• TABLE OF CONTENTS
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 Front Cover
 Center information
 Half Title
 Title Page
 Executive summary
 Table of Contents
 Introduction
 Methodology
 Results
 Discussion
 Conclusions
 Reference
 CARICOM firms' survey
 Survey of national level policy...






Group Title: Monograph Series - International Agricultural Trade and Policy Center. University of Florida ; no. 07-01
Title: Perception of firms and policy makers of the impact of CARICOM policy measures on the business environment of selected CARICOM countries
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Title: Perception of firms and policy makers of the impact of CARICOM policy measures on the business environment of selected CARICOM countries
Series Title: Monograph Series - International Agricultural Trade and Policy Center. University of Florida ; no. 07-01
Physical Description: Book
Language: English
Creator: Gordon, Ronald M.
VanSickle, John J.
Publisher: International Agricultural Trade and Policy Center, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2007
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Bibliographic ID: UF00089750
Volume ID: VID00001
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.

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Table of Contents
    Front Cover
        Page i
    Center information
        Page ii
    Half Title
        Page iii
    Title Page
        Page iv
    Executive summary
        Page v
        Page vi
        Page vii
        Page viii
        Page ix
        Page x
        Page xi
        Page xii
    Table of Contents
        Page 2
    Introduction
        Page 3
        Page 4
    Methodology
        Page 5
        Page 6
        Page 7
        Page 8
    Results
        Page 9
        Page 10
        Page 11
        Page 12
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        Page 15
        Page 16
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        Page 43
        Page 44
    Discussion
        Page 45
        Page 46
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        Page 48
        Page 49
    Conclusions
        Page 50
        Page 51
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        Page 122
    Reference
        Page 123
    CARICOM firms' survey
        Page 124
        Page 125
        Page 126
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    Survey of national level policy framers within CARICOM member states
        Page 133
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Full Text

MGTC 07-01


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ional Agricultural Trade and Policy Center


I I


MONOGRAPH SERIES


'V


UNIVERSITY OF

FLORIDA


Institute of Food and Agricultural Sciences


Perception of Firms and Policy Makers of the Impact
of CARICOM Policy Measures on The Business
Environment of Selected CARICOM Countries

By
Ronald M. Gordon and John J. VanSickle


MGTC 07-0 1September 2007


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MGTC 07-01


September 2007









INTERNATIONAL AGRICULTURAL TRADE AND POLICY CENTER


THE INTERNATIONAL AGRICULTURAL TRADE AND POLICY CENTER (IATPC)

The International Agricultural Trade and Policy Center (IATPC) was established in 1990 in the
Institute of Food and Agriculture Sciences (IFAS) at the University of Florida (UF). The mission
of the Center is to conduct a multi-disciplinary research, education and outreach program with a
major focus on issues that influence competitiveness of specialty crop agriculture in support of
consumers, industry, resource owners and policy makers. The Center facilitates collaborative
research, education and outreach programs across colleges of the university, with other
universities and with state, national and international organizations. The Center's objectives are
to:

* Serve as the University-wide focal point for research on international trade, domestic and
foreign legal and policy issues influencing specialty crop agriculture.
* Support initiatives that enable a better understanding of state, U.S. and international policy
issues impacting the competitiveness of specialty crops locally, nationally, and
internationally.
* Serve as a nation-wide resource for research on public policy issues concerning specialty
crops.
* Disseminate research results to, and interact with, policymakers; research, business,
industry, and resource groups; and state, federal, and international agencies to facilitate the
policy debate on specialty crop issues.










Perception of Firms and Policy Makers

of the Impact of

CARICOM Policy Measures


The Business Environment

of

Selected CARICOM Countries




by


Ronald M. Gordon
&
John J. VanSickle











Perception of Firms and Policy Makers
of the Impact of
CARICOM Policy Measures
on
The Business Environment
of
Selected CARICOM Countries





Researchers

Ronald M.Gordon, Graduate Research Assistant, Food and Resource
Economics Department, IFAS/University of Florida; and John J
VanSickle, Director, International Agricultural Trade & Policy Center,
IFAS/ University of Florida







Sponsors
Center for Latin American Studies, University of Florida; International
Agricultural Trade & Policy Center, University of Florida;
CARICOM Secretariat; CARIFORUM





Copyright 2007 by Ronald M Gordon and John J VanSickle. All rights reserved. Readers may
make verbatim copies of this document for non-commercial purposes by any means, provided
that this copyright notice appears on all such copies.









Executive Summary


Background


This report is a component of a project intended to enhance the understanding of the impact of
Caribbean Community (CARICOM) economic integration arrangements on the economic gains
of its members and the decision-making framework of entrepreneurs or economic agents. The
five countries of Dominica, Guyana, Jamaica, St Lucia and Trinidad and Tobago, were selected
as a representative sample of CARICOM. Firms and policy makers from these countries were
interviewed in person and subsequently surveyed with an electronically administered instrument.
The firms operated in various areas including agricultural production, agricultural marketing,
agro processing, agricultural services, fisheries, manufacturing, professional services and tourism
and hospitality services. Policy makers were from ministries of agriculture and fisheries, finance,
trade and industry, planning and tourism.


The purpose of this project was two-fold. The first objective was to evaluate the scope of impact
of the CARICOM polices and or national government policies on the production and investment
decisions of firms. The second objective was to determine the scope of impact of the CARICOM
policies and or national government policies on the economic and institutional environment
influencing firms' production decisions, from policy framers' perspectives.


The firms' survey population comprised members of business associations in the target countries
such as the Chambers of Commerce, Manufacturers' Associations, Exporter's Associations or
Tourism & Hotel Associations. The population of policy makers surveyed comprised
government ministries and departments pertaining to agriculture, finance, fisheries, industry,
planning, tourism and trade. The policy makers' population sample was selected from lists of
CARICOM Secretariat meeting participants and supplemented with data obtained during the
interview visits to the target countries. The interviews conducted involved a similar spread of
representatives from both target populations.









A four-part questionnaire was developed for the survey. The first section sought demographic
data on the respondents. The second and third sections invited the respondents to rank concepts
commonly accepted as critical to business success, based upon entrepreneurial experience
worldwide as well as on academic literature. The ranking pertained to the importance of the
factors in relation to their business. They were also asked to rank the impact of national and
CARICOM policies on business success. The fourth section sought a comparative evaluation of
the impact of national and CARICOM policies on the business environment as well as
respondents' perspective on the contribution of the CARICOM integration arrangements to
countries' economic gains. Two similar structured questionnaires were designed and
administered, one for each of the two groups of respondents, after appropriate field-tests. The
general focus of the two survey instruments was similar although there were differences in the
questions posed to the respective respondent groups.


In-Person Interviews


Firm interviewees were questioned on their perception of CARICOM and the impact of the
CARICOM arrangements on aspects of their business. Policy makers were similarly questioned
but in relation to national policy formulation and the business environment. A total of 47 firms
and 18 policy makers were interviewed across the five countries.


All respondents thought of the grouping of states when reference was made to CARICOM. A
majority of both groups perceived that CARICOM was good, citing in support (1) a larger
market, (2) opportunity for increased competitiveness and (3) improved prospects for economic
growth. Some reservations were voiced concerning (1) protracted decision-making, (2) the non-
involvement of the grass roots and (3) the apparent lack of focus on the optimisation of national
level resources.


Some firms viewed the CARICOM arrangement as contributing to a decrease in business partly
because of increased protectionism. Others perceived an increase in the cost of their doing
business or constraints on their target market because of greater protectionism or the presence of
non- tariff barriers (NTBs). A few firms indicated having an opportunity to input into the design









of CARICOM policy but many were of the view that the CARICOM arrangements did
strengthen their business environment.


A small number of policy makers said that national policy development was made easier by the
CARICOM arrangements and many indicated opportunity to provide input into the design of
CARICOM policies. However, few thought that the CARICOM arrangements strengthened the
business environment in their countries.


A subset of the firms and policy makers were questioned, additionally, about the impact of the
NTBs and the intrinsic structural characteristics of some national economies. The firms indicated
that NTBs ultimately constrain a firm's growth and can negatively impact a country's economic
gains. The policy makers' advocated that greater cognisance be taken of the structural
weaknesses of the economies of some states as a prerequisite to arriving at regional policy. A
differential approach to policy design, focusing on a sub-group of countries, was tabled as an
option to level the playing field within the Community.


Surveys: Firms


The questionnaire was administered in two parts, A & B, to facilitate its timely completion. One
thousand one hundred and four firms were contacted across the five countries. Thirty-seven
declined to participate. The response rate was 13.86 percent for Part A and 9.82 percent for Part
B. In declining order, the largest proportion of responses for Part A came from Jamaica, Trinidad
and Tobago, Guyana, St Lucia and Dominica. There was a similar order for Part B but with
Dominica and St Lucia reversed. Respondents listed the sub-sectors in which they operate and
the size of their firm, based upon the annual sales volume of their businesses.


The entrepreneurial population of CARICOM is very diverse with respect to (1) firm size (2)
area (sub-sector) of operation and (3) scope of operations. Based on the responses received, the
micro firms with annual sales volume of less than US$ 1.0 million is the dominant group, being
twice as large as the next largest group of large firms that have an annual sales volume greater
than US$ 6.5 million. The group of small firms and that of medium firms group are









approximately equally sized. Manufacturing is the dominant area of operation but many firms are
multi-faceted and operate in more than one sub-sector. Some operational combinations revealed
are: (1) agriculture & manufacturing; (2) agriculture and services (professional); (3) agriculture,
manufacturing & trade and commerce and (4) services (professional) & trade and commerce.
Some of the firms have global experience, operating in countries outside of their home base and
the Caribbean Community. Large firms lead in this regard but micro and small firms are also
involved.


Business Environment: The respondents evaluated the business environment by rating the
impact of eleven business success factors. These were: (1) the cost of capital; (2) the exchange
rate; (3) exchange rate management; (4) the rate of inflation;(5) the cost of unskilled labour; (6)
the cost of skilled labour; (7) the cost of local inputs; (8) the cost of foreign inputs; (9) the
availability of technology; (10) the ease of access to markets and (11) institutional structures or
rules for operating businesses. For the collective of firms, there is an overwhelming negative
perception of the critical business factors influencing the business operations of firms, except for
'availability of technology'. This view is substantiated when the data are examined by country

with the exception of; (1) 'unskilled labour', 'skilled labour' and 'local inputs' in Guyana and (2)
'institutional structures' or 'rules' in St Lucia. At the country level, all critical factors were
perceived 'negative' in Dominica. Collectively, the firms also perceived an across the board
'negative' impact of government policy on the critical business factors. There were a few
exceptions to this profile when the data were disaggregated by country. These pertained to (1)
Dominica for: (a) 'exchange rate management'; (b) 'cost of unskilled labour'; (c) 'cost of skilled
labour' and (d) 'access to markets'; (2) Guyana and Trinidad and Tobago for 'access to markets';
and (3) St Lucia for: (a) 'exchange rate'; (b) 'exchange rate management'; (c) 'availability of
technology' and (d) access to markets'.


Respondents ranked their perception of the CARICOM policy agenda relating, inter alia, to: (1)
agricultural and industrial development; (2) services; (3) tourism; (4) trade and (5)
transportation, on the critical business factors. The ranking scale was the same as previously
used. Firms, collectively, indicated a positive impact of CARICOM policies on 'access to
markets' only and in three areas there was an overall negative perception of impact. Examination









of the data disaggregated by country, however, elicited a much more varied impact perception
profile. A similar varied perception profile was obtained when the data were disaggregated by
firm size and sub-sector of operation. One striking feature revealed by the disaggregation was
that there was no overriding 'negative' perception indicated by medium firms, large firms or the
service (professional) sub-groups.


Firms ranked their perception of the impact of specific CARICOM policy areas on their business
operations namely: (1) the implementation of the Common External Tariff (CET); (2) the Rules
of Origin; (3) Trade Negotiations (WTO); (4) Trade Negotiations (EU); (5) Trade Negotiations
(Other); (6) Agriculture; (7) Fisheries; (8) Industry; (9) Services (tourism & hospitality); (10)
Services (professional & other) and (11) Transportation. There was a 'positive' perception of the
impact of three areas, namely: (1) the CET; (2) the Rules of Origin and (3) Services
(professional), for all firms. For the most part this profile was mirrored by the sub-groups in the
disaggregated data, except for St Lucia, which did not perceive a positive impact for any
CARICOM policy area. The perception of impact of the other CARICOM policy areas varied
when the data were disaggregated by sub-groups. Across the sub-group categories, except for a
few instances, there was either a 'no impact' or 'negative' perception for some CARICOM
policy areas such as (1) agriculture; (2) fisheries; (3) Industry; (4) services (tourism and
hospitality) and (5) services (professional).


National policies were generally ranked as having more important policy influence than
CARICOM policies, by the more optimistic set of respondents. In only one instance, that of
'market access' was the CARICOM policies perceived to be of greater influence.


A relatively conservative response was offered for the ranking of the contribution of CARICOM
economic gains to countries' economic gain with the majority indicating 'minimally' or
'somewhat' and only 15 percent indicating 'considerably'. The disaggregated data showed large
and micro firms responding 'considerably'. Country disaggregation revealed that this optimistic
view was shared by twice the proportion of Trinidad and Tobago respondents as by Jamaica
respondents. Sub-sector disaggregation showed that Manufacturing and Trade & Commerce lead









in having a view of 'considerably' followed by Service (professional). Respondents from
Agriculture are only weakly optimistic in this regard.


Investment Environment: Respondents perceived six of the eleven factors as having a positive
impact on the investment environment. These were: (1) the cost of capital; (2) exchange rate
management; (3) the cost of skilled labour; (4) the availability of technology; (5) access to
markets and (6) institutional structures or rules for business operations. Of the eleven factors,
national government policy was perceived to have a positive impact on only (1) exchange rate
management; (2) the availability of technology and (3) access to markets.


