Caribbean Civilisation

Remember that great story you learnt at Sunday School, about the little guy with the slingshot who took down the big bully with a single stone to a part of his anatomy where it really hurts? Well, its happening right here in the Caribbean.

In the 21st century Caribbean version of the timeless Biblical story, the little guy is Antigua and Barbuda; the big bully is the United States; the slingshot is the World Trade Organisation and the stone is international trade law.

And the place that really hurts could be the multi-billion dollar US music and film industry.

On January 28 the WTO Disputes Settlement Body agreed to a petition from Antigua and Barbuda to suspend application of US Intellectual Property laws in retaliation for the failure of the United States to comply with WTO rulings on the illegality of US prohibitions of Internet gambling (see following story).

The US actions have devastated what used to be a thriving offshore gaming industry that earned Antigua and Barbuda thousands of jobs and millions of dollars in government revenues.

“The irony is rich, rich, rich”, Ms. Lori Wallach, a leading consumer rights advocate in the United States, is quoted as saying by the New York Times.

How so? Well back in 1994, when the WTO was being set up, it was the United States who insisted on the inclusion of the cross-retaliation provision that Antigua and Barbuda is now using against it.

The effect of this provision is that countries that are found to be in violation of WTO rules, and which refuse to comply with the rulings of the WTO DSB, can be punished by the aggrieved country with trade sanctions in another area of their commercial relations.

Its like telling a student that is found to be cheating in his Chemistry exam that he can’t play on the school football team, even if he is the star player—and the only thing that football and Chemistry examinations have in common is that they are both governed by school rules.

As the world’s largest economy, the United States was uniquely positioned to impose punitive trade sanctions on other WTO members, secure in the knowledge that the ability of other nations to hurt it in return was moderated by the realities of asymmetrical trade power.

The US successfully used cross-retaliation against the EU, for instance, to force  the latter to comply with WTO rulings on bananas; rulings that pretty much destroyed the banana industries in the Eastern Caribbean—so that US multinationals could get access to the EU market.

Who would have thought that the tiny nation of Antigua and Barbuda, with one of the world’s smallest economies, could hurt the economy of the United States?

- Norman Girvan