A Matter of Size: Challenges to Caribbean development

“It’s not the size of the dog in the fight; it’s the size of fight in the

dog.” – Mark Twain

Name: Michelle Webster

ID Number: 408002464

Lecturer: Dr. Wendy Grenade

Subject: Caribbean International Politics

Michelle Webster
408002464
Caribbean International Politics

The question of what exactly embodies a ‘small state’ is one that has yet to

be definitively determined. Population is certainly a key factor, with the

Commonwealth Secretariat defining a small state as one inhabited by one and a

half million or less1. However, this is not the sole feature which characterises a small

state; unique developmental challenges such as limited diversification and capacity,

susceptibility to natural disasters and environmental change, isolation, openness,

and income volatility are also cited2as significant aspects. Consequently countries

like Jamaica, which has roughly three million citizens, is also categorised as a small

state. Jamaica, along with its Caribbean counterparts, is regularly referred to as a

Small Island Developing State (SIDS) a group which extends far beyond the

Caribbean. SIDS were acknowledged as a distinctive group of developing countries

facing specific social, economic and environmental vulnerabilities at the United

Nations Conference on Environment and Development (UNCED)3. This particular

group, owing to their size, often face heightened constraints to development and as

such warrant a special approach if these issues are to be resolved.

The old adage ‘size matters’ certainly comes to mind when taking into

account the difficulties faced by small states such as those that comprise the

Commonwealth Caribbean. Although many of the vulnerabilities experienced by

1 Commonwealth Secretariat (http://www.thecommonwealth.org/Internal/180407/) accessed

3rd March 2011

2 Ibid

3 United Nations Office of the High Representative for the Least Developed Countries,

Landlocked Developing Countries and Small Island Developing States

(http://www.unohrlls.org/en/sids/43) accessed 5th March 2011

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many small states are also encountered by larger states, small states are

predominantly susceptible to certain risks. According to Patsy Lewis: “The

intensification of globalisation and the re-emergence of neo-liberalism as the

dominant ideological construct governing the economic relations of states in the

international system present particular challenges to the development thrusts of

small states”4, this is in addition to the environmental and social fragilities which

remain ever present. The Caribbean is a prime example of the inconvenience that

modest size involves. Diminutive dimensions affect the productivity, development

and cooperation policies of Caribbean territories, which results in an elevated threat

of marginalisation from the global economy. Factor in the increased exposure to

natural disasters and the extent of their weakness is palpable.

In his article “Small states and the vulnerability debate”, C. Y. Thomas

identified four main dimensions of vulnerability experienced by Caribbean countries:

economic, environmental, social, and institutional5. Economic vulnerability

appertains to the amplified susceptibility to what Thomas refers to as exogenous

shock i.e. unpredictable shocks beyond domestic control. What is more, the small

states of the Caribbean lack the capacity to counteract these shocks – which affect

their incomes, employment, output, market, consumption, and wealth – due to their

equally small economies6. Environmental vulnerability arises as a result of

4 Lewis, Patsy. “Bringing Small States Back in: The Caribbean and the Pacific in a New World

Order” Social and Economic Studies 56: 1 & 2 (2007): 1-31

5 Thomas, C.Y. “Small states and the vulnerability debate.” Guyana and the Wider World

Stabroek News. 14 January 2004.

6 Ibid

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extraordinarily delicate ecosystems. Hurricanes, floods and hazards of that nature

are common in the Caribbean and the effect of a natural disaster is felt to a greater

degree than in the case of larger more diverse economies where the resources and

capacity to respond to crisis are superior. Social cohesion is an additional area of

vulnerability for small states and by extension the Caribbean as many factors, both

internal and external, may destabilize the social structure of a small state. Finally,

institutional vulnerability is a complex issue that faces the Caribbean. As

globalisation presses onward, small states of the region are forced to contend with

its numerous implications. Their domestic institutions must respond appropriately to

the expansion of the world economy or risk getting left behind; unfortunately this is

much easier said than done. The cost of negotiating in the global arena serves as an

increased burden on smaller economies. Consequently many of these countries are

incapable of effectively engaging in fundamental international processes.