Overall, the collective CARICOM policies are perceived to have a positive impact on business
success factors related to investment decisions of firms. When questioned about the potential for
the contribution of the CARICOM integration arrangements to increased investment in their
country, the greater proportion of respondents anticipated CARICOM policies would contribute
either 'considerably' or 'somewhat' to future investment with only a few projecting 'minimal'
contribution.


Surveys: Policy Makers


Seventy-six policy makers from the five countries were sent questionnaires and one declined to
participate. The response rate to Part A was 44.7 percent and to Part B 34.2 percent. For Part A
the largest proportion of responses were from Trinidad and Tobago (42.42 percent) followed by
Dominica (21.21 percent), Guyana (18.18 percent), Jamaica (12.12 percent) and St Lucia (6.06
percent). For Part B Trinidad and Tobago again lead the responses with 40.00 percent followed
by Guyana (24.00 percent), Dominica (20.00 percent) with Jamaica and St Lucia each at 8.00
percent. The experience profile of the policy makers indicated that over 60 percent of them have
a minimum of five years experience. Economics is the top field specialisation with the majority
holding masters degrees and one holding a PhD degree. Some policy makers are qualified in
multiple areas of specialisation.









Policy makers perceive that both national policies and CARICOM policies have a general
'positive' impact on the critical business factors. CARICOM policy was perceived as having a
positive impact on national policy formulation. The impact of specific CARICOM policy areas
was also seen as 'positive'. In a comparison of the influence of national versus CARICOM
policy sources on the critical business factors, the more optimistic policy makers perceived a
greater national policy influence for all but 'the cost of skilled labour' and 'access to markets'.
CARICOM policy was perceived to have greater influence on these two factors. Policy makers
revealed optimism about the contribution of the CARICOM integration arrangements to
countries' economic gain with 24 percent indicating 'considerably' and 52 percent 'somewhat'.
For policy makers, all the critical business factors had a positive impact on the investment
climate. They viewed the policies they were formulating to have a 'positive' impact except on
'exchange rate' and 'exchange rate management' about which they indicated 'no impact' or
'neutral'. CARICOM policies were similarly perceived and all CARICOM policy areas were
thought to have a positive impact on investment. Policy respondents were quite optimistic about
the contribution of CARICOM arrangements to countries' economic gain with 24 percent
indicating 'considerably' and 44 percent 'somewhat'.


Surveys: Supplemental Comments


The supplemental comments related to policy design and formulation and addressed: (1)
reviewing of aspects of the institutional structures and supporting arrangements; (2) pursuing a
more targeted and differential strategy inclusive of entrepreneurs and (3) specific consideration
of the diversity of economic characteristics that exist between and among CARICOM member
states.


Conclusions


The survey responses revealed considerable heterogeneity within the CARICOM business
environment of the five target countries. The differences are particularly evident when the survey
responses are disaggregated by country, firm size or sub-sector of operation. This suggests that
the policy formulation process pertaining to the business environment within CARICOM should









embrace a stakeholder inclusive strategy and process that actively and deliberately embraces the
economic and related characteristics exhibited by countries, firms and sub-sectors within the
business environment.










Table of Contents


Introduction ..... ............................ .................... 3
Background ..................................................................... 3
Purpose................. ................................... 4
O objectives .................. ..... ......... .. ................................................ 4
M eth od ology .......... .... ............... ..................................................................... . 5
F ir m s .......................................................... ..... ...... 5
P o licy m a k e r s ............................................................................................................ ... .... 7
Field Testing and Survey Adm inistration........................................ 9
In -P erso n In terv iew s ....................................................................................... ...... ............ 9
R results ....................................................................... 9
In te rv iew s ................... ................... ...................9..........
S u rv ey s ................... ................... ...................2.........0
F ir m s' R e sp o n se s ................................................................................................................ 2 0
Policy Makers' Responses ........................................................................... 30
Perception of CARICOM Level Policies by Country, Firm Size & Sub-sector ........... 35
D isc u ssio n .................................................................................. 4 5
Interviews ....................................... .............. 45
Surveys ........... ... ................................................... 46
Firms: ........................................ 46
P o lic y M a k e r s : ........................................................................... .......................................... 4 8
Supplemental Comments and Observations ........................................ 49
C on clu sion s ........... .................................................... ........................... 50
R e fe re n c e s ............................................................................................................. .......... ...... 12 4
Annex 1 .............................................. .................. 125
Annex 2 .....................................................................135









Introduction


Background
The Caribbean Community and Common Market comprised primarily of the former British
colonies of the Caribbean, South and Central America was formed into a customs union
registered with the GATT/WTO in August 1973. The expectation was that there would be
economic gains from the resulting integration agreement more so than if the countries remained
as separate individual nations (Brewster and Thomas, 1967). An empirical analysis of the trade
among a sub-set of five Caribbean Community (CARICOM) countries is being undertaken to
evaluate the extent to which gains have resulted from the CARICOM economic integration
arrangements, in keeping with the underlying rationale of a preferential trade agreement. This
project is a complement to that trade analysis exercise.


The goal of this project is to enhance the understanding of the impact of the Caribbean
Community (CARICOM) economic integration arrangements as well as that of national and
CARICOM policies on (1) the business environment of the target countries, (2) the decision
making framework of entrepreneurs and (3) the economic gains of the countries. The five
countries of Dominica, Guyana, Jamaica, St Lucia and Trinidad and Tobago, were selected as a
representative sample of CARICOM. The views of a cross section of firms were obtained
through a survey administered electronically. Litchfield et al (2003) report on the use of detailed
multi-period household surveys to evaluate the impact of agricultural and other trade
liberalization policies on the dynamics of poverty in three developing countries. Winters (1997)
reports on the ranking of barriers to intra- European Union (EU) trade through a survey of EU
businesses. This literature and the report of VanSickle et al (2005) on the survey of the grower
perspectives in the U. S. nursery industry informed the methodological approach with respect to
the survey. Firms and policy makers were surveyed from each of the five countries.


For entrepreneurs, the survey was administered among enterprises and firms involved in
agriculture, fisheries, manufacturing, services including professional as well as tourism and
hospitality and trade. The firms' survey population comprised members of the business
associations of the target countries such as the Chambers of Commerce, Manufacturers'









Associations, Exporters' Associations or Tourism & Hotel Associations. Representatives of
firms were also interviewed selected from areas including agricultural production, agricultural
marketing, agro processing, agricultural services, fisheries, manufacturing, professional services
and tourism and hospitality services.


The population of policy makers surveyed was identified from government ministries and
departments pertaining to agriculture, finance, fisheries, industry, planning, tourism and trade. A
similar spread of policy makers in the target countries was also interviewed. The policy makers'
population sample for the survey was identified from a perusal of meeting lists provided by the
CARICOM Secretariat and supplemented with data from meeting lists obtained during the
interview visits to the target countries.


Purpose
The purpose of this exercise was two-fold. First, in relation to firms the project seeks to evaluate
the scope of impact of the CARICOM polices and or national government policies on their
production and investment decisions. Second, for policy framers, the project seeks to determine
the scope of impact of the CARICOM policies and or national government policies on the
economic and institutional environment influencing firm's production decisions. An additional
purpose, in respect to both groups, was to ascertain the perception of the impact of the
CARICOM integration arrangements on the economic gains of the countries.


Objectives
For firms the objective was to develop a database on the decision parameters in order to:


1) Evaluate the main issues considered by enterprises or firms when making decisions
affecting the enterprises or firms;
2) Identify and characterise those issues as to their being influenced by national policies
and CARICOM policies; and
3) Determine the extent to which enterprise or firm owners are influenced by CARICOM
policies in the determination of their investment and marketing decisions.









For policy makers the objective was to create a database to evaluate the economic and
institutional environment influencing the decisions of the firms so as to:


1) Ascertain the sources of stimuli that serve to shape the economic and institutional
environment of enterprises or firms;
2) Identify those economic and institutional factors that are deemed critical to the economic
viability of the enterprises or firms in the target countries.
3) Determine the extent to which the national economic and institutional environment is
perceived influenced by national or CARICOM policies.


Methodology


Two structured four part questionnaires were designed, one for each of the two groups of
respondents. The general focus of the two survey instruments was similar although there were
differences in the questions posed to the respective respondent groups.


Firms
For the firms, the first section sought demographic data on the respondents. These data pertained
to: (1) country and location of enterprise; (2) sub-sector of operation; (3) geographic scope of
operations; (4) number of workers employed and (5) size of firm based on their annual sales
volume in United States (US) dollars. For this variable firms were categorised into four groups.
Firms with a sales volume less than US $ 1.0 million were in the micro group and those with a
sales volume greater than US $ 1.0 million but less than US $2.5 million were classified as small.
Firms with a sales volume greater than US$ 2.5 million but less than US $6.5million were
considered medium sized and those with a sales volume greater than US $ 6.5 million were large.


Section II invited the respondent's ranking of concepts commonly accepted as critical to a
business (Acs and Szerb, 2007; Alvarez and Crespi, 2003; Cook, 2001; Stel et al., 2007). Eleven
critical success factors were identified for ranking with respect to their impact on business
operations, national policies impacting on the factors and CARICOM policies impacting on the
factors. The success factors used for this analysis were: (1) the cost of capital; (2) the exchange









rate; (3) exchange rate management; (4) the rate of inflation; (5) the cost of unskilled labour; (6)
the cost of skilled labour; (7) the cost of local inputs; (8) the cost of foreign inputs; (9) the
availability of technology; (10) the ease of access to markets and (11) institutional structures or
rules for operating businesses.


The Treaty of Chaguaramas broadly outlines a policy agenda in several areas in support of the
preferential trading agreement among member states of CARICOM. This policy agenda relates
to, inter alia, agricultural and industrial development, services, tourism, trade and transportation.
A summary of the respective policy goals was provided to respondents with respect to a) the
tariff regime, b) rules of origin, c) joint negotiation of trade agreements, d) agriculture and
fisheries, e) industry and services, f) tourism, g) transportation, and h) establishment, capital and
movement of persons. Information on the CARICOM policies was distilled primarily from the
Revised Treaty of Chaguaramas (CARICOM Secretariat, 2006).


Firms were also invited to rank their perception of the impact of CARICOM policy areas on their
own business operations. The policy areas indicated were: (1) the implementation of the CET;
(2) the Rules of Origin; (3) Trade Negotiations (WTO); (4) Trade Negotiations (EU); (5)Trade
Negotiations (Other); (6) Agriculture; (7) Fisheries; (8) Industry; (9) Services (Tourism &
Hospitality); (10) Services ( Professional & other) and (11) Transportation.


For the questions in Section II, the ranking scale was from -3 to +3 where -3 = a strong negative
impact, 0= no impact (neutral) and +3 a strong positive impact. Respondents were also able to
indicate U if they had no view or were uncertain or N/A if not applicable.


Section III sought responses on a desirable investment climate. Respondents were invited to
rank the importance of the factors from three perspectives, namely: (1) their contemplation of
future investment in their business environment; (2) the influence of their national government's
policies on the factors and their future investment decisions and (3) the influence of the
CARICOM policy agenda on the factors and their future investment decisions. In addition,
respondents were also invited to indicate whether any of the eleven specific CARICOM policy
areas listed above seem likely to influence their investment decisions. .The scale for ranking the









responses in this section was (+) = a positive impact, (0) = no impact (neutral) and (-) = a
negative impact. Respondents were able to indicate U if they had no view or were uncertain or
N/A if not applicable.


The fourth Section of the questionnaire sought a comparative evaluation on the impact of
national and CARICOM policies with respect to their influencing the critical business factors
important to the viability of their enterprise or firm. Responses were indicated on a scale of 1 to
4 where 1 = least important and 4 = very important. A response of U or N/A was given if the
respondent was uncertain or considered the question not applicable to their circumstances. This
section also elicited respondents' perspective on the contribution of the CARICOM integration
arrangements to: (1) countries' economic gains and (2) potential for increased investment in the
country. Responses for either question were recorded on a ranking scale of 1 to 4 where 1= no
impact, 2 = minimally, 3 = somewhat and 4 = considerably. Those who were uncertain or had no
view could have elected to respond 'U'.


Respondents were also invited to make any general or specific comment to supplement their
responses to the structured portion of the questionnaire.


Policy makers
The first section of the policy makers' questionnaire sought general data and information on the
respondents. These data pertained to: (1) country and ministry of assignment; (2) years of service
at the current ministry; (3) service at another ministry; (4) area of specialisation and (5) highest
level of academic training.


Section II elicited respondents' perception of: (1) the impact of national policies on the business
factors; (2) the impact of the collective of CARICOM policies on the business climate, as filtered
through the business factors; (3) the extent to which the collective of CARICOM policies are
perceived supportive or unsupportive of national policies in relation to the critical business
factors and (4) specific CARICOM policies having an impact on the national business climate.
The listing of business factors was the same as was used with the firms, as was the CARICOM
policy agenda and the CARICOM policy areas. Similarly, for the questions in this section, the









ranking scale was from -3 to +3 where -3 = a strong negative impact, 0 = no impact (neutral) and
+3 a strong positive impact. Respondents were also able to indicate U if they had no view or
were uncertain or N/A if not applicable.


Section III invited responses on a desirable investment climate. Respondents were requested to
rank the importance of the business factors from three perspectives, namely (1) their perception
of importance in relation to future investment in their country, (2) the likely impact of their
national government's policies on the factors and the future investment climate in the country
and (3) the influence of the CARICOM policy agenda on the business factors and consequential
future investment climate in their country. In addition, respondents were also invited to indicate
whether any of the eleven specific CARICOM policy areas listed earlier seem likely to influence
the investment climate in their country. The scale for ranking the responses in this section was
(+) = a positive impact, (0) = no impact (neutral) and (-) = a negative impact. Respondents were
able to indicate U if they had no view or were uncertain or N/A if not applicable.


