RESTRICTED  WORLD  TRADE  
ORGANIZATION  WT/TPR/S/190 
1 October 2007  
 
(07-4027) 
Trade Policy Review Body  
   
 
  
 
TRADE POLICY REVIEW 
 
Overview Report by the Secretariat 
 
OECS-WTO MEMBERS 
 
  
 
This report, prepared for the second Tr ade Policy Review of the OECS-WTO 
Members, has been drawn up by the WT O Secretariat on its own responsibility.  
The Secretariat has, as required by th e Agreement establishing the Trade Policy 
Review Mechanism (Annex 3 of the Ma rrakesh Agreement Establishing the 
World Trade Organization), sought clarification from the OECS Members on 
their trade policies and practices under re view:  Antigua and Barbuda, Dominica, 
Grenada, Saint Kitts and Nevis, Sa int Lucia and Saint Vincent and the 
Grenadines. 
 
Individual reports for each of these Members are contained in separate 
documents in the same series WT/TPR/S/190 with suffixes ATG, DMA, GRD, 
KNA, LCA and VCT. 
 
Any technical questions arising from this report may be addressed to 
Mr. Angelo Silvy (tel. 022 739 5249), Ms . Katie Waters (tel. 022 739 5067), and 
Mr. Raymundo Valdés (tel. 022 739 5346). 
 
Document WT/TPR/G/190 contains the policy statement submitted by the 
OECS-WTO Members. 
 
 
Note: This report is subject to restricted circ ulation and press embargo until the end of the first 
 session of the meeting of the Trade Policy Review Body on the OECS-WTO Members. OECS-WTO Members WT/TPR/S/190 
 Page iii 
 
 
CONTENTS 
 
 Page 
SUMMARY OBSERVATIONS v 
 (1) E CONOMIC ENVIRONMENT  v 
 (2) T RADE AND INVESTMENT POLICY FRAMEWORK  vi 
 (3) M ARKET ACCESS FOR GOODS  vii 
(4) E XPORT MEASURES  viii 
 (5) O THER MEASURES AFFECTING TRADE  viii 
 (6) SECTORAL POLICIES  viii 
I. ECONOMIC ENVIRONMENT 1 
 (1) S TRUCTURE OF THE ECONOMY , OUTPUT , AND EMPLOYMENT  1 
 (2) F ISCAL POLICY  3 
 (3) M ONETARY AND EXCHANGE RATE POLICY  4 
 (4) B ALANCE OF PAYMENTS , TRADE AND INVESTMENT FLOWS  5 
 (5) O UTLOOK  6 
II. TRADE AND INVESTMENT POLICY FRAMEWORK 7 
 (1) G ENERAL CONSTITUTIONAL AND LEGAL FRAMEWORK  7 
 (2) T RADE POLICY OBJECTIVES AND FORMULATION  7 
 (3) F OREIGN INVESTMENT REGIME  8 
 (4) I NTERNATIONAL RELATIONS  8 
 (i) World Trade Organization 8  (ii) Regional agreements 11 
 (iii) Other preferential agreements and arrangements 13 
 (5) A
ID FOR TRADE AND TECHNICAL ASSISTANCE  15 
III. TRADE POLICIES AND PRACTICES BY MEASURE 19 
 (1) M EASURES DIRECTLY AFFECTING IMPORTS  19 
 (i) Customs procedures, documentation, and registration 19  (ii) Customs valuation 21 
 (iii) Rules of origin 21 
 (iv) Tariffs, other duties and taxes 21 
 (v) Other levies and charges 26 
 (vi) Import prohibitions, restrictions, and licensing 26  (vii) Contingency measures 28 
 (viii) Technical regulations and standards 29 
 (ix) Sanitary and phytosanitary measures 30 
 (2) M
EASURES DIRECTLY AFFECTING EXPORTS  31 
 (i) Documentation, export taxes, and restrictions 31 
 (ii) Export subsidies, financing, support, and promotion 32 WT/TPR/S/190 Trade Policy Review 
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 Page 
 (3) M EASURES AFFECTING PRODUCTION AND TRADE  33 
 (i) Legal framework for business and taxation 33 
 (ii) Incentives and assistance 33  (iii) Competition policy and regulatory issues 34 
 (iv) Government procurement 36 
 (v) Intellectual property rights 36 
IV. TRADE POLICIES BY SECTOR 38 
 (1) A
GRICULTURE  38 
 (2) M ANUFACTURING  39 
 (3) S ERVICES  39 
 (i) GATS commitments 39 
 (ii) Telecommunications 41  (iii) Financial services 43 
 (iv) Air transport 45 
 (v) Maritime transport 46  (vi) Tourism 47 
 (vii) Professional services 48 
 (viii) Other offshore services 49 
REFERENCES   51 
 
CHARTS 
I. ECONOMIC ENVIRONMENT 
I.1 Eastern Caribbean States           1 
II. TRADE AND INVESTMENT POLICY FRAMEWORK 
II.1 Aid for trade support, 2001-06        16 
 
TABLES 
II. TRADE AND INVESTMENT POLICY FRAMEWORK 
II.1 Notifications to the WTO, January 2001 to March 2007       9  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
III.1 Comparative procedures and expenses for imports, 2006     20 
III.2 OECS summary tariff analysis        22 III.3 Customs services charges, 2007        23 
III.4 Changes to trade-related tax regimes, as at May 2007      26 
III.5 OECS Members' standards bureaux        29
 
III.6 Comparative procedures and expenses for exports, 2006     31 
III.7 Marketing boards or similar arrangeme nts in place over the 2001-07 period   35  
III.8 Intellectual property rights legislation enacted since the Uruguay Round    37 
III.9 Membership in international instruments on intellectual property rights    38 
IV. TRADE POLICIES BY SECTOR 
IV.1 Sectors in which GATS specific commitments were made     40 
 OECS-WTO Members WT/TPR/S/190 
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SUMMARY OBSERVATIONS 
1. Antigua and Barbuda, Dominica, 
Grenada, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines (OECS-WTO 
Members) are independent States, members of 
the Organization of Eastern Caribbean States (OECS).  Since their last Review in 2001, the OECS-WTO Members have taken steps to liberalize trade, including the elimination of 
import quotas and the reduction of their use of 
non-automatic licensing.  They have adopted legislative and institutional improvements that facilitate trade, including in various service activities.  Continuing to strengthen the institutional and legal framework in areas like 
SPS, government procurement, competition 
policy and intellectual property protection would enhance the transparency and predictability of their trade regimes, particularly if reforms were anchored in 
enhanced multilateral commitments. 
2. OECS-WTO Members have continued 
to move away from agriculture to services, activities in which they seem to enjoy a comparative advantage.  Nevertheless, their narrow production base make them vulnerable 
to external shocks, a problem magnified by 
their relatively fragile fiscal positions.  The latter could be addressed in part by reducing the numerous incentives still granted to selected activities, some contingent upon 
exportation.  Such rationalization would also 
reduce transaction costs, improve resource allocation and help ensure the sustainability of economic growth. 
(1) E
CONOMIC ENVIRONMENT  
3. The economies of the OECS-WTO 
Members grew at an average collective real rate of 3.4% during 2001-06.  Services are by far the main economic activity, their share of GDP having increased to just over 80% in 2005.  Tourism is the major single economic 
activity.  Goods producing sectors have 
continued to lose GDP share. 
4. The OECS-WTO Members are small:  
in 2006, their combined GDP was some US$3.8 billion and their total population some 
550,000 persons, resulting in an average per capita income about US$6,900 (ranging from US$4,450 in Dominica to US$11,840 in 
Antigua and Barbuda).  Due to their small 
size, OECS-WTO Members are dependent on a relatively narrow range of economic activities and subject to diseconomies of scale, both in the production of goods and the 
provision of government and other services.  
Although participation in the integrated regional market being created by CARICOM seeks to address these problem, OECS-WTO Members remain particularly vulnerable to exogenous shocks. 
5. Due to their participation in the 
Eastern Caribbean Currency Union, OECS-WTO Members have no independent national monetary policy.  Since 1976, the Eastern Caribbean Central Bank (ECCB) has been 
responsible for monetary  and foreign exchange 
policy, keeping their common currency, the EC dollar, pegged to the U.S. dollar.  Inflation has in general been low in recent years, with an annual average of some 2% over the 2001-06 period. 
6. In contrast, fiscal policy is conducted 
in an independent manner by each OECS-WTO Member.  Attempt have been made to harmonize fiscal policies through fiscal benchmarks;  OECS-WTO Members are 
seeking to comply with agreed benchmarks by 
2020.  Fiscal policy has generally been geared at obtaining an operational surplus and, to this end, steps have been taken to address fiscal imbalances.  The current account situation has 
shifted from a deficit to a surplus in 2005 and 
2006.  However, with capital expenditure rising steadily, the overall deficit has increased to some 4.2% of GDP in 2006. 
7. Despite its reduction, to some 103% of 
GDP in 2006, public debt remains high and 
represents a significant constraint to fiscal 
policy.  Because fiscal policy is, in practice, the only macroeconomic instrument the national authorities have available to influence output and employment, the high public debt 
limits the authorities' ability to use a WT/TPR/S/190 Trade Policy Review 
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countercyclical fiscal stance to reduce the 
impact of external shocks. 
8. The economies of the OECS-WTO 
Members are characterized by a recurrent 
shortage of savings over investment, which 
has required substantial capital inflows to finance deficits in the external current accounts.  This has contributed to an increase in the external debt in most OECS-WTO 
Members, although overall OECS external 
public debt declined in 2005, to some 58% of GDP mainly on account of debt forgiveness for Antigua and Barbuda. 
9. The external current account registers 
is in deficit in all OECS-WTO Members, with 
the combined deficit reaching almost 22% of 
regional GDP in 2006.  The merchandise trade balance is structurally negative, with a deficit of some 39% of GDP in 2005.  In contrast, the surplus in the services balance was around 
some 20% of GDP in 2006.   
10. Trade in goods and services plays a 
vital role in the economies of the OECS-WTO Members, representing some 123% of their aggregate GDP in 2005;  total imports and exports account for some 71% and 52%, 
respectively, of aggregate GDP.  Growth in 
merchandise exports has been weak over the 2001-05 period, on account of high labour costs and transportation constraints, an erosion of preferences, the effect of natural disasters, 
and the closure of the sugar industry in 
St. Kitts.  The OECS-WTO Members' main trading partners are the United States, the European Union (particularly the United Kingdom), Trinidad and Tobago, Barbados, 
and Canada.  Merchandise trade among 
OECS-WTO Members accounts for less than 10% of total trade. 
(2) T
RADE AND INVESTMENT POLICY 
 F RAMEWORK  
11. OECS-WTO Members see trade as a 
crucial element in their development, and there 
is increasing recognition among them of the potential of economic reform including trade liberalization to advance wider economic objectives.  Trade policy formulation and 
implementation in OECS-WTO Members takes place at the national, OECS, and CARICOM levels.  Since their last Review, 
trade policy coordination among OECS-WTO 
Members has increased, and they have taken a decision to establish an economic union.  Other trade-related developments have been driven by CARICOM, including the 
establishment of a regional standards body, 
and a CARICOM competition commission. 
12. Participation in multilateral 
negotiations has focused on ensuring that WTO rules contain flexibilities to take account of their small size and development needs.  
Nearly all OECS-WTO Members have 
increased the number of their notifications, although most continue experiencing difficulties in this area.  In the area of dispute settlement, Antigua and Barbuda has been a 
complainant in a case before the WTO's 
Dispute Settlement Body;  other OECS Members have been third parties to disputes. 
13. The administration of trade policy 
within and among OECS-WTO Members is subject to significant human resource 
limitations, contributing to a slow pace of 
implementation of multilateral commitments and, in general, to reform among OECS-WTO Members.  Thus the importance of the higher degree of regional cooperation in the 
formulation of trade policy among the OECS-
WTO Members that has been achieved during the period under review.  Further deepening this coordination and establishing regional institutions to deal with trade policy issues 
would bring additional gains, including an 
enhanced participation in the multilateral trading system.  
14. The OECS-WTO Members have 
benefited from a range of technical assistance projects during the period under review.  
OECS-WTO Members regard Aid for Trade as 
an important initiative to deal with adjustment costs associated with trade liberalization and economic reforms, and with improving production and supply capacity.  Within Aid 
for Trade activities, the OECS-WTO Members OECS-WTO Members WT/TPR/S/190 
 Page vii 
 
