trade Policy Review
Mechanism (Annex 3 of the Marrakesh Agreement Establishing the World Trade
Organization), the policy statement by the Government of Jamaica is attached.
Note: This report is subject to restricted circulation and press embargo until the end of the meeting
of the Trade Policy Review Body on Jamaica.
Jamaica
WT/TPR/G/42
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CONTENTS
I.
BACKGROUND .................................................................................................................... 5
II.
RECENT ECONOMIC AND TRADE ENVIRONMENT..................................................... 5
(1)
TRADE PERFORMANCE ............................................................................................................ 6
(i)
(ii)
(iii)
(iv)
(v)
(vi)
Merchandise trade ...................................................................................................... 6
Traditional and non-traditional export performance .................................................. 7
Traditional domestic exports...................................................................................... 7
Non-traditional domestic exports ............................................................................... 7
The apparel sector ...................................................................................................... 7
Services ...................................................................................................................... 8
(2)
ACHIEVEMENTS UNDER THE NIP ............................................................................................ 8
III.
REGIONAL INTEGRATION .............................................................................................. 10
IV.
PARTICIPATION IN PREFERENTIAL SCHEMES .......................................................... 11
(1)
CARIBBEAN BASIN INITIATIVE (CBI) ................................................................................... 11
(2)
CARIBCAN .......................................................................................................................... 11
(3)
ACP/EEC LOME CONVENTION ........................................................................................... 11
(4)
GENERALIZED SYSTEM OF PREFERENCES (GSP) .................................................................. 11
(5)
SAN JOSE ACCORD ................................................................................................................ 12
V.
THE URUGUAY ROUND AND THE WTO ...................................................................... 12
VI.
INSTITUTIONAL FRAMEWORK ..................................................................................... 13
VII.
CONCLUSIONS .................................................................................................................. 14
Jamaica
I.
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BACKGROUND
1.
Jamaica is an independent, English-speaking Caribbean island which has a total area of
10,990.5km2. It forms part of the greater Antilles comprising also Cuba, Hispaniola (Haiti and the
Dominican Republic), and Puerto Rico. The population of Jamaica is estimated at 2.5 million with a
work force of 1.1 million. Jamaica since its independence in 1962, adopted, as its form of
government, a parliamentary democracy based on the Westminster model.
2.
There have been several phases to the country’s development. Jamaica was under Spanish
rule from 1494 to 1655, and subsequently under British rule from 1655 to 1962. For more than 180
years after 1655, Jamaica was primarily a plantation economy based on the cultivation of sugar cane
and export of sugar using slave labour. With the abolition of slavery in 1838 and the decline of sugar,
until the 1940's, Jamaica progressively diversified into the production of other export crops such as
coffee, cocoa, logwood, bananas and citrus. Tourism became an increasingly important industry after
the turn of the century. From the 1950s, and for nearly 35 years, bauxite mining and alumina
production was the island’s most important earner of foreign exchange. In 1985, it was surpassed by
tourism. During the 1950s and 1960s, economic and trade policies were designed to promote import
substitution for domestic consumption and export promotion with the emphasis on labour intensive
industries. In the 1970's, Jamaica continued on the path of a mixed economy but with increased state
participation.
3.
Since the 1980's and throughout the early 1990's, Jamaica underwent an accelerated
programme of structural adjustment reforms to adapt to the global trend toward trade liberalization.
4.
The reforms consisted of the programme of privatization and divestment which facilitated the
deregulation of sectors of critical development importance such as agriculture, tourism, transportation,
banking, manufacturing and communications. These have resulted in the liberalization of markets,
the elimination of price controls and subsidies, and the reduction and removal of tariffs and non-tariff
barriers to trade. Other measures included a simplification of the tax system, financial sector reforms
to enhance the prudential and supervisory role of the Bank of Jamaica, and the strengthening of
monetary policy 1.
5.
