St Kitts Welcomes Free Trade Prospects With Brazil

by Phillip Morton, Investors Offshore.com

03 February 2011

Saint Kitts and Nevis has welcomed negotiations with Brazil towards a ‘Partial Scope Agreement’ which will provide preferential tariffs to the twin-island federation for businesses engaged in manufacturing, in what Prime Minister Denzil Douglas described as a ‘win-win’ situation for both states.

“Several products made here in St. Kitts and Nevis find their way to Brazil already, but I believe they do enter the market with an applicable 30% tariff. From the perspective of St. Kitts and Nevis, the attainment of a duty-free trade agreement, similar to the Caribbean Basin Initiative, and what is operated between Brazil and Guyana, is vital in order to secure the opportunity for increased production in locally-based manufacturing facilities,” said Douglas.

In brief remarks at an event hosted by the Board of Directors of the local manufacturing company, PPC-Kajola Kristada, Douglas noted that Brazil, with a population of over 290 million people, “represents that chance for manufacturing facilities to at least double their production, given the fact that the traditional US market has experienced a downturn in housing, and has reached saturation point in some areas.”

Douglas said that businesses are operating today in very challenging environment and the current global economic and financial circumstances mean that the route to long-term sustainability in the business world calls for careful, yet progressive, approaches to achieve profitability and the chance to reinvest for future growth and prosperity.

He said positive progress is being made on the trade agreement, following the first round of discussions in April last year and preparation for another round of negotiations this month that would focus and advance much of the required technical work.

“I am pleased to tell you, also, that the Ministry of Trade received valuable support in the form of technical assistance from the CARICOM Secretariat, in preparation for this next round of negotiations. It is in this regard that I must extend appreciation to our Ambassador Miguel Chaves de Magalhaes, who has been of tremendous support. In like manner, high commendation must go to Kajola-Kristada, especially the local manager Mr Rosa, who has been a major driving force towards forging the trade agreement with Brazil, as well as consistent support from the St. Kitts-Nevis Chamber of Industry and Commerce. Our combined efforts, I am sure, will soon result in the signing of the Partial Scope Agreement with Brazil, as soon as the appropriate clearance is received.”

Upon the agreement’s entry into force, Douglas said he expected “manufacturing activity to increase, increased employment opportunities for local workers, greater diversity for the islands’ economy, a greater profile for the country in terms of international trade, and provide greater profitability and financial security for manufacturing facilities operating in the Federation.”

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