 
place emphasis on the identification of 
infrastructural needs to improve delivery of goods and services, and on receiving support to pursue economic diversification.  They also 
stress that Aid for Trade should be additional 
to present commitments. 
(3) M
ARKET ACCESS FOR GOODS  
15. The OECS-WTO Members continue 
to rely heavily on foreign trade taxes, mainly 
tariffs, customs service charges, environmental 
charges and consumption or other taxes on imports for revenue collection.  In 2006, taxes collected on international trade represented just over 51% of tax revenue in the OECS Members as a whole.  However, most OECS-
WTO Members have undertaken reforms 
aimed at decreasing dependence on trade taxes. 
16. The OECS-WTO Members apply 
CARICOM's Common External Tariff (CET) 
with exceptions.  Although the average tariff 
per se  has fallen from 11.9% in 2001 to 10.9% 
in 2006, overall import duties (tariffs plus customs service charges) have increased slightly in recent years, due to higher customs service charge rates.  T he unweighted average 
import duty among all OECS countries was 
some 16.4% in 2007, up from 16.1% at the time of their previous review.  Individual national averages range from 14.9% to 20.7%  
because of the allowances CARICOM makes 
for tariff reductions, and national exceptions to 
the CET .  The OECS average i mport duty for 
agricultural products (WTO definition) is 23.7%, considerably higher than that for non-agricultural products (14%).   
17. Tariffs alone  generally go up to 20% 
for industrial products and 40% for agricultural goods.  In a few cases, however, tariffs on goods that have been subject to tariffication exceed 100%, while tariffs on motor vehicles hovering around 45-70%.  All 
OECS Members bound at least 99% of their 
tariffs lines upon acceding to the WTO.  In Grenada, import duties exceed WTO bound rates for some products.  18. Customs service charges (CSC) range 
from 3% ad valorem  in Dominica to up to 
10% in Antigua and Barbuda.  The only OECS country to have recorded the CSC in its WTO 
Tariff Schedule is St. Kitts and Nevis. 
19. Since their last review, OECS-WTO 
Members have engaged in a process of tariffication of the quantitative restrictions maintained on a number of products (beer and 
aerated beverages, curry, pasta, among others).  
Dominica had previously tariffied most of the items benefiting from Article 56 protection.   
20. OECS-WTO Members have continued 
to computerize and simplify customs procedures.  They now use the transaction 
value for customs valuation except for 
Grenada, which continues to use minimum import prices.   
21. Import licensing continues to be 
widely used by all six countries for their trade 
with third countries.  Although most import 
licences are granted automatically, and their scope was reduced during the period under review, non-automatic licences are still used in every OECS country except Dominica.  Licensing affects more often agricultural and 
agri-business goods.   
22. Independent standards bodies function 
in each of the OECS-WTO Members.  Technical regulations and standards are generally adapted from international standards, 
and little in the way of testing or certification 
is done in the OECS region due to institutional constraints.  None of the OECS-WTO Members have in place any formal procedures for the notification of trading partners when 
SPS measures are put in place.  Antigua and 
Barbuda is the only OECS country to have made any notifications of its SPS measures to the WTO.  In most OECS Members, there are few or no facilities to ensure that the SPS measures are established on an evaluation of 
the actual risks involved.  WT/TPR/S/190 Trade Policy Review 
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(4) E XPORT MEASURES  
23. With a few exceptions, the OECS-
WTO Members do not use export-licensing.  Only Antigua and Barbuda, Dominica and 
St. Kitts and Nevis apply export taxes, on a 
limited number of products. 
24. Production for export may benefit 
from tax incentives.  All six countries have notified the WTO Committee on Subsidies and 
Countervailing Measures of their Fiscal 
Incentives Acts as providing export subsidies.  WTO's General Council granted the OECS-WTO Members and other Members an extension to end 2015 for the dismantlement of export subsidies.  In St. Vincent and the 
Grenadines, certain manufacturing enterprises 
that export can qualify for reduced corporate tax rates.  Antigua and Barbuda, St. Lucia, and St. Vincent and the Grenadines have adopted free zone legislation although only the first 
two have operating zones.   
(5) O
THER MEASURES AFFECTING 
 T RADE  
25. In addition to export subsidies, OECS-
WTO Members continue to rely heavily on tax incentives to promote foreign investment.  
Incentives provide relief from the payment of, 
among others, consumption, stamp and import taxes and duties on the importation of raw materials and capital goods.  The duration of benefits is in some cases related to local value 
added, although the authorities have noted that 
in practice this is rarely the case.   
26. The fiscal cost of incentive 
programmes appears to be high, and their cost effectiveness has been questioned in a number 
of studies.  In recent years, some OECS-
WTO Members have undertaken to reform various aspects of those programmes, for example by freezing the granting of tax holidays or setting up new administrative arrangements to enhance transparency.  
Continuing the reassessment of incentive 
programmes with a view to their possible rationalization could contribute to greater transparency and efficiency in their use, and make a contribution to addressing the 
persistently fragile fiscal situation of OECS-WTO Members. 
27. None of the OECS-WTO Members 
are parties to the WTO Agreement on 
Government Procurement.  In practice, OECS-WTO Members seem to employ both public and selective tendering, and select bids with the lowest price.  However, in some OECS-
WTO Members there are no legislated 
guidelines defining these or other aspect of the selection process.  Enhancing the regulatory and legal framework for public procurement could contribute to a more transparent and efficient use of public funds. 
28. Progress has been made with respect 
to the enactment of new intellectual property legislation but none of the OECS-WTO Members has completed this process to fully reflect the TRIPS Agreement.  Putting in place 
the required institutions has also proved 
difficult.   
(6) S
ECTORAL POLICIES  
29. Agriculture has continued to lose GDP 
share, reflecting in particular the contraction of the banana and sugar industries;  the sugar 
industry in St. Kitts and Nevis was closed in 
2005.  Both banana and sugar production depend on tariff preferences in export markets.  Agricultural policies in the OECS-WTO Members are formulated at the domestic level.  
In all six countries agricultural products enjoy 
much higher tariff protection than other goods.  Except Dominica, OECS-WTO Members make use of non-automatic import licences to protect a number of agricultural activities from 
non-CARICOM imports. 
30. OECS-WTO Members have service-
oriented economies.  Overall, tourism-related industries are the most important economic activities, followed by offshore financial and other services.  The services sectors of OECS-
WTO Members are in practice generally open 
to trade and foreign investment, but these countries have made few GATS commitments.  Three OECS countries made commitments OECS-WTO Members WT/TPR/S/190 
 Page ix 
 
 
under the Fourth Protocol (on basic 
telecommunications) but none made commitments under the Fifth Protocol (on financial services). 
31. In telecommunications, except for 
Antigua and Barbuda, OECS-WTO Members have, since 2001, opened up their markets to competition and developed a regulatory and coordinating structure.  None of these five 
countries impose limits on foreign ownership 
of telecommunications companies.  Although in the five countries tariffs for fixed line services have fallen since liberalization, except in Dominica, their fixed line markets continue 
to be dominated by one provider.  In Antigua 
and Barbuda, a state monopoly provides 
domestic fixed line services, while one private operator provides domestic long distance fixed line services the country has no plans to participate in the common OECS structure due 
to the subsidies provided by the telecom sector 
to electricity and water utilities. 
32. All OECS Members operate both 
domestic and off-shore fina ncial services.  All 
six countries have been taking steps to consolidate regulation of financial services 
under a single authority at the national level, 
excluding domestic banks.  The latter have been subject for some time to a uniform legislation and are regulated by the ECCB;  uniform legislation for domestic insurance is 
at an advanced stage of drafting.  Full foreign 
ownership is permitted in insurance and  banking services.  There has been considerable 
regulatory and legislative reform in all OECS Members following on from the G7 Financial Action Task Force's report on the state of 
money laundering in various offshore centres.   
33. Air transport policy is formulated at 
the OECS level by the Civil Aviation Regulatory Board.  Most airlines operating in the sub-region are incorporated in Antigua and 
Barbuda, where there are no restrictions on the 
ownership of domestic ca rriers.  All the main 
airports and seaports in OECS Members are owned by their respective governments and managed by government-owned authorities.  In general, private sector participation in the 
provision of auxiliary services in ports and 
airports is limited in practice.  In all countries except St. Kitts and Nevis, cabotage is restricted to domestically-flagged ships.  All except St. Lucia and Grenada maintain an 
International Ships' Registry.   
34. All OECS Members offer fiscal 
incentives for hotel development, including customs duty and corporate income tax exemptions. 
35. OECS-WTO Members have different 
regimes with respect to professional services:  
in some Members there are laws to regulate specific professional service providers, and in others professional services are totally unregulated.  Efforts are being made to 
harmonize legislation at the CARICOM level.   
 
 
 OECS-WTO Members WT/TPR/S/190 
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I. ECONOMIC ENVIRONMENT 
(1) STRUCTURE OF THE ECONOMY , OUTPUT , AND EMPLOYMENT  
1. The six Organization of Eastern Caribbean States (OECS) WTO Members, Antigua and 
Barbuda, Dominica, Grenada, St. Kitts and Nevis, St . Lucia, and St. Vincent and the Grenadines, are 
island states in the Lesser Antilles (Chart I.1).  In 2006, the combined GDP of the six OECS-WTO 
Members reached some US$3.78 billion;  the GDP of individual members ranged from about US$320 million in Dominica to almost US$1 billion in  Antigua and Barbuda (see Tables I.1 in the 
national reports).  This and the relatively high c oncentration on a few economic activities, makes them 
particularly sensitive to exogenous shocks.  The si x countries have a combined area of some 2,800 
square kilometres and a tota l population of about 550,000. 
Chart I.1:  Eastern Caribbean States 
 
2. In 2006, the average per capita income of the six OECS-WTO Members was about US$6,900 
(at market prices);  it ranged from US$4,450 in  Dominica to US$11,840 in Antigua and Barbuda 
(see Tables I.1 in the national reports).  GDP pe r capita based on purchasing-power-parity varied from 
US$6,764 in Dominica to US$17,523 in St. Kitts  and Nevis, up from US$5,727 and US$12,443 in 
2001, respectively.1 
                                                      
1 Estimates of GDP per capita based on PPP in 2006 were US$13,908 for Antigua and Barbuda;  
US$9,255 for Grenada;  US$7,140 fo r St. Lucia, and US$8,090 for St. Vi ncent and the Grenadines.  IMF World 
Economic Outlook Database.  Viewed at:  http://www.imf.org/external/pubs/ft/weo/ 2007/01/data. WT/TPR/S/190 Trade Policy Review 
Page 2 
 
 
3. Services are by far the main economic activity  in OECS-WTO Members, accounting for over 
80% of GDP (at factor cost) in 2005.  Tourism is the major single economic activity, with hotels and restaurants accounting for some 9.3% of GDP across the six countries.  However, including its direct and indirect effects, tourism's contribution to GDP may be much higher.
2  Other important services 
areas are transport, wholesale trade,  financial services, and telecommunications, which represented 
12.0%, 12.2%, 11.0% and 7.4%, respectively, of the OECS GDP in 2005.  Construction activities 
accounted for some 13.5% of GDP in 2005, propelled by infrastructure projects by the various Governments, by tourism developments, and by c onstruction in preparation for the 2007 Cricket 
World Cup. 
4. The traditional sectors, in particular agriculture , have continued to lose share of GDP during 
the period under review:  for the OECS as a group,  agriculture represented 5.5% of GDP in 2005, 
down from 7% in 2000 (Chapter IV(1)).
3  The contribution of manufacturing to GDP declined from 
5.6% in 2000 to 5.2% in 2 005 (Chapters III(3)(ii) and IV(2)). 
5. The OECS countries achieved an average growth rate of some 3.4% over 2001-06.  After a 
period of weak growth in 2001-02, aggravated by the reduction in the production and exportation of 
bananas and the effect of the 11 September attacks in the United States, real output expanded at some 
5% per year between 2003 and 2006, driven by rec overy in the tourism and construction sectors.  
Growth since 2003 has been strongest in St. Lucia,  St. Kitts and Nevis, a nd Antigua and Barbuda;  
Grenada experienced fast growth in 2005, after a severe recession in 2004 caused by Hurricane Ivan 
(Tables I.1 in the national reports).  Real GDP growth for the OECS region was 5.8% in 2005 and 
7.1% in 2006 (at basic prices).4  A recent report notes that growth during 2005-06 was at its strongest 
in more than 15 years, driven by tourism and constr uction;  the latter reflects significant expansions in 
hotel capacity, particularly in Antigua and Barbuda and St. Lucia, grant-financed investments in 
cricket stadiums ahead of the 2007 Cricket Wo rld Cup, and supporting public infrastructure.5 
6. Gross capital formation expanded faster than GDP over 2001-05 owing mainly to growth in 
the construction sector and to hotel development.  However, the low return from investment might be due to the high cost of capital, and despite the wid espread policy of tax incentives (Chapter III(3)(ii));  
moreover, real output changes and public investment  do not seem to have stimulated private domestic 
investment decisions.
6 
7. There are no current official data on unemployment for most OECS Members:  the figure for 
both St. Lucia and Grenada is around 18%.  The rate is relatively high because labour shed from traditional industries, such as banana production, has not been readily absorbed by the faster growing 
service industries. 
8. The small size of OECS-WTO Members makes them vulnerable to diseconomies of scale, 
including in the provision of government services .  Wages and salaries of central government 
employees represented some 12.7% of GDP in 2005, ranging from 11.3% in An tigua and Barbuda to 
                                                     
 
2 For example, an OECS Secretariat study estimates this contribution to be of some 90% for Antigua 
and Barbuda, taking into account construction in the sector (see OECS online information.  Viewed at:  
http://www.oecs.org/ ottawa/ecs.html. 
3 Averages are for the whole Eastern Caribbean Currency Union (ECCU) area, which comprises also 
Anguilla and Montserrat.  However, the contribution of these two territories to overall regional GDP is minor. 
4 Basic price is the amount receivable by the producer from the purchaser for a unit of a good or service 
produced, less any tax payable, plus any subsidy receiva ble on that unit as a consequence of its production or 
sale.  It excludes any transport charge s invoiced separately by the producer. 
5 IMF (2007). 
6 IMF (2007). OECS-WTO Members WT/TPR/S/190 
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14.4% in St. Kitts and Nevis.7  The authorities indicated that while  the small size of the OECS-WTO 
Members made the provision of services relativel y expensive, the populations expected their 
respective governments to provide a full range of public services.  Although policy coordination has 
improved since then, there is scope for greater coor dination in policy formulation and implementation 
at the OECS level (see Chapter II(2)) which coul d help reduce the unit costs of public services. 
(2) FISCAL POLICY  
9. Fiscal policy is conducted independently by each OECS country, under the responsibility of 
the respective Ministry of Finance, and is the main macroeconomic policy instrument used by the 
national authorities to influence output and em ployment fluctuations, given the monetary 
arrangements of the currency union. 
10. OECS-WTO Members have taken steps in the last few years to address fiscal imbalances.  
The consolidated fiscal accounts of OECS countri es are characterized by a current account surplus 
and a large capital account deficit.  The consolid ated fiscal operations of the OECS-WTO Members 
central governments resulted in an overall defic it of EC$449 million (excluding debt forgiven in 
Antigua and Barbuda) in 2006, or some 4.2% of GDP, up from an overall fiscal deficit of 2.9% of 
GDP in 2005.  Overall, the current account shifted from a deficit in each year during 2001-04 to a small surplus in 2005, and a larger surplus (1.8 % of GDP) in 2006, reflecting stronger growth in 
revenue.  Capital expenditure has been rising steadily,  consistent with an expansion of capital projects 
starting in 2005.  
11. OECS-WTO Members continue to rely heavily on foreign trade taxes, mainly customs duties 
and charges and consumption taxes on imports for re venue collection.  In 2006, taxes collected on 
international trade represented some 12.8% of GDP  and 50.9% of tax revenue in the OECS Members 
as a whole.  The main single source of tax revenue  is the consumption tax (21.6% of tax revenue), 
followed by tariffs (14.9%), and the customs service charge (9.6%):  Dominica, Grenada and 
St. Vincent and the Grenadines have tried to change  this by introducing a VAT (Chapter (I)(2) in the 
national reports).  The authorities in St. Lucia indicat ed that there was an intention to introduce a VAT 
in two years.  As part of a programme of fiscal  reforms, Antigua and Barbuda reintroduced personal 
income taxes in 2005 and introduced a sales tax in 2007.  Together with the cessation of consumption 
taxes, these reforms were intended to reduce dependence on trade taxes. 
12. Medium-term strategies in the various OECS countries are aimed at increasing the current 
fiscal surplus, since the capital account  is likely to continue to post a deficit as a result of large-scale 
investment projects, generally financed through grants, concessional loans, and borrowing from third 
countries and banks.  To this end, efforts are unde r way in several OECS countries in the form of 
fiscal reform. 
13. OECS countries have also been making effort s to harmonize their fiscal policies.  As the 
fiscal benchmarks introduced in 1998 did not lead to  fiscal convergence by the target date of 2007, a 
new system of benchmarks was approved by the E CCB's Monetary Council in July 2006.  The new 
system of benchmarks established a compliance date of 2020.
8  The benchmarks include:  a gross 
                                                      
