The Caribbean
Australia's relations with the Caribbean
Australia has friendly relations with the countries of the Caribbean, largely based on shared historical, sporting, social and political ties and membership of the Commonwealth. Many Caribbean countries are also valued partners in the United Nations and a range of international organisations. Consistent with the Australian Government's commitment to strengthening relations with the Caribbean, the Government formally established relations with the Caribbean Community (CARICOM) through a Memorandum of Understanding signed by Mr Rudd, as Prime Minister, in the margins of the Commonwealth Heads of Government Meeting in Trinidad and Tobago on 29 November 2009. A centrepiece of the Government's renewed ties with the region is a A$60 million Development Assistance Partnership. The former Minister for Foreign Affairs and Trade the Hon Stephen Smith MP visited Dominica on 5 and 6 May to address the thirteenth CARICOM meeting of Council for Foreign and Community Relations (COFCOR). This represented the first visit by an Australian Minister to Dominica and the first time an Australian Minister addressed a CARICOM COFCOR meeting.
Australia maintains one diplomatic mission in the Caribbean, in Port of Spain, Trinidad and Tobago. Australia's High Commissioner to Trinidad and Tobago is accredited to the Caribbean countries of Antigua and Barbuda, the Bahamas, Barbados, Dominica, Grenada, Haiti, Jamaica, Saint Kitts and Nevis, Saint Lucia and Saint Vincent and the Grenadines, along with Belize, Guyana and Suriname. The Australian High Commission in Trinidad and Tobago also has consular responsibilities for Anguilla, Aruba, British Virgin Islands, Cayman Islands, French Guiana, Guadeloupe, Martinique, Montserrat, Netherlands Antilles and the Turks and Caicos Islands. The Australian Embassy in Mexico City has responsibility for Australia's relations with Cuba and the Dominican Republic.
The sporting ties underpinning Australia's warm relations with the Caribbean are based on a shared love of cricket and participation in events such as the Commonwealth Games. There is a small Caribbean community in Australia, the largest being 1,126 individuals born in Trinidad and Tobago (2006 Census). In September 2008, Australia provided A$1 million in relief to the Caribbean to help the victims of Tropical Storm Fay and Hurricanes Gustav, Hanna and Ike. A$300,000 was directed to relief efforts in Jamaica, the Bahamas and Turks and Caicos with the balance going to Cuba and Haiti. Australia's assistance was provided through the International Federation of Red Cross and Red Crescent Societies for relief supplies, temporary shelter, health services and other emergency relief activities. More recently the Australian Government has provided A$24 million in emergency and recovery assistance to Haiti following the 12 January 2010 earthquake. This is the largest contribution made an Australian Government for relief in any Caribbean country.
Regional overview
The Caribbean consists of the islands of the Greater Antilles and the Lesser Antilles and is spread across an area similar in size to eastern Australia., The islands are linked by a similar culture and history. Guyana and Suriname, on the South American continent, are generally included as part of the Caribbean as their outlook tends to be more Caribbean than Latin American (particularly with Guyana's cricket and Commonwealth links). Both countries are also members of the Caribbean Community (CARICOM), the region's main political grouping.
Strong former colonial influences are reflected in the main languages - English, French and Dutch. Spanish is also widely spoken. Over the past decade, the Caribbean states have made efforts to integrate their economies and increase their combined voting power in multilateral organisations. The major regional organisations are the Caribbean Community (CARICOM), the Association of Caribbean States (ACS), and the Organisation of Eastern Caribbean States (OECS), a sub-regional grouping of six eastern Caribbean countries and three UK dependent territories. CARICOM is predominantly the English-speaking Caribbean plus Suriname and Haiti, comprising 15 members. The ACS represents the Greater Caribbean, consisting of 25 members (including some Central and South American countries).
While CARICOM focuses on enhancing greater regional integration and a single market economy, the ASC has broader aims of regional cooperation and addressing regional issues such as sustainable tourism, disaster management, transport and trade. The OECSis dedicated to economic harmonisation and integration, protection of human and legal rights, and the encouragement of good governance.