The economic development of Jamaica, classified as a small economy, has to be viewed, in
part, in the context of the constraints placed upon it by its small size, population, markets, and limited
range of resources. Countries the size of Jamaica tend to be high cost producers in both the
manufacturing and agricultural sectors. They are also externally propelled economies because of their
high degree of openness. The impact of global economic fluctuations is felt more intensely in a very
small country and this compounds economic vulnerability. Jamaica is continually striving to improve
its level of international competitiveness, but it is challenged both by its geography and the new
international trading environment in which it must now function.
II.
RECENT ECONOMIC AND TRADE ENVIRONMENT
6.
Prompted by the emergence of an increasingly competitive global economy and sluggish
domestic economic growth, the government adopted, in March 1996, a National Industrial Policy
(NIP) outlining the range of policies which will serve to underpin the current process of domestic
macro-economic adjustment and recovery. Recognizing the pivotal role of the export sector to the
country’s development, the NIP emphasizes an aggressive export-oriented, private sector-led
development strategy coupled with a programme of efficient import substitution. This outward1
Government of Jamaica/Ministry of Finance and Planning, Offering Circular, June 1997, pg. 12.
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Trade Policy Review
looking approach has been adopted as a means of facilitating Jamaica’s integration into the regional
and global economies by way of ensuring that the requisite conditions are in place to facilitate a swift
response to the new requirements of global competitiveness, as well as guaranteeing Jamaica’s ability
to implement the commitments undertaken in regional, bilateral and multilateral trade negotiations.
7.
The main components of the NIP include (a) macro-economic policy aimed at creating the
basis for growth in a stable environment; (b) an industrial strategy aimed at investment and trade
promotion and the development of supporting physical, economic and human infrastructure; (c) social
policy aimed at poverty alleviation and (d) environment policy2 aimed at ensuring the sustainability of
activities on land and in the oceans. Its implementation period spans a course of fifteen years and is
characterized by three inter-locking phases each beginning in 1996.
8.
Phase I, 1996-1997, seeks to establish a Social Partnership between the government, business
and labour in the short term. Phase II, 1996-1998, intends to achieve the medium-term strategy of
growth and stability. Phase III, the long-term strategy, ends in 2010 with the overall achievement of
sustainable export growth within a stable and predictable macro-economic environment.
9.
Five strategic industry clusters drawn from the services, science and technology,
manufacturing and agricultural sectors have been identified as possessing the required dynamism
which will serve to propel growth in the overall economy. Within each cluster one or two leading
industries have been targeted as ‘growth poles’ in the economy3. These ‘growth poles’ - tourism,
shipping and berthing, apparel, agro-processing, minerals, bauxite and alumina - exhibit significant
potential for export growth and expansion. Although it is recognized that export potential still exists
in the more traditional agricultural sector, emphasis is now being placed on the human resource-based
services sectors such as tourism, entertainment, telecommunications, shipping and berthing, and
informatics (and the synergies among these sectors) as new growth sectors. The decision to target the
services sector as the catalyst for economic development stems from the fact that services are
expected to play an increasingly dominant role in world trade. Jamaica’s primary service sector,
tourism, is expected to continue to exhibit overall growth and improvement due in large part to the
drive toward product enhancement and diversification within a context of sustainable development.
(1)
TRADE PERFORMANCE4
10.
Although the NIP was implemented in March 1996, the expected growth in the export sector
was not realized for reasons such as, inter alia: (a) high financing and operating costs; (b) increased
competition from imports, and (c) drought.
(i)
Merchandise trade
11.
The value of total merchandise exports for 1997 remained constant at US$1, 387.6 million,
reflecting an increase of 0.1% over 1996. Merchandise exports contracted by 3.5%, or
US$49.9 million in 1996 over 1995. This performance contrasts sharply with the three previous years
when export growth during 1993-1995 averaged 11.1% per annum. Merchandise imports increased
by 6.5% moving from US$2,916.4 million in 1996 to US$3,106.7 million in 1997. This increase in
imports contributed largely to the widening of the trade deficit which stood at US$1,719.1 million.
