Economic Integration and Development

Noting the economic challenges within the Caribbean region, the CSME is necessary for economic integration. The Caribbean exploits natural resources because economic development in the region is delayed in comparison to small and comparable countries and we have preferential rates for agricultural produce. The Caribbean was in line with Ireland, Singapore and Cyprus in 1975. However, there has been a steady decline in growth in the 1970’s to the 1990’s of 1% of the GDP per capita. In 2000, there has been some growth in the real GDP in the Caribbean, increasing per capita incomes. Although poverty rates in the region are high, the Caribbean ranks high on the Human Development Index based on income, literacy and life expectancy. The main economic challenges facing the Caribbean are the loss of preferential arrangements, the ability to achieve higher productivity levels and the necessity to strengthen fiscal positions and reduce public debt burden.
As governments face political mandates to improve social and economic conditions, European markets are eroded. Developing countries have not taken the advantage of the long period of preferential market access to increase productivity of agricultural produce. The agricultural sector in the Caribbean is finding it difficult to be globally competitive. The lower productivity of both public and private investments has declined in the 1990’s. The agriculture sector has declined as a result of migration. Currently, remittances are a major factor to foreign exchange receipts in the region. However, migration has caused the brain drain which weakens the region’s human resources. Excessive build up in public debt hurts growth as resources were redirected to debt servicing.