Small states are certainly not a new phenomenon. The dismantling of the

Soviet Union produced numerous small states and the same holds true for

decolonisation. The Commonwealth of Nations has long recognised the unique

challenges that confront small states and has taken noticeable interest in their

plight. This is not surprising given the fact that more than half its membership can

be classified as small states. Nonetheless the Commonwealth’s commitment has

much deeper roots. Paul Sutton suggests five reasons for this unremitting

engagement7 including the fact that the United Nations (UN) has proven an

7 Sutton, Paul. “Small States and the Commonwealth” Commonwealth and Comparative

Politics, Vol. 39, (November 2001) pp 90 -94

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uncertain advocate because of its inherent limitations; the insistence of small states

to have their voices heard; and the shared social and political systems especially in

the case of the Caribbean. As a result of the large size and the system of rules that

govern its operation the UN is a less than ideal platform for small states. The

Commonwealth on the other hand is significantly more informal and malleable, as

such is better able to address the distinct needs of small states. Small states have

recognised their power within the commonwealth and have remained vocal in the

forum they are also very well informed, especially those from the Caribbean as Paul

Sutton points out. Additionally small states have fully embedded themselves into

the framework of the Commonwealth and participate fully in its processes. The

Commonwealth of Nations has a vested interest in the plight of small states.

In 2008 the association of Caribbean states known as CARIFORUM, entered

into an Economic Partnership Agreement (EPA) with the European Union. The

agreement which took only a year to negotiate was catalysed by the approaching

expiration of the World Trade Organisation’s waiver allowing non-reciprocal trade

preferences to ACP countries. The EPA has been a controversial agreement and

much discussion surrounds its merits or lack thereof. It can however be credited

with at least one major achievement, however; the discourse it generated has

highlighted one of the key issues affecting Caribbean states in the 21st century:

dependency. The turbulent history of the Caribbean gave birth to a region of volatile

‘mono-crop’ economies. After independence attempts to diversify merely resulted in

the substitution of one literal crop, be it bananas or sugar, for the metaphorical crop

of tourism. This has had a variety of adverse effects on the region. The nature of

Caribbean economies coupled with their size has left them open to innumerable

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risks which have become patently obvious in the current global financial climate.

This reality also threatens the sovereignty of these small and vulnerable states. The

complex interplay between small states and larger powers is unbalanced at best.

The complex actuality is that while the majority of the region is legally independent,

they depend on the world’s super powers to a great degree. This translates to

inequality in the global arena. The influence wielded by larger countries over their

smaller equivalents would almost appear to be more akin to control. Theoretically

independent states are all sovereign equals but this does not hold up under

scrutiny. The practical reality is that powerful countries which by design tend to be

larger have a great level over weaker countries that most often fall into the small

state category. Consequently dependence often results in a loss of true

sovereignty. Interference in internal affairs of small developing states is a regular

occurrence. The requirement aid as well as trade revenue often forces conformity.

This can be evidenced by the Caribbean’s relationship with Cuba. Though a rich

source of trade opportunity the Caribbean, until relatively recently, has been slow to

engage with Cuba. This was no doubt a result of Cuba’s tumultuous relationship

with the world’s biggest super power i.e. America. It was only in light of America’s

relaxing of its strict standards in relation to Cuba – initially as a result of

preoccupation with its fight against terrorism and subsequently due to the change

in government – that the Caribbean felt open to actively seek out developing a

more integrated relationship with its neighbour. America is the region’s biggest

trade partner and a severing of that relationship would be detrimental to the region

accordingly the Caribbean follows America’s lead. This is but a single example of

how dependency has shaped political policy and by extension thwarted the concept

of sovereignty in the region. Small size translates to less resources which translates

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to less capacity for development and diversification which in turn translates to

dependency; this inhibits the unimpeded pursuit of national interest in a wider

context. The intense reliance on trade and aid, not to mention large external debt,

has stifled independence. In the end competition in any real sense of the world is

not an option for single small states and without this option many have turned to

blind devotion in the disguise of cooperation.

