E,S, Williams

The exploitation of natural resources in the Caribbean, and dependence on preferential trade has caused economic development to lag behind. Also, the exploitation of natural resources has increased this problem. These factors have caused development in Caribbean countries to fall behind that of other countries like Singapore and Cyprus who started off on the same level with the Caribbean. Though the Caribbean has a declining GDP and high rates of poverty, it does not take away from the progress that Caribbean made over the years measured by the HDI, in terms of income, health, education and life expectancy.

The move away from traditional markets and deteriorating access to preferential markets that the Caribbean is heavily dependent on has posed a serious challenge. Adding to this problem is that the European countries want to maintain control of labour and operate on a market without restrictions.

Alarmingly, another problem faced is that production is low while production costs on the agricultural land are high, they are still labour intensive and pay high transport costs. This causes losses and Government subsidies would not be able sustain this demand for help. It is a case of loss with high interest costs and low growth. Hence, its main goal should be toward self sustaining growth and development, as there would be fiscal imbalances or deficits.

Their main aim is to restructure economy to trade on current global trading environment, get higher productivity levels and reduce public debt. Hence, the CSME is important since it provides a solution with o en regionalism for free trade of goods and services, free access to labour and capital, and an outline for investment and a regional source of capital.

The CSME model also presents opportunities for joint marketing in extra-regional markets, joint research and development, and joint purchasing arrangements. Though this is the framework, implementation of the CSME has lagged in terms of reduction in tariffs, the ability for labour to move freely and also the rights of the public sector. Financial resources which is needed to initiate the growth and development process is a major issue. Moreover, members maybe unwilling or unable to go beyond their current funding level.

A pivotal role has been played by the Central Bank in financing development and social programs. But, In order to fulfill the trust envisaged by this program a significant increase in Bank’s resources is required. Also, compensatory mechanisms form a necessary feature of the CSME because benefits of regional integration are often asymmetrically distributed among countries. Thus, to finance the gap, there is a proposal to be funded the member states and region’s development partners and The CSME would require new and expanded private sector.

Though much integration has come through the cross border of ownership of financial institution, it is limited to reduction in cost or increase in availability of finance for business investment. Therefore Innovative and supportive financing strategies are to be implemented if the private sector is to play the important role allocated to it. They must also be appropriate to the characteristics of the firm in terms of size etc.to minimize the risk of cross border contagion, also a full regional stock exchange allows the firm to compete on the international markets.