The fourth Section of the policy makers' questionnaire sought a comparative evaluation on the
impact of national and CARICOM policies with respect to their influencing the critical business
factors for the investment climate in their country. Responses were indicated on a scale of 1 to 4
where 1= least important and 4= very important. A response of U or N/A was given if the
respondent was uncertain or considered the question not applicable to their circumstances. This
section also elicited respondents' perspective on the contribution of the CARICOM integration
arrangements to: (1) countries' economic gains and (2) increased investment in the country.
Responses for either question were recorded on a ranking scale of 1 to 4 where 1= no impact, 2 =
minimally, 3 = somewhat and 4 = considerably. Those who were uncertain or had no view could
have elected to respond 'U'.


Respondents were also invited to make any general or specific comment to supplement their
responses to the structured portion of the questionnaire.









Field Testing and Survey Administration
The questionnaires were field-tested, through individual or focus group discussions in each of the
target countries and modified based upon the feedback received. One important change was the
division of each of the questionnaires into two parts, the first dealing with the current
environment and the second with future investment. This change reduced the time required for
the completion of each part and was advised as a prudent measure to encourage a greater
response. The survey was administered electronically, initially through an online survey service
provider. Questionnaires were also distributed by email in a PDF file format, to facilitate ease of
completion. A CARICOM Secretariat letter of support for the research was transmitted with the
PDF file. Field visits, electronic and telephone contacts were undertaken in order to improve the
response rate.


In-Person Interviews
Firm interviewees were questioned on their perception of CARICOM and the impact of the
CARICOM arrangements on various aspects of their business. Policy makers were similarly
questioned but in relation to national policy formulation and the business environment. A total of
47 firms and 18 policy makers were interviewed across the five countries.


Results


Interviews
Interviewees' Profile: The firm interviewees were distributed as follows: Dominica (5), Guyana
(17), Jamaica (6), St Lucia (10) and Trinidad and Tobago (9). Eighteen policy makers were
interviewed, distributed as follows: Dominica (3), Guyana (2), Jamaica (5), St Lucia (4) and
Trinidad and Tobago (4). A representation of the firms and policy makers interviewed is
presented in Tables 1 and 2 respectively.
Analysis of Responses: Four questions were posed to both groups of respondents. These
pertained to (1) thoughts with reference to CARICOM, (2) a perspective of CARICOM, (3)
providing input into the design of CARICOM policies and (4) the impact of CARICOM
arrangements on the business environment. The other questions were specific to each group.

1 The firm Survey Monkey, available at http://survevmonkev.com/ was used for this service.









Question 1 (to firms and policy makers) on thoughts when reference is made to CARICOM:
Response options were (a) grouping of states or (b) the agency facilitating the arrangements
among the states. More respondents of both groups think of the grouping of countries than they
do of the agency facilitating the arrangements among the states.


Question 2 (to firms and policy makers) on a perspective of CARICOM, the Community:
Response options were (a) good (b) inconsequential or (c) bad. Here also, more respondents of
both groups were of the view that CARICOM the Community was good or a good concept.
Points made in support were:
1) Larger market and greater pool of technical skills available to the manufacturer or service
provider;
2) The opportunity for firms to access a market greater than their national one allows them
to catalyse their growth and equips them with the ability to eventually be competitive
globally;
3) Prospects for economic growth for the region will be enhanced, particularly in light of the
relatively small size of the individual members of the Community;


Those of a different view mainly thought it inconsequential. None thought it bad. Concerns were
voiced pertaining to:
4) The protracted process perceived being influenced by the absence of political will, and
the consequent lack of impact in forging increased economic cooperation;
5) The perception that increased economic cooperation is 'a middle class intellectual
exercise' in which the peasant or grass roots of the society is mostly uninvolved;
6) The bureaucratic burden imposed and the apparent lack of focus on the optimisation of
national level resources.


Question 3 (to firms) on CARICOM arrangements' impact on volume of business: Response
options were (a) increased (b) unchanged or (c) decreased. A smaller proportion of firms were of
the view that the CARICOM arrangements increased the volume of their trade or business
compared with those who thought that the volume of their trade or business had either been
unchanged or declined. Issues cited in support of an increase in trade or business included:









1) A gain in market share and improvement in competitiveness consequent upon
globalisation
2) Access to a larger (regional) market for products as well as a larger pool for sourcing
product at a competitive price.
For the majority who responded unchanged or decreased, some of the reasons cited were:
3) The firm has traditionally traded in the Caribbean and the CARICOM arrangements
would not have had any impact
4) Increased protectionism among countries has led to a decrease in business
5) The firm has experienced an increase in business but this cannot be attributed to the
CARICOM arrangements
6) The CARICOM arrangements do not impact on tourism/hospitality service firms
7) The CARICOM arrangements exist on paper and generally do not affect companies
unless there is a problem.


Question 3 (to policy makers) on the effect of CARICOM arrangements' on national policy
development: Response options were (a) easier (b) no change or (c) more complex. A smaller
proportion of policy makers thought that their national policy development activities were made
easier by the CARICOM arrangements compared with those who thought there was either no
change or the national policymaking was more complex because of the CARICOM
arrangements. Comments in support of national policymaking being easier included
1) National policy being built upon what exists at the regional level
2) National policy being designed upon advice from the CARICOM Secretariat.


Those who responded no change or it being more complex indicated:
3) The considerable challenge to conform to a group position when the national
circumstances dictate a different policy prescription
4) A single-mindedness of perspective at the national level that ignores regional policy
positions
5) A complex national economic environment and internal weaknesses in the economy that
suggest policy prescriptions different to those being proposed at the regional level.









Question 4 (to firms) on CARICOM arrangements' effect on the cost of doing business:
Response options were (a) increased (b) not changed or (c) decreased. Fewer firms perceived
that the CARICOM arrangements reduced the cost of their doing business compared with the
number of firms that thought the CARICOM arrangements had either not changed or increased
the cost of their doing business. Among the reasons cited for the perception of decreased costs
were:
1) The sourcing of inputs from a member state at a reduced cost or free of import duties
2) The reduction in the amount of bureaucracy when visiting other countries in the region
3) Reduced product cost per unit consequent upon an increased volume of business with
stagnant overhead costs.


For those who said either 'increased' or 'not changed', reasons given included:
4) Business costs, such as with professional services or knowledge based businesses, are
not linked to the CARICOM arrangements
5) The absence of cross border trading in the commodity
6) The need to carry increased inventory on account of seasonality of supply from member
states
7) Consumption taxes imposed in some countries
8) Limited impact of ability to source regional inputs free of duty.


Question 5 (to firms) on CARICOM arrangements' effect on their target market: Response
options were (a) increased (b) remained same or (c) decreased. Fewer firms indicated that the
CARIOCM arrangements increased their target market as opposed to those that indicated either
no effect or a decrease in their target market. Reasons suggested for an increase included:
1) The intra regional preferential trade arrangements as well as an increase in intra regional
travel positively influenced market share gain
2) Recent increase in orders from within the region and trade data show an increase in
sourcing from regional suppliers
3) More competitively priced products from within the region, in some instances partly
attributable to the lower tariff
4) Participation in regional trade shows.











Those who responded either 'remained the same' or 'decreased' supported this position with
reference to:
5) The absence of intra regional trading in the commodity
6) Market access constraints on account of non-tariff barriers in some countries
7) CARICOM arrangements impacting on the tourism/hospitality sector are virtually non-
existent
8) The firm's focus on a global market rather than a regional one
9) Firms from larger states discriminate against firms from smaller states in their terms of
trade for intra regional consignments
10) The absence of incentives to encourage the sourcing of goods manufactured in the region.


Question 6 (to firms) on the perception of member states of CARICOM being open to trade in
goods or services: Response options were (a) simpler regulations (b) require conformity similar
to any other country or (c) create great difficulty for intra regional trade. More firms perceived
the creation of great difficultly for intra regional trade in goods or services than those that
indicated either easier regulations or conformity similar to any other country. Among the reasons
advanced for the perception of great difficulty were:
1) The maintaining of licensing systems for some commodities
2) The need to contend with huge bureaucracies in many instances
3) Non-uniformity of standards and rules applicable to the same commodity across the
region
4) Various non tariff barriers for goods and services presumed erected to discriminate
against firms and service providers from the region and protect vested national interests;
5) The absence of political will to open up the market
6) The inability to easily ascertain a country's requirements for trade in goods or services.


Those who said either simpler regulations or require conformity similar to any other country,
offered in support:
7) Reference to the development of CARICOM standards to facilitate intra regional trade
8) Simpler documentation for trade with some countries









9) Less stringent standards than required for global trade
10) Trouble free experience working regularly with two member states in the area of
tourism/hospitality services.


Question 7 (to firms) and Question 4 (to policy makers) on opportunity to provide input into the
design of CARICOMpolicies: Response options were (a) Yes or (b) No. Among the firms, a
smaller group indicated having an opportunity to input into the design of CARICOM policy
while among the policy makers the group that so indicated was larger.


Those firms that indicated opportunity to input in the design of CARICOM policy were able to
do so through:
1) Membership in a national or regional business association, although the transmission is
not always unimpeded
2) National mechanisms or consultations established for this purpose or through various
regional private sector for a.


Among the reasons cited by those firms that indicated the lack of opportunity to input into the
design of CARICOM policy were:
3) Absence of any clear channel of communication in addition to the lack of any specific
regional policy making body in the tourism/hospitality sector
4) Absence of any consultative mechanism to permit communication of ideas
5) Small manufacturers do not perceive themselves having an impact on CARICOM policy
and are not seen as important to the national economy by the local policy maker
6) Consultation opportunities offered are ineffectual
7) While opportunities might be available many companies lack the expertise or capacity to
utilise them
8) The professional services sector is not usually perceived to be within the services sector
and therefore inputs from such firms are not sought.


The policy makers who indicated opportunity to input into the design of CARICOM policy
supported this with reference to:









1) Opportunity to review and comment on documentation circulated by the CARICOM
Secretariat although the timeliness of circulation coupled with the lack of national
capacity sometimes created constraints
2) Participation in meetings of the COTED although the timeliness of implementation and
output, as a result of the tardiness of responses from some countries, was lamented
3) Participation in other regional fora. The implementation of a formalised process to
provide for an integrated system of policy design across sectors was advocated. In this
regard consideration could be given to the use of information technology as a time and
cost efficient tool.


A few policy makers expressed reservations about being able to input into the design of
CARICOM policy. These made reference to:
4) The need for a greater involvement of states in the meetings of some of the CARICOM
institutions through the establishment of committees charged with the responsibility for
policy design and more regular meetings particularly in association with regional
agencies that might have an overlap in focus
5) More effective national level consultation designed to feed into the regional policy
development
6) A more concerted attempt to solicit and utilise national level inputs in the process of
regional level policy development
7) National level budgetary constraints that sometimes limit the extent of national
representation at regional policy development fora.


Question 8 (to firms) and Question 5 (to policy makers): on CARICOM arrangements
strengthening the business environment. Response options were (a) Yes or (b) No. A greater
proportion of firms were of the view that the CARICOM arrangements did strengthen their
business environment, than those that had the opposite view.


Firms that perceived a strengthening of the business environment pointed to:
1) A larger and easily accessible market with the removal of duty on intra-regional trade of
products of regional origin









2) An improvement in product standards, firm level productivity, increased competitiveness
and the institutional arrangements (rules) pertaining to trade
3) Easier access to a larger pool of skilled labour
4) The joint negotiation of trade arrangements at the international level.


Firms that did not perceive a strengthening of the business environment made reference to:
5) The focus of the CARIOCM arrangements primarily on commodity trading with less if
any consideration of tourism/hospitality services or professional services
6) The dearth of information and timely communication on the regional market supply and
demand status pertaining to commodities of interest
7) The non-uniformity of grades, standards and regulations pertaining to agricultural health
and food safety issues
8) The need for increased consultations and institutional strengthening with a focus on
improving the competitiveness of small businesses.


In contrast to firms, a greater proportion of policy makers were of the view that the CARICOM
arrangements did not strengthen the business environment. The policy makers that perceived a
strengthening of the business environment referred to:
1) An expanded market and the opportunity for smaller firms particularly to hone skills in
order to become internationally competitive
2) The greater facilitation of the movement of people among the countries of the region
3) Stronger cooperation and collaboration among member states in the area of fisheries.


Those policy makers who opined that the CARICOM arrangements did not strengthen the
business environment made reference to:
4) Greater benefits to be achieved if the national planning body were to lead in policy
development focused on improving the business environment
5) Internal weaknesses in the country's macroeconomic environment that militate against
the country deriving much benefit if any from many of the regional policies
6) The non-attainment of benefits that were proposed in policy documents presented at
regional fora









7) Weak action on the stimulation of investment.


Firms' Responses to the Supplementary Questions


Question on the potential impact of non-tariff barriers on investments and gi ,n thi1
The following is a summary of the response of two firms, which were posed the question:
Firm 1:
Yes we did have to forego investment opportunities and constrain our growth as a result of our
experiencing non-tariff barriers (NTBs). Our sales volume was lower and our possible expansion
was restricted since market access was denied. The requirement that an agricultural chemical that
is registered in one country must also be registered in another before it can be traded from the
first to the second is more a constraint to the growth of the firm.


Firm 2:
We have been seriously affected by the NTBs that have surfaced and there has been an impact at
the country level also. In some instances the country has lost the opportunity to reap benefits that
could accrue from the use of the agricultural chemical in question. This may be due to
bureaucratic problems as is the case with St Vincent and the Grenadines (one country) where the
Pesticide Control Board has not met for in excess of one year because one individual has refused
to convene the board meeting. Here the action of one person has likely had a negative impact on
a country's gains and also my firm's investment. The lack of registration of an agrochemical
results in my firm being unable to market that product. This lack of registration has been used to
bar our entry to the Jamaican market for the past 2-3 years. In turn, this has affected the growth
of my firm since our vision is to expand within the Caribbean. We are the only firm to market
products like ours throughout the Caribbean (both English and Dutch) and with the advent of the
CSME our company will be well positioned to take advantage of the opportunities that emerge. I
question the need to register a product in each country. There was talk of regional harmonisation
of pesticide legislation but nothing has materialised. Harmonisation will allow for the
registration in country A to be recognized in country B and an agreed team of experts satisfactory
to all interest groups can be used in the process. The current system that requires registration in
each country takes more time, increases costs and is a barrier to trade.