7 IMF (2006). 
8 The previous benchmarks referred to Central G overnment accounts while the new ones refer to the 
public sector as a whole.  The previous benchmarks included:  (a) Gross central government debt had to be less 
than 60% of GDP;  (b) the current ba lance of the central government had to be between 4 and 6% of GDP (this 
measure was dropped in the new system);  (c) the overall balance of the central government had to be less than -
3% of GDP;  (d) the total debt service had to be less than 15% of current revenues (this measure was dropped.  
The previous system called for benchmarks to be applied equally across countries and to be achieved by 2007.  The new system allows different speeds of convergence, with intermediate targets established for each country, WT/TPR/S/190 Trade Policy Review 
Page 4 
 
 
public and publicly guaranteed deb t/GDP ratio of less than 60%;  a nd a primary balance of the public 
sector consistent with achieving and maintaining th e target by 2020.  The enforcement of the new 
system would be maintained through peer review in the Monetary Council. 
14. The OECS countries as a group face a substantial debt burden.  Despite a sharp decline in 
2005, mainly due to a debt write-off provided to  Antigua and Barbuda, and renegotiations by 
Dominica and Grenada, the public sector debt was 1 03.5% of GDP in 2006.  Debt service absorbs a 
substantial portion of revenues in most countries, with the exception of Dominica and Grenada, which 
have made considerable progress in reaching agr eements with creditors.  Despite the high debt 
burden, access to new financing has remained ava ilable, although the cost of this financing has 
increased, since governments have increasingly relied on commercial financing. 
(3) MONETARY AND EXCHANGE RATE POLICY  
15. All OECS-WTO Members are members of the Eastern Caribbean Currency Union (ECCU).9  
The Eastern Caribbean Central Bank (ECCB), based in  St. Kitts, is the monetary authority for the 
ECCU.  The ECCB has been responsible for moneta ry and foreign exchange policy for the whole 
ECCU area since 1976, first as the East Caribbean Currency Authority (ECCA), then as the East 
Caribbean Central Bank, from 1980.  Pursuant to  the ECCB Agreement Act of 1983, the ECCB has 
responsibility for monetary, credit, a nd exchange rate policy under a regi me of joint sovereignty.  The 
ECCB's Monetary Council, comprising a Minister from each of the OECS countries, is the main decision-making body;  as members of the Monetary  Council, ministers represent the currency union 
and not their respective countries.  The ECCB Ag reement Act identifies monetary stability, money 
and capital market development, and real sector deve lopment as the objectives to be attained, in that 
order.  The Act stipulates that foreign exchange mu st cover at least 60% of monetary liabilities, but 
the ECCB has been keeping a cover close to 100% (96.5% in 2005). 
16. The exchange rate parity may be modified only by unanimous decision of the Monetary 
Council and the ECCB's Board of Directors.  Mone tary stability has been pursued through a fixed 
exchange rate regime, which pegs the EC dollar to the U.S. dollar at a rate of EC$2.70 per US$1.  
Movements in the EC dollar real effective exchange ra te are related largely to changes in the value of 
the U.S. dollar vis-à-vis other major currencies.  Th e EC dollar depreciated in real effective terms by 
some 10% between 2001 and 2006.  The nominal peg has remained unchanged since 1976. 
17. The money supply is virtually endogenous due to  the existence of a quasi-currency board.  
Limits are imposed on credits to member governments:  the ECCB's holding of treasury bills of a 
certain government may not exceed 10% of a government 's current revenue for the current year, while 
holdings of other government securities may not exceed  15% of the currency in circulation and other 
demand liabilities.  Also, temporary advances to a government in any financial year may not exceed 
5% of that government's average annual current reve nue in the preceding three years, and holdings of 
bonds issued by development finance corporati ons may not exceed 2.5% of the average annual 
government current revenue over the preceding three years.  The ECCB operates a regional market for 
government securities of the ECCU  member states.  Th e Regional Governments Securities Market 
(RGSM), established in November 2002 and re gulated by the Eastern Caribbean Securities 
                                                                                                                                                                    
 
based on initial conditions and constraints.  See IMF, Eastern Caribbean Currency Union: 2006 Regional 
Discussions-Staff Report, and Pub lic Information Notice on the Executi ve Board Discussion on the Eastern 
Caribbean Currency Union .  IMF Country Report No. 07/96, March 2007. 
9 Anguilla and Montserrat are also Members. OECS-WTO Members WT/TPR/S/190 
 Page 5 
 
 
Regulatory Commission (ECSRC), currently issues two types of securities with varying maturities:  
treasury bills and bonds.10 
18. During 2001-05, broad money (M2) in the OECS region grew by an average of 7.5% a year, 
nearly twice the rate of growth of nominal GD P;  M2 growth accelerated in 2006, to 11.6%.  
Domestic credit increased at an annual rate of so me 4.8%, resulting in a sharp increase in the net 
foreign assets of the banking system over the period.11  Nominal interest rates declined over 2001-06, 
with prime lending rates of between 8.5% and 12% in  both 2005 and 2006.  Real interest rates also 
declined, to a range of some 5.7-9.2% for prime lending rates. 
19. Consumer price inflation remained subdued between 2001-03, but started to accelerate in 
2004;  the average CPI increase was slightly below 2%  during 2001-05, for the OECS as a whole, and 
some 2.8% in 2006.  However, inflation varies ac ross countries:  it has been particularly low in 
Dominica and Antigua and Barbuda, while St. Lucia and St. Kitts and Nevis have posted higher-than-
average rates (Chapter I(3) in the national reports).  The main factors in the relative low inflation have 
been the ECCB's prudent monetary policy, the fixe d exchange rate regime, and the decision of most 
governments to delay the pass through of higher gl obal oil prices to retail prices.  Inflation has 
increased slightly as of 2004, as countries have gradua lly allowed domestic oil prices to reflect world 
trends;  it reached an average of 2.8% for the ECCU in 2006. 
20. Since 2005, OECS Members have not maintained  exchange controls on capital and non-trade 
current transactions.  The EC$250,000 limit on fore ign-exchange purchases without approval from the 
respective Minister of Finance, was eliminated in that year. 
(4) BALANCE OF PAYMENTS , TRADE AND INVESTMENT FLOWS  
21. The current account of the balance of payments  of the OECS Members posts a sizeable and 
increasing deficit, which reached some 22% of GDP in 2006.  The deficit is primarily caused by the 
large trade imbalance, equivalent to some 39% of GDP in 2006.  Merchandise imports for the six OECS-WTO Members totalled EC$5 billion in 2006, compared with exports of some 
EC$650 million.  Each individual country posts a trad e deficit.  The net foreign assets of the ECCB 
reached EC$1,872 million (some US$693 million) in 2006. 
22. Each OECS-WTO Member posts a services surplus.  However, despite a widening services 
balance surplus, the current account deficit in all ex cept St. Kitts and Nevis has deteriorated in recent 
years.  This is mainly the result of increased merchandise imports and weak export performance.  
Increased imports were triggered by the boom in construction and tourism and by increases in the 
prices of some commodities, particularly fuel.  W eak exports are due largely to reduced receipts from 
traditional export commodities, particularly bananas and sugar.  The income account is structurally in 
deficit in all OECS countries, despite sizeable current transfers inflows;  this is due mainly to large 
outflows of investment income. 
23. Some two thirds of imports are manufactured goods.  The main import items are machinery 
and transport equipment, followed by chemical s, semi-manufactures, and other consumer goods. 
24. The main export products vary by country but are mainly agricultural products:  bananas are 
the main export product in St. Lucia and St. Vincen t and the Grenadines, and are second in Dominica, 
                                                     
 
10 ECCB online information.  Viewed at:  h ttp://www.eccb-centralba nk.org/Money/rgsm.asp. 
11 Commercial bank credit distribution in December 2005 was as follows:  personal mortgage, 26%;  
consumer credit, 21%;  tourism, 10%;  Central Government, 9%;  distribution, 8%;  construction and land development, 6%;  manufacture, 2%;  agriculture 4%;  other, 14%. WT/TPR/S/190 Trade Policy Review 
Page 6 
 
 
after soaps and detergents.  Following the demise of the sugar industry, switches, relays, fuses and 
capacitors are St. Kitts and Nevis' main export product.  Nutmeg accounted for over a third of 
Grenada's exports until 2005.  More than 90% of  exports take place under preferential conditions.  
Export performance has been weak over the 2001-05 pe riod, on account of an erosion of preferences, 
the effects of natural disasters, and the closure of the sugar industry in St. Kitts.  In this respect, a 
recent study estimates that the value of implicit a ssistance derived from EC banana preferences 
declined from about 15% of GDP in the early 1990s to about 2% in 2005;  it is also estimated that, as a result of reduced preferences, Dominica, St. Lu cia, and St. Vincent and the Grenadines could 
experience a permanent loss of between 1-2% of GDP and a deterioration in fiscal balances of 0.5-1% 
of GDP.
12 
25. Current account deficits have been financed by capital inflows;  the overall surplus in the 
capital and financial account reached 26.1% of GDP in 2006, up from 18.2% in 2001.  The surplus 
reflects mainly foreign direct investment and offi cial concessional assistance, including grants and 
also external borrowing. 
26. The large financing needs have contributed over th e years to an increase in the external debt 
in most OECS countries.  The external public debt  declined to some 57.9% of GDP in 2005, from 
69.7% in 2004, mostly on account of debt forgiven ess for Antigua and Barbuda.  In 2005, the highest 
external debt to GDP ratio in the region was in  Grenada (88%), followed by Dominica (80%), St. 
Kitts and Nevis (67%), St. Vincent and the Gren adines (54%), St. Lucia (44%), and Antigua and 
Barbuda (38%).  Debt to GDP in the latter fell si gnificantly following the forgiveness of its debt to 
Italy.  Due to external debt refinancing, partic ularly in Dominica and Grenada, the external debt 
service ratio for the OECS region, which had been increasing until 2005, fell from 16% in that year to 
an estimated 10.4% of exports of goods and services in 2006.13  Interest payments represented some 
4% of exports of goods a nd non-factor services in 2005. 
27. The OECS countries' main trading partners are the United States, the EC, particularly the 
United Kingdom, Trinidad and Tobago, Barbados, and Canada, which together account for around 
two thirds of imports and expor ts.  Trade with other CARICOM Members has increased during the 
period under review, reaching almost 20% of tota l trade in 2005, partly on account of larger oil 
imports from Trinidad and Tobago.  On the other hand, trade among OECS countries accounts for less than 10% of total trade.  The exception is Dominica,  where some 20% of exports are directed to other 
OECS Members.  The authorities indicated that some of the reasons for the limited trade among OECS Members were;  the similarity of the produc tion base, the high cost of producti on and other 
constraints, in particular relating to the cost  and availability of transportation services and 
infrastructure.  
28. Foreign direct investment inflows in the OECS area totalled EC$5.9 billion (US$2.2 billion) 
in the 2001-05 period.  The main single area for inv estments has been tourism (in particular hotels and 
resorts).  Manufacturing was also an important area, where investment has been  in detergents, soaps, 
and light electronics. 
(5) O
UTLOOK  
29. The IMF forecasts GDP growth of 4.4% for 2007 for the OECS countries, with growth 
supported by the implementation of major infrastructur al projects in most count ries.  Construction and 
tourism are expected to continue to be the most dynamic sectors.  An overall fiscal deficit of 2.3% of 
GDP is anticipated.  The current account of the balan ce of payments in all countries is likely to remain 
                                                      
12 IMF (2007);  and Mlachila, and Cashin (2007). 
13 IMF (2007). OECS-WTO Members WT/TPR/S/190 
 Page 7 
 
 
under pressure, as imports expand significantly as growth accelerates, while exports lag behind.  The 
overall current account deficit is estim ated to be around 20% of GDP. 
II. TRADE AND INVESTMENT POLICY FRAMEWORK 
(1) GENERAL CONSTITUTIONAL AND LEGAL FRAMEWORK  
30. The constitutional and legal systems of the six OECS-WTO Members under review (the 
OECS Members) demonstrate considerable homogene ity.  All six countries share similar procedures 
for enacting legislation and judicial provisions, am ong others.  All adopted the "Westminster style" 
parliamentary system at Independence, and they al so have comparable executive, legislative and 
judicial traditions (Chapter II of the national reports).  The six countries are members of the Commonwealth of Nations, all have  constitutions that grant essentia lly identical powers to their 
(largely ceremonial) Head of State, and all enact legislation in fundamentally the same manner.  
However differences in constitutional frameworks do exist:  only Dominica is a republic, while the 
others retain the Queen of England as their Head of State.  In Antigua and Barbuda, Grenada, and 
St. Lucia, the legislatures are bi-cameral whereas in Dominica, St. Kitts and Nevis, and St. Vincent and the Grenadines they are unicameral. 
31. The homogeneity of legal systems has given rise to important institutional synergies.  For 
instance, the similarities of OECS Members' le gal systems enables legislation drafted for one 
jurisdiction to be adopted in another without undue  difficulty.  In many cases, model legislation is 
drafted for all members at once and may be adopted  later with relevant modifications by national 
legislatures, this promotes efficiency and savings in a number of areas where resource limitations would make legislative action costly.  An exampl e is the establishment of the Eastern Caribbean 
Telecommunications Authority (ECTEL)
14 and the enactment of domes tic Telecommunications Acts 
in each ECTEL member state (Chapter IV of the na tional reports).  Another example is the revised 
Uniform Banking Acts which are identical in each state.  
32. OECS Members have been su ccessful in establishing regi onal institutions for specific 
purposes.  Examples are the Eastern Caribbean Court of Appeal (ECCA), the Eastern Caribbean Central Bank, and the Eastern Caribbean Civil Aviation Authority.  The existence of the ECCA, in 
particular, is only possible because of the high de gree of harmonization of the legal systems of the 
countries involved.  Such harmonization also creat es potential synergies for the implementation of 
WTO obligations, as well as opportunities for the de velopment of new trade supporting institutions. 
(2) T
RADE POLICY OBJECTIVES AND FORMULATION  
33. OECS Members' trade policy objectives are mu ltifaceted.  OECS Members see trade as a 
crucial element in their development;  there is an increasing recognition of the potential of trade 
liberalization to advance wider economic objectives,  so that economic reforms occasioned by various 
commitments are increasingly viewed as a necessary and desirable process.  Simultaneously, they have argued that WTO rules need to be flexible  enough to take account of their development needs 
and that appropriate mechanisms should be ava ilable for "small vulnerable economies" to support, 
where necessary, the adjustment required as a result of trade liberalization.  As part of advancing 
these wider objectives, OECS Members have attempted to increase their participation in trade-related 
negotiations generally, and have s ought trade-related technical assistance in order to achieve this.
15  
The major negotiating focus has been  to secure, wherever possible, fl exibility in negotiated rules in 
                                                      