2
Government of Jamaica/Ministry of Finance and Planning, Offering Circular, June 1997, pg. 12
These growth poles are: tourism, entertainment, sports, shipping and berthing, telecommunications,
information technology, agro-processing, fresh produce, natural fibers, horticulture, marine products, apparel,
light manufacturing, minerals, caustic soda, chemicals, ceramics.
4
The figures for 1997 in this section are preliminary and were taken from the Economic and Social
Survey Jamaica 1997 published by the Planning Institute of Jamaica.
3
Jamaica
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Total merchandise trade for 1997 increased by 4.4% over the 1996 figure of US$4,303.3 million to
reach US$4,494.3 million.
(ii)
Traditional and non-traditional export performance
12.
The lack of export growth in 1997 was attributable to the negative effects in the agricultural
sector of a year-long drought which resulted in a reduction in agricultural production. This reduction
led to an increase in the price of produce for the local market which led to a diversion of some
products from the export market to the domestic market. Another reason for the poor export
performance was the decline in export earnings from, inter alia, the apparel sector and chemicals and
chemical products.
(iii)
Traditional domestic exports
13.
In 1997, the value of domestic exports of traditional products increased by 4.1% to reach
US$948.1 million up from US$910.9 million for 1996. This increase in domestic export earnings was
attributable to an increase in earnings for a few products namely alumina, bananas, coffee and coffee
products and rum which increased by 7.6%, 2.0%, 7.7% and 5.7% respectively. With respect to other
traditional exports, earnings from sugar and bauxite decreased as a result of a decline in the volume of
exports of these products.
14.
Net earnings from the bauxite/alumina sector, however, were estimated at US$335.5 million
for 1997, representing an increase of 0.8% over the 1996 total of US$332.7 million. Although the
volume of banana exports fell by 10.3% to 79,709 tonnes from 88,917 tonnes in 1996, earnings
increased by 2.0% to US$45 million consequent on a 23.9% increase in the price per tonne on the
European market from US$456 per tonne in 1996 to US$565 in 1997. Therefore the increase in
export earnings for bananas resulted primarily from the increase in price per tonne for this product.
(iv)
Non-traditional domestic exports
15.
Domestic exports of non-traditional products totalled US$406.9 million representing a
decline of 6.6% over total exports for these products in 1996. Exports of miscellaneous manufactured
products accounted for approximately 57% of total non-traditional exports in 1997. Apparel was the
chief earner of foreign exchange in this category of exports
(v)
The apparel sector
16.
Over the years, the apparel sector has been one of Jamaica’s leading non-traditional exports.
This sector exhibited robust growth between 1991-1995 and accounted primarily for the positive
performance of Jamaica’s non-traditional export sector. In 1991 export earnings from the sector
amounted to US$301.8 million. By 1995 export earnings increased by 92.4% to US$580.9 million.
In 1996 the total value of apparel exports was US$538.2 million representing a decline of 7.3% over
total earnings for 1995. The rate of growth contracted marginally the following year when exports
declined by 0.3% over total exports for 1996 amounting to US$536.6 million in 1997. This is in
sharp contrast to the average annual growth rate of 18% for the apparel sector between 1991-1995.
17.
The apparel sector began to suffer reversals in 1996 due to competition from Mexican apparel
producers since the implementation of NAFTA, the on-going process of liberalization of the global
textiles industry consequent on the phasing out of the Multifibre Arrangement (MFA), and the
macroeconomic environment within which local manufacturers have operated. This led to the closure
of approximately 23 factories and a reduction in the level of investment in the sector since 1996.
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Trade Policy Review
18.
The apparel sector is now benefiting from a programme designed to strengthen its
international competitiveness through cost reduction, industrial restructuring, training and
productivity improvement.
(vi)
Services
19.