Policy Makers' Responses to the Supplementary Questions


Question on the characteristics of the Jamaican economy that work against the competitiveness
of the private sector.
Policy Maker 1
Jamaica's problems are unique and debt is a major one. In general, a labour force and its work
ethic are critical factors in competitiveness. Labour needs to be highly trained and disciplined.
This is not so in Jamaica which suffers from structural weaknesses in the economic environment.
The population is not very educated. As a consequence it is more challenging for Jamaican
managers to manage the workers, especially those at the lower level. In comparison, in China,
the people are more educated, more dedicated, work under hostile conditions for smaller wages
and are easier to manage. These are 'soft elusive factors' and cannot be addressed by regional
policies. The quality of human resource is the foundation of competitiveness, at both the national
and household levels. Consequently, it would be necessary to educate the Jamaican workforce
and re-socialise the society in order to address the social challenges.


Policy Maker 2
This would be challenging. I am unaware of changes that would be compatible with local
policies and circumstances that would not affect other countries. Some issues such as the
financial crisis are not found in other states and if the (Jamaican) government is looking at tax
policies to generate revenue this will have to be addressed with Jamaica in mind. Consequently,
the government may have to be narrow in focus. Perhaps there may have to be a more inclusive
consideration of national circumstances when designing policy at the regional level, leading to
the making of some measure of accommodation in regional level policy. This will be a challenge
but it will be validated if a way can be found to consider national circumstances.









Question on Jamaica's participation in the CARICOM single economy (CSE) in light of
Jamaica's economic circumstances


Policy Maker 1
Others may not share this view of the disadvantaged status of the Jamaican economy. Rather
they may take a more mechanical or prescriptive approach that will not stop Jamaica from
participating in the CARICOM Single Economy (CSE). However, my view is that the country
will not be competitive and that the trade imbalance will likely remain until Jamaica can solve its
social problems.


Policy Maker 2
There is considerable divergence of monetary and fiscal policies among the CARICOM partners,
yet there is talk of policy harmonisation within the Community. This would be a major challenge
in moving to a CSE given the existing divergence. Achieving this goal in the near future (our
lifetime) would be extremely difficult. Another question is whether it is necessary to achieve this
goal of a CSE. Perhaps there could be common policies in some aspects of financial sector
integration such as with the stock exchanges, with selected taxation issues and perhaps with
insurance, without a formal CSE. Unless tangible benefits can be demonstrated to be achievable
from a CSE there will be little incentive to attain that goal (of a CSE)2.


Question on changes to the process of arriving at CARICOM policy that can serve to reduce
national level complexity and enhance the business environment.


Policy Maker 1
In order to improve the competitiveness of individual members within the CARICOM there will
be need for policies that are not regional, focused on improving the weaker states. This suggests
a 'sub-group' approach to create an even the playing field within the Community since the
weaker countries need support to alleviate social tensions within their economies. The




2 This comment was made during the initial interview. It is placed here on account of its greater relevance to this
issue.









application of generic medicine to disequilibrium is inadvisable. Country specific medicine is
required.


Policy Maker 2
Inclusiveness is required. Consultations with stakeholders should be increased when looking to
develop such policies. In addition, there should be increased sensitisation of stakeholders to
enhance their appreciation of the suite of policies and their impact.


Surveys
Firms' Responses
Firms' Population Demographics and Characterisation
One thousand one hundred and four firms were contacted across the five countries. Thirty-eight
declined to participate. The valid responses received to Part A of the survey totaled 153 with
112 being submitted for Part B, making the response rate 13.86 percent for Part A and 9.82
percent for Part B. For Part A, the largest proportion of responses (29.61 percent) came from
Jamaica followed by Trinidad and Tobago (21.71 percent), Guyana (18.42 percent), St Lucia
(17.11 percent) and Dominica (13.16 percent). There was a similar spread of responses to Part B
but with the proportion from Dominica being slightly larger than that from St Lucia. In both
instances, in excess of 75 percent of the respondents were located in the urban area. Respondents
were invited to indicate the sub-sectors in which they operate, choosing from agriculture,
fisheries, manufacturing, mining, services (tourism and hospitality), services (professional or
other), trade & commerce and other. In descending order, the four largest groups of respondents
to Part A were manufacturing (36.18 percent), Services (T&H) (26.97 percent), Services (P)
(25.00 percent) and Trade & Commerce (18.42 percent). For Part B the descending order was
manufacturing (39.45 percent), Services (P) (29.36 percent), Services (T&H) (23.85 percent) and
Agriculture (22.02 percent).


Among the respondents to Part A, 46.31 percent were micro firms, 16.78 percent small firms,
15.44 percent medium firms and 21.48 percent large firms. For Part B the profile was 48.04
percent micro firms, 14.71 percent small firms, 16.67 percent medium firms and 20.59 percent
large firms. These profiles are graphically depicted in Figure 1 A and Figure 1 B respectively.











The operations were not all confined to one country since 18.95 percent of respondents to Part A
and 22.94 percent of respondents to Part B operated in another country. For these, the locations
of the other operating base or bases included other Caribbean countries3, South America, North
America, Asia, Europe and Africa4. Eighty-seven percent of the firms employed full-time year
round workers. At the higher end, the number of year round employees ranged from 2,500 to
1,200. These were all large firms, many with operations across sub-sectors such as (1)
agriculture and manufacturing (2) manufacturing and trade and commerce or (3) agriculture,
manufacturing, services (tourism and hospitality) and services (professional). Some of these
operated in only one sub-sector and a few in more than one country. Micro firms dominated in
the one to ten full time employment range. However, these too were involved in operations
across sub-sectors namely (1) agriculture and manufacturing (2) agriculture and services
(professional) and (3) manufacturing and trade & commerce. Some however were single sub-
sector firms in either manufacturing or services (tourism and hospitality) or services
(professional). In addition, about 50 percent employed part-time year round workers also. Full-
time seasonal employment was exhibited by at least 21 percent of the firms while at least 31
percent engaged in part-time seasonal employment.


Perception of Policy Impacts on Current Business Operations
Baseline Perception of Critical Factors: The respondents were invited to evaluate their
business by rating the impact of the eleven factors identified as critical to the conduct and
profitability of businesses and investments, using the specified ranking scale. The summary of
responses presented in Figure 2 indicates the perception of a definite negative impact for all the
factors except technology, which showed a positive impact and access to markets where the
negative impact was weak.


Some respondents cited other factors that affected their business operations, namely:
1) Non tariff barriers;
2) Bureaucracy and archaic customs regulations;

3 Including CARICOM countries.
4 For example: Brazil, Colombia, Costa Rica, Honduras, Venezuela; Canada, USA; China, Sri Lanka: UK: Kenya
and Nigeria.









3) Labeling and phytosanitary regulations in destination markets;
4) Shipping facilities and costs;
5) Limited government vision and policy pertaining to tourism as well as weak local tourism
support systems and structures ;
6) Inadequate dissemination of information on CARICOM policies;
7) Unsupportive investment climate.
Government Policies on Critical Business Factors: Respondents were requested to rank their
perception of the impact of their national government policies on the same set of critical business
factors, using the same ranking scale. The summary of responses presented in Figure 3 also
indicates the perception of a definite negative impact of governments' policies on all the factors.
Here however that perception was less pronounced for technology and access to markets.


Some respondents offered comments on additional areas pertaining to government policy such
as:
1) Tardiness in the establishment of rules for electronic commerce;
2) Lack of adequate systems for consultation with the private sector on issues pertaining to
growth of the economy and the absence of a long term vision for growth and economic
transformation;
3) Weak public policy in respect of some segments of the service sector and tourism in
particular;
4) Inadequate policy and financial support to firms' export marketing initiatives;
5) Weak secondary education system contributing to a skills gap in the labour market.
CARICOM Policies on Critical Business Factors: A summary of the CARICOM policy
agenda as generally outlined in The Treaty of Chaguaramas was provided to respondents with
respect to a) the tariff regime, b) rules of origin, c) joint negotiation of trade agreements, d)
agriculture and fisheries, e) industry and services, f) tourism, g) transportation, and h)
establishment, capital and movement of persons. Respondents were invited to rank their
perception of the impact of the CARICOM policies on the critical business factors, using the
same ranking scale as with the previous questions. The summary of the responses presented in
Figure 4 shows a neutral view in relation to the impact of the CARICOM policies on six of the
eleven critical factors, namely: cost of capital, exchange rate and its management, inflation, cost









of unskilled labour and the availability of technology. There was a definite positive perception
with respect to the access to markets and a negative perception in relation to three factors: cost of
skilled labour, cost of local inputs and cost of foreign inputs. Respondents were ambivalent on
the impact of CARICOM policies on institutional arrangements or rules. In addition, the level of
responses in the uncertain/not-applicable category was, on the average, noticeably higher for this
question than the previous ones.


There were additional observations were offered to complement some respondents' response to
this question, namely:
1) The continued existence of protectionism within the CARICOM market in the form of
both quantitative and qualitative barriers to trade;
2) The cost of transportation; and
3) A perceived bias to companies from other CARICOM countries contributing to price
inflation in the respondent's country.
CARICOM Policy Areas on Business Operations: Firms were invited to rank their perception
of the impact of the eleven CARICOM policy areas on their business operations. The summary
of the responses is presented in Figure 5. In three policy areas, there was a definite positive
perception of impact on business operations namely: the CET, the Rules of Origin and Services
(Professional & other). Industry showed a weak positive perception of impact and there was a
negative perception of the impact of the WTO trade negotiations. Perception of impact was
neutral in the areas of EU and Other Trade Negotiations, Agriculture, Fisheries, Services
(Tourism and Hospitality) and Transportation.


Comparative Evaluations
National vs. CARICOM Policies: Respondents were invited to compare the importance of their
national government's policies versus the CARICOM policies with respect to their influencing
the critical business factor important to the viability of their enterprise.


The response data are presented graphically in Figure 6. The data are stacked in columns so that
those who responded least important, '1', are represented in the lowest segment of the column5.

5 Recall the ranking scale for this question is 1 to 4 where 1 = least important and 4 = very important.









Those who responded '2' are in the second lowest segment. The '3' respondents are in the third
segment going up and the '4' respondents are in the fourth segment going up. The uppermost
segment reflects the 'U/NA' respondents. Response categories 3 and 4 reflect those respondents
most optimistic about the impact of the two groups of policies. Focusing on these two groups of
respondents, the data show a perception of greater national policy influence on ten of the eleven
critical factors. In the instance of the other factor, market access, there appears to be a perception
of greater CARICOM policy influence.
Overview of Impact of CARICOM Arrangements: Respondents were invited to indicate their
perception of the contribution of the CARICOM economic integration arrangements to the
economic gains of their country. A summary of the responses is presented in Figure 7.


Overall a relatively conservative response was offered with the majority indicating that the
contribution was either 'minimal' or 'somewhat'. A minority thought the contribution was
'considerable' and fewer still thought there was no impact.









Evaluation of Investment Environment
Enterprise Outlook on Desirable Investment Climate: The respondents were invited to rank
the importance of the critical factors in relation to their contemplation of future investment in
their current business environment. The summary of responses presented in Figure 8 indicates
that six of the critical factors are perceived to have a positive impact on future investment. These
are the cost of capital, exchange rate management, the cost of skilled labour, the availability of
technology, ease of access to markets and institutional structures or rules for business operations.
The exchange rate, inflation, and cost of inputs both local and foreign were perceived to have a
negative impact on the desirable investment climate. The respondents were evenly divided on
their perception of the impact of the cost of unskilled labour on the desirable investment climate.


Some respondents indicated other issues that impact on a desirable investment climate, namely:
1) Access to skilled labour and the availability of training facilities to upgrade skills of the
labour force;
2) The availability of supplies or inputs;
3) Adequate law enforcement to establish a secure environment and contain crime;
4) National government policy that promotes exports as opposed to one that is biased
towards imports;
5) The availability of venture capital from financing institutions;
6) Improved scope of institutional framework to encompass business partnerships with
international investors;
7) Improved infrastructure at the air and sea ports and for inland transportation;
8) Better formulated and articulated government policy together with improved national
interagency collaboration;
9) Government policy supportive of the agro industry in particular;
10) Better telecommunications and utilities support systems.


Government Policy Influence on Desirable Investment Climate: Respondents were asked to
rank their perception of the impact of their government's policies on their future investment
decisions. The summary of responses shown in Figure 9 convey that there is a negative
perception of the influence of government policy on all but three of the critical factors that firms









consider in their future investment decisions. The three critical factors that are perceived to have
an overall positive influence of government policy are exchange rate management, availability of
technology and access to markets. Respondents offered comments on other policy issues that
impact their future investment decisions, namely:
1) No articulated tourism policy and the absence of institutional or other support for
destination marketing;
2) The unpredictability of policy continuity in the event of a change of government;
3) Generally weak policy measures and incentives for investment;
4) The absence of an export promotion framework to support private sector investment
initiatives.


CARICOM's influence on a Desirable Investment Climate
Perceived Impact of CARICOM Policy Agenda: The respondents were asked their perception
of the summarised policy goals of CARICOM and their impact on the critical business factors
relevant to influencing their investment decisions. A summary of the responses is provided in
Figure 10.


Overall the collective CARICOM policies are perceived to have a positive impact on the critical
business factors in relation to investment decisions of firms. Inflation is the only area perceived
otherwise and in this instance the greater proportion of respondents is neutral.


