Is it possible to bridge the gulf in understanding that exists between the Dominican Republic and the English speaking Caribbean?
By David Jessop
Despite the Dominican Republic having a strong and growing economy, its companies looking outwards for new investment opportunities, and a government that is playing an ever more significant role in the Hemisphere and the wider world, many Anglophone nations and Caricom are cautious or even suspicious about its intentions.
The reasons for this are many. At its most obvious there is a disparity in size. The Dominican Republic has some 9.9m people compared with around 6.5m in the whole Anglophone Caribbean. Its economy is growing more rapidly than that of the English speaking Caribbean, with ECLAC forecasting an increase of 3.5 per cent in 2010 compared to an average of 1.8 per cent for the region. There is a fear that the Anglophone Caribbean’s incomplete integration process makes it and its economies are particularly vulnerable. And at another level still, there is a deeply seated and often mutually negative perception caused by cultural stereotyping, linguistic and historic differences and dissimilar aspirations.
More particularly in recent months these suspicions have been reinforced in relation to EPA implementation over two still to be resolved issues with Caricom. These relate to how the EPA will be coordinated in a way that ensures full Dominican involvement, and the failure of many Anglophone Caribbean customs regimes to implement the tariff reductions associated with regional preference, despite the EPA’s requirement that all signatories are granted no worse treatment on tariffs than they extend to EU.
These concerns are felt particularly strongly in Santo Domingo where the public and private sector are open to trade agreements and the advantages they offer and where campaigns are underway to take advantage of EPA opportunities involving Government, business and advisers from other Latin American nations.
Until relatively recently, the Dominican Republic with its strongly US-oriented thinking, powerful but relatively closed family elites and a legacy of negative thinking about the Anglophone Caribbean - in part derived from the late President Balaguer - the Dominican Republic had not sought an improved relationship with its English speaking neighbors. However, the election of President Fernandez in 1996 changed this. He recognized then and does today the need to make the Dominican Republic more open to the world if its economy was to grow. He also saw that its businesses needed to become transparent and accountable if there was to be external investment and they were to seek opportunity outside of its borders.
The consequence of this is that many Dominican companies have changed and are now becoming active investors and joint venture partners in the region, the Dominican Republic and beyond.
For example, the Dominican Republic’s leading brewer, the conglomerate Leon Jimenes which has an eighty per cent share of the Dominican market for beer, acquired for around US$30m in mid 2009, a majority share in breweries in St Vincent, Antigua and Dominica as well as interests in Europe as part of its strategy of regional growth.
Importantly, and after experiencing some difficulties, the company is beginning to cross the cultural divide between the Anglophone and Hispanic Caribbean. This was evidenced in recent comments by St Vincent’s Prime Minister, Dr Ralph Gonslaves, speaking to the media in relation to the company’s decision to invest in establish a canning and waste water treatment plant and to brew Presidente beer locally.
“When the policy makers and investors can work (together), it means that when the issue of incentives arises for continuation or extension, the government is much better disposed to give favorable consideration than if the investors simply want to do their own thing and don’t want to have a partnership,” ..... “I want to assure them their investment is safe”.
What this seems to suggest is that the way forward in improving relations between the Dominican Republic and the Anglophone Caribbean may first be through developing much stronger business to business relationships.
As larger Dominican companies begin to look outwards to lessen their exposure to the domestic market and to find new opportunities for investment, what is missing at a pan-Caribbean level is the kind of dialogue on joint investment opportunities that occurs informally and frequently among the senior executives of the region’s larger Anglophone companies.
If proof were needed of the value such exchanges it can be seen in the regional private sector associations that look after the interests of rum (WIRSPA) and tourism (CHTA) where Dominican business interests have been beneficially integrated into the decision making and advocacy structures of the two bodies for many years.
Earlier this month, Dr Fernandez, met the US President, Barack Obama. Photographs of the two men and a clip of the two President’s words to the press were widely circulated. They appeared relaxed in each other’s company. They had spoken about Haiti, Honduras, Cuba, making the Dominican Republic a centre for the production of clean energy, and developing a more collaborative regional environment in relations to narcotics interdiction and security.
This clearly annoyed some in the Anglophone Caribbean who observed that there had been no prior consultation and in private observed tartly on the bilateral nature of the encounter without asking why it is that President Fernandez is received in the White House or for instance by the German Chancellor or French President.
Caricom Governments may for the most part continue to look inwards, but there is no reason why the leaders of larger Caricom private sector enterprises should not be thinking creatively about how to relate to their economically dynamic counterparts in the Dominican Republic.
If regional economic integration is ever to become a reality the relationship between Caricom and the Dominican Republic has to improve. In this there is a central role for the private sector. Large companies from Europe and further afield are investing in the Dominican Republic and its companies are moving out into the region and the wider world. If Caricom is not to be left behind there needs to be more dialogue, better media coverage, stronger diplomatic relations and an emphasis on addressing outstanding problems in a manner that creates trust.
David Jessop is the Director of the Caribbean Council and can be contacted at email@example.com
Previous columns can be found at www.caribbean-council.org
July 30th, 2010