The share of services has increased dramatically moving from a level of 32.3% in 1980 to an
average of approximately 53% in the 1990s. In 1996 services accounted for 57.1% of total earnings
increasing from 49% in 1991. Over the last five years, 1993-1997, Jamaica’s net services exports
moved from US$233.6 million in 1993 to US$299.3 million in 1997 representing an average growth
rate of 9.7%.
Services exports declined by 12.1% from US$340.6 million in 1996 to
US$299.3 million in 1997. This decline in net earnings was attributable to (a) stagnant earnings from
foreign travel; (b) increased levels of investment income outflows particularly through increased
profit repatriation by mining companies, and (c) increased foreign exchange outflows from other
services.
20.
Although tourism is the primary services exports, the share of other services such as
transportation consisting of passenger fares from the national airlines and port disbursements for the
use of the increasingly important cargo transhipment facilities; data entry and processing, and the
miscellaneous category of services consisting of, inter alia, fees for various types of professional
services have been increasing steadily. The contribution of the entertainment industry to economic
development is difficult to assess and quantify. However, the contribution of this industry is
considered to be very significant and is increasing at a rapid rate.
(2)
ACHIEVEMENTS UNDER THE NIP
21.
Two years after the implementation of the NIP, macro-economic stability has been
substantially achieved. Reflecting the successful pursuit of a strict monetary policy during the
financial year 1996/97, inflation declined from a peak of 80.2% in 1991 to 15.8% in 1996 down from
25.6% in 1995. By the end of the calendar year 1997 inflation fell to 9.2%. For the fiscal year
1997/98 to December, the rate of inflation was 7.2%, a marginal decrease from the 7.5% recorded for
the same period of the 1996/97 fiscal year. Nominal interest rates declined and the exchange rate is
relatively stable with fluctuations occurring within a narrow band around J$36.00 to the US dollar 5.
Local aggregate demand has been contained so that import growth slowed during the fiscal year
1996/97. External trade, however, is still characterized by a large deficit of US$1.7 billion in the
merchandise trade account for 1997. Macroeconomic achievements include a) inflows of relatively
high levels of private capital, and b) an increase in the Net International Reserves (NIR) by US$271.3
million to US$692.6 million. A major objective of subsequent budgets has been to build on the gains
of the 1997/98 fiscal year. Projections for the current fiscal year 1998/99 envisage the maintenance of
a competitive exchange rate; a lowering of the inflation rate to 6%-8%; the attainment of real GDP
growth of 2-3% and an increase in the NIR by US$118 million.
22.
Progress has also been made with regard to the establishment of a Social Partnership
between the Government, the private sector and labour. The main objective of the Social Partnership
is the achievement and maintenance of sustainable macroeconomic growth and development through
a process of cooperation and coordination in economic management and decision-making among the
three major partners. Under this tri-partite agreement, each party will undertake commitments in its
respective area(s) - the government - macroeconomic management; the private sector - prices, and
the trade unions - wages - with a view to obtaining the aforementioned objective.
5
Planning Institute of Jamaica, Economic Update and Outlook, October - December 1997, pg. 5-6.
Jamaica
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23.
Negotiations on the Social Partnership are currently being conducted on a sectoral basis. A
Memorandum of Understanding (MOU) has been concluded between the Government, the
bauxite/alumina companies and the unions and is now subject to ratification by the workers.
Indications are that the workers will ratify the MOU. A similar Memorandum of Understanding has
also been reached between the Jamaica Public Service Company, the electricity supplier, and the
unions. It is envisaged that other agreements will be concluded in other sectors. It is expected that
these agreements will be a first step toward achieving a national social partnership.
24.