A few respondents offered additional comments, namely:
1) Lack of cohesiveness among countries in some instances of bloc negotiations with
business entities external to the region;
2) Increased cooperation in the energy sector between Jamaica and Trinidad and Tobago is
perceived as a positive catalyst;
3) Countries are perceived to be operating singularly;
4) Enhanced sea and air links and more developed intra regional trading mechanisms
needed;
5) Some governments (Jamaica) should devote more resources to sensitising and informing
the populace (on critical) national issues.











Perceived Impact of CARICOM Policy Areas on Investment: Firms were invited to rank
their perception of the impact of CARICOM policy areas on their investment decisions. The
summary of the responses is presented in Figure 11.
In all policy areas except fisheries there is an overwhelming positive perception of influence on
firms' investment decisions. In fisheries the neutral perception is greater than the positive one.
Overview of CARICOM Policies Potential Impact on Investment: Respondents were invited
to provide an overview of the potential for contribution of the CARICOM economic integration
arrangements to increased investment in their country. A summary of the responses is presented
in Figure 12.
The data show that the greater proportion of the respondents is either somewhat (47 percent) or
considerably (32 percent) optimistic about the CARICOM integration arrangements positively
influencing future investment in their countries. A very small minority, of 7 percent in each
grouping, are either uncertain or anticipate minimal or no impact of the CARICOM
arrangements on future investment.


Supplemental Comments and Observations
Respondents were invited to provide any additional general or specific comments to supplement
their responses. The comments are summarised and grouped for easier assimilation.


Comments pertaining to 'Institutional Structures' or 'Rules 'for conducting business:


1) Despite stated polices to facilitate the movement of people and capital it is feared that
the implementation by civil servants will block the process;
2) There is a need for a revision of the CARICOM double taxation treaty. Currently it is
a disincentive to investment;
3) Incomplete maritime boundary delimitation agreements hinder efforts at enhanced
management of the fisheries resources;
4) The path to integration in CARICOM has been too protracted. The achievement of
integration will be a boon to business and investment, particularly with the
unrestricted movement of capital. However, the transportation problem needs to be









solved. Additionally, greater attention ought to be focused on facilitating the private
sector operations;
5) Rationalisation is not enough! We need unification in several critical business areas.
Specifically the need for a single stock exchange with unified rules;
6) There is a general feeling that CARICOM is a 'waste of time' because one does not
feel the impact of CARICOM except during the ICC World Cup Cricket when visa
requirements were instituted;
7) The implementation and enforcement of common legislation and agreements should
have a positive impact on both business and social structures in the region. This will
alleviate petty and vindictive actions by policy makers and governmental heads.
Generally there is need for constitutional reform in all the regional governments, to
allow for greater discussion of policy issues within the governments and legislatures;


Comments related to Policy and Incentive issues:


1) Unity in the region and collaboration on the use of raw materials and other resources
for national and regional benefit is supported;
2) A greater effort should be made to encourage consumers to utilise products and
services from the region and discourage extra regional competition;
3) Reference should be made to the joint customs union that is expected to have a
positive impact on regional trade. The benefits of CARICOM have not yet been fully
realized due to the inability of our policy makers to utilise the tools adequately;
4) The CSME provides Guyana with the opportunity to provide industrial partnerships
among CARICOM countries and the evolution of an industrial policy supportive of
that goal. Policies must support movement of capital, skills and integrated
development;
5) Governments need to drive the integration process at a faster rate;









Comments referring to 'Special Considerations' issues:


1) Notwithstanding articulated CARICOM policies, national level circumstances will
thwart investment growth;
2) Since no provision is made in any of the CARICOM agreements for special treatment
of the LDCs such as Dominica, the benefits to be derived for Dominica will remain
minimal;
3) The regional approach to negotiations has facilitated and enabled the voice of the
region to be heard and it has redefined the terms of engagement with tremendous
benefits for the Region. However, at the operational level member states are faced
with significant constraints to adopt and implement these measures. CARICOM now
needs to focus on capacity building in member states of the OECS in particular;


Comments pertaining to 'Market Access':


1) Protectionism in some countries create conditions unfavourable to wider market
access and the promotion of investment opportunities to potential investors;
2) Positive economic growth will be attained following the devotion of greater attention
to opening the regional market and reducing the barriers thereto;
3) We cannot plan major investments for the smaller Caribbean territories with low
populations. We find it more useful to target high volume markets beyond
CARICOM countries such as Haiti, Dominican Republic, and Cuba in the region and
the EU and North America outside. The prospects of trading with China, Japan,
Brazil and others would relegate trade within CARICOM to leftovers if any.
Economies of scale must take precedence.


Comments on Transportation Challenges:


1) We know the Caribbean, although linked closely, is not reachable by sea due to lack
of scheduling of international lines. We need to connect the islands closely and
enhance the movement of CARICOM products regularly.









Additional comments:


1) Trinidad, as the most industralised CARICOM country stands to gain significantly
from the improvement of intra-CARICOM trade. However, current policies of the
government have fuelled inflation and contributed to a significant increase in the cost
of both skilled and unskilled labour.
2) The changing dynamics of the many sectors of our regional and local economies
makes it difficult to predict the impact of CARICOM as you seek. Disparities will
negatively impact at first but gradually improvement will bring about acceptance and
prosperity;


Policy Makers' Responses
Population Demographics and Characterisation
Seventy-six policy makers from the five countries were sent questionnaires. One declined to
participate. Thirty-four valid responses were received to Part A and 26 to Part B, making the
response rate 44.7 percent to Part A and 34.2 percent to Part B. For Part A the largest proportion
of responses were from Trinidad and Tobago (42.42 percent) followed by Dominica (21.21
percent), Guyana (18.18 percent), Jamaica (12.12 percent) and St Lucia (6.06 percent). For Part
B Trinidad and Tobago again lead the responses with 40.00 percent followed by Guyana (24.00
percent), Dominica (20.00 percent) with Jamaica and St Lucia each at 8.00 percent. For Part A of
the survey the three largest sets of responses were from the Ministry of Trade (40.62 percent)
followed by the Ministry of Agriculture (34.38 percent) and the Ministry of Tourism (9.38
percent). For Part B it was the Ministry of Agriculture (38.46 percent), the Ministry of Trade
(34.62 percent) and the Ministry of Tourism (11.54 percent). Profiles of the ministry
representation for the respective surveys are presented in Figures 13 A and Figure 13 B.
The respondents indicated their years of experience from a selection of five categories, namely:
less than 2.5 years, greater than 2.5 but less than 5 years, greater than 5 but less than 7.5 years,
greater than 7.5 years but less than 10 years and greater than 10 years. In both surveys, total of
62 percent of the respondents had an excess of 5 years experience as depicted in the profiles
presented in Figures 14 A and Figure 14 B.









However, also in both instances an excess of 65 percent of the respondents served in only one
ministry, that in which they were currently located. Economics, Management, Agriculture and
Agricultural Economics were the dominant fields of academic training in descending order, in
both instances.


All but two of the respondents were trained at least to the first-degree level and many benefited
from postgraduate training, either in their fields of specialization or in a related field. A profile of
the respondents to Policy Survey A, by area of specialisation, is presented in Figure 15 A. For
this survey, the number of degree holders in the top areas of specialisation ranges from a high of
14 in economics to a low of 4 in each of agriculture and agricultural economics. This is
graphically represented in Figure 15 B.


A profile of the respondents to Policy Survey B, by area of specialisation, is presented in Figure
16 A. For this survey, the number of degree holders in the top areas of specialisation ranges
from a high of 13 in economics to a low of 2 in agricultural economics. This is graphically
represented in Figure 16 B.


Perception of Policy Impacts
National Policies on the Business Climate: The respondents were invited to evaluate the impact
of the national policies they were formulating and implementing on the critical business factors
in their respective countries. The summary of the responses in Figure 17 indicate that for all but
two critical business factors the perception of the policy makers is that the national policy impact
is strongly positive. For two of those factors, namely exchange rate and exchange rate
management, the majority of the respondents were neutral about there perception of impact.


CARICOM Policies on the Business Climate: The summary of the policy agenda outlined in
the Treaty of Chaguaramas was also presented to the respondents to policy makers' survey.
Respondents were invited to rank their perception of the impact of the CARICOM policies on
the business climate as represented by the critical business factors, using the ranking scale as
previously indicated. The summary of responses presented in Figure 18 indicates an
overwhelming positive perception of the CARICOM polices on all the critical business factors









except exchange rate. For this factor more respondents were neutral as opposed to positive about
the impact of CARICOM policies, but collectively, the neutral and positive responses were in the
majority.


CARICOM Policies Impact on National Government Policies: Respondents were invited to
rank their perception of CARICOM policies, collectively, being supportive or unsupportive of
those of their national government in relation to the critical business factors. The ranking scale
used was the same as with the previous questions. From the summary of responses presented in
Figure 19 it will be observed that there is a positive perception that CARICOM policies are
supportive of national government policies with respect to all of the critical business factors.
However there is a stronger demonstration of this perception for four critical factors: (1) cost of
unskilled labour, (2) cost of skilled labour, (3) access to markets, and (4) institutional structures
or rules for conducting business.


Impact of Specific CARICOM Policy Areas on Business Climate: Policy Makers were
invited to rank their perception of the impact of the eleven specific CARICOM policy areas
previously identified, on the business climate in their country. The summary of the responses is
presented in Figure 20. For all the critical business factors that shape the business climate the
overwhelming response was the perception of a positive impact. In the instance of both types of
services there was no perception of any negative impact.


Comparative Evaluations
National vs. CARICOM Policies: Policy respondents were invited to compare the importance
of the national policies they design and implement versus the CARICOM policies with respect to
the policies influencing the critical business factors in their country. The response data are
presented graphically in Figure 21. The data are stacked in columns so that those who responded
least important, '1', are represented in the lowest segment of the column6. Those who responded
'2' are in the second lowest segment. The '3' respondents are in the third segment going up and
the '4' respondents are in the fourth segment going up. The uppermost segment represents the
'U/NA' respondents. Response categories 3 and 4 reflect those respondents most optimistic

6 Recall the ranking scale for this question is 1 to 4 where 1 = least important and 4 = very important.









about the impact of the two groups of policies being compared. Focusing on these two groups of
respondents, the data show a perception of greater national policy influence on nine of the eleven
critical factors. In the instance of the other two factors, cost of skilled labour and market access,
the CARICOM policy influence is perceived to be greater.


Overview of Impact of CARICOM Arrangements: Respondents were invited to indicate their
perception of the contribution of the CARICOM economic integration arrangements to the
economic gains of their country.
A summary of the responses is presented in Figure 22. The data show that 52 percent of the
respondents think that the CARICOM arrangements contribute somewhat the economic gains of
the countries while 24 percent think that the contribution is considerable.


Evaluation of Investment Environment
Policy Makers' Outlook on a Desirable Investment Climate: The policy respondents were
invited to rank the importance of the critical factors in relation to firms' contemplation of future
investment in the country, using the three-point scale described above. The summary of
responses presented in Figure 23 indicates that all but one of the critical factors are perceived to
have a positive impact on future investment. The cost of foreign inputs was the only critical
factor perceived to have a negative impact on the desirable investment climate.


Three additional issues were cited as having an impact on the future investment climate. These
are:
1) New legislation;
2) Unclear government policy; and
3) Crime.


Perceived Impact of National Policies on Investment Climate: Policy Makers were then
invited to rank their perception of the policies they were engaged in formulating on the
investment climate in their country, again using the three-point scale. The summary responses
presented in Figure 24 indicate a positive perception of policy impact for only eight of the
critical business factors, namely: (1) inflation; (2) cost of unskilled labour; (3) cost of skilled









labour; (4) cost of local inputs; (5) cost of foreign inputs; (6) technology; (7) access to markets
and (8) ruled for conducting business. In two areas, exchange rate and exchange rate
management the perception was that of a negative policy impact while for cost of capital the
majority view was equally divided between a positive impact and no impact (neutral).


Influence of CARICOM Policies on Investment Climate: Respondents' views were sought on
the impact of the collective CARICOM policies on the critical business factors, pertaining to the
investment climate, using the three-point scale. The summarised responses are presented in
Figure 25. For this question there was no separation of 'labour' into 'unskilled' and 'skilled' or
of 'inputs' into 'local' and 'foreign'. The responses indicate a positive perception of CARICOM
policies on seven of the critical factors, namely: (1) cost of capital; (2) inflation; (3) labour; (4)
inputs; (5) availability of technology; (6) access to markets and (7) institutional arrangements or
rules for conducting business. On 'exchange rate management', the views were equally divided
between 'positive' and 'no impact' or 'neutral' and on 'exchange rate' the perception of 'no
impact' dominated.
Perception of Influence of CARICOM Policy Areas: Respondents were invited to identify any
of the previously specified CARICOM policy areas that seem likely to influence the investment
climate in their country. The summary of the responses are presented in Figure 26. All of the
CARICOM policy areas are perceived to have a positive impact on the future business climate.


Overview of CARICOM Policies Potential Impact on Investment
Respondents were invited to provide an overview of the potential for contribution of the
CARICOM economic integration arrangements to increased investment in their country. A
summary of the responses is presented in Figure 27. Forty-four percent of the respondents are of
the view that the policies will impact 'somewhat' on future investment. Twenty-four percent are
equally divided on the policies influencing considerably and minimally while 4 percent are
equally divided between 'no impact' and 'uncertain'.









Perception of CARICOM Level Policies by Country, Firm Size & Sub-sector
Disaggregation by Country
The firms that responded to Survey A were grouped by country of location. This facilitated an
analysis, from a country perspective, of their perception to CARICOM level policies as well as
to the CARICOM arrangements' contribution to economic gain.