Economic overview
The economies of the Caribbean are considerably diverse. A number of the smaller islands have GDPs in the range of US$300 - US$600 million. The largest of the Caribbean countries, the Dominican Republic, has a population of over 9 million and a GDP of around US$46 billion (2009). Trinidad and Tobago, with a population of 1.3 million, is the leading Caribbean producer of oil and gas and has a GDP of approximately US$20.4 billion (2009). In contrast, Haiti, the least developed country in the Western Hemisphere according to the United Nations Development Program (UNDP), has a population of 9 million and a GDP of around US$6 billion (2009).
Economic and trade policy directions
Smaller 'single commodity' economies in the Caribbean have been drastically affected by the demise of preferential trade arrangements for agricultural products, particularly bananas and sugar. The agriculture sector traditionally accounted for significant employment. Recently tourism and financial services have become the leading contributors to economic growth as the region responds to the challenges of diversifying economies. Many Caribbean countries are members of the network of Small Island Developing States, an initiative of the United Nations Development Program. As small developing states, these countries are vulnerable to fluxes in global economic activity and tourism flows.
The CARICOM Single Market and Economy (CSME) is intended to enhance export opportunities and attract foreign investment by creating a single market among the participating member states. The main objectives of the CSME are to promote full use of labour (full employment) and to maximise production and exploitation of the region's natural resources and capital. The CSME also hopes to improve competitive production and stimulate production of a greater variety and quantity of products and services, to maximise trade with other countries. These objectives are intended to promote sustained economic development and improve standards of living and work. A Caribbean Single Economy is scheduled to be phased in over the period 2008–20015 which, among other things, will look at the adoption of a common currency and common economic policies. All CARICOM member states, with the exception of Haiti and the Bahamas, have formally joined the region's single market.
Economic and trade relationship
Australia's trade with the Caribbean is low, albeit growing modestly, with the balance generally in Australia's favour. In 2009-10, Australia's total two-way merchandise trade with member countries of the Caribbean Community (CARICOM) was valued at around A$126 million. Australia's exports to the Caribbean include meat (including beef) and cheese. Australia's imports from the Caribbean include essential oils and perfumes and alcoholic beverages. Trinidad and Tobago is Australia's major trading partner in the Caribbean. In 2009-10, two-way merchandise trade between Australia and Trinidad and Tobago was A$84 million (exports A$80 million, imports A$4 million). For further information, please refer to individual country fact sheets.
The Caribbean region is growing as a destination for Australian foreign direct investment. While investment in the oil and gas sector by companies such as BHP Billiton accounts for a large proportion of the traditional direct investment, there is growing investment in other sectors such as aluminium-hulled fast sea vessels, patrol boats, mining sector services and manufacturing.
Export opportunities
Possible niche trade opportunities for Australian exporters include:
Mining and related services
Opportunities exist in the Dominican Republic, Suriname and Guyana. Opportunities also exist in the offshore oil and gas sectors in Suriname and Guyana, especially if border disputes can be resolved.
Fast ferries, pleasure boats, light vessels
This sector presents a variety of opportunities. There is scope for developing fast ferry services within the region, especially the Eastern Caribbean, as an alternative to expensive inter-island air transport. The tourist sector generates a requirement for light and pleasure water craft.
Tourism and related infrastructure
The economic backbone of many small Caribbean countries is tourism. This creates opportunities for Australian companies in the area of resort development and management. Tourist industry services, such as hospitality training, are another area of potential investment.
Food and beverage
The region imports processed food both for the domestic market and to cater for tourists visiting the region. This generates demand for good quality international items such as cheese and milk products, meat and wine.
New technologies
These include Australian polymer banknotes, construction, computers and computer accessories. Deregulation of telecommunications sectors in the region and the upgrading of facilities offers opportunities in telecommunications hardware and software.
Power generation
The cost of traditional sources of power generation (ie petroleum products) is a major burden for Caribbean economies. With an abundance of sun and wind, many of these countries enjoy something of a comparative advantage where alternative technologies for power generation are concerned.
Education
There is a demand for education services, particularly tertiary education, outside the region which is currently largely met by the US and Canada. Australian institutions are in a strong position to compete in this market.
Updated November 2010