14 ECTEL online information.  View ed at:  http://ectel.int/ectelne w-2/aboutus_files/aboutus.html. 
15 The OECS States have sourced several projects to aid in capacity building (see for example:  
http://www.oecs.org/ proj_trade.htm). WT/TPR/S/190 Trade Policy Review 
Page 8 
 
 
order to mitigate possible negative consequen ces from what may be onerous commitments.  
Accordingly, OECS Members have uniformly em phasized the need for special and differential 
treatment;  the need to safeguard long-standing prefer ences;  the need for them to avoid deep cuts in 
tariffs;  and where relevant, the need to secure  an appropriate development package in trade 
negotiations. 
34. The OECS Members' international trade comm itments can be viewed in terms of three 
concentric circles.  At the core is duty-free treatment among OECS partners.  The middle circle 
encompasses duty-free trade with other CARICOM me mbers, with some exceptions. In relation to 
third countries, OECS members, as part of CA RICOM, have adopted, in stages, the CARICOM 
Common Market and Common External Tariff.  Th e outer ring comprises multilateral commitments 
including tariff bindings and other obligations cove red by the WTO Agreements.  The establishment 
of the Economic Partnership Agreement (EPA) w ith the European Union as part of CARIFORUM 
would create another circle of preferential commitm ents between the existing middle and outer circles 
(see section (4)(iii) below). 
35. Although there has been some activity during the review period in trade arrangements 
between the OECS Members16, which is expected to deepen through the OECS Economic Union, the 
main focus of trade policy implementation and de velopment has been CARICOM integration.  WTO 
membership and the EPAs received the major part of resources.17 
36. The core administration of OECS Members' trade policy is on two main levels.  At the 
national level, each country participates directly in  trade negotiations and consultations as and when 
resources allow;  at the same time policy is coordi nated or harmonized through the OECS Secretariat 
(see section (4)(ii)(a) below). 
(3) FOREIGN INVESTMENT REGIME  
37. OECS Members' foreign investment regime has not changed during the review period.  With 
some minor exceptions, foreign investment receives  national treatment in all OECS Members.  The 
only restriction generally relates to requireme nts for obtaining alien landholding licences.  The 
rationale for this restriction is related to limita tions in land availability for commercial purposes, and 
the need to rationalize land use and enable nationals  to afford property while avoiding speculation by 
foreign nationals .  Licences are subject to satisfactory applica tions to national Cabinet of Ministers 
and the payment of requisite fees.  However, licen ces are not required in a number of cases, such as 
investment in sectors considered of priority fo r the country, or where the purchase does not exceed a 
certain threshold. 
(4) INTERNATIONAL RELATIONS  
(i) World Trade Organization 
38. Prior to Independence, all OECS Members applied GATT de facto, as members of the 
metropolitan territory of the United Kingdom.  Following Independence, they became GATT 
contracting parties under Article XXVI:5(c) with their rights and obligations under GATT retroactive 
to the date of Independence.  Antigua and Bar buda, Dominica, St. Lucia, and St. Vincent and the 
                                                      
16 CARICOM online information.  Viewed at:  http://www.caricom.org/j sp/oecs_news/oecs_new_ 
treaty.jsp. 
17 Caribbean Regional Negotiating Machinery online information.  Viewed at:  http://www.crnm.org/ 
acp.htm. An overview of the state of play of OECS-WTO Members in variou s trade arenas is available at:  
http://www.acici.org/aitic/documen ts/reports/reports40_eng.htm. OECS-WTO Members WT/TPR/S/190 
 Page 9 
 
 
Grenadines are original members of the WTO.  Grenada, and St. Kitts and Nevis became WTO 
Members in 1996.  They all apply at least MFN treatment to all their trading partners. 
39. OECS Members have been more active in the WT O since their previous Review, including in 
terms of giving effect to their WTO obligations.  A ll six states have undertaken legislative reforms in 
intellectual property;  St. Lucia is the most advanced  in this process.  In the case of Grenada and St. 
Vincent and the Grenadines, recent success contrast s with the situation in  2001 when neither had 
made much progress in amending domestic legisl ation to give effect to WTO obligations. 
40. Most OECS Members have made efforts to improve their notification records.  Differences in 
levels of implementation and notif ications may be attributable to differences between the countries' 
technical or human resources. 
Table II.1 
Notifications to the WTO, January 2001 to March 2007 
Agreement Antigua & 
Barbuda Dominica Grenada St. Kitts and 
Nevis St. Lucia St. Vincent & 
the Grenadines 
Agreement on Agriculture  
Articles 10 
and 18.2 None None None None None None 
Article 18.2 None None None None None None 
Para. (ii), p. 24 of 
G/AG/2) None None None None Yes None 
Agreement on Implementation of Article VI of the GATT 1994 (Anti-dumping Agreement) 
Article 16.4 None None None None None None 
Article 16.5 None None None None None None 
Article 18.5 Yes None Yes None None None 
Agreement on Implementation of Article VII of the GATT 1994 (Agreement on Customs Valuation)  
Annex III para. 1  None None None None None None 
Article 22.2  None None None None None None 
Agreement on Import Licensing Procedures  
Articles 1.4  None None Yes None Yes None 
Article 5 None None None None Yes None 
Article 7.3  None Yes None None Yes None 
Article 8.2 None None Yes None Yes None 
Agreement on Safeguards  
Article 12.6 None None None None None None 
Agreement on Subsidies a nd Countervailing Measures  
Article 25.1 
GATT 1994  Yes Yes Yes None Yes None 
Article 18.5  None None  Yes None None None 
Article 25.11 None None None None None None 
Article 25.12 None None None None None None 
Article 32.6 None None Yes None None None 
Article 27.4 Yes Yes Yes None Yes Yes 
Agreement on Technical Barriers to Trade  
Article 2.9  None None None None None None 
Article 10.6  None Yes Yes None Yes None 
Agreement on the Application of Sanitary and Phytosanitary Measures  
 Yes None None None None Yes 
Agreement on Trade-Related Aspect s of Intellectual Property Rights  
Article 3.1  None None None None None None 
Article 63.2 Yes None Yes None Yes None 
Agreement on Trade-Rela ted Investment Measures  
Article 5.1 None None None None None None 
General Agreement on Trade in Services  
GATS 
Article III:4,  None None None None None None 
GATS 
Article V:7(a)  Yes Yes Yes None Yes Yes 
Note: Yes = At least one notification has been made;  None = No notification has been made. 
 
Source: WTO Secretariat. WT/TPR/S/190 Trade Policy Review 
Page 10 
 
 
41. OECS-WTO Members made limited commitments in their GATS Schedules.  Antigua and 
Barbuda, Dominica, and Grenada presented offe rs in the WTO extended negotiations on 
telecommunications.  All three states have ratified the Fourth Protocol.  None of the Members under 
review participated in the extende d negotiations on financia l services.  Up to early 2007, only Antigua 
and Barbuda had not made initial offers in the services negotiations pursuant to the Doha Mandate.18 
42. Antigua and Barbuda is the only OECS-WTO Memb er that has been a complainant in a case 
before the WTO's Dispute Settlement Body (DSB);  the case concerned various U.S. measures that 
affected the cross-border supply of gambling a nd betting services (Chapter II, national report of 
Antigua and Barbuda).  However, all of the other OE CS Members have been third parties to disputes:  
St. Kitts and Nevis has participated as a thir d party in the EC- Export Subsidies on Sugar19 case;  the 
others have all been third parties in European Communities – Regime for the Importation, Sale and 
Distribution of Bananas.20 
43. Together with some other WTO Members, the six OECS Members have supported a proposal 
to extend the time limit to use export subsidies until 2018, under Article 24.7 of the Agreement on 
Subsidies and Countervailing Measures.21  They have also adopted common negotiating positions on 
the issue of "small vulnerable economies" generally, together with other members of CARICOM, in 
pushing for flexibilities in the DDA.  The six have also advocated the adoption of flexibilities and the 
recognition of principles of non-reciprocity in NAMA, and have highlighted the need for the negotiations to take account of the consequences of  preference erosion for the region.  The OECS 
Members are also attempting to seek flexibility in th e negotiations on fisheries to preserve their ability 
to offer subsidies aimed at promoting diversifi cation and development of the fisheries sector.  
44. With assistance from the European Communiti es, the OECS-WTO Members established a 
technical mission in Geneva in late 2004 to support engagement in WTO issues.
22  The establishment 
of the office is reflective of the commitment of  OECS Members to deeper engagement in the 
multilateral trading system generally.  The mission was staffed initially by one technical employee;  
an additional technical member was employed in 2006. 
45. The establishment of the technical mission in Geneva has provided a number of benefits.  
Among these, it has enabled OECS members to participate directly in the negotiations;  permitted the six to co-sponsor a number of proposals in vari ous committees;  and it has assumed, on occasions a 
coordinating role within the WTO for the entire Ca ribbean region, in the area of services for the 
African, Caribbean and Pacific group.
23 
46. Notwithstanding the establishment of the missi on, improvements in negotiation performance 
and the rate of implementation con tinue to require additional technical  support at the domestic level.  
The mission's success in improving OECS Member e ngagement in the multilateral system suggests 
opportunities for deepening cooperation through the est ablishment of other trade-related institutions 
focused on the OECS.  A new draft economic treaty anticipates this development as trade policy has 
                                                      
18 WTO online information.  Available at:  http://www.wto.org/english/ tratop_e/serv_e/s_negs_e.htm. 
19 WTO documents WT/DS265/28, WT/DS266/28, WT/DS283/9, 28 April 2005. 
20 WTO online information.  Available at:  http://w ww.wto.org/English/tratop_e/dispu_e/cases_e/ds27_ 
e.htm. 
21 WTO document G/SCM/W/535, 12 April 2006. 
22 Delegation of the European Commission in Barbados  and the Eastern Caribbean, e-newsletter, April-
June 2005 Vol. 12.  Viewed at:  http://www.delbrb.cec.eu.int/en/whatsn ew/newsletter_volum e12_Apr_to_Jun 
2005.pdf. 
23 AITIC online information.  Viewed at:  http ://www.acici.org/aitic/documen ts/reports/reports40_ 
eng.htm. OECS-WTO Members WT/TPR/S/190 
 Page 11 
 
 
been identified as one of the areas for centralized competence for decision making.  In this context, 
strengthening the capacity of the Secretariat to  provide technical advice and assistance to OECS 
Members may help to improve performance at the na tional levels.  The authorities, however, indicated 
that substantial external assistance would be requi red to enable the realization of this intent. 
47. Recent developments at the WTO highlight th e potential value of pooling available regional 
resources.  The Committee on Trade and Developm ent (CTD) recommended in October 2006 that 
small, vulnerable economies should be  allowed to use regional institu tions to implement obligations 
in the areas of SPS, TBT, and TRIPS24;  the recommendation was agreed by the General Council on 
5 December 2006.25  Moreover, the World Bank has noted the need for OECS sub-regional 
cooperation to promote the harmonization of stan dards, shared licensing requirements, and the 
articulation of regional competition policy as a means of promoting economic competitiveness.26  The 
OECS Trade Policy Assistance Project, funded by th e Canadian International Development Agency, 
has already provided technical and financial r esources to the states and has facilitated the 
development of a Trade Policy Unit within the Secretariat.27 
(ii) Regional agreements 
(a) OECS 
48. The OECS was created by the Treaty of Basseterre, and came into being in 1981.  The main 
objective of the OECS is to promote cooperati on and economic integrati on between the member 
states:  Antigua and Barbuda, Dominica, Grenada, Montserrat, St. Kitts and Nevis, St. Lucia, and 
St. Vincent and the Grenadines.  Anguilla and the Br itish Virgin Islands are associate members.  The 
OECS aims to assist its members in the realization of their obligations to the international community 
and, wherever possible, arrange common representation overseas. 
49. The OECS Secretariat, based in St. Lucia, pr ovides support and coordination services to help 
members identify scope for joint action.  The Secr etariat also conducts some specific, specialized 
projects.  It oversaw the establishment and supervises the operation of the technical Mission in Geneva. 
50. OECS states cooperate in a number of respects,  in areas as wide ranging as health, education, 
culture, justice, and telecommunications.
28  Until now, trade arrangements between the member states 
have been governed primarily by CARICOM me mbership.  However, OECS Governments took a 
decision in June 2006 to formally establish an economic union.29  The draft economic union treaty 
provides a foundation for closer cooperation on cer tain governance related matters, while another 
pillar of the treaty focuses on deepening economic integr ation.  This integration is expressly geared to 
complement integration efforts already taking place at the CARICOM level. 
51. Institutionally, administration of trade polic y within and among OECS Members is still 
subject to human resource limitati ons.  Generally, the internati onal trade departments of OECS 
Members tend to be limited to two to three individua ls who are required to develop expertise in all the 
                                                      