By Country: re the Critical Factors
The Dominica respondents perceive a negative impact of the CARICOM policies on (1) cost of
capital (2) inflation (3) cost of local inputs (4) cost of foreign inputs (5) availability of
technology and (6) institutional structures or rules for conducting business. They have a
predominant neutral view of those policies' impact on the exchange rate and exchange rate
management and a positive perception of the CARICOM policies' impact on the cost of
unskilled and skilled labour and access to markets (see Figure 28).
The Guyana respondents perceived a negative impact of the CARICOM policies only on the
cost of skilled labour. There was a perception of a neutral impact on (1) the exchange rate (2)
exchange rate management (3) inflation (4) the cost of unskilled labour and (5) the cost of local
inputs. The impact on (1) cost of capital (2) the cost of foreign inputs (3) availability of
technology (4) access to markets and (5) institutional structures or rules for conducting business
was perceived as positive by this sub-group (see Figure 29).
The respondents from Jamaica had a negative perception of the impact of the CARICOM
policies on (1) the cost of capital (2) the cost of skilled labour (3) the cost of local inputs and (4)
the cost of foreign inputs. They were neutral concerning exchange rate management inflation and
the cost of unskilled labour but had a positive perception of the impact of CARICOM policies on
the availability of technology and access to markets. In addition, they were equally divided
between being negative and neutral regarding exchange rate management and institutional
structures (see Figure 30).
The St Lucia respondents had a negative perception of the impact of CARICOM policies on
nine of the critical factors, namely (1) the cost of capital (2) inflation (3) the cost of unskilled
labour (4) the cost of skilled labour (5) the cost of local inputs (6) the cost of foreign inputs (7)
the availability of technology (8) access to markets and (9) institutional structures or rules for









conducting business. There was a neutral perception of the CARICOM policies on the exchange
rate and exchange rate management (see Figure 31).
The Trinidad and Tobago respondents did not perceive an overall negative impact of the
CARICOM policies on any of the critical business factors. A predominantly neutral impact was
perceived for the impact on (1) cost of capital (2) exchange rate (3) exchange rate management
(4) the cost of local inputs (5) the cost of foreign inputs (6) the availability of technology and (7)
institutional structures or the rules for the conduct of business. A positive impact was perceived
on (1) the cost of unskilled labour (2) the cost of skilled labour and (3) access to markets. The
perception was equally divided between negative and neutral for inflation (see Figure 32).


By Country: re CARICOM Policy Areas
Dominica respondents had a positive perception of the impact of the CARICOM policy areas,
except for transportation that was negative and fisheries that was neutral (see Figure 33).
Guyana had a positive perception of three CARICOM policy areas (1) the CET (2) the rules of
origin and (3) Services (Professional). There was a 'no impact' or 'neutral' perception of (1)
WTO trade negotiations (2) EU trade negotiations (3) Other trade negotiations (4) Fisheries (5)
Industry (6) Services (Tourism and hospitality) and (7) Transportation. Opinion on Agriculture
was equally divided between 'no impact' and 'positive' (see Figure 34).
The Jamaica respondents had a positive perception of the impact of four CARICOM policy
areas, (1) the CET (2) the Rules of Origin (3) the EU trade negotiations and (4) Other trade
negotiations. There was a predominant negative perception of the WTO trade negotiations. These
respondents indicated a 'no impact' or 'neutral' response for five areas (1) Agriculture (2)
Fisheries (3) Industry (4) Services (Tourism and hospitality) and (5) Transportation. Opinion was
equally divided between 'no impact' and 'positive' for Services (Professional) (see Figure 35).
No CARICOM policy area was perceived to have had a positive impact by the St Lucia
respondents. A negative impact was perceived from (1) the WTO trade negotiations (2) the EU
trade negotiations (3) Other trade negotiations (4) Industry and (5) Services (tourism and
hospitality). Opinion was equally divided between negative and positive for the CET and
between 'negative' and 'no impact' for Services (Professional). A 'no impact' or 'neutral' view
was expressed for (1) the Rules of Origin (2) Agriculture (3) Fisheries and (4) Transportation
(see Figure 36).









Trinidad and Tobago respondents had a positive view of six CARIOCM policy areas, namely
(1) the CET (2) the Rules of Origin (3) Other trade negotiations (4) Industry (5) Services
(Professional) and (6) Transportation. Opinion was equally divided between 'negative' and
'positive' with respect to the WTO trade negotiations. A 'no impact' or 'neutral' view was
expressed for (1) the EU trade negotiations and (2) Agriculture. There was an 'uncertain'/'not
applicable' response for (1) Fisheries and (2) Services (Tourism and hospitality) (see Figure 37).


By Country: re Contribution to Economic Gain
Dominica's respondents were weakly optimistic about the CARICOM arrangements
contributing to the economic gain of the country with 39 percent perceiving a minimal
contribution and 23 percent indicating 'somewhat' (see Figure 38). Guyana's respondents were
similarly weakly optimistic about the contribution of the CARICOM arrangements to the
country's economic gains with 29 percent responding 'minimally' and 41 percent indicating
'somewhat' (see Figure 39). The perception in Jamaica mirrored that in Dominica with 42
percent indicating 'minimally' and 23 percent 'somewhat' (see Figure 40). For St Lucia, 25
percent of the respondents indicated 'minimally' and 59 percent said 'somewhat' (see Figure 41).
The respondents from Trinidad and Tobago were the most optimistic with 45 percent
indicating minimally, 20 percent 'somewhat' and 30 percent 'considerably' (see Figure 42).


Disaggregation by Firm Size
The firms that responded to Survey A were grouped by firm size. This facilitated an analysis,
from a firm size perspective, of their perception to CARICOM level policies as well as to the
CARICOM arrangements' contribution to economic gain.


By Firm Size: re the Critical Factors
From the perspective of the Micro firms, as indicated in Figure 43, the CARICOM policies have
a definite negative impact on all but two of the critical factors. The perception of 'no impact' or
'neutral' dominates for the exchange rate. For markets, equal weight is given to 'negative' and
'positive' perceptions.









Small firms have a perception of a negative impact on (1) cost of capital (2) cost of local inputs
and (3) cost of foreign inputs, as indicated in Figure 44. There is a 'neutral' or 'no impact'
perception for (1) exchange rate (2) exchange rate management and (3) inflation. A positive
impact is perceived on (1) the availability of technology (2) access to markets and (3)
institutional structures or rules for doing business. The cost of unskilled labour is equally
weighted by 'no impact' and 'positive' while the cost of skilled labour is also equally weighted
by 'negative' and 'positive'.
Medium firms have no overriding negative perception of the impact of CARICOM policies.
There is a positive perception of CARICOM policy impact on (1) the cost of capital (2) the cost
of foreign inputs (3) the availability of technology and (4) access to markets. A 'no impact' or
'neutral' perception prevails for (1) exchange rate management (2) inflation (3) the cost
unskilled labour (4) the cost of local inputs and (5) institutional structures or rules for doing
business. The exchange rate is equally weighted 'negative' and 'no impact' or 'neutral'. The cost
of skilled labour is also similarly equally weighted, as indicated in Figure 45.
Large firms also have no overriding negative perception of the impact of CARICOM policies, as
indicated in Figure 46. There is a positive perception of CARICOM policy impact on (1) the cost
of skilled labour (2) the cost of foreign inputs (3) access to markets and (4) institutional
structures or rules for doing business. A 'no impact' perception exists for (1) the cost of capital
(2) exchange rate (3) exchange rate management (4) inflation (5) the cost of unskilled labour and
(5) the availability of technology. The cost of local inputs is equally weighted 'no impact' and
'positive'.


By Firm Size: re CARICOM Policy Areas
The Micro firms perceive a positive impact from three CARICOM Policy areas, namely (1) the
CET (2) Services (Tourism and hospitality) and (3) Services (Professional), as indicated in
Figure 47. They view the WTO trade negotiations as having a negative impact. The policy areas
perceived to have 'no impact' are (1) the Rules of Origin (2) Other trade negotiations (3)
Agriculture (4) Fisheries and (5) Industry. The EU trade negotiations and Transportation are both
equally weighted as having a 'negative' and 'no impact'.









Small firms have a positive perception of the impact of six CARICOM policy areas, namely (1)
the CET (2) the Rules of Origin (3) the EU trade negotiations (4) Other trade negotiations (5)
Industry and (6) Transportation. This group has a perception of 'no impact' for (1) Agriculture
(2) Fisheries and (3) Services (Professional).The perception of the impact of the WTO trade
negotiations is equally weighted as 'no impact' and 'positive' while that of Services (Tourism
and hospitality) is equally weighted 'no impact' and 'uncertain/not applicable' (see Figure 48).
Medium sized firms perceive a positive impact of the CARICOM policy areas of (1) the CET
(2) the Rules of Origin and (3) Industry, as seen in Figure 49. These respondents had a 'no
impact' or 'neutral' perception for (1) the EU trade negotiations (2) Other trade negotiations and
(3) Transportation. The WTO trade negotiations policy area is equally weighted as 'no impact'
and 'positive' while Services (Professional) received three equal weights of 'no impact',
'positive' and 'uncertain'/'not applicable'. Both Fisheries and Services (Tourism and hospitality)
were most heavily ranked 'uncertain'/ 'not applicable'. Agriculture was equally weighted as
'positive' and 'not applicable'.
Large firms have a positive perception of three CARICOM policy areas (1) the CET (2) the
Rules of Origin and (3) the EU trade negotiations. Six policy areas are perceived as having 'no
impact' or 'neutral' namely (1) Other trade negotiations (2) Agriculture (3) Fisheries (4) Industry
(5) Services (Tourism and hospitality) and (6) Transportation. The WTO trade negotiations
policy area is equally weighted 'negative' and 'positive' and Services (Professional) is equally
weighted 'no impact' and 'positive', as indicated in Figure 50.


By Firm Size: re Contribution to Economic Gain
Micro firms could be considered weakly optimistic about the contribution of CARICOM
arrangements to their countries economic gains with 46 percent indicating 'minimally' and 26
percent 'somewhat' (see Figure 51). The respondents from Small firms demonstrated a stronger
expectation of the contribution of the CARICOM arrangement to economic gain with 39 percent
indicating 'somewhat' and 23 percent 'minimally' (See Figure 52). The responses of the
Medium firms mirrored those from the Micro firms with 51 percent indicating 'minimally' and
25 percent 'somewhat' (see Figure 53). Large firms were the most optimistic with 40 percent
indicating 'somewhat' and 20 percent 'considerably' (see Figure 54).









Disaggregation by Sub-sector
The respondents to Survey A were grouped by sub-sector of operation. This facilitated a sub-
sectoral analysis of their perception to CARICOM level policies as well as to the CARICOM
arrangements' contribution to economic gain. Eight sub-sector groupings were considered,
namely (1) Agriculture (2) Manufacturing (3) Services (Tourism and hospitality) (4) Services
(Professional) (5) Trade and Commerce (6) Agriculture and Manufacturing (together) (7)
Services (together) and (8) Manufacturing/Trade & Commerce (together).


By Sub-sector: re the Critical Factors
Among the firms involved only in Agriculture there was the perception of a 'negative' impact
on five critical business factors, namely (1) the cost of capital (2) exchange rate management (3)
the cost of local inputs (4) availability of technology and (5) institutional structures or rules for
conducting business, as indicated in Figure 55. A perception of 'no impact' or 'neutral' was there
for 'exchange rate' and 'inflation' and a 'positive' impact was perceived for 'the cost of foreign
inputs' and 'access to markets'. The perception of the impact on the cost of skilled labour was
equally weighted between 'negative' and 'positive' and the predominant view about unskilled
labour was 'uncertain' or 'not applicable'.
For Manufacturing firms there was a negative perception of impact for (1) inflation (2) the cost
of local inputs (3) the cost of foreign inputs and (4) the availability of technology, as seen in
Figure 56. For three critical factors, namely (1) the cost of capital (2) exchange rate and (3)
exchange rate management the perception of impact was equally weighted between 'negative'
and 'no impact' or 'neutral'. There was a definite 'positive' perception of impact for (1) the cost
of unskilled labour (2) the cost of skilled labour (3) access to markets and (4) institutional
structures or rules for the conduct of business.
For Services (T&H) there was a negative perception of impact for (1) the cost of capital (2)
inflation (3) the cost of skilled labour (4) the cost of local inputs (5) the cost of foreign inputs
and (6) institutional structures or rules for doing business. A 'no impact' or 'neutral' perception
was indicated for (1) exchange rate (2) exchange rate management and (3) the cost of unskilled
labour. A 'positive' perception was indicated for only two critical factors namely (1) availability
of technology and (2) access to markets (see Figure 57).









The Service (P) firms did not indicate the perception of any negative impacts. A 'no impact' or
'neutral' perception was indicated for (1) the cost of capital (2) exchange rate (3) exchange rate
management (4) inflation (5) the cost of unskilled labour and (6) the availability of technology,
as seen in Figure 58. A 'positive' perception of impact was indicated for (1) the cost of skilled
labour (2) the cost of local inputs (3) the cost of foreign inputs (4) access to markets and (5)
institutional structures or business rules.
Firms in Trade and Commerce perceived a negative impact for the exchange rate, as indicated
in Figure 59.A 'positive' impact was perceived for the cost of foreign inputs and access to
markets. A 'no impact' or 'neutral' perception was indicated for (1) the cost of unskilled labour
92) the cost of local inputs (3) the availability of technology and (4) institutional structures or
business rules. Four critical business factors were perceived equally weighted, namely (1) the
cost of capital ('neutral' and 'positive') (2) exchange rate management ('negative' and
'positive') (3) inflation ('negative' and 'no impact') and (4) the cost of skilled labour ('negative'
and 'no impact').