Government continues to lend support to the private sector in its effort to build international
competitive advantage particularly in those sectors which will serve as catalysts for the modernisation
of the economy and diversification of the production and export base. Under the NIP various
initiatives have been undertaken by the Government to re-examine and restructure the incentives
regime with a view to implementing a more flexible and transparent incentives programme. Measures
taken to improve the incentives regime include the extension of the Export Industry Encouragement
Act (EIEA) to grant tax relief to firms exporting a minimum of 5% of their output; the amendment of
the Jamaica Export Free Zones Act to allow for private designated free zones outside of the existing
free zone area; Motion Picture Encouragement Act is to be amended to extend beneficiary status to
musicians and providers of motion picture facilities; low interest financing under the Export-Import
Bank facility; the elimination of tariffs on non-competing imported raw materials and capital goods,
and the strengthening of the Modernisation of Industry Programme. These pieces of legislation are
designed to promote investment, productivity, international competitiveness and industry parity with
competitors from other countries enjoying similar benefits.
25.
The institutional framework within which the private sector will operate is currently being
re-organized. The supervisory role of the government agencies and the mechanisms to facilitate
public-private sector consultation are being implemented. Nine (9) Industry Advisory Councils have
been established under the NIP and will serve as fora for discussions on sector-specific issues and on
the appropriate economic and trade policy measures to be implemented in order to facilitate sectoral
and overall growth and private sector integration into the economy. This will provide the business
sector the opportunity of having a direct input into the formulation of trade and economic policy.
Allied to this is the public sector modernisation programme geared toward improving the
productivity, efficiency and management capability of government and para-statal institutions.
26.
Other developments regarding the strengthening of the institutional and regulatory framework
within which businesses will operate include the review of the Fair Competition Act; a revision of the
Companies Act; the establishment of the Office of Utilities Regulation to regulate the public utilities
sector; strengthening of the Jamaica Bureau of Standards in its measurement and quality assessment
systems and financial sector reform and adjustment.
27.
An integral factor in Jamaica’s industrial development is the intrinsic role of investment in
upgrading and expanding production methods and facilities in research and development
infrastructure; marketing and distribution; technological advancement and innovation and the
application of new business strategies and support infrastructure in human and technical resources and
science and technology. In order to attract the requisite level of investment needed to spur economic
growth, a liberal foreign investment regime has been implemented representing great strides over the
last twenty years - the 1970's and 1980's - when the climate for foreign investment was very
restrictive. Numerous measures which once inhibited foreign investment such as the Foreign
Exchange Control Act, and the list of areas reserved for local investment only have been eliminated.
Consequently, Jamaica now has no legal impediment to direct foreign investment and applies the
principle of national treatment to foreign investors.
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Trade Policy Review
28.
Social and environmental policies to complement the industrial policy have also been
developed. The government has developed a social agenda addressing important issues of education
and training consistent with the overall strategy for human resource development.
29.
Given the country’s high dependence on its natural resources, particularly in the tourism,
mining and agricultural sectors, emphasis is now being placed on sustainable economic development
as a means of effectively integrating environmental concerns into economic planning thereby
achieving a balance between economic development objectives and those of environmental
preservation.
III.
REGIONAL INTEGRATION
30.
Recognizing the importance of economic integration, particularly for smaller economies,
Jamaica became a founding member of the Caribbean Community and Common Market
(CARICOM) which was established in 1973. The Group’s membership currently stands at fifteen
(15) states. CARICOM’s main activities have been in the area of economic integration through the
creation of a Caribbean Common Market. Other areas of functional cooperation include education,
health, labour matters, agriculture, transportation, communications, tourism and disaster preparedness.
31.
CARICOM, in recognition of the need to prepare its economies for international competition,
while at the same time providing an adjustment period, began unilateral trade liberalization in 1992
when the revised Common External Tariff (CET) came into effect.
32.
Tariff rates were set at levels designed to encourage international competitiveness by helping
to keep production costs low and promote efficient production. The CET rate structure is being
applied on a progressive basis, which by 1999 will lead to tariffs ranging from 0 to 20%, with 40% for
agricultural goods. Jamaica is currently applying rates which range from 0 to 25% for industrial
products and 40% for agricultural goods. Jamaica does not apply any restrictions on the entry of
goods of CARICOM origin.
33.
