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45th COTED meeting in Guyana…Guyana makes case for rum industry
Caribbean Community (CARICOM) Trade Ministers started their two-day meeting yesterday at the Marriott Hotel in Georgetown to search for solutions to the challenges preventing the optimization of the free movement of people and goods under the Caribbean Single Market and Economy (CSME).
Head of Guyana’s delegation, Minister of Foreign Affairs, Carl Greenidge (right) at the opening of the 45th Meeting of the Council for Trade and Economic Development (COTED) at the Marriott Hotel, Georgetown.
Behind the closed-door session of the 45th Meeting of the Council for Trade and Economic Development (COTED), Guyana made a push for the region’s rum producers who have complained of an uneven playing field due to competition from the U.S Virgin Islands and Puerto Rico, who benefit from U.S. subsides.
Prior to Guyana’s presentation on the state of the CARIFORUM rum industry – challenges and opportunities, Minister of Foreign Affairs, Carl Greenidge, said that the rum producers are concerned, not just about the finished product, but also the inputs.
“The rum manufacturers have an interest in the treatment of some of their products and the treatment of the inputs for those products with regards customs and taxations,” Greenidge stated.
As it relates directly to the CSME, the Foreign Minister made it clear that satisfactory is not the word that can be used to describe the implementation of the regime.
“There are clearly challenges posed by the implementation of the idea and we agree that some of those need to be resolved. Some of those need to be sorted out in a way satisfactory to all sides. We are not yet there,” Greenidge stated.
Last month, Komal Samaroo, Chairman of Demerara Distillers (DDL) group of companies, assumed the leadership of the West Indies Rum and Spirits Producers’ Association Inc. (WIRSPA)
It is estimated that the industry earns in excess of US$550 million in foreign exchange every year, but also depends on healthy local markets as its base. According to Samaroo, rum companies rely on the profitability in their local market to be able to finance entry into export markets which are highly competitive and where regional producers are up against global spirits giants.
According to WIRSPA, the regional brands continue to face an uphill battle against these companies, several of whom may be benefiting from substantial subsidies provided through the United States tax system which provides them with ‘Cover-Over’ payments.
These payments are tax rebates given back to producers in the US Virgin Islands and Puerto Rico when they sell rum into the US.
“Increasingly, we’re seeing brands entering our local markets which benefit from these subsidies and are selling well below what we would consider to be expected costs. So not only are we up against subsidised brands in the export markets, but these brands are now entering local markets as well,” Samaroo has stated.
OTHER ISSUES FOR COTED
Secretary-General of CARICOM, Ambassador Irwin LaRocque said that issues on the agenda such as compliance with the provisions of the Revised Treaty and the decisions of the Community’s Organs require urgent attention.
“It is therefore necessary that COTED ensures compliance,” Ambassador LaRocque stated.
There are matters on the agenda with respect to trade in goods that have remained unresolved for a considerable length of time. These relate mainly to the trade in agricultural products.
Ambassador LaRocque urged that the regional representatives must also seek to remove the areas of uncertainty in respect of the free movement of skills regime.
“We have to recognize that the free movement of skills has been embraced by the people as a benefit of integration. Many have taken advantage of the opportunities presented by this regime. And again, it is my understanding that this regime has worked fairly-well,” Ambassador LaRocque said.
He said that there are challenges. Some have been experienced by persons seeking to exercise their rights under the regime in accordance with decisions of the COTED and the Conference of Heads of Government. He added that there have been challenges experienced by Member States seeking to confer those rights.
“The Council must move quickly to resolve those issues,” Ambassador LaRocque urged.
The COTED Meeting concludes today.
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