Conclusion

Smile size does not necessarily negative all prospects for growth.

Globalisation offers many opportunities for small states to overcome their size this

is evidenced by the prosperity of small states such as Singapore. Many small states

have experienced economic growth and social development over the past thirty

years.8 The need for economic reform i.e. the restructuring of industries and the

exploration of alternative activities is the first and most urgently required step

towards growth. Diversification is difficult due to size and capability but it is not

impossible. Innovative approaches to marketing have the potential to develop new

avenues for trade. Manufacturing products on a scale grand enough to compete

with global powerhouses is improbable but niche markets may be successfully

manipulated. Products unique to the Caribbean will offer an opportunity to create a

special market. The existent areas of trade must also be re-assessed. Tourism is the

current crop ‘du jour’ but there are many unexploited possibilities in that sector.

Health tourism and adventure tourism are among the many comparatively

untapped sources of revenue. The service sector is of special importance to the

8 Read, Robert. “The Implications of Increasing Globalisation and Regionalism for the

Economic Growth of Small Island States” World Development, Vol.32, No. 2 pp. 365- 378

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region’s economic advancement; offshore finance and even offshore education

must be fully exploited to increase competitiveness. Investment in these areas

should be encouraged and the necessary investment environment, namely ensuring

the rule of law and developing infrastructure to promote investor confidence,

cultivated in order for them to flourish. E-commerce is also a viable export based

development strategy.9 The service sector is less susceptible to high transportation

costs which are a major hurdle barring Caribbean development10. Reform is also

necessary at the institutional level. Management of domestic finances must adapt

to the global economic changes, meaning that policies such as those which

emphasize tariffs as a main source of revenue must be reconsidered. With the

dawn of free-trade and the EPAs the global trading environment has transformed

and the Caribbean must transform with it. Alternative Taxation systems must be

instituted or enforced more stringently. Integration is also a must in order to ensure

resilience. Regional cooperation in all areas is necessary. Trade within the region

can satisfy domestic need more cost effectively considering the close proximity of

the states. Integration also affords small Caribbean states a stronger voice on the

international stage. The similarities in size, development, and vulnerabilities of

Caribbean states means that states are able to look to models within the region to

determine what actions and policies are likely to be most effective, consultation is

9Briguglio, Lino., Et al., Toward an Outward-Oriented Development Strategy for Small

States: Issues, Opportunities, and Resilience Building, A Review of the Small States Agenda

Proposed in the Commonwealth/World Bank Joint Task Force Report. Singapore, International

Monetary Fund (2006) pp. 7-14

10 Ibid

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key. Cooperation is a method of increasing exploitable resources such as human

resources with the free flow of labour. Self reliance is not a viable option given size

and population, functional cooperation is necessary to protect against the outside

world. Domestic free trade can assist in supply basic needs which would foster

independence from external political and economic pressure. Integration can also

combat marginalisation by being a means of securing the foreign policy and

security interests of the collective. Though there is a degree of integration within

the Caribbean there is still advancement to be made. Cross- border trading and

business establishment should be more urgently encouraged and exchange control

abolished. Furthermore division between Anglo, Spanish and French Caribbean is

still an unnecessary issue and a hindrance to development. Finally reinforcing

resilience is a necessary step. The development of disaster strategies to assist in

coping with the effects of uncontrollable crises will go along way is assuaging the

environmental vulnerability suffered. National emergency plans and disaster relief

funds should be instituted and updated regularly. Regional plans should also be

determined in advance. Protecting natural resources and the environment at large

is also important. Mechanisms for ensuring the sustained use of resources need to

be put into operation.