24 WT/COMTD/SE/5, 3 October 2006. 
25 WT/GC/M/104, 5 December 2006. 
26 World Bank (2005);  and AITIC online information.  Viewed at:  http://www.acici.org/aitic/ 
documents/reports/reports40_eng.htm. 
27 OECS Secretariat online information.  View ed at:  http://www.oecs.org/proj_trade.htm. 
28 See for example OECS online information.  Viewed at: http://www.oecs.org/proj_prog.htm. 
29 CARICOM online information.  Viewed at:  http://www.caricom.org/j sp/oecs_news/oecs_new_ 
treaty.jsp. WT/TPR/S/190 Trade Policy Review 
Page 12 
 
 
trade negotiating arenas and across the entire gamut of  trade disciplines.  Dominica for example, has a 
trade division staffed by two officials, and in St. Kitts and Nevis, all trade issues are assigned to two public servants, who also discharge non-trade-rela ted functions.  The resulting stretching of the 
limited human resources contributes to the slow pace of implementation among OECS Members. 
(b) CARICOM and other regional arrangements 
52. All six OECS-WTO Members are founding me mbers of the Caribbean Community and 
Common Market (CARICOM), estab lished by the Treaty of Chagaramus in 1973.  In 1989 the 
CARICOM Heads of Government decided to revise the treaty to create the CARICOM Single Market and Economy (CSME), intended to create a single ec onomic space within which there would be free 
movement of goods, services, capital, and CARI COM nationals between Member States.  The 
revision of the Treaty was completed in 2000 and all six OECS-WTO Members have enacted 
domestic legislation giving effect to the CSME.  Since 1991, all CARICOM member states have sought to implement a Common External Tariff (CET), through a phased process (see section III(1)(iv) below).
30 
53. The Conference of Heads of Government is  the highest decision-making body and final 
authority of CARICOM.  A number of ministerial councils deal with policy in different areas.  The 
Council for Trade and Economic Development (CO TED), representing membership of trade and 
development ministers from all Member States, is responsible for the promotion of trade and 
economic development in CARICOM, and is among the organization's most influential institutions.  
The Council for Foreign and Community Relations (C OFCOR) is responsible for relations between 
CARICOM, international organi zations, and third countries, while the Council for Finance and 
Planning (COFAP) is responsible for monetary policy coordination.31 
54. Since 1997, CARICOM has worked through the Caribbean Regional Negotiating Machinery 
(CRNM) to coordinate information and strategy in external trade negotiations, including in the WTO. 
55. During the period under review, the OECS Member s' major developments in trade have been 
driven essentially by CARICOM membership.  In April 2005, CARICOM governments inaugurated 
the Caribbean Court of Justice (CCJ) in Trinidad and Tobago, a sui generis  court with an original and 
exclusive jurisdiction for interpreting provisions of the Revised Treaty of CARICOM, as well as an 
appellate jurisdiction for municipal appeals fro m CARICOM states that choose to substitute the 
jurisdiction with the London based Privy Council with that  of the CCJ.  In its original jurisdiction, all 
Member States are obligated by Treaty to recognize a nd give effect to the jurisdiction of the Court.32 
56. In 2003, the "Jagdeo Initiative" outlined a strategy for implementing the Regional 
Transformation Programme in Agri culture, which had originally been announced in 1996.  The 
original programme was designed in part to devel op a regional programme to improve the agricultural 
sector in CARICOM countries.33  The Initiative sought to identify the constraints on agricultural 
production and specify practical strategies for overc oming the same.  CARICOM has also deepened 
                                                      
30 For information on the history and development of the CSME see CARICOM online information.  
Viewed at: www.caricom.org. 
31 For further details on CARICOM's structure and operation see WTO (1998a), Chapter II and WTO 
(1998b), Chapter II. 
32 For the status of accession to the original  jurisdiction of the Court see CARICOM online 
information.  Viewed at:  http://www.caricom. org/jsp/single_market/csme_summary_key_elements_jan_07. 
pdf. 
33 CARICOM Secretariat Press Rel ease No. 87, 2001.  Viewed at:  http://www.caricom.org/jsp/ 
pressreleases/pres87_04.htm. OECS-WTO Members WT/TPR/S/190 
 Page 13 
 
 
trade-related cooperation at a te chnical level with the establishment of the CARICOM Regional 
Organization for Standards and Quality (CROSQ).  Of the six OECS-WTO Members, only St. Lucia 
and St. Vincent and the Grenadines have enacted  the agreement establishing CROSQ into domestic 
law. 
57. CARICOM Member States also took a deci sion in 2004 to establish a Community 
Competition Commission (CCC) to be headquartered  in Suriname.  To facilitate enactment of 
necessary legislation, a model Competition Bill was drafted for use by Member States.34  However, 
with the exception of St. Vincent and the Gr enadines, none of the OECS-WTO Members have 
enacted national competition laws;  no OECS member has established national competition 
authorities.  The OECS Members are undertaking c onsultations among themselves in order to decide 
on the establishment of a sub-regional compe tition authority as opposed to creating national 
competition authorities in each of the OECS Member States.  The authorities have indicated that both 
a draft harmonized competition bill and a draft agreement establishing an OECS competition authority have been completed.  
58. All OECS countries are members of the Associa tion of Caribbean States (ACS), a forum for 
economic and trade policy coordination at the regional level comprising 25 Caribbean Basin 
countries. 
(iii) Other preferential agreements and arrangements 
59. CARICOM has signed bilateral trade agreemen ts with Colombia, Cuba, Costa Rica, the 
Dominican Republic, and Venezuela.  Under the CARICOM-Colombia Agreement on Trade, 
Economic and Technical Cooperation, re-negotiated in 1997, Colombia  granted unilateral preferential 
access to its market for four years to a group of pr oducts originating in CARICOM.  After the four-
year period the preferential trade scheme became reciprocal, taking into account development differences.  The OECS countries, as less develope d countries within CARICOM, are not obliged to 
grant any concessions under this agreement. 
60. The CARICOM-Cuba Agreement, signed on 3 July 2000, provides for duty-free access on a 
list of goods agreed by both sides.  The CARI COM-Dominican Republic Free Trade Agreement, 
which came into force in 2000, grants bilate ral duty-free access for a number of products from 
1 January 2004.  However, exports from the Domi nican Republic to the CARICOM less developed 
countries, which include the OECS countries, conti nue to attract duties.  The CARICOM-Venezuela 
Agreement on Trade and Investment entered into  force on 1 January 1993.  It is a one-way 
preferential agreement aimed at promoting CARI COM exports to Venezuela through duty-free access 
for some products or phased reduction in tariffs.
35 
61. The OECS Members also benefit from the Caribbean Basin Initiative, and CARIBCAN, both 
of which are non-reciprocal and unilateral.  OECS members are also party to the ACP-EC Revised Cotonou Agreement. 
62. Under the Caribbean Basin Initiative (CBI), in effect since 1984, OECS countries are eligible 
for duty-free access to the U.S. mark et subject to rules of origin.
36  Preferences were expanded in 
2000 through the United States-Caribbean Basin Tr ade Partnership Act (CBTPA), which, for a 
                                                      
34 CARICOM online information.  Viewed at:  http://www.caricom.org/jsp/single_market/csme_ 
implementation.jsp. 
35 For details of CARICOM bilateral agreements s ee CARICOM online informati on.  Viewed at:  for 
consultation at: http://www.crnm.org/bilateral.htm. 
36 For further details see WTO (1999a), Chapter II(iv). WT/TPR/S/190 Trade Policy Review 
Page 14 
 
 
specified period, accorded the same preferential tari ff and quota treatment granted to certain textile 
and apparel articles imported into the United Sa tes from NAFTA countries, subject to conditions. 
63. Under CARIBCAN, in force since 1986, expor ts originating in the OECS and other 
CARICOM countries are granted duty-free treatment by Canada:  the eligible products exclude 
textiles, clothing, footwear, luggage and other l eather goods, lubricating oils, and methanol.  To 
qualify for duty-free access, 60% of the ex-factory pr ice of eligible products must originate in a 
beneficiary country or in Canada. 
64. The combined impact of the CBI/CBTPA and CARIBCAN on OECS exports to the 
United States and Canada has been relatively small.   The World Bank, for example, noted that the 
OECS's share of exports to the United States unde r the CBI programme declined between the early 
1990s and 2003.37  The authorities suggested that the declin e was the result of the inclusion of U.S. 
sourcing requirements in rules of origin, in products  of particular importance to the OECS members.  
Although, there has been a general downward trend fo r exports to the United States for all six OECS 
Members, trade with the United States has continue d to be of particular importance for Grenada and 
St. Kitts and Nevis (Chapter I).  The U.S. Government has noted that a significant amount of exports 
from the region enter under the CBI programme.38  During the period under review, Canada absorbed 
well under 1% of total merchandise exports from OE CS Members, except for Grenada (Chapter I). 
65. OECS Members' exports are granted preferentia l access to the EC market under the ACP-EC 
Revised Cotonou Agreement (which replaced the Four th Lomé Convention).  Under this agreement, 
the principal beneficiaries among OECS-WTO Member s have been Dominica, Grenada, St. Lucia, 
and St. Vincent and the Grenadines, which were tr aditional suppliers of bananas to the EC, and in 
particular, the United Kingdom, and St . Kitts and Nevis, which was a traditional supplier of sugar.  
However, the successive Lomé and later Cotonou Ag reements have had rela tively little impact on 
other exports from OECS countries.39 
66. OECS Members are also beneficiaries of the European Development Fund (EDF) and 
STABEX Fund programmes.  The EDF is tied to the EC 's attempt to promote a coherent development 
strategy in the sub-region.40  Funds allocated under the EDF have been used to support projects in 
education and in health.  Under the Ninth EDF (2000-07), OECS Members were allocated approximately €26 million for various projects. 
67. Under the STABEX programme, the EC provided compensation for losses in export earnings 
on certain agricultural products on which certain OECS Members were dependent, in part as a result 
of obligations under the Lomé IV Convention.
41  Initially, STABEX funds were used mostly for 
restructuring the banana industry;  however, in the later programmes, allocations were mainly for 
agricultural and economic diversification and soci al and community development.  The EC phased 
out the STABEX mechanism gradually in the run up to 2000.  
68. OECS Members have been engaged in nego tiations as part of CARIFORUM (CARICOM 
plus the Dominican Republic), with the EC, with  the aim of agreeing a WTO compatible economic 
                                                      
37 World Bank (2005). 
38 USTR online information.  Viewed at:   http:// www.ustr.gov/assets/Trade_Development/Preference_ 
Programs/CBI/asset_upload_file 670_8672.pdf. 
39 World Bank (2005), Chapter 3. 
40 The basis and objectives of the European development strategy in the Caribbean is available online 
at:  http://www.delbrb.cec. eu.int/en/eu_carib_region/EU_Carib_D evelop_Partner ship_ Communication.pdf. 
41 Delegation of the European Commission in Barbados and the Eastern Caribbean online information.  
Viewed at:  http://www .delbrb.cec.eu.int/en/winban/overview.htm. OECS-WTO Members WT/TPR/S/190 
 Page 15 
 
 
partnership agreement (EPA);  the authorities expect the agreement to have a significant 
"development dimension."  The Caribbean Regi onal Negotiating Machinery (CRNM) leads the 
negotiations with the EC;  the technical work for th e negotiations involves direct participation from all 
Member States.  Launched in 2004, the negotiatio ns have proceeded in phases and are due to be 
completed by 1 January 2008.  OECS Members have  attempted to adopt a harmonized approach to 
development issues in the EPA.  From an OECS sta ndpoint, these are needed to  offset the costs of 
tariff liberalization, new trade rules, and further economic reforms.42  The authorities have also 
indicated that the approach is also geared to ward promoting competitiveness and developing supply 
side capacity to enable their respective economies to benefit from liberalization pursuant to the EPA. 
69. CARICOM has also been exploring the possibilit y of concluding an FTA with Canada since 
January 2001.43  The authorities noted that, consequent to the visit of the Canadian Prime Minister to 
the region, in July 2007, negotiations toward a new trade and economic cooperation agreement with 
Canada are expected to be undertaken in the n ear future.  The possibility of an FTA with the 
United States has been mooted44, but the authorities indicated that it is not expected to be pursued 
soon. 
(5) AID FOR TRADE AND TECHNICAL ASSISTANCE  
70. Despite having benefited from a range of technical assistance projects on trade policy since 
their last Review in 2001, OECS-WTO Members c ontinue to face significant human resource and 
technical challenges that limit their responsiveness at  the multilateral level and have an effect on the 
pace of implementation of their WTO obligations.  New obligations for implementation arising out of 
the DDA may give rise to further challenges for already stretched limited resources.  The present 
review reveals a number of areas where support from the international community could assist in achieving greater integration of OECS Members in to the global economy and the multilateral trading 
system. 
71. During the period under review, OECS Members benefited from technical assistance from a 
number of organizations:  (a) the WTO provided a range of Geneva-based and regional trade policy 
courses, which have trained an estimated 40 CARICOM officials since 1999;  (b) the Organization of 
American States cooperated with the University of th e West Indies to build capacity in the OECS by 
offering a graduate degree to nationals of the region in international trade policy;  (c) the 
Commonwealth Secretariat provided technical assi stance through training of regional officials, 
conducting trade-related studies, as well as examin ing prospects for attracting trade-related 
investment to the region;  (d) the Canadian Inte rnational Development Agency provided technical and 
financial resources to the states through the establi shment of the OECS Trade Policy Project and 
examined the feasibility of a trade negotiation su pport unit;  (e) the Inter-American Development 
Bank assisted CARICOM countries in implementati on of WTO agreements;  (f) the EC provided 
short-term technical assistance in key trade -related disciplines, as well as funding for the 
establishment of the OECS Technical Mission in  Geneva;  (g) the United States Agency for 
International Development provided assistance to  fund SPS-related officials from the region to 
attending SPS Committee meetings in Geneva;  and (h) the Agency for International Trade 
Information and Cooperation provided funding and assi stance in preparations for the Trade Policy 
Review of the OECS. The organization also provided assistance to the OECS Members in developing 
                                                     
 
42 World Bank (2005), Chapter 3. 
43 Caribbean Regional Negotiating Machinery online information.  Viewed at:  http://www.crnm. 
org/bilateral.htm. 
44 Caribbean Regional Negotiating Machinery online information.  Viewed at:  http://www.crnm.org/ 
acp.htm. WT/TPR/S/190 Trade Policy Review 
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proposals on aid for trade, in preparation for even tual discussions with donors and other international 
agencies. 
72. Although OECS Members have received technical assistance and aid for trade from some 
international partners during the review period, anal ysis reveals that such aid has been of relatively 
low value and has varied widely between OECS  countries.  Based on OECD and WTO data, the 
average level of aid to OECS Members globa lly between 2001-05 was under US$17 million annually, 
with contributions ranging from less than US$0.5 million in 2001 to around  US$32 million in 2004. 
73. Aid for trade support, by WTO Task Force categories:  (a) trade policy and regulations, 
(b) trade development, and (c) infrastructure, show erratic annual allocations, with the major share of 
contributions split between infrastructure and tr ade development over 2001-06 (Chart II.1).  The 
largest contribution for infrastructure, which occurred in 2005, accounted for an estimated 
US$27 million out of total aid donations of appr oximately US$29 million. Support for trade policy 
and regulations, where OECS Members have substa ntial needs, have been limited throughout the 
period.  The major donors to OECS Members du ring the period under review were:  Belgium, 
Canada, the EC, and Japan. 
05101520253035
2001 2002 2003 2004 2005 2006Chart II.1
Aid for trade support, 2001-06
US$ million
  Source: WTO Secretariat, based on OECD Creditor Reporting System. Viewed at:  http://stats.oecd.org/WBOS/
                   Default.aspx?DatasetCode=CRSNEW.Infrastructure
Trade development
Trade policy and re gulations
 