Some respondents indicated involvement in more than one sub-sectoral area, consequently
responses were analysed in three groupings namely (1) agriculture together with manufacturing
(2) Services (All) and (3) Manufacturing together with Trade and Commerce.
The Agriculture and Manufacturing grouping indicated a 'negative' perception of impact on
(1) the cost of capital (2) the cost of skilled labour (3) the cost of local inputs (4) the cost of
foreign inputs and (6) institutional structures or business rules, as seen in Figure 60. A 'no
impact' or 'neutral' perception was given for (1) exchange rate (2) exchange rate management
(3) inflation and (4) the cost of unskilled labour. The perception of a 'positive' impact was
indicated for 'access to markets' only.
For the Services grouping there was a 'negative' perception of impact for 'the cost of skilled
labour' and 'the cost of foreign inputs', as shown in Figure 61. A positive perception was
indicated for (1) the cost of local inputs (2) access to markets and (3) institutional structures or
rules for business. Six critical business factors were given a 'no impact' or 'neutral' rating
namely (1) the cost of capital (2) exchange rate (3) exchange rate management (4) inflation (5)
the cost of unskilled labour and (6) the availability of technology.









The Manufacturing / Trade and Commerce grouping had a 'negative' perception of the
impact on (1) the cost of local inputs and (2) the cost of foreign inputs, as seen in Figure 62.
There was a 'positive' perception only for 'access to markets'. This group had a 'no impact' or
'neutral' perception for (1) the cost of capital (2) exchange rate (3) exchange rate management
(4) inflation (5) the cost of unskilled labour and (6) the availability of technology. The critical
factor 'Institutional structures' or 'business rules' was equally weighted 'negative' and
'positive'.


By Sub-sector: re CARICOM Policy Areas
The Agricultural firms do not perceive any of the CARICOM policy areas as having a 'positive'
impact on their business, as seen in Figure 63. Transportation is viewed as having a 'negative'
impact and the impact of Services (T&H) is perceived as uncertain/not applicable. Three areas
are perceived to have 'no impact' or 'neutral' namely (1) the WTO trade negotiations (2) the EU
trade negotiations and (3) Industry. Six areas are equally weighted namely (1) the CET ('no
impact' and 'uncertain/not applicable) (2) the Rules of Origin ('negative' and 'no impact' and
'uncertain/ not applicable) (3) Other trade negotiations ('no impact' and 'positive') (4)
Agriculture ('negative' and 'positive') (5) Fisheries ('no impact' and 'uncertain/ not applicable)
and (6) Services (professional) ( 'positive' and uncertain/ not applicable).
The Manufacturing group does not perceive any of the CARICOM policy areas as having a
'negative' impact on their businesses, as seen in Figure 64. Four policy areas are perceived to
have a 'positive' impact namely (1) the CET, (2) the Rules of Origin, (3) Other trade
negotiations and (4) Industry. Those perceived as having 'no impact' or 'neutral' are (1)
Agriculture, (2) Fisheries, (3) Services (tourism & hospitality), and (4) Transportation. Three
areas are equally weighted namely (1) the WTO trade negotiations ('negative' and 'positive'),
(2) the EU trade negotiations ('no impact' and 'positive') and (3) Services (professional) ('no
impact' and 'positive').
For Services (T&H) there are seven areas with a 'negative' rank namely (1) the WTO trade
negotiations, (2) the EU trade negotiations, (3) Other trade negotiations, (4) Industry, (5)
Services (tourism & hospitality), (6) Services (professional) and (7) Transportation, as indicated
in Figure 65. The Rules of Origin is ranked 'no impact' or 'neutral' while three areas are equally
weighted namely (1) the CET ('no impact' and 'positive'), (2) Agriculture ('no impact' and









'uncertain/not applicable) and (3) Fisheries ('negative' and 'uncertain/not applicable').No policy
area was thought to have a 'positive' impact on their businesses.
In contrast, for Services (P) no policy area was seen as having a 'negative' impact on business
operations. Three perceived to have a 'positive' impact were (1) the CET, (2) the EU trade
negotiations and (3) Services (professional). Eight areas were thought of as having 'no impact'
or 'neutral' namely (1) the Rules of Origin, (2) the WTO trade negotiations, (3) Other trade
negotiations, (4) Agriculture, (5) Fisheries, (6) Industry, (7) Services (tourism & hospitality), and
(8) Transportation, as seen in Figure 66.
The Trade and Commerce group also did not perceive any policy area as having a 'negative'
impact, as indicated in Figure 67. Both the CET and the WTO trade negotiations were thought of
as having a 'positive' impact. Five areas were perceived of as having 'no impact' namely (1)
Agriculture, (2) Fisheries, (3) Industry, (4) Services (T&H) and (5) Transportation. Four areas
were equally weighted these being (1) the Rules of Origin ('no impact' and 'positive'), (2) the
EU trade negotiations ('positive' and 'uncertain/not applicable'), (3) Other trade negotiations
('no impact' and 'positive') and (4) Services (professional) ('no impact' and 'uncertain/not
applicable').
The Agriculture and Manufacturing grouping indicated a 'negative' perception of impact of
the WTO trade negotiations (see Figure 68). This group perceived a 'positive' impact of (1) the
CET, (2) the Rules of Origin and (3) Other trade negotiations. Seven areas were seen as having
'no impact' namely (1) the EU trade negotiations, (2) Agriculture, (3) Fisheries, (4) Industry, (5)
Services (tourism & hospitality), (6) Services (professional) and (7) Transportation.
For the Services (All) grouping there was a 'negative' perception of impact for the WTO trade
negotiations and a 'positive' perception for (1) the CET (2) the EU trade negotiations (3) Other
trade negotiations (4) Industry (5) and Services (P). Those areas seen as having 'no impact' were
(1) the Rules of Origin (2) Other trade negotiations (3) Agriculture (4) Fisheries (5) Services
(tourism & hospitality) and (6) Transportation (see Figure 69).
The Manufacturing / Trade and Commerce grouping had a 'negative' perception of the
impact of the WTO trade negotiations and a 'positive' perception for (1) the CET (2) the Rules
of Origin and (3) Other trade negotiations. This group perceived six areas as having 'no impact'
namely (1) Agriculture, (2) Fisheries, (3) Industry, (4) Services (tourism & hospitality), (5)









Services (professional) and (6) Transportation. The EU trade negotiations were equally weighted
'negative' and 'no impact' (see Figure 70).


By Sub-sector: re Contribution to Economic Gain
Firms in Agriculture were weakly optimistic about the contribution of the CARICOM
arrangements to their country's economic gain with 57 percent of the respondents indicating a
perspective of a 'minimal' contribution and 29 percent indicating 'somewhat' as shown in Figure
71. Manufacturing firms were definitely more optimistic about the CARICOM arrangements
contributing to economic gain since, as seen in Figure 72, only 14 percent indicated 'minimally'
while 33 percent indicated 'somewhat' and 24 percent said 'considerably'. Firms in Services
(tourism & hospitality) were less optimistic than those in Manufacturing but more so than those
in Agriculture. In the Services (tourism & hospitality) group 50 percent indicated 'minimally',
19 percent said 'somewhat' and 6 percent chose 'considerably' (see Figure 73). The Services
(professional) group was also fairly optimistic about the CARICOM arrangements contributing
to economic gain with 62 percent indicating 'minimally' and 15 percent each choosing
'somewhat' and 'considerably' as shown in Figure 74. The response from the Trade and
Commerce group was equally weighted at 25 percent each to 'no impact', 'minimally',
'somewhat', and 'considerably' as seen in Figure 75. The selection within the Agriculture and
Manufacturing group was 27 percent 'minimally', 36 percent 'somewhat' and 16 percent
'considerably' (see Figure 76). For Services (All) 49 percent indicated 'minimally', 27 percent
'somewhat' and 16 percent 'considerably', as in Figure 77. The response from the
Manufacturing/ Trade and Commerce group was 22 percent 'minimally' 36 percent
'somewhat' and 20 percent 'considerably', as in Figure 78.









Discussion


Interviews
These have been distilled from the responses to both rounds of interviews:


1) More interviewees from both firms and policy makers agreed that the Caribbean
Community was a good concept, when asked their perspective on CARICOM. When
subsequently questioned about the CARICOM arrangements strengthening the business
environment, a greater proportion of firms concurred that there was strengthening. In
contrast, a greater proportion of policy makers were of the view that the CARICOM
arrangements did not strengthen the business environment.
2) The majority view among firms was that the CARICOM arrangements did not contribute
to (1) increasing their volume of business, (2) reducing the cost of their doing business or
(3) increasing their target market. However, a few firms did indicate some benefits
accruing from the arrangements. Among those were (1) access to a larger market, (2) an
improvement in competitiveness consequent upon globalisation and (3) the reduction of
the cost of inputs available within the region.
3) The greater proportion of firms perceived greater difficulty for intra regional trade and
some specifically identified non-tariff barriers (NTBs) as having a constraining impact on
the growth of their business.
4) Among the firms, opportunity for input into the design of CARICOM policies was
acknowledged but not many participated because, inter alia, of consultation mechanisms
that are ineffectual and narrow in scope.
5) Policy makers indicated opportunity to input into the design of CARICOM policies but
expressed reservation concerning inadequate consideration of national circumstances
when designing CARICOM policy. A related issue is apparent overlooking of the
structural differences and considerable divergence that exist among some elements of the
economies of the CARICOM members. The view was expressed that there may be need
for a differential approach to some policy design and formulation in order to more
effectively accommodate the weaker states within the overall regional policy framework.









Surveys
These inferences emanate from the descriptive analysis of the responses to the surveys and are
based on the representative sample from the five target countries.
Firms:
1) The entrepreneurial population of CARICOM is very diverse with respect to (1) firm size
(2) area (sub-sector) of operation and (3) scope of operations. The micro firms with
annual sales volume of less than US$ 1.0 million is the dominant group being twice as
large as the next largest group of large firms that have an annual sales volume greater
than US$ 6.5 million. The small firms group and the medium firms group are
approximately equally sized.
2) Manufacturing is the dominant area of operation but many firms are multi-faceted and
operate in more than one sub-sector. Some operational combinations revealed are (1)
agriculture & manufacturing (2) agriculture and services (professional) (3) agriculture,
manufacturing & trade and commerce (4) Services (professional) & trade and commerce.
This multi-faceted feature was observed in firms of different sizes.
3) Some of the firms have global experience based on their operating in countries outside of
their home base and the Caribbean Community. Large firms lead in this regard but micro
and small firms are also involved.
4) For the collective of firms, there is an overwhelming negative perception of the critical
business factors influencing the business operations of firms, except for 'availability of
technology'. This view is substantiated when the data are examined by country with the
exception of (1) 'unskilled labour', 'skilled labour' and 'local inputs' in Guyana and (2)
'institutional structures' or 'rules' in St Lucia. At the country level, all critical factors
were perceived 'negative' in Dominica.
5) The collective of firms also perceived an across the board 'negative' impact of
government policy on the critical business factors. There were a few exceptions to this
profile when the data were disaggregated by country. These pertained to: Dominica for
(1) 'exchange rate management', (2) 'cost of unskilled labour', (3) 'cost of skilled labour'
and (4) 'access to markets'; Guyana and Trinidad and Tobago for 'access to markets' ;
and St Lucia for (1) 'exchange rate', (2) 'exchange rate management', (3) 'availability of
technology' and (4)' access to markets'.









6) The collective of firms indicated a positive impact of CARICOM policies on only one
critical business factor, namely 'access to markets' and in three areas an overall negative
impact was demonstrated. Examination of the data disaggregated by country, however,
elicited a much more varied impact perception profile. A similar varied perception profile
was obtained when the data were disaggregated by firm size and sub-sector of operation.
One striking feature revealed by this additional desegregation was that there was no
overriding 'negative' perception indicated by medium firms, large firms or the service
(professional) sub-groups.
7) There was a 'positive' perception of the impact of three CARICOM policy areas, namely
the CET, the Rules of Origin and Services (professional) for the collective of firms.
Mainly, this profile was mirrored by the sub-groups in the disaggregated data except for
St Lucia, which did not perceive a positive impact for any CARICOM policy area. The
perception of impact of the other CARICOM policy areas varied when the data are
disaggregated by sub-groups. Across the sub-group categories, except for a few instances,
there was either a 'no impact' or 'negative' perception for some CARICOM policy areas
such as (1) Agriculture (2) Fisheries (3) Industry (4) Services (tourism and hospitality)
and (5) Services (professional).
8) A comparison of the relative importance of national versus CARICOM policy sources
influencing the critical factors indicates a perception of the national policies being
generally ranked the more important policy influence, by the more optimistic set of
respondents. In only one instance, that of 'market access' was the CARICOM policies
perceived to be of greater influence.
9) A relatively conservative response was offered to the perception of the CARICOM
arrangements contributing to countries' economic gain with the majority indicating
'minimally' or 'somewhat' and only 15 percent indicating 'considerably'. A review of
the data disaggregated by firms indicated that the most optimistic view ('considerably')
was shared primarily by large and micro firms. Desegregation by country revealed that
the optimistic view was shared by twice the proportion of Trinidad and Tobago
respondents as by Jamaica respondents. Desegregation by sub-sector indicates that
Manufacturing and Trade & Commerce lead in having an optimistic perception followed









by Service (professional). Respondents from Agriculture are only weakly optimistic in
this regard.
10) The greater proportion of respondents anticipate CARICOM policies contributing either
'considerably' or 'somewhat' to future investment with only a few projecting 'minimal'
contribution.
Policy Makers:
1) The experience profile of the policy makers indicates that over 60 percent of them have a
minimum of five years experience. Economics is the top field among the areas of
specialization, with the majority holding masters degrees and one holding a PhD degree.
Management, Agricultural Economics and Agriculture are among the top areas of
specialisation. Some policy makers are qualified in multiple areas of specialisation.
2) The perception of policy makers is that both national policies and CARICOM policies
have a general 'positive' impact on the critical business factors.
3) From the perspective of policy makers the interface of CARICOM policy on national
policy as well as the impact of specific CARICOM policy areas is also 'positive'.
4) A comparison of national versus CARICOM policy sources with respect to the influence
on the critical business factors revealed, for the more optimistic policy makers, that there
was a perception of greater national policy influence for all but 'the cost of skilled
labour' and 'access to markets'. CARICOM policy was perceived to have greater
influence on these two factors.
5) Policy makers are quite optimistic about the contribution of the CARICOM integration
arrangements to countries' economic gain with 24 percent indicating 'considerably' and
52 percent 'somewhat'.
6) Policy respondents perceived that all the critical business factors had a positive impact on
the investment climate. They also viewed the policies they were formulating to have a
'positive' impact except on 'exchange rate' and 'exchange rate management' about
which they indicated 'no impact' or 'neutral'.
7) CARICOM policies were seen to have a 'positive' impact on the critical business factors
except for 'exchange rate' and 'exchange rate management'.
8) All CARICOM policy areas were projected to have a positive impact on investment









9) Policy respondents were quite optimistic about the contribution of CARICOM
arrangements to countries' economic gain with 24 percent indicating 'considerably' and
44 percent 'somewhat'.
Supplemental Comments and Observations
A review of the supplemental comments and observations provided by firm respondents
suggests:


1) Attention ought to be focused on some aspects of the institutional structures or rules for
conducting business, and associated supporting arrangements, within the Caribbean
Community. In some instances there seems to be scope for reducing bureaucratic
constraints. In others there is need for the revision of the institutional structures.
2) A more targeted policy design and formulation process may be required to catalyse the
formation of potential linkages between and among entrepreneurs.
3) Greater consideration ought to be given to the diversity of economic characteristics that
exist between and among CARICOM member states when designing and formulating
CARICOM policies. This could likely be attained through a more deliberate attempt at
engaging national policy makers and target stakeholders in the regional policy
formulation process.
4) The persistence of market entry barriers is a major constraint to business growth.
5) Innovative policy design will be required to resolve some business constraints, such as
transportation, that result from the geographical configuration of the Caribbean
Community.









