By David Jessop
In the early hours of May 17 it became apparent that the Dominican Republic’s President, Leonel Fernandez, had won an outright victory in the first round of his nation’s presidential race, taking 53 per cent of the popular vote against the 41 per cent of his main rival, Miguel Vargas.
In doing so President Fernandez secured a second consecutive term in office, an achievement only matched previously by the late President Joaquin Balaguer who served eight terms in all.
Although President from 1996 to 2000, President Fernandez had been barred as the incumbent from standing again in 2000 by a 1994 constitutional amendment. However, following a change in the constitution in 2002, he was able this time to seek a second four-year term.
In the past, the electoral process and the politics of the Dominican Republic, their outcome and implications have been seen as being of little interest in the English-speaking Caribbean.
This is because of a sense across Caricom that whatever happened to its populous neighbour – latest estimates suggest it has some 9.4 million people – it was unlikely to touch the rest of the region.
However, despite the perfunctory media coverage of the Dominican presidential race in the anglophone Caribbean and the near absence of public comment from any Caribbean government on the outcome, President Fernandez’s re-election is a matter of importance that has a direct bearing on the economic future of the region, the coherence of Cariforum and the future of regionalism.
Irrespective of the failure of many Caribbean governments to understand the significance of developing a relationship with the Dominican Republic in the past – Trinidad, Cuba, Jamaica and Haiti are notable exceptions – there are very good reasons why every government and business in Caricom should consider carefully on the election result and the likely economic and trade policies that President Fernandez and his ministers will pursue.
In the past the attitude in much of the anglophone Caribbean has been to complain in private about the Dominican Republic’s growing penetration of its traditional markets in Europe, its significant levels of influence with the European Commission, the growing share of the European banana market that it has obtained, and the difficulty of anglophone Caribbean companies accessing its market. There has also been on occasions a sense of anxiety over its ability to rapidly co-ordinate a position between its business community and government or over issues such as its well considered approach to regional and international appointments that have seen Dominicans emerge in a number of high-profile positions.
In all of this there have been some startlingly successful areas of functional co-operation. Dominican Republic negotiators were fully integrated into the Caribbean Regional Negotiating Machinery for the EPA negotiations; the rum and tourism industries of the Dominican Republic play a full role in the region’s two leading trade associations, the West Indies Rum and Spirits Producers Association and the Caribbean Hotel Association, and many inter-regional institutions such as Caribbean Export have successfully operated under Dominican leadership.
Despite this, the Dominican Republic is not blameless. Rather than foster long-term relationships it has taken a largely needs-based approach, that turns around for example, its interest in maximising its opportunities from trade negotiations such as the Economic Partnership Agreement (EPA) with Europe; its continuing desire for a non-permanent seat on the UN Security Council; delimitation issues relating to fisheries; and on a small number of hemispheric or multilateral issues that it regards as important.
As consequence, with the notable exception of the President, the Foreign Minister Carlos Morales Troncoso and a few analysts and businessmen, the majority of the Dominican elite remain puzzled by the anglophone Caribbean’s attitude, its smallness, its culture and its approach to business.
This arm’s length relationship is now in need of rapid change by both parties.
This is because very soon the Dominican Republic with its large and more advanced economy is about to enter, along with all other members of Cariforum, into a single trade arrangement with Europe that will also change the Dominican trade relationship with Caricom.
Uniquely in the hemisphere the Dominican Republic will, after the EPA is signed in July, have both a free trade agreement with Europe and with the United States. It will be able to provide its business community with the opportunity to take advantage of the economies of scale that arise from having a large and viable domestic market, an as-yet-to-develop economy across its land border in Haiti, and the possibility of producing goods and providing services for the world’s two most wealthy markets, the US and the EU.
It has also been granted in the context of the EPA regional preference. Over simplified this means that any preference granted by one Caricom member to another must include the Dominican Republic thereby enabling it to benefit after a short transition period from access to markets in the English-speaking Caribbean despite the fact that the Caricom-Dominican Republic Free Trade Agreement has not been completed.
Warning recently about the necessity of addressing the issue of regional preference, Jamaica’s Prime Minister Bruce Golding noted that the region still has work to do on the regional structure, in particular in areas where the region concluded agreements with Europe but has yet to conclude our own internal arrangements.
In what in part was a thinly veiled allusion to the problems of integrating the Dominican Republic’s economy with that of the anglophone part of the region he said: “I cannot ignore the fact that in some instances, the EPA compelled the region to undertake some difficult commitments. For example, as a region we have long recognized the need for asymmetry and special and differential treatment amongst and between Caribbean member states, as not all islands are at the same level of development. However, such asymmetry is lacking under the EPA, save for in very few instances. There is a view that the regional preference clause could undermine such asymmetry and criticism that the EPA is in breach of some provisions of the Treaty of Chaguaramas.”
Mr Golding said he would continue to urge his European counterparts to consider the issue of differential treatment for the poorer countries of the region, under the EPA. He said: “I have said to them that a way has to be found to assist the poorer countries of the region.
If they can’t get differential treatment, they should get differential assistance.”
Assimilating the Dominican Republic into the Caribbean’s regional and international trade relationships will be a challenge and of particular sensitivity given that industries such as sugar, and many governments, scarcely have any contact at all with their Dominican counterparts. It argues for a programme of measures by both sides including the appointment of ambassadors, greater political and economic exchange on issues of common concern and closer functional co-operation.
President Fernandez’s return to office offers an opportunity for the Dominican Republic to genuinely reach out to the region on a sustained basis and for the English-speaking Caribbean to encourage this, and in return visitors from the anglophone Caribbean to be in Santo Domingo more regularly.
Previous columns can be found at www.caribbean-council.org