74. Aid for trade contributions also vary consider ably between OECS Members, and the value is 
relatively small, and declining in some cases.  Of the six members, Antigua and Barbuda and St. Kitts 
and Nevis have been the most consistent recipien ts of aid for trade, although, in both cases, aid OECS-WTO Members WT/TPR/S/190 
 Page 17 
 
 
appears to be down from 2001 levels.45  St. Vincent and the Grenadines received relatively few 
contributions between 2001 and 2006:  the only substantial infusion of aid was of just under 
US$700,000, for trade development in 2004. 
75. In Antigua and Barbuda, the largest consistent aid for trade contribution was for trade policy 
and regulations, with some support for infrastructure in 2003 and 2004, and relatively small donations 
of support for trade development.46  With the exception of 2001, when St. Kitts and Nevis received 
trade development support, nearly all the dona tions during 2001-05 were for trade policy and 
regulations.  St. Kitts and Nevis received no co ntributions under the heading of infrastructure.47 
76. Dominica, Grenada, and St. Lucia, received little aid prior to 2003;  in all three, the largest 
contributions are for infrastructure.  Dominica has been the largest recipient of such aid, which 
reached a maximum of around US$22 million in 2005.48  Aid for trade in all other OECS states is 
considerably lower.  In 2004 and 2005, Grenada received larger infusions of aid compared with 
previous years, coinciding with international aid following two major hurricanes in a ten month 
period. 
77. OECS-WTO Members regard AFT as being impor tant in the context of dealing with 
adjustment costs associated with trade liberali zation and economic reforms, and with improving 
production and supply capacity.  The authorities indicated  that they regarded assistance provided prior 
to the Hong Kong ministerial as inappropriate for cat egorization under AFT.  The authorities stressed 
that their view of the concept was that it referred  to a level of "additional" commitments, in the sense 
that they should be additional to those which were  already in existence at the time of the Hong Kong 
Ministerial, aimed at assisting countries in th eir development objectives, specifically through the 
provision of trade related assistance to help them in tegrate more fully into the global economy.  In this 
context, they placed heavy emphasis on the identifica tion of infrastructural needs to improve delivery 
of goods and services, and also stressed the im portance of receiving supp ort to pursue economic 
diversification.  Particular areas of emphasis were:  transportation services, which were regarded as key to promote greater trade between OECS Memb ers but also between them and third trading 
partners;  alternative energy sources and distributio n, which were regarded as important due to the 
heavy dependence on imported energy supplies;  and the expansion and availability of ICT and other 
technologies to small and medium enterprises, as a means of improving efficiency and expanding the 
scope of services trade.  While the authorities indicate d that they were still in the process of refining 
specific proposals in these various sectors, they indicated  that their view was that any efforts in these 
areas had to be "Hong Kong forward," in order to be  meaningful developments in the area of AFT. 
78. OECS-WTO Members participated in the Task Force on Aid For Trade (AFT), which 
submitted its report and recommendations in July 2006.
49  This report identified broad categories for 
intervention:  (1) policy reform;  (2) infrastructur al development;  (3) adjustment to cushion the 
effects of trade liberalization;  (4) alleviation of supply-side constraints;  and (5) other trade related 
needs.  Under these broad headings OECS Member s have identified preliminary areas for support. 
79. Under the policy support heading, OECS-WTO Me mbers have requested technical assistance 
for:  (i) tax reform, statistical trade-data collecti on and analysis;  (ii) adop tion and implementation of 
best practice standards legislation;  and (iii) iden tification of WTO-compliant tax reward systems to 
                                                      
45 OECD Creditor Reporting System.  Viewed at:  http://stats.oecd.org/WBOS/Default.aspx?Datset 
Code=CRSNEW. 
46 OECD Creditor Reporting System. 
47 OECD Creditor Reporting System. 
48 OECD Creditor Reporting System. 
49 WTO document WT/AFT/1, 27 July 2006. WT/TPR/S/190 Trade Policy Review 
Page 18 
 
 
promote production.  Under support for infrastructure development, they have requested support for, 
inter alia :  (i) development of alternative energy ge neration and distribution;  (ii) upgrading and 
expansion of sea and airports;  (iii) establishmen t of regional standards organizations.  Under 
adjustment support, OECS Members have flagged the n eed for:  (i) support for economic reforms;  (ii) 
financial contributions to assist with re-education a nd re-deployment of workers in certain industries;  
and (iii) worker severance or compensation schemes.  In the area of supply side support, they have 
identified a need for assistance with:  (i) agricu ltural diversification measures;  (ii) services 
diversification and promotion;  (iii) increasing mark et-research capacity;  (iv) development of national 
export strategy plans;  (v) access to new technologies fo r firms;  and (vi) promotion of ICTs to assist 
small and medium enterprises.  
80. OECS Members have received funding from th e EC to support the OECS Technical Mission 
in Geneva.  The mission has proved effective, despite  its small size, in helping the OECS play an 
integral role in the DDA negotiations and in raisin g the general level of participation of the OECS 
Members at the WTO.  The mission has also been crucial as a coordinator for the region, and has 
chaired a number of meetings of importance to OECS Members, such as on RTAs.  In general, OECS 
Members consider that the mission is crucial to the improved performance of the OECS Members at 
the multilateral level.  In this respect, they consid er that their integration into the global economy and 
multilateral trading system would be greatly enhanced  by ensuring the sustainability and effectiveness 
of the mission and increasing its technical compli ment.  The authorities noted that, as funding for the 
mission was heavily dependant on donor assistance , there were difficulties with guaranteeing the 
maintenance of the technical staff at all times.  The mission experienced some financial difficulties in 
mid-2007.   
81. In the area of trade policy and regulations, OE CS Members continue to require technical 
assistance to reach the number of trade experts in  the region, and facilitate the establishment of 
relevant institutions to improve WTO compliance.  The following areas may require particular efforts 
in one or more OECS Members: 
− Customs valuation.  Notwithstanding improveme nts in implementation of WTO obligations 
during the period under review, OECS Members could still benefit from a review of related 
legislation and technical expertise aimed at  harmonized implementation.  OECS Members 
continue to show some divergence in custom s valuation practices.  OECS Members could 
also benefit from technical assistance to improve  investigative capacity in light of problems 
with under-valuation in some countries (Chapter III); 
− Competition law and policy.  Although some  OECS Members have adopted competition 
legislation during the period under review, th ey may benefit from training on administration 
of competition legislation and from assistance to establish national and regional competition 
authorities; 
− Import licensing.  OECS Members apply similar import licensing regimes, with 
modifications.  However, not all of them have notified their regimes to the WTO.  Some of 
the regimes are not fully applied since they were  linked to quantitative restrictions that are no 
longer in place.  OECS Members could benefit from assistance to reform their licensing 
regimes, and to train local officials; 
− Technical barriers to trade, and sanitary and phytosanitary measures.  OECS Members could 
benefit considerably from technical assistance aimed at helping to pool available regional 
resources and the establishment of appropriate  regional institutions with responsibility for 
dealing with technical barriers to trade and sanitary and phytosanitary measures.  Although OECS-WTO Members WT/TPR/S/190 
 Page 19 
 
 
OECS Members have made considerable progress with the establishment of national 
standards bodies during the review period, assi stance to establish regional institutions would 
promote savings through the centralization of authority for these two areas.  Officials of 
national standards bodies could also benefit from technical assistance to improve their 
training, monitoring, and surveillance capacity, and performance in the area of notifications in 
both TBT and SPS matters.  The implementation of the SPS agreement, would also be enhanced through the centralization of technical expertise among OECS Members in a regional institution.  Most OECS countries do not maintain inventories of SPS measures or 
any statistical information on the number of measures adopted at any point in time for 
example.  Assistance to help establish regi onal testing and laboratory facilities would be 
beneficial and more cost efficient than establishing national bodies in each OECS Member; 
− Agriculture.  OECS Members would benefit from technical assistance for training on the 
Agreement on Agriculture, and to increase negotia ting capacity through the training of local 
experts; 
− Trade Related Intellectual Property Rights.  OECS Members have shown a mixed 
performance in the implementation of the TRIPS Agreement since the last review.  None of 
the OECS-WTO Members has enacted all the legi slation necessary to be fully compliant with 
the Agreement, although some are close.  The major obstacle to implementation is a lack of 
administrative capacity in a number of IPR-related areas.  Additional training on TRIPS and on administration of intellectual property legislation, including the establishment of bodies to deal with IPR issues, and enforcement issues would be beneficial for all OECS Members; 
− Services.  All OECS Members require sustained further training on GATS, with specific 
reference to scheduling.  Targeted WTO tr aining to strengthen negotiating capacity in 
services would also be beneficial; 
− Trade remedies.  OECS Members would profit from assistance with the establishment of 
regional institutions to facilitate joint impl ementation of the agreements on Anti-Dumping, 
Safeguards, and Subsidies and Countervailing Measures, including training for experts and 
negotiators in the area; 
− Subsidies.  All OECS Members have notified incentives programmes as providing export 
subsidies, and currently benefit from the phase- out extension granted unde r Article 27.4 of the 
SCM Agreement.  Hence, training on subsidies for regional officials would be useful, with 
particular focus on revising current incentives programmes;  and 
− WTO trade policy and other courses.  OECS Members have benefited from technical training 
through Geneva-based and regional trade polic y courses during the review period.  More 
specialized courses are needed urgently, to cons olidate expertise and to promote specialized 
knowledge and local mastery of specific WTO related issues. 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(1) M
EASURES DIRECTLY AFFECTING IMPORTS  
(i) Customs procedures, documentation, and registration 
82. Customs procedures differ to some extent among the OECS-WTO Members.  In five of the 
six, importers are not required to register.  Th e exception is St. Lucia, where both commercial and WT/TPR/S/190 Trade Policy Review 
Page 20 
 
 
non-commercial importers must register in order to ob tain a code number that is used to identify the 
shipper.  In Dominica, a trade code number is issu ed only if the importer does not already have a VAT 
or tax identification number. 
83. None of the OECS countries require preshipment inspection, neither do they require importers 
to use customs brokers.  
84. The number of documents required for imports ranges from two to five, plus any documents 
required for imports under preferential treatment, subject to licensing, or other special cases (Table III.1).  The time involved in importing a c ontainer ranges from 13 to 20 days, as estimated by 
the World Bank (Table III.1).  This is partly linke d to the OECS Members' geographical location and 
the fact that transport services are not always freque nt partly due to the smallness of the markets.  
Once goods are landed, it normally requires one to two days to clear customs in most countries, although the authorities in Grenada and St. Lucia in dicated that some shipments may require up to 
three days. 
Table III.1 
Comparative procedures and expenses for imports, 2006 
 ATG DMA GRD KNA LCA VCT 
Documents required for all imports (excluding documents required for 
preferential imports, licensed goods, etc.) 2 3 5 5 4 5 
Time for import (days) 15 17 20 13 19 13 
Source:  Data on import documents are from the national chapters.  Data on the import time and cost are from World Bank 
Doing Business online information.  Viewed at:  http://www.doingbusiness.org/E xploreTopics/TradingAcross 
Borders. 
85. Five OECS-WTO Members use the Automated System for Customs Data (ASYCUDA) to 
process customs entries.  The exception is St. K itts and Nevis, which moved from the ASYCUDA to 
the Total Revenue Integrated Processing System (TRIPS) in early 2006.  Both the ASYCUDA and the 
TRIPS systems allow for the electronic filing of import documents, but as at mid 2007 St. Lucia was 
the only OECS country to use this feature.  In some countries this refo rm is expected to be 
implemented concurrently with other steps towards automation.   As at August 2007, Antigua and 
Barbuda was moving to Customs Automated Services (CASE), developed by Jamaica.50 
86. A decision to subject a particular shipment to  physical inspection is generally based upon a 
risk assessment that tak es into account such factors as the type of product imported, the country of 
origin, and the customs agency’s e xperience with the shipper.  The overall level of physical inspection 
ranges from 5% in St. Lucia (where the risk-asses sment programme is fully operational) to 90% in 
Grenada (the risk-assess ment programme is still in the planning stage). 
87. Reform efforts are under way in most OECS countries’ customs services.  T echnical and 
financial assistance is being sought in Grenada to strengthen administration at the Customs and Excise 
Department, and considerati on is being given to hiring specialized  private firms to improve collection, 
strengthening the audit capacity, tightening enforcem ent, and enhancing information exchange.  In 
Dominica, complaints about delays and inefficiencies  in the clearance of goods have inspired reform 
plans that will include the introduction of updated technology, changing the staffing structure, and 
setting up an intelligence unit.  The main reforms in St. Kitts and Nevis centre on training and 
computerization.  The Caribbean Regional Technical Assistance Centre  (CARTAC) is promoting the 
transformation of customs agencies into revenue au thorities that would operated more on a business-
like basis.  
                                                      