Conclusions


There is considerable heterogeneity within the CARICOM business environment as indicated by
the survey responses of firms from the five countries surveyed. The differences are particularly
evident when the survey responses are disaggregated by country, firm size or sub-sector of
operation.


The various categories share some similarities with respect to the perception of the importance of
the critical business factors influencing the business environment. However, the descriptive
analysis undertaken highlights differences in perception among the categories about the relative
importance of these factors. This suggests that these perceptions of differences ought to be taken
into consideration during the policy formulation process, by means perhaps of a differential
approach to policy formulation. This conclusion may be refined following econometric analyses
of the data.


Diverse economic and operational characteristics are evident among the entrepreneurial sector in
CARICOM. The sector includes large firms, many of which contribute a great deal to absorption
of employment, are multi-sectoral in scope of operations and operate globally. However, the
micro firms are the largest group of firms, some of which also operate globally and across sub-
sectors. Country economic characteristics are also diverse as are those across sub-sectors.
Consequently, a key conclusion of this research is that the policy formulation process pertaining
to the business environment within CARICOM should be sufficiently inclusive to reflect
representative participation of the major sub-groups of firms, across the countries. To
complement an inclusive process, the strategy should actively and deliberately embrace the
economic and related characteristics exhibited by countries, firms and sub-sectors within the
business environment.









Table 1: Distribution of Firms Interviewed by Country and Firm Type


Firm Types Number of Firms by Country Total

Dominica Guyana Jamaica St Lucia Trinidad &
Tobago
Agricultural 2
chemicals 2
Agricultural 2
marketing 1 1

Agro processing 8
2 2 1 1 2
Distributor 3
1 2
Livestock & 4
poultry 1 1 1 1
Manufacturer 8
6 1 1

Professional 8
services 1 2 2 2 1
Seafood 5
processing and 2 1 2
marketing
Tourism & 7
hospitality 2 4 1
services
Total 5 17 6 10 9 47


Source: Prepared from interview records









Table 2: Distribution of Policy Makers Interviewed by Country and Ministry Type



Ministry Types Number of Policy Makers by Country Total


Dominica Guyana Jamaica St Lucia Trinidad &
Tobago
Agriculture
(encompassing 1 1 3 2 1 8
Fisheries)

Commerce,
Investment & 1 1 2
Consumer Affairs


Finance 1 1 1 3



Planning & 1 1 2
Development


Trade 2 2



Tourism 1 1



Total 3 2 5 4 4 18


Source: Prepared from interview records
















Large
21%


Micro
47%


Medium
15%


Small
17%


Large
21%


Micro
47%


Medium
17%


Small
15%


Figure 1 A: Profile of Size of Firms for Survey A


Figure 1 B: Profile of Size of Firms for Survey B

































Critical Business Factors

U Negative Q Neutral E Positive M Uncertain/Not applicable




Figure 2: Summary of Impact Evaluation of Critical Business Factors on Business Operations

































C',"


i~p` e~~i c~~"~ ~ .," t"03i ~\`~ ~~sL ~~
tt.' \,OQ g o~~ .


Critical Business Factors




M Negative [ Neutral Q Positive H Uncertain/Not applicable





Figure 3: Perception of the Influence of National Government Policies on Critical Business Factors

















4O



S20 -




0--' 1 11
0, C--


Critical Business Factors


B Negative E Neutral 1 Positive l Uncertain/Not applicable




Figure 4: Perception of the Influence of CARICOM Policies on Critical Business Factors























4' 4 -

V 77

CARICOM Policy Areas


M Negative 0 Neutral 0 Positive B Uncertain/Not applicable




Figure 5: Perception of the Influence of CARICOM Policies on Firm's Business Operations















90
80
S70
60
50
40
30
- 20
10
0


r l r r r r r r n r r |m rom r m r m r
S O O O O c O O O 0O O c O c 0
o O .o O O O O O .o O o O O .2 O .o O
z < z < z < z < z < z < z < z < z < z < z <
z o z o z o z o z o z o z o z o z o z o z <


Exchange Ex.
Rate Management


Inflation Unskilled Skilled Labour Local Inputs Foreign Inputs Technology Markets
Labour


Critical Factors by Policy Source

1 M 2 3 0 4 U/NA






Figure 6: Firms' Comparison of Perceived Policy Impacts by Policy Source7












SThe ranking scale here is 1 to 4 where 1= least important and 4 = very important.


Cost of
Capital


Rules















Considerably
15%





















Somewhat


Uncertain
11%


No Impact
7%


Minimally
37%


30%









Figure 7: Firms' Perception of the Contribution of CARICOM Integration Arrangements to Countries' Economic Gains















60 -



S40)

B 30

i 20



00






Critical Business Factors


M Positive 0 Neutral F Negative 1 Uncertain/Not applicable





Figure 8: Enterprise Perception of Importance of Critical Business Factors for Future Investment





































Critical Business Factors

E Positive 8 Neutral 3 Negative 0 Uncertain/Not applicable


Figure 9: Perception of Government Policy Influence on Future Investment Decisions


40


" 30
Ct

0 20


10


0


~~ c ~CC



















S40


20




0


Nz 100 0



Critical Business Factors

M Positive 0 Neutral E Negative Q Uncertain/Not applicable





Figure 10: Perception of CARICOM Policies' Influence on Business Factors related to Investment


































-' -,
V:c

V: i


CARICOM Policy Areas
B Positive El Neutral E Negative E Uncertain/Not applicable





Figure 11: Perception of the Influence of CARICOM Policy Areas on Investment Decisions













No Impact
7%


Minimally
7%


Considerably
32%


Figure 12: Firms' Perception of the Influence of CARICOM Integration Arrangements on In-country Investment


Uncertain
7%


- Somewhat
47%

















Other
3%






Trade
42%





Planning
3%


Finance
6%


Agriculture
34%


\ Industry
3%
Tourism
9%


Other
4%


Trade
35%


Tourism
12%


Agriculture
37%







Finance
4%

SIndustry
8%


Figure 13 A: Ministry Representation Profile of
Policy A Respondents


Figure 13 B: Ministry Representation Profile of
Policy B Respondents

















Under 2.5 yrs
15%


Over 2.5/ Under
5 yrs
23%


Over 2.5/ Under
5 yrs
22%


Over 7.5/ Under
10 yrs
9%


Over 5/ Under
S 7.5 yrs
19%


Over 7.5/ Under
10 yrs
8%


Over 5/ Under
7.5 yrs
23%


Figure 14 A: Experience Profile of Policy A Respondents


Over 10 yrs
34%


Under 2.5 yrs
16%


Over 10 yrs
31%


~I


Figure 14 B: Experience Profile of Policy B Respondents

















Agri.
onom
13%


Natural
Science-
3%




Management Z
17%




Sociology/
3%


Agriculture
13%


Marketing
3%











Economics
48%


c 10
0 9
m 8
7
6
o 5
4
S3
S2
1
0


Os


<'V


Areas ofSpecialisation
E Bachelors 0 Masters Doctoral Degree


Figure 15 A: Areas of Specialisation Profile of
Survey A Respondents


Figure 15 B: Degree Profile Survey A: Top Areas
of Specialisation


i/i i/i i/
iiiiF :l liii ii
iii iii ii


4*e



















International
Relations
10%

Agri. Economics
7%



Natural Science
30


Management
17%


Agriculture
13%


Marketing
3%











Economics
44%


\Fishereis Biology
3%


Figure 16 A: Area of Specialisation of Survey B Respondents


4

2

0

4'4




Areas of Specialisation

E1 Bachelors C Post Grad. Dip. E Masters a Doctoral Degree


Figure 16 B: Degree Profile Survey B: Top Areas of
Specialisation
















32 -

S24

: 16
s




8- -? -



Critical Business Factors

m Negative 1i Neutral a Positive a Uncertain/Not applicable






Figure 17: Perception of National Policy Impact on Critical Business Factors



























10

5








Critical Business Factors

E Negative E Neutral E Positive B Uncertain/Not applicable





Figure 18: Policy Makers' Perception of CARICOM Policies on Critical Business Factors

























20




10






S,..',, SOO

4$11 4
V 13


W4.. 70


Critical Business Factors

M Negative [ Neutral 0 Positive 1 Uncertain/Not applicable





Figure 19: Perception of CARICOM Policies' Impact through National Policy on Critical Business Factors



















20

15
Io


5


7 6 ,O


V.S


CARICOM Policy Areas
M Negative E Neutral Q Positive H Uncertain/Not applicable




Figure 20: Perceived Impact of Specific CARICOM Policy Areas on Business Climate


j""
c~O

































Unskilled Skilled Local Inputs
Labour Labour

Critical Factors by Policy Source

0El 2 2E3 3 4 U/NA


Figure 21: Policy Makers' Comparison of Perceived Policy Impacts by Policy Source







8 The ranking scale here is 1 to 4 where 1 = least important and 4 = very important.














Uncertain
3%


No Impact
7%


Minimally
14%


Considerably
24%


Somewhat
52%


Figure 22: Policy Makers' Perception of the Contribution of CARICOM Arrangements to Countries' Economic Gain





























N~'S


N$'/


V -
N"


Vp


Critical Business Factors
0 Positive D Neutral 0 Negative E Uncertain/Not applicable




Figure 23: Policy Maker's Outlook on Investment Climate


8









































/ V )


Critical Business Factors

0 Positive El Neutral M Negative Uncertain/Not applicable


Figure 24: Policy Maker's Perception of National Policy Impact on Investment Climate


-~Np


-C,


,i
u

90`'





















20


15


10
t, i-












Critical Business Factors

Positive El Neutral U Negative B Uncertain/Not applicable





Figure 25: Policy Maker's Perception of CARICOM Policy Impact on Investment Climate

































'.
0N
0


CARICOM PolicyAreas

1 Positive ] Neutral E Negative E Uncertain/Not applicable





Figure 26: Policy Maker's Perception of Impact of CARICOM Policy Areas on Investment Climate


i
.,""
C~,Pii


i" ~;2~'
~c~ a4
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No Impact
4%


Uncertain
4%


Minimally
24%


Considerably
24%


Somewhat
44%






Figure 27: Policy Makers' Perception of Influence of CARICOM Integration Arrangements on In-country Investment
































Critical Business Factors

M Negative E Neutral ] Positive [ Uncertain/Not applicable





Figure 28: Dominica's Perception of the Impact of CARICOM Policies on the Business Environment















12 -
12

10
A",













Critical Business Factors
U Negative 0 Neutral 0 Positive I Uncertain/Not applicable





Figure 29: Guyana's Perception of the Impact of CARICOM Policies on the Business Environment
Figure 29: Guyana's Perception of the Impact of CARICOM Policies on the Business Environment






























. ^-. ..] < ^ .< -
a 14 3
VS~ ~~9


Critical Business Factors
U Negative 0 Neutral 0 Positive 1i Uncertain/Not applicable




Figure 30: Jamaica's Perception of the Impact of CARICOM Policies on the Business Environment



















10
,C



B 6
1 0 --------------------- ----------















Critical Business Factors

n Negative 0 Neutral [2 Positive Uncertain/Not applicable






Figure 31: St Lucia's Perception of the Impact of CARICOM Policies on the Business Environment















16
14
12


0o








0 6 -



Critical Business Factors
M Negative E Neutral E Positive H Uncertain/Not applicable





Figure 32: Trinidad & Tobago's Perception of the Impact of CARICOM Policies on the Business Environment
































CARICOM Policy Areas
U Negative [ Neutral [ Positive H Uncertain/Not applicable





Figure 33: Dominica's Perception of CARICOM Policy Areas
































CARICOM Policy Areas
a Negative El Neutral 0 Positive i Uncertain/Not applicable





Figure 34: Guyana's Perception of CARICOM Policy Areas





































Figure 35: Jamaica's Perception of CARICOM Policy Areas












87














S6


4


2


s *
c^C


CARICOM Policy Areas

M Negative 0 Neutral 0 Positive M Uncertain/Not applicable




Figure 36: St Lucia's Perception of CARICOM Policy Areas


A ~"





























(A.o


CARICOM Policy Areas

M Negative 0 Neutral [ Positive 1 Uncertain/Not applicable





Figure 37: Trinidad & Tobago's Perception of CARICOM Policy Areas




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