News: CSME presents new opportunities

(TTG 25/03/2006) Port of Spain - Inquiring minds in T&T want to know: how will the new Caricom Caribbean Single Market Economy (CSME) agreement, recently signed in Jamaica, affect small business owners in this country?

Dr Eric Williams must be smiling in his grave because his dream has finally come to past. Remember, he was the one who originally proposed the same idea that inspired the formation of Caricom, his name for it was “Caribbean Federation.”

But now that the ink has dried on Caricom’s latest agreement the real concern for each country is exactly how this new initiative would affect its citizenry and their commercial markets.

Undoubtedly, this is a boon for the corporate giants in the Caribbean as they can easily expand there operations without feeling the pains of expansion. But what happens to the small- and medium-sized businesses? How would CSME impact on them?

There is a growing cadre of small/medium businesses that are operating in saturated markets in T&T.

CSME has suddenly open doors to new opportunities in the form of additional markets. But be forewarned that before jumping into this market the business must conduct some sort of self assessment or audited to determine if such a move is not only feasible but profitable.

There is another cadre of business owners in T&T who will ignore the potential this new initiative represents. Some, even if they are aware of the benefits, do not have the resources to expand their operations in T&T or anywhere else. These are the businesses that will be most adversely affected by CSME.

Their competition will start coming from countries like Jamaica, Guyana, Belize and all the other small Caribbean islands whose economy is not as robust as T&T. CSME gives them the right to compete like locals.

For readers who are unfamiliar with the CSME agreement, basically it legalises the “free movement” of qualified citizens within Caribbean member states.

Currently members states include: T&T, Jamaica, Barbados, Guyana, Belize and Suriname.

Within 30 days of the signing on March 31, the following countries are expected to sign a letter of intent to become a member state in CSME: Antigua, Barbuda, Dominica, Grenada, St Kitts and Nevis, St Lucia, St Vincent and the Grenadines.

Free movement is an important pillar of CSME where qualified nationals travel with ID cards between member states.

To phase in the free movement of Caribbean citizenry, the member states have agreed that “qualified citizens” must fall under the criteria of university graduate, artistes, musicians, sports and media personnel, self-employed people and any support staff associated with a Caricom company.

According a document distributed by the Ministry of Labour, “CSME is intended to assist member states of Caricom to achieve their national objectives, such as full employment of all factors of production, improved standards of living and work, sustained economic development and expansion of trade and effective economic relations with other countries.”

Based on the content of the CSME agreement, and the inevitability that there will be losers and winners in this new trade initiative, the point of this article is to highlight the actions that should be taken by small- and medium-sized businesses in T&T specifically and the other member states as a whole.

The question is: as an owner of a local small/medium company with maximised resources, how does a small business capitalise on this new initiative?

Many of them are too under capitalised, in survival mode and, in all honesty, will become spectators of this new initiative.

There are still others who, because of the particular stage of their business, are just not able to take advantage of the CSME. It does not matter how you categorise your business right now, every business owner operating in T&T must understand the benefits of this new initiative.

But before you categorise your business, answer this simple question honestly: is my business operating at full capacity now? That is not an easy question to answer if you do not have the metrics to determine what is full capacity. And if you don’t have the numbers to tell you where you are, you are most likely not operating at full capacity.

Granted most local small businesses do not have any idea of what share of the market they control, however any business can quickly use simple indicators to determine their capacity for expansion, for example:

For retail sales:

How fast do you turn over your inventory?

Can the business afford to double its inventory and overhead cost?

Is your gross monthly sales, over the last six months, going up, down or at a steady pace?

For services

Do you have the manpower to expand your services locally?

Is there a possibility of opening another branch of your business?

In T&T?

Is the service available in the market you intend to enter?

How is your service different to what currently exist in the market?

When you have determined that CSME is a possibility for your company, your next step is to determine which country/market you would like to approach.

T&T residents will have to go to the Ministry of Foreign Affairs for an application. There is no application fee. The documents necessary for a university graduate to qualify includes:

Certification of a university degree

Birth certificate

Marriage certificate, where applicable

Police certificate of character

Passport

Three passport-sized photos.

In cases where the person is an artiste, a musician, a media worker or a sportsperson the completed application form must be accompanied with items two to six above in addition to:

A letter from the respective ministry which states that the applicant was registered in the particular field—art, sports, media or music.

Copies of relevant qualification or certification in the respective field.

Letter from the previous employers.

It takes up to six weeks for the application form to be processed and the skill certificate to be issued.

Caricom’s newest brain child, CSME, is actually the first initiative that will directly affect the rank and file nationals of the member states. But its value must be recognised.

Whether we know it or not, this is the first step towards the building of a regional economy that goes beyond the level of government co-operation.

When we face the fact that there will be a significant percentage of the local businesses who will not benefit from CSME that has to be seen in the perspective that there will always be individuals, businesses or events that will always leave some of the population out.

The good thing about taking that perspective is that it can become a goal for many of the businesses who cannot use it right now.

Many a naysayer will count the reasons why this new initiative will not work. The response to most of their comments should be, that’s why it’s an initiative. It is always easy to postulate reasons to negate any idea without suggesting a suitable alternative. The point is that it’s a lot smarter to have a tool in a box and not need it than not to have it at all.

Business owners and wage earners who can see the advantage of using this initiative should jump on it with both feet.

The people of T&T should be proud that Caricom and this new CSME agreement was actually pioneered by a son of our small republic. That pride should be translated into a determination to make the CSME the glue that unites the entire Caribbean community.

The tools for the success of this initiative is now in the hands of citizens in the respective countries. They must understand what they have and taking advantage of all the rights and privileges afforded in this document.

To determine your business marketing readiness take a free complete marketing self-diagnostic assessment test.

This assessment is in the form of a questionnaire made up of 87 thought-provoking questions that will change the way you look at your business. The test is entitled: How Do You And Your Business Stack Up For CSME.

Go to www.TrinidadAndTobagoBusiness.com

By Tony Puckerin - the managing director of Caribbean Guerilla Marketing Concept, a marketing consulting company.