CATEGORY:ECONOMY/MONEY ------------------------- INSIDE GRENADA SATURDAY September 15,2007 (The following is the address delivered to persons attending the press conference by Mr. Lennox Andrews, Permanent Secretary in the Ministry of Finance). My name is Lennox J. Andrews, the Permanent Secretary of the Ministry of Finance. I am joined by Mr. Carl Felix, Comptroller of Customs; Mrs. Petra Joseph, Corporate Communications Officer in the Ministry of Finance A pleasant Good Morning to all of you and welcome to this special press conference on the discussions held with the Ministry of Finance and representatives of the Association of Traffickers' Trade. That meeting took place yesterday afternoon to address some of the issues relating to the implementation of a new regime for the traffickers. I must say that the meeting was indeed cordial and friendly, with discussions being lengthy, frank and honest; as a result it was easy for us to take firm decisions. We all therefore left the meeting expressing our satisfaction with the outcome and pledging our commitment to work together to ensure the continuation and strengthening of the trade. And we agreed that we should have this press conference to inform and update the nation on the issues of the traffickers' trade in Grenada. Before detailing to you the decisions we arrived at during our meeting a few points must be made on the traffickers trade itself. The traffickers trade in Grenada is decades old. For many years, persons from the rural communities would purchase agricultural products such as avocados, sour sop, and breadfruit for sale on the Trinidad market on weekends. In turn these persons would return from Trinidad with basic grain and starch such as rice and sugar, milk and potatoes, for domestic consumption and for sale on the local market. It was a striving industry for many humble families who through this means were gainfully employed and were able to satisfactory maintain their families and educate their children. Indeed, with the advent of fruit fly and other pests, together with the development of the agricultural sector in Trinidad, the trade in Grenadian produce to Trinidad gradually decline, and today the trade is mainly one way with goods being purchased from Trinidad and sold on the Grenadian market. Noticeably though, the traffickers' trade continued to expand with the growth of the manufacturing sector, and the devaluation of the TT dollar which allowed for the purchase of high quality cheap products from the neighboring island. As a result steps were taken in Grenada to facilitate such trade given its importance in employment generation, and its impact on the consumption ability of our people. One of the first steps taken was to have a separate section in Customs for the entry of the traffickers' goods to the island. Traffickers were given special arrangements to facilitate the easy clearing of their goods. Granted that they purchased their items not directly from producers but from wholesalers and retailers, they were treated differently from the established businesses. These actions represented governments' effort to protect and develop an informal sector which generated income and employment for a very important section of the population and which at the same time gave the opportunity for the modest and noble in our society to help themselves and to unleash their entrepreneurial spirit. Today, the world has changed; businesses have changed and the way in doing business has also changed. These changes have been brought about not by mere technological achievements, but by the agreements and arrangements which we establish with other peoples and regions of the world. As a nation and a people, we must be mindful of change, we must be always ready to embrace change and prepare for such change, especially when it is good. It makes no sense we continue to hold on to old ways of doing things when our neighbors and friends are benefiting from doing things better. If we do not we would be left behind and be slowing down our own progress. The world today has changed substantially from the decades ago when the two way trade flourished. Our country's relationship with our neighbors and our region has also changed. Today, we are members of CARICOM, and we together with our friends in CARICOM are moving towards the establishment of a Single Market and then Economy. This requires that we implement different laws and regulations to facilitate the establishment of such a market. One of the main principles governing the establishment of the CSM is that all importers must be treated the same; there can be no preferential treatment, no special arrangements for certain kind or class of people. All must be treated the same. It therefore requires that we reconsider the way we treat with our traffickers as far as our trade relations are concerned. Our brothers and sisters in our region, namely St.Vincent and Dominica have already taken steps to regularize the trafficker's trade. In this regard, over the last year or so, the Customs department of the Ministry of Finance, has been meeting with our traffickers in an effort to prepare them for this new situation. A number of meetings were held in which the new regime was explained to the traffickers. It would seem that not all that had to be done to facilitate a smooth transition were done. It would also seen that some of the traffickers did not understand the importance of the new system and therefore the implications of this new regime was met with some concerns. Our meeting with the traffickers association on Tuesday 11th September, 2007 was geared towards hearing those concerns of the traffickers and identifying solutions. Before I go on to detail the issues raised and actions taken to deal with them I wish to state categorically and emphatically that at no time in our discussions did traffickers indicated that they were unaware of the change and that they were not going to comply with the new regime. They all demonstrated an understanding of the reasons for this new regime and they were all prepared to abide with and work along with the new conditions. All they requested was for certain actions to be taken to ensure optimality and that the playing field was in deed level. 1) The first issue raised relate to the question of they obtaining a CARICOM Certificate of Origin for the goods they import. Under the new regime, all importers are required to present to Customs a certificate indicating the origin or the place of manufacture of the goods they imported. If therefore the good is imported from CARICOM they have to present a CARICOM certificate of origin indicating that the good was manufactured in a CARICOM country. The difficulty with this however, is that producers of a particular good give certificates of origin only to their recognized agent in the country that imports the good. So that there is only one agent who has a monopoly on the importation of that item in the country. It therefore means that traffickers are unable to get a certificate of origin for a product for which there is an already existing agent in the country. To give an example, if the Agent for Busta in Grenada is Bryden and Minors, then a trafficker who wants to import Busta cannot get a certificate of origin from the producer of Busta in Trinidad since that agent is Bryden and Minors and the producer in Trinidad will not be prepared to give another certificate to another person. It therefore means that the traffickers would be unable to import Busta at the lower CARICOM Rate and hence will lose their trade. The traffickers brought this to our attention and we thought that this was a reasonable case which required our attention and possible solution. We therefore had a lengthy discussion on how to approach this issue and we agreed as follows: • The Ministry of Finance would hold discussions with importers in Grenada who are Agents for certain products and ask them if they are prepared to give up or share the "Agent Status" with the Traffickers Association. These products are Busta, Fruta, LLB, Orchard, Coke and Sprite. This meeting is being planned for early next week and the results will be transmitted to the traffickers shortly thereafter. In relation to this the traffickers noted that there are other products produced within our region but for which there are no Agents in Grenada. They agreed that for such products, they can in fact get Certificates of Origin, and in this regard have agreed to produce certificates of origin when importing these products. The traffickers also indicated that some of their products are produced from outside of the region and therefore they would be prepared to pay the extra regional duties and taxes. 2) Traffickers raised the issue of the charges meted on to them by brokers to fill up the entry form. Their concern and rightly so is that these charges are in deed high and required our assistance. We decided on a two-prong approach to deal with this matter. • First, we are going to hold a meeting with the brokers, both in Grenville and St. George's and ask of them that their charges for filling in the entry form should not exceed EC$40.00 per trafficker. That meeting is being planned. • Secondly, we have agreed to provide training to the traffickers so that they themselves can in fact fill out the form. I must say that this is one of the shortcomings of the Ministry in preparing the traffickers for the new regime, since such training should have taken place before the new regime come into place. Nevertheless. We have agreed that there will be three such training; the first is planned for the 19th September at the Methodist School in Grenville at 4.30pm. 3) The third issue raised by the traffickers relate to improvements in their facilities (i.e. their shed) at St. George's and Grenville. The traffickers requested additional washroom facilities in the places indicated. We agreed to work with the Grenada Port Authority to ensure that that matter is addressed. 4) It was indeed very heartening to learn at the meeting that the traffickers have begun discussion with the Grenada Ports Authority on other areas of assistance, including the clearance of bulk purchasing and office space at the Port.