SVG cannot change tariff rates – Director of Trade

The Ministry of Trade in St Vincent and the Grenadines cannot, on its own reduce the 70 per cent tariff presently being charged on certain goods being imported into this country from Trinidad and Tobago.

The tariff was introduced on January 1 and is part of the implementation of Article 164 of the Revised Treaty of Chaguaramas,which is designed to promote the development of industries in the Lesser Developed Countries (LDCs), {{more}}of CARICOM, including St Vincent and the Grenadines.

In an interview with SEARCHLIGHT on Tuesday, director of trade Cuthbert Knights said the 70 per cent tariff affects wheat or meslin flour, aerated beverages, beers, stouts, aerated waters and other types of waters that originate from More Developed Countries (MDCs) inside CARICOM, like Trinidad and Tobago.

“The tariff was approved at COTED (the Council for Trade and Economic Development) by all of the LDC countries, and at least two of the MDC (More Developed Countries) countries had to approve those rates so SVG arbitrarily or on its own cannot go and change those rates,” Knights said.

Under Article 164, the LDCs are allowed to deny preferential (duty free) entry into their markets of certain products originating in CARICOM and extra regional countries.

The application of the provisions of Article 164 was approved by COTED in 2006 and now, locally, the Ministry of Trade has utilized the licensing regime to provide protection to the industries operating within the OECS.

Knights stated also that SVG exists in what is known as a Customs Union where there is a common external tariff and those common external tariffs (used in all countries in CARICOM) cannot be changed by just one country.

He, however, noted that the fact that there are complaints, means that there is room for discussion.

“One cannot link it back to say that St Vincent can change those duties; it can’t happen that way, but if there are challenges that are emerging due to the implementation, those are things that can be discussed to see how they can be some redress,” said Knights.

He said that part of Article 164 allows for a midterm review every five years and the next review will be in 2018, “so there is scope to review the challenges that are now presented during the review in 2018. If there are now challenges, there can be discussions on the matter to see how they can be addressed.”

Knights said that it is general knowledge that the traffickers are providing a service in terms of getting produce out of the country and that is commendable and no one would like to see anything go wrong with this process.

“…Their contribution is one that we have to commend them highly for so no one will want to see anything that is going to prevent them from doing this trade,” said Knights, who opined that like anything else, when a new structure is implemented, some problems may arise that have to be sorted out.

He said St Lucia has also implemented Article 164, while Grenada is making plans to do so, “and I am certain that they will be facing the same challenge.”

Knights said that all Article 164 seeks to do is to give some space for local industries to develop themselves and one of the ways of doing so is to have a special tariff in place on different types of goods. He said that the 70 per cent tariff exists on certain goods that come from MDCs inside CARICOM, while goods that come from outside of CARICOM have a 100 per cent tariff placed on them.

Locally, Article 164 protects items being produced by the Eastern Caribbean Flour Mills (ECGC), the East Caribbean Bottlers Incorporated (ECBI) and the St Vincent Brewery Ltd.

SEARCHLIGHT was unsuccesful in our attempts to contact director general of Finance and Planning Maurice Edwards to ask about the challenges being experienced by traffickers in bringing foreign exchange out of Trinidad. However, on the ULP Speaks radio programme on Tuesday night, Minister of Transport and Works Julian Francis said Edwards would be sending someone from the Ministry of Finance to Trinidad and Tobago to try to bring resolution to the matter. (LC)