50 Jamaica Customs Online Services.  Viewed at:  http://unpan1.un.org/intradoc/groups/public/ 
documents/Other/UNPAN022058.pdf OECS-WTO Members WT/TPR/S/190 
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(ii) Customs valuation 
88. Dominica is the only OECS country to have notified and submitted its customs legislation 
under Articles 22.1 and 22.2 of the Customs Valu ation Agreement (CVA).  None of the OECS 
countries claimed special and differential treatment under the CVA;  and none submitted replies to the 
checklist of issues on customs valuation.  St. Vincen t and the Grenadines is the only OECS country to 
have modified its laws after the signature of the Marrakesh Agreement other countries' laws date from 
the GATT period.  St. Lucia is the only memb er of the World Customs Organization among the 
OECS countries. 
89. The transaction value is used for the great major ity of imports in most OECS countries.  For 
example, it accounts for an estimated 80-85% of shipments in Dominica, and for some 90% in 
St. Kitts and Nevis.  Apart from the motor vehicles sector, reference prices are generally not used.  
Grenada is the main exception to th ese rules, as its laws do not allow fo r the use of transaction value;  
it still uses m inimum import prices to determine the cust oms value of imports, based on a valuation 
database that is updated with reference prices to assi st with the identification of under-invoicing.  By 
contrast, in St. Kitts and Nevis the Customs Act specifically outlaws the use of minimum customs 
values.  In Antigua and Barbuda, declared values ma y be checked against refe rence prices when there 
are doubts about a declaration;  this is done for about 5% of shipments in Dominica.  
90. Under-invoicing and other forms of customs fraud remain a problem in several countries:  
motor vehicles are a problem area;  the authorities have noted that im porters often decl are false engine 
sizes or undervalue the goods.  In Dominica, for example, it is estima ted that around 20-25% of invoices 
for vehicles declare incorrect values .  The authorities in most countri es use printed or online guidebooks 
to check the declared values for vehicles.  A valua tion database is being deve loped in Grenada to deal 
with under-invoicing in general. 
(iii) Rules of origin 
91. Dominica is the only OECS country to have notified the WTO that it does not have non-
preferential rules of origin, and is also the only on e to have notified its preferential rules of origin.51 
92. The OECS countries all use the rules of origin  introduced by CARICOM in 1998.  Duty-free 
treatment is accorded to CARICOM goods satisfying origin requirements only if they are shipped 
from other member states.  All CARICOM members were expected to implement on 1 January 2007 
the rules of origin contained in the Amended Sche dule I of the revised Treaty of Chaguaramas, based 
on HS 2007.  Due to delays in the adoption of HS 2007, however, none of the OECS countries have 
yet been able to adopt the new rules of origin:  efforts are being made in each country to introduce 
HS 2007, but expectations differ on when this can be accomplished. 
(iv) Tariffs, other duties and taxes 
(a) MFN applied tariff structure 
93. The CARICOM common external tariff (CET), which entered into effect on 1 January 1991, 
is applied by all OECS Members.  P ermanent or temporary exceptions to the CET are allowed, such 
that the same product might face different rates when imported into each of the six countries.  The 
unweighted average tariff rate among all OECS c ountries is 10.9%, with the individual national 
averages ranging from 10% to 12.2% (Table III.2):  the variation is wider for agricultural products 
than for non-agricultural products.  The highest averag e rates for the OECS are all in the agriculture 
                                                      
51 WTO document G/RO/W/106, 29 September 2006. WT/TPR/S/190 Trade Policy Review 
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sector, most notably on tobacco, fruits and vegetables, and beverages and spirits.   The highest rates on 
non-agricultural products (WTO definiti on) are on fish and fishery products. 
Table III.2 
OECS summary tariff analysis 
(Per cent) 
 OECS 
unweighted 
average Antigua 
and 
Barbudaa Dominica Grenada St. Lucia St. Kitts 
& Nevis St. Vincent & 
the 
Grenadines
Total 10.9 10.7 12.2 11.2 10.0 10.3 10.9 
HS 01-24 20.0 17.7 27.6 20.3 19.2 14.6 20.5 
HS 25-97 9.0 9.3 8.9 9.3 8.0 9.4 9.0 
By WTO category        
WTO Agriculture 18.2 16.2 25.8 18.2 16.7 14.2 18.0 
   Animals and products thereof 17.9 19.1 19.0 22.1 14.5 15.1 17.7 
   Dairy products 6.6 6.3 6.3 6.7 6.3 7.5 6.7 
   Coffee and tea, cocoa, sugar etc. 18.2 16.6 22.1 17.9 17.1 17.6 17.9 
   Cut flowers, plants 9.5 7.9 8.9 10.6 8.8 9.0 11.7 
   Fruit and vegetables 24.9 23.8 31.9 25.3 25.4 17.2 25.7 
   Grains 15.4 15.0 15.0 15.0 15.0 14.5 17.8 
   Oil seeds, fats and oils and their products 16.2 15.8 16.5 16.6 16.7 13.6 17.7 
   Beverages and spirits 31.9 19.0 80.3 24.0 24.1 21.6 22.1 
   Tobacco 23.8 21.0 31.5 26.0 19. 5 19.0 26.0 
   Other agricultural products n.e.s. 4.8 3.9 4.2 5.8 4.2 4.3 6.5 
WTO Non-agriculture (incl. petroleum) 9.5 9.7 9.5 9.8 8.6 9.6 9.6 
WTO Non-agriculture (excl. petroleum) 9.5 9.7 9.6 9.8 8.6 9.6 9.6 
   Fish and fishery products 23.1 19.5 26.6 25.7 26.9 10.9 29.0 
   Mineral products, precious stones and metals 8.9 8.9 9.0 9.8 8.1 8.6 9.1 
   Metals 6.2 6.7 6.1 7.1 4.3 6.6 6.6 
   Chemicals and photographic supplies 7.6 7.3 10.0 7.4 7.1 6.6 7.0 
   Leather, rubber, footwear and tr avel goods 10.4 10.2 9.0 10.7 11.1 10.5 10.7 
   Wood, pulp, paper and furniture 9.5 9.3 9.1 9.7 8.4 10.6 9.6 
   Textile and clothing 11. 7 11.6 10.6 11.7 12.3 12.5 11.6 
   Transport equipment 10.6 12.5 9.7 9.9 8.5 12.5 10.3 
   Non-electric machinery 5.4 6.9 3.9 6.6 2.8 5.9 6.4 
   Electric machinery 9.8 10.3 9.5 9.8 7.5 12.1 9.8 
   Non-agriculture articles n.e.s. 13.7 13.8 13.4 13.5 12.5 15.3 13.5 
   Petroleum 7.5 7.5 5.6 9.4 6.9 8.1 7.3 
Memo        
   Average tariff on all imports, 2001 11.9 14.5 13.1 11.2 10.1 11.5 10.9 
   Customs Service Charge (CSC), 2001 4.2 5.0 2.0 5.0 4.0 5.0 4.0 
   Average tariff on all imports plus CSC, 2001 16.1 19.5 15.1 16.2 14.1 16.5 14.9 
   CSC, 2006 5.5 10.0 3.0 5.0 5.0 6.0 4.0 
   Average tariff on all imports plus CSC, 2006 16.4 20.7 15.2 16.2 15.0 16.3 14.9 
   Change in average tariff, 2001-06 -1.0 -3.8 -0.9 ― -0.1 -1.2 ― 
   Change in average tariff plus CSC, 2001-06 +0.3 +1.2 +0.1 ― +0.9 -0.2 ― 
 
― No change. 
 
a The CSC in Antigua and Barbuda is 10%, w ith a reduced rate of 5% on some products. 
 
Source:  WTO Secretariat estimates, based on data pr ovided by the respective OECS authorities. 
94. The OECS countries do not use seasonal tariffs except on Irish potatoes imported into 
Dominica.  St. Kitts and Nevis, St. Lucia and St. Vincent and the Grenadines use specific rates for a 
few products;  the tariffs of the other three OECS Members are solely ad valorem . OECS-WTO Members WT/TPR/S/190 
 Page 23 
 
 
95. While all OECS countries have identical applie d rates for many products, overall border taxes 
on imports may differ widely across countries.  This is because they all have tariff exemption schemes 
for specific shipments, enterprises, or products, meaning that products may be dutiable for one 
importer but duty-free for another, depending on its final use. 
96. All OECS Members apply additional charges on mo st or all imports.  The most important is 
the customs service charge (Table III.3).   The CSC ranges from a low of 3% in Dominica to a high of 
10% in Antigua and Barbuda.  The most typical ra te is 5%, which is employed in Antigua and 
Barbuda, Grenada, and St. Kitts and Nevis.  Four countries increased the level of their CSC during the 
review period, leading to a rise in the unweighted average rate from 4.2% to 5.5%.  The CSC applies 
to imports from other CARICOM countries, but not  to imports by government agencies.  Some 
countries provide CSC exemptions that re inforce tariff concessions, such as the exemptions in 
St. Kitts and Nevis for enclave manufacturers, in  St. Lucia for all classes of raw materials and 
packaging materials imported by local manufacturers,  and in St. Vincent and the Grenadines for two 
companies that operate resort islands.   
Table III.3 
Customs services charges, 2007 
Country Tax Rate Scope Binding in 
the WTO 
Antigua and Barbuda Customs servi ce tax 10% All imports Left blank 
Dominica Customs service charge 3% All imports Left blank  
Grenada Customs service charge 5% All impor ts save for Government, the flour mill, 
and telephone companies and domestic 
manufacturing Left blank  
St. Lucia Customs service charge 5% All imports Left blank  
St. Kitts and Nevis Customs service charge 6% All imports Bound 
St. Vincent and the 
Grenadines Customs service charge 4% All imports  except imports of the St. Vincent 
Banana Growers Association, Canouan Resorts Development Ltd, and Otley Hall Development 
enclave industries Left blank 
 
Source . WTO Secretariat, based on informa tion provided by the authorities. 
97. For the OECS region as a whole, the combined tariff and CSC rose from 16.1% to 16.4% 
during the review period.  Although the OECS aver age tariff fell from 11.9% in 2001 to 10.9% in 
2006 (Table III.2), that reduction was more than c ounterbalanced by increases in the CSC in most of 
the Members.  Taking into account both the tariff a nd the CSC, Antigua and Barbuda and St. Kitts and 
Nevis were the only OECS countries to reduce their import duties during the review period, mainly on account of their adoption of Phase IV and III of the CET schedule of reductions, respectively (see 
below). 
98. Some applied tariffs declined during the revi ew period in some OECS Members, generally 
due to domestic reasons.  In Dominica, for example, some tariff reductions have been made because domestic production ceased (pasta, footwear), or b ecause changes in regional production meant that a 
tariff above the CET was no longer warranted (oils a nd fats).  In the case of aerated beverages, 
however, Dominica’s tariffs were reduced in order to  ensure that total import charges fell below the 
Uruguay Round binding.  In St. Kitts and Nevis, so me tariff rates have fallen as Phase III of the CET 
scheme of reductions was implemented.  
99. Article 83 of the Revised CARICOM Treaty allo ws for the reduction or suspension of the 
CET when a good is not produced in sufficient quant ities within the CARICOM area to meet demand.  
Subject to approval by COTED, exceptions to the CET are agreed between CARICOM members, and 
each country maintains a List of Conditional Duty  Exemptions to the CET.  CARICOM members 
may maintain tariffs at rates below the CET, provide d that they do not violate the CARICOM List of WT/TPR/S/190 Trade Policy Review 
Page 24 
 
 
Items Ineligible for Duty Exemption.  The list includes goods produced in the CARICOM market in 
quantities considered adequate to justify the appl ication of tariff protection, and also states the 
purposes for which the goods may be admitted into the importing member State free of import duty or 
at a rate lower than the CET;  these approved prin ciples are generally used in industry, agriculture, 
fisheries, forestry, and mining.  Each CARICOM country may also maintain e xceptions to the CET 
included in the Lists A, B, C, and D.  CARICO M members have greater flexibility in the tariffs 
applied to the items included in List A (e.g., fo odstuffs) and List C (e.g., spirits, beer, tobacco, 
firearms, motor vehicles, some electrical appliances,  and jewellery and precious stones), such that the 
rates applied by each country are liste d individually.  In general, the rates applied to items in List A 
are lower than the CET, while the rates applied to items in List C are higher.  
100. CARICOM members implemented the CET on a four-phase schedule.  The fourth and final 
phase was to have been reached on 1 January 1998, but only St. Vincent and the Grenadines  met that 
deadline.  As at mid 2007, only St. Kitts and Ne vis was still using Phase III.  The other countries 
implemented Phase IV in 2000 (Grenada, St. Lucia)  or 2001 (Antigua and Barbuda, Dominica). 
(b) Bound MFN tariffs 
101. The OECS countries do not have unified tariff bindings in the WTO.  While the separate 
national schedules are broadly similar, they vary co nsiderably at the level of individual items and 
sectors.  That variance is demonstrated both by the wi de range in average bound tariffs (58.2-76.5%), 
as well as the differences on some individual prod ucts and sectors.  Grenada is the only country 
among the OECS to have bound all its tariff lines;  the others have bound between 93.2% (Dominica) 
and 99.7% (St. Vincent and the Grenadines). 
102. All six countries bound agricultural tariffs at a ceiling rate of 100%, w ith some exceptions.  
Exceptions were generally bound higher than 100%  in Antigua and Barbuda, Dominica, St. Lucia, 
and St. Vincent and the Grenadines, but in Gren ada some tariff lines were bound at zero.  Non-
agricultural goods were bound at a ce iling rate of 50% except in St. Kitts and Nevis, where they were 
bound at 70%;  in all cases there are a number of exceptions including bound rates as high as 250% in 
agriculture, and unbound tariff lines in non-agricultu ral goods in Antigua and Barbuda, Dominica, and 
St. Lucia.  Products bound above the 50% or 100 % rates include motor vehicles, cement, alcohol, 
margarine, and fruit. 
103. The applied rates for a few products in Gren ada exceed the rates bound in the WTO. 
104. Grenada engaged in tariff renegotiations under GATT Article XXVIII in 2002-03 because 
implementation of Phase IV of the CET resulted in  applied tariffs exceeding bound rates for certain 
agricultural products, such as meat and beer.  Even  after these negotiations, the applied tariffs on 
15 agricultural items are higher than the bound ra tes (typically by five percentage points). 
105. Although each OECS country applies other duties and charges to imports, only St. Kitts and 
Nevis bound other duties and charges in the WTO, at a general rate of 18% (3% CSC and 15% 
consumption tax), with a number of exceptions.  Other OECS Members left blank the "other duties 
and charges" column in their WTO schedules.  Th is has been interpreted by a WTO panel to be 
equivalent to a binding at a level "zero".52 
                                                      
