Although the Caribbean is struggling to come to grips with the Caribbean Single Market and Economy (CSME), we laud the attempt by the private sector to get formally involved in negotiations, a point made by this newspaper some months ago.

We have seen that as the world moves towards ever-greater trade liberalisation for goods and services under the World Trade Organisation (WTO), countries are no longer able to apply high tariffs to protect local industries.

But it is just not a matter of tariffs. A sore point is the subsidisation of exports - the support rich countries provide to make their agricultural surpluses competitive in export markets.

Under the Uruguay Round agreement, developed countries committed themselves to reducing their export subsidies by 36 per cent of their 1986-1988 value for most commodities by 2000.

According to the Economist, they have kept this promise but have fallen down in others, and show little sign of making further concessions. Recently, the WTO members were split over a draft treaty to open markets in agricultural goods.

According to reports, the draft calls for a reduction of up to 60 per cent in import tariffs on agricultural goods, while at the same time cutting back on subsidies to farmers and an end to all subsidies within ten years.

The United States argued that plan “doesn’t provide the reform needed” and leaves protectionism in place. This is unacceptable to the European Union, which offered a smaller cut, while major exporting countries want to see the payments scrapped much more quickly.

The banana trade highlights the problem of liberalisation. Bananas are the world’s most traded fruit and the European Union imposes strict quotas and high tariffs on them from producers in Latin America, while allowing free access to African, Caribbean and Pacific countries.

The European Union claims it is providing aid by giving growers from poor countries preferential access and good prices, but the WTO disagrees and has given its blessings to the imposition by the United States of retaliatory measures.

Thousands of workers in the Caribbean rely on sugar and bananas, but these crops sell mainly under preferential trade arrangements to the European Union, and are now being phased out; bananas in 2006 and sugar in 2009.

So the Caribbean is in a bind, the loss of these industries will be a hard blow. Already Dominica is reeling under pressure from the loss of banana exports.