AfriCaribbean trade potential staggering

With the right action and network, the Caribbean could increase its measly exports to Africa by as much as US$80 million annually, says Executive Director of the International Trade Centre (ITC) Pamela Coke-Hamilton.

She made the disclosure on Thursday during the opening of the inaugural AfriCaribbean Trade and Investment Forum at the Lloyd Erskine Sandiford Centre, as she launched the ITC’s Expanding African-Caribbean Trade report, which examines the export potential for trade between Africa and the Caribbean.

“The figures we estimated across goods and services are pretty startling. With the right actions and networks, Africa and Caribbean trade could reach up to US$1 billion [over the next five years]. Africa could boost annual exports to the Caribbean by US$171 million year-over-year by 2026 and this is more than 50 per cent increase over last year’s export levels,” Coke-Hamilton reported.

“The Caribbean could also expand exports to Africa by US$80 million year-over-year, equivalent to increasing our exports by almost a third,” she said.

The trade expert noted that research has shown that the goods trade between Africa and the Caribbean is currently “negligible” and heavily concentrated in a handful of goods and countries.

“Not even 0.1 per cent of African exports headed to the Caribbean nations in 2020, while the continent bought less than one per cent of Caribbean exports,” she disclosed.

She indicated that almost 70 per cent of Africa’s exports to the Caribbean are primary minerals and more than 40 per cent of Caribbean exports to Africa are chemicals.

Coke-Hamilton said not surprisingly, high market access costs continued to hinder trade integration between the two regions and the absence of a free trade agreement between African and Caribbean countries meant that tariffs in certain sectors reached a high of 28 per cent.

“Non-tariff costs are also very high, transport between key markets just isn’t there, and traders struggle to comply with regulatory requirements in the partner markets because of delays, fees, testing requirements and credit checks,” she noted.

However, Coke-Hamilton said despite the hindrances there was a favourable outlook, as she noted that exports of agricultural goods, fertilisers and health products have significant growth potential.

“Africa’s agribusiness sector holds US$53 million in export growth potential for the Caribbean. Most of it in fish, kidney beans and vegetables,” she said.

“Strengthening the international agrifood value chain is one of the best ways to address the growing concerns about food security. The Caribbean has US$11 million to tap into, across lifesaving healthcare and pharmaceutical products, many of which are hard to obtain in Africa,” she reported.

The former executive director of the Caribbean Export Development Agency said equally uplifting was the opportunities from an increased variety of goods.

She explained that research showed that 27 African countries have an export growth potential of over 100,000 products ranging from “sardines to cars” and that 15 Caribbean countries could increase goods export to Africa on a similar scale, for some flagship products such as rum.

Coke-Hamilton said perhaps the most important area where trade could be increased was that of services exports.

“The Caribbean has the potential to export services worth half a billion US-dollars to Africa, double the value of possible goods exports. Tourism accounts for almost half of the region’s export potential services to Africa, followed by transport and also very importantly, the creative industries,” she said

“It clearly shows that the potential for increased and diversified trade between Africa and the Caribbean is massive, and it is a potential that we have to exploit. The triple-C crisis of COVID-19, conflict and climate change have highlighted more than ever the need for economies to diversify their trading partners,” said Coke-Hamilton.

She added that for both regions to unlock just half of the US$1 billion export potential they should tackle the trade barriers which include regulatory bottlenecks and challenges relating to transport and logistics.

She said it will also require more engagement, transparency and experience-sharing from both governments and the private sector. (MM)