52 WTO document WT/DS302/R, 26 November 2004. OECS-WTO Members WT/TPR/S/190 
 Page 25 
 
 
(c) Tariff and tax concessions 
106. All of the OECS countries use some form of fiscal incentives (section III)(3)(ii) below), 
which generally provide, inter alia, for tax and tariff concessions.  In addition, various schemes 
provide tariff concessions for supplies and/or capita l goods imported by or on behalf of producers in 
certain sectors.  Among the beneficiaries of these sch emes are farmers in genera l (St. Kitts and Nevis) 
or banana growers in particular (St. Lucia and St. Vincent and the Grenadines), and fishermen (St. Kitts and Nevis, St. Vincent and the Grenadines). 
107. In Dominica duty-free imports are allowed for raw materials and inputs, materials, tools, 
plant, machinery, and building materials that are used in a variety of construction and manufacturing 
activities.  St. Kitts and Nevis offers a drawb ack on customs service charges for manufacturing 
enterprises that import inputs and subsequently ex port the processed goods.  Some countries reserve 
the approval for such concessions to Cabinet (e .g., Antigua and Barbuda, St. Vincent and the 
Grenadines), while others provide this authority to the Ministry of Finance (e.g., Dominica).  OECS 
Members are part of a group of developing count ries which were recently granted the right to 
continue such subsidies till 2015 (see below).    
108. In all OECS countries, imports destined for gove rnment institutions are not subject to import 
duties;  diplomatic missions and international orga nizations are granted similar treatment.  Hospitals, 
relief organizations, and other ch aritable institutions are also eligible for duty-free treatment. 
109. Concessions can also be designed to meet sp ecific, temporary needs:  Grenada offered 
temporary duty-free concessions for the post-hurri cane rebuilding efforts in 2004-05, and some 
countries granted temporary duty-free treatment for various sectors that needed to expand capacity 
prior to the Cricket World Cup in 2007 (e.g., hotels). 
110. Statistics on the number and value of concessions are not available in most OECS countries.  
Two exceptions to this are St. Lucia (where 158 of  the 180 applications for tariff concessions were 
granted during 2001-06) and St. Vincent and the Grenadines (where concession programme resulted 
in EC$441.5 million of forgone  tariff revenue during 2001-06). 
111. The World Bank has noted that tariff and tax concessions are only required or demanded 
because of the high tariffs and other trade-relate d service charges imposed by the OECS countries.
53  
The authorities have, however, indicated that ta riff and tax concessions are essential to attract 
investment in OECS Members.  Notwithstanding, so me steps are being taken towards reform.  In St. 
Vincent and the Grenadines, for example, the Government announced in 2006 that it would 
rationalize the system of granting duty-free concessions  in order to control related revenue losses, and 
would lower the level of concessions to 50% of the import duties and consumption tax payable in 
specific categories.   
(d) Tariff preferences 
112. Duty-free access is granted in all OECS countries to imports from other CARICOM 
countries, provided they meet the CARICOM rules of  origin criteria.  No preferences are granted on 
imports from non-CARICOM countries.  The CARI COM preferences do not include the customs 
service charges, but do cover some other taxes.  In  St. Kitts and Nevis, for example, agricultural 
products of CARICOM origin are exempt from the consumption tax, like domestic produce. 
                                                      
53 World Bank (2005), p. 44. WT/TPR/S/190 Trade Policy Review 
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(v) Other levies and charges 
113. Numerous changes have been made during the review period in the other levies and charges 
imposed on imports and domestic produc ts (Table III.4).  The most si gnificant structural changes have 
been in the creation of new value-added tax es (VATs) and sales or excise taxes.  These r eforms have 
been inspired, in part, by the expectation that ne gotiated tariff reductions will need to be compensated 
by increases in revenue from other sources.  
Table III.4 
Changes to trade-related tax regimes, as at May 2007 
 Antigua and 
Barbuda Dominica Grenada St. Kitts and 
Nevis St. Lucia St. Vincent and 
the Grenadines 
Customs service charge Increased No change No change Increased Increased No change 
Value-Added Tax n.a. Created  Pending n.a. n.a. Created 
Consumption taxes Repealed Repealed Re peal pending Increased Reduced Repealed 
Environmental taxes Created Increased No  change Increased Changed No change 
Sales or excise taxes One created, 
one pending One repealed, 
one created Increased Created No change Created 
 
n.a. Not applicable. 
 
Source:  National reports. 
114. Dominica and St. Vincent and the Grenadines have each created a VAT regime during the 
review period.  The two schemes are similar:  both have rates set at 15% for most transactions, but offer a reduced rate of 10% for hotels.  The two prov ide for various exemptions (notably for exports);  
and both imposed the VAT concurrently with th e repeal of various other taxes (especially 
consumption taxes on domestic a nd imported goods).  Grenada also enacted a new VAT, together 
with the repeal of other taxes, but implementation of  the new regime is expected some time after the 
planned date of 1 October 2007.  Antigua and Barbuda opted to replace its consumption taxes and 
other taxes, with a sales tax.  Deliberations over ta x reform within St. Kitts and Nevis and St. Lucia 
are still at a relatively early stage, with no legislative proposals yet made to Parliament. 
115. Excise taxes are also evolving in the region.   Dominica imposed an excise tax on fuel, 
tobacco, alcohol, and motor vehicles in 2005.  This  replaced the consumption tax on these products.  
Grenada increased its petrol taxes in 2006, and in the same year St. Kitts and Nevis imposed an excise 
duty of 15% on alcohol and tobacco  products.  Concurrent with its  new VAT, St. Vincent and the 
Grenadines instituted new excise taxes in 2007 on al cohol, tobacco, fuels, vehicles and parts, and 
incandescent bulbs. 
116. All OECS countries have some form of taxati on aimed at reducing environmental problems.  
These typically include taxes on beverage cont ainers, as well as levies (either specific or ad valorem ) 
on environmentally sensitive items such as automob iles, tyres, batteries, electric heaters, and air 
conditioners.  Most Members’ environmental taxes apply only to certain goods, but in Dominica all 
packaged items that are not explicitly scheduled, irrespective of their environmental impact, are 
subject to an across-the-board 1% rate.  St. Luci a also applies a uniform 1% rate on non-scheduled 
items, but exempts clothing, footwear, foodstuffs , raw materials and packaging for industrial 
purposes, and pharmaceuticals. 
(vi) Import prohibitions, restrictions, and licensing 
117. All of the OECS Members employ prohibitions and licensing to restrict certain types of 
imports.  All of the outright prohibitions appear to be aimed at regulating imports that might pose OECS-WTO Members WT/TPR/S/190 
 Page 27 
 
 
health and safety risks (e.g., drugs, pesticides,  and weapons).  Import-licensing requirements are 
similar for certain classes of imports that have implications for health and safety. 
118. Licences may also be required for the importation of  goods that appear to be restricted largely 
or entirely for economic reasons, such as the protecti on of infant industries or when there is no local 
production of the item in question, to reduce the na tional import bill.  In St. Kitts and Nevis, for 
example, when local production is rising licences for imports of some agricultural products may be denied. 
119. Import-licensing schemes can also be tied to regional integration, (for example products 
covered by Article 164 of the Revised CARICOM Tr eaty), such that some products are subject to 
licensing only when imported from outside the CARICOM region or, in some cases, from outside the 
OECS sub region.  For example, Antigua and Ba rbuda has one schedule of goods that requires a 
licence whenever imported from outside the OECS countries (e.g., flour, pasta, and beer), and another schedule of goods that must be licensed whenever  imported from outside CARICOM (e.g., meat, fish, 
soap, and certain articles of clothing).  Similar import-licensing regimes are in place in Dominica, St. Lucia, and St. Vincent and the Grenadines. 
120. St. Kitts and Nevis uses quantitative restrictions to limit imports from non-CARICOM 
countries of:  eggs, cabbages, carrots, onions, sweet  peppers, tomatoes, and white potatoes only when 
domestic production cannot meet demand.   
121. At the time of their last Review, the OECS  countries applied non-automatic licensing on 
products subject to quantitative restrictions unde r Article 56 of the CARICOM Treaty.  In 2006, 
CARICOM took a decision, pursuant to Article 164 (Promotion of Industrial Development) of the 
Revised CARICOM Treaty, to replace non-automa tic import licensing with tariffs.  The main 
intended beneficiaries under the decision were  OECS Members who qualify as LDCs in the 
CARICOM context.  Article 164 also allows le ss developed CARICOM c ountries to petition COTED 
to suspend Community origin treatment to certain products and to apply tariff rates higher than the 
CET.
54  In January 2006, it was agreed by COTED th at tariff rates could be increased on goods for 
which Article 164 may be applied.  It was further ag reed that this decision would be reviewed in the 
first instance, after a period of five years.  As at mid 2007, the resulting tariffs had not, however, been 
invoked by any OECS Member state and OECS countries were in the process of deciding whether and how to impose the higher rates.  Instead, the rates pr ovided in the CET were being applied.  In some 
cases, like in Antigua and Barbuda and in St. Vincen t and the Grenadines, the same items subject to 
tariffication have remained subject to non-automa tic import licensing.  Dominica had previously 
tariffied most of the items bene fiting from Article 56 protection. 
122. The authorities in OECS countries state that most licences, other than those imposed for 
health and safety reasons, are granted automatically, and in many cases are applied for and received at 
the time of importation;  in Grenada, licence applications must be made prior to importation.  
Processing time is generally a day or two. 
123. Non-automatic licences are used in every OECS country, except Dominica;  the coverage 
varies by country, but generally includes agricu ltural and agri-business goods, as well as goods where 
there are safety concerns.  In Grenada, chicke ns, chicken eggs, and war toys are subject to non-
                                                     
 
54 The goods for which Article 164 may be applied and CARICOM origin suspended are (years, 
MDC/third party rates in percentage between parentheses):  aerated beverages (10, 70/100);  waters, other 
waters (10, 70/100);  beer (10, 70/100);  malt (10, 70/100);  candles, paraffin wax (7, 40/50);  
curry powder (5, 30/40);  pasta (5, 50/100);  animal feed (10, 50/100);  wooden furniture (10, 40/50);  solar water heaters (10, 40/50);  industrial gases, oxygen, carbon dioxide, acetylene (10, 40/50). WT/TPR/S/190 Trade Policy Review 
Page 28 
 
 
automatic licensing.  The list of goods is longer in  St. Vincent and the Grenadines, but the authorities 
state that the list of goods subject to non-automatic licenses is to be rationalized and minimized.  
Non-automatic licensing is in principle used extensiv ely in St. Lucia, but the authorities indicate that, 
in practice, applications for a licence are rejected onl y if they are not made in proper form.  While the 
rules vary from country to country, the licences are generally valid for a month or six weeks, are not 
transferable, and do not provide for penalties in the case of non-use. 
124. In addition to restricting imports of certain  products, some OECS Members impose either 
licensing or prohibitions on imports from certain count ries.  Laws are still on the books to restrict 
imports from Iraq (Dominica) or Iraq and Kuwait (G renada).  In Antigua and Barbuda, a 2001 order 
prohibited the import without a licence of goods originating in countries that were not 
WTO Members;  some of these countries have since acceded, but the list does not appear to have been 
updated.  Data were not available on the number of licences applied for, granted, or used in any of the 
OECS countries. 
(vii) Contingency measures 
(a) Anti-dumping and countervailing measures 
125. During the review period, none of the OECS countries has initiated any investigations nor 
imposed any anti-dumping or countervailing measures.  None has a body devoted to the implementation of anti-dump ing or countervailing laws. 
126. Dominica, Grenada and St. Lucia are the only OECS Members to have notified their anti-
dumping and countervailing duty legislation in the WT O;  Antigua and Barbuda and St. Lucia have 
notified the WTO Committee on Subsidies and Count ervailing Measures that they maintain no 
measures requiring notification. 
127. Anti-dumping and countervailing dut y laws have not been ame nded to reflect the Uruguay 
Round Agreements.  The legal basis for anti-dumping and count ervailing measure legislation is in 
national laws dating from 1959-1964.   The Revised CARICOM Treaty provides the basis for adopting 
anti-dumping measures but only against imports from other CARICOM members.  A model 
CARICOM anti-dumping law is under active c onsideration in some OECS countries. 
(b) Safeguards 
128. During the period under review, none of the OECS  countries initiated any investigation nor 
imposed any safeguard measure.  None has established an authority to carry out such investigations. 
129. No OECS country has national safeguards legisl ation.  However, CARICOM rules permit the 
use of safeguards, and less developed countries (i ncluding the OECS countries) may invoke the 
special provisions in Chapter 7 of the Revised Trea ty of Chaguaramas, in particular Articles 150 
which replaced Articles 28 and 29 of the original Tr eaty.  Article 150 (Safeguard Measures) entitles a 
country defined as a disadvantaged country (all OECS  Members) to limit imports of goods from other 
CARICOM member for up to three years, and to take such other measures as COTED may authorize.   
130. OECS countries did not avail themselves of the safeguard provisions of the WTO Agreement 
on Agriculture or Textiles and Clothing. OECS-WTO Members WT/TPR/S/190 
 Page 29 
 
 
(viii) Technical regulations and standards 
131. Each of the OECS countries has its own bureau of standards (Table III.5).  Antigua and 
Barbuda, St. Lucia, and St. Vincent and the Gren adines signed the WTO Code of Good Practice for 
the Preparation, Adoption and Application of Sta ndards during the period of this Review;  Grenada 
and Dominica had signed before 2001.55  St. Kitts and Nevis has not signed the Code. 
Table III.5 
OECS Members' standards bureaux 
Institution Antigua and 
Barbuda 
Bureau of 
Standardsa Dominica 
Bureau of 
Standardsb Grenada 
Bureau of 
Standardsc St. Kitts and 
Nevis Bureau of 
Standardsd St. Lucia 
Bureau of 
Standardse St. Vincent 
and the 
Grenadines 
Bureau of 
Standardsf 
Year established 1987 2000 1989 1998 1990 1998 
Activities, 2001-06       
   Standard adopted 8 26 38 n.a. 21 35 
   Tech. regs. adopted 0 11 13 n.a. 6 6 
   WTO notifications 0 10 12 0 45 0 
Functions       
   Develop standards  Yes Yes  Yes Yes Yes Yes 
   Certification No No Yes Yes Yes Nog 
   Conformity assess. No Nog Yes n.a. Yes n.a. 
   Market surveillance No Nog Yes n.a. Yes n.a. 
   Metrology Yes Nog Yes n.a. Yes n.a. 
 
n.a. Not applicable 
 a Ministry of Finance and Economy. 
b Ministry of Foreign Affairs, Trade and Marketing. 
c Ministry of Trade and Industry. d Ministry of Foreign Affairs, International Tr ade, Industry, Commerce and Consumer Affairs. 
e Ministry of Trade, Industry, and Commerce. 
f Ministry of Telecommunications, Science Technology and Industry. g Although the function is not currently performed by the institution, there are plans to do so in the future. 
Source : Information provided by the authorities. 
132. Each of the six OECS Members maintains an inve ntory of technical regulations or conformity 
assessment procedures in force, but only three made notifications of technical regulations to the WTO 
during the review period (Table III.5). 
133. The structure and responsibilities of the bureaus of standards, and the procedures by which 
standards and technical regulations are adopted, are very similar in all OECS countries.  Technical regulations are referred to as either compulsory