The CARICOM Treaty was amended in 1997 with the signing of the Protocol Amending the
Treaty Establishing the Caribbean Community. This Protocol, known as Protocol I, restructured the
organs and institutions of the Community. It is one of several Protocols aimed at deepening the
integration process through the establishment of the CARICOM Single Market and Economy
(CSME), in order to achieve sustained economic development, international competitiveness, and
coordinated economic and foreign policies.
34.
Protocol II, which governs the Right of Establishment, Services and Movement of Capital
throughout the region, was also signed in 1997.
35.
Protocol II, inter alia, provides for the elimination of the need for passports for travel within
the region and of the requirement for work permits for graduates of regional tertiary institutions and
media workers, who are CARICOM nationals.
36.
Other Protocols for which negotiations have already begun are Protocol III, which will cover
Industrial Policy; Protocol IV - Trade Liberalization and External Trade Policy; and Protocol VII Disadvantaged Countries, Region and Sectors. The others which are scheduled to be negotiated are:
Protocol V - Agricultural Policy; Protocol VI - Transportation; Protocol VIII - Dispute Settlement;
and Protocol IX - Competition Rules.
37.
In the process of expanding trade relations with the wider region, CARICOM concluded
preferential trade agreements with Venezuela and Colombia. However, the Agreement with
Jamaica
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Colombia became reciprocal as of 1998 June 1, when the More Developed Countries (MDCs) of
CARICOM began to grant reciprocal treatment to a selected list of products from Colombia. A free
trade agreement is currently being negotiated with the Dominican Republic, and there are proposals
for similar agreements between the Central American Common Market and the Andean Community.
38.
Jamaica’s membership in the Association of Caribbean States (ACS) is also ultimately
aimed at expanding its regional trade relationships. The objective of the ACS is to develop an
enhanced economic space for trade and investment with opportunities for co-operation in order to
increase the benefits which accrue to the peoples of the Caribbean from their resources and assets,
including the Caribbean Sea.
39.
Jamaica, together with its CARICOM partners, is committed to full participation in the
negotiations for the Free Trade Area of the Americas (FTAA) while recognizing the tremendous
challenge this will pose for the smaller economies of the hemisphere.
IV.
PARTICIPATION IN PREFERENTIAL SCHEMES
40.
Jamaica participates in four main preferential schemes, namely, the Caribbean Basin Initiative
(CBI); CARIBCAN: LOMÉ; and the Generalized System of Preferences (GSP):
(1)
CARIBBEAN BASIN INITIATIVE (CBI)
41.
The Caribbean Basin Initiative (CBI) is a programme through which 28 Central American and
Caribbean countries receive duty free access to US market for a specified list of products. Jamaica’s
exports under CBI amounted to US$203,405,213 in 1997.
(2)
CARIBCAN
42.
CARIBCAN is a trade cooperation programme through which the Government of Canada
provides duty-free access to the Canadian market for all CARICOM’s exports except textiles and
apparel. Jamaica exports under CARIBCAN totalled US$10,670,902 in 1997.
(3)
ACP/EEC LOME CONVENTION
43.
The LOME Convention is a combined trade, financial and technical cooperation agreement
between the European Community and the African, Caribbean and Pacific (ACP) Group of countries
which has been in existence since 1975. Jamaica was among the original signatories to the first
Convention. The major portion of Jamaica’s trade in bananas, sugar and rum is covered by the
relevant protocols of the Convention Earnings from the export of these products were valued at
US$180 million in 1996 and US$155.75 million in 1997.
44.
Negotiations for a successor arrangement to the Fourth Lomé convention, 1990-2000 will
begin in September of this year. Jamaica places great importance on market access for its traditional
exports under this convention and would wish to see it continued recognising that a post-Lome IV
agreement has to be responsive to the requirement of WTO compatibility.
(4)
GENERALIZED SYSTEM OF PREFERENCES (GSP)
45.
Jamaica is eligible for benefits under the Generalized System of Preferences (GSP). In 1997,
Jamaica’s exports under GSP amounted to US$17,955,509.
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Trade Policy Review
46.
Approximately 35% of Jamaica’s trade in agricultural and manufactured goods is covered by
preferential trading arrangements of a non-reciprocal nature.
(5)
SAN JOSE ACCORD
47.
Jamaica is also a beneficiary to the San Jose Accord signed by petroleum-importing Central
American and Caribbean countries with exporting countries, Mexico and Venezuela. This Agreement
provides access to lines of credit for approximately 20% of the cost of petroleum supplied by Mexico
and Venezuela. These funds can be used to finance economic development projects in productive
sectors on preferential terms.
V.
THE URUGUAY ROUND AND THE WTO
48.
Jamaica ratified the Final Act of the Uruguay Round and the Agreement establishing the
WTO with its annexes on 31 January , 1995 and acceded to the WTO, on 31 March , 1995.
49.
In order to meet Jamaica’s obligations under the WTO Government Ministries/Agencies have
embarked on a programme to bring relevant legislation in line with WTO obligations. An InterGovernmental Task Force has been set up to revise Copyright, Insurance and Anti-dumping and
Countervailing Duties Acts, and to draft new legislation on Customs Valuation, Patents, Trademarks
and Designs, including Integrated Circuits.
50.
In the Uruguay Round Negotiations, Jamaica undertook market opening commitments in the
service sectors of Business, Education, Health-related and Social Services, Tourism, Recreational,
Cultural and Sports, Maritime Transportation and the Banking and Insurance Divisions of Financial
Services. In the area of Agriculture, Jamaica bound its agricultural products under Annex 1 of the
Agreement on Agriculture at 100%. Other non-agricultural goods were bound at 50%.
51.
Under the Fourth Protocol to GATS, Jamaica opened for competition value-added network
services (VANS) and value-added data services (VADS). However, basic telephony will continue to
be serviced by the local public telephone company until 2013 when current exclusive licenses expire.
52.
In anticipation of the increase in competition in this sector, the Government has established an
independent regulatory body, the Office of Utilities Regulation (OUR),whose purpose is to monitor
the utilities sector, including telecommunications, by preventing anti-competitive practices and
ensuring that activities are carried out in a transparent, non-discriminatory and competitively neutral
manner.
53.
While competition policy is still under discussion within the multilateral forum, Jamaica has
developed and implemented its own rules on this issue through the Fair Trade Competition Act of
1993. The supervisory body, the Fair Trading Commission, with its quasi-judicial powers, regulates
unfair trade practices and promotes competitive business habits. Work is currently being undertaken
on a draft proposal to establish a Commercial Court which will facilitate the speedy resolution of
commercial disputes.
54.
Concerning current discussions to formulate an international agreement on investment,
Jamaica holds the view that if there is to be a multilateral framework for foreign investment, it should
be one that strikes a balance between the liberalization thrust and the development imperative.
Careful attention should be given to the selection of the appropriate forum for the negotiations.
55.
Regarding notification obligations under the various agreements, Jamaica has made a
concerted effort to comply with its notification requirements.
Jamaica
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56.
Recognizing that an immediate and full response in fulfilling WTO obligations is hampered
by limitations in resources, financial, human and institutional, Jamaica believes that it is important to
maintain the time frames agreed in the Multilateral Trading Agreements. However, it should be
understood that for small island developing states such as Jamaica, there is a real need to maintain, for
a sufficient period, time concessions, preferential arrangements, and non-reciprocal agreements in
order to achieve as smooth a transition as possible.
VI.
INSTITUTIONAL FRAMEWORK
57.
The Ministry of Foreign Affairs and Foreign Trade is responsible for the formulation of trade
policy as it relates to foreign trade as well as the negotiation of foreign trade agreements. The
formulation and implementation of Jamaica’s overall trade policy falls within the purview of a
number of other Government Ministries and Agencies namely, the Ministries of Commerce and
Technology, Industry and Investment, Agriculture, Finance and Planning, and Jamaica Promotions
Corporation (JAMPRO), the Planning Institute of Jamaica (PIOJ), and the Attorney General’s
Department.
58.
The private sector, particularly through its umbrella organizations, also plays a pivotal role in
the formulation of trade policy. The Government, in due recognition of the private sector’s central
role in economic growth, places great importance on its partnership with the private sector. This
collaboration functions not only in the development of policy but also in its implementation and in the
negotiation of trade agreements. This latter role is becoming even more pronounced with the
imminent negotiations for the Free Trade Area of the Americas (FTAA), the successor to the LOME
IV Agreement, and the continued negotiations in the WTO.
59.
A primary forum for private and public sector interaction is the Trade Coordination and
Policy Committee which was established in 1992 under the aegis of the Ministry of Foreign Affairs
and Foreign Trade. The Committee brings together Government Ministries and Agencies, private
sector organizations such as the Jamaica Exporters Association, the Private Sector Organization of
Jamaica, the Jamaica Chamber of Commerce and the Jamaica Manufacturers Association. Individual
firms are also represented on the Committee. Members also include the University of the West
Indies, including the Institute of Business which is attached to it, and the trade unions.
60.
The Committee, which is chaired at the Ministerial level, provides a monthly forum for indepth discussions on trade policy and trade related issues. The Committee makes recommendations
on trade policy issues.
61.
Two bodies under the aegis of the Ministry of Industry and Investment complement the work
of the Trade Coordination and Policy Committee. These are the Trade Facilitation Board (TFB) and
the Investment Facilitation Board (IFB). Both Boards comprise public and private sector
representatives. The TFB seeks to identify and resolve issues which hamper trade while the IFB
addresses problems encountered in the processing of investment projects and make recommendation
for the facilitation of the process.
62.
The private sector in recognition of the increasing impact that regional and international trade
agreements have on their own development, have put in place its own arrangements to address trade
policy issues. These are broad-based in Membership and deliberate on a wide range of issues.
WT/TPR/G/42
Page 14
VII.
Trade Policy Review
CONCLUSIONS
63.
Jamaica has embarked upon an irreversible process of market liberalization. With the
adoption of an export-led growth model attempts are being made to create an environment conducive
to attracting and increasing investment, fostering private sector growth and increasing levels of
productivity. The long-term policy directions of the industrial policy is the sustainability of high
growth through investment promotion, particularly, the dynamic and competitive export clusters.
However, in order to achieve these growth targets, efforts will have to be aimed at (a) a further
lowering of interest rates; (b) promoting financial sector consolidation to stimulate long-term
investment; (c) promoting greater private sector productivity and efficiency; (d) upgrading the
economic, physical and social infrastructure, and (e) implementing WTO-consistent sector-specific
incentive schemes.
64.
Jamaica’s ability to strengthen and deepen the push toward export growth will also depend to
a large extent on the outcome of intra-regional negotiations on the CSME and extra-regional
negotiations on the Lomé Convention, FTAA, the ACS, CARICOM’s negotiations with sub-regional
blocs such as the Andean pact, the CACM and individual countries such as Colombia, Venezuela and
the Dominican Republic. These negotiations have been characterized by the process of `open
regionalism’, the dismantlement of protectionist policies, the reduction or the elimination of tariff and
non-tariff barriers and the creation of an expanded export market base for products of member states.
The issue of NAFTA parity is another matter of concern to Jamaica and by extension the CBI region
in terms of the trade diversionary impact on the local apparel industry as a result of the more
advantageous market access conditions afforded to Mexico under this agreement.
65.
A market-oriented economy will serve to underpin Jamaica’s participation in these
negotiations and, as a corollary, will consolidate the thrust toward export growth. Open regionalism
will assist in attracting foreign investment; facilitate foreign market penetration; encourage intrasectoral specialisation, increased levels of productivity and will aim to foster the growth of reciprocal
trade.
Ministry of Foreign Affairs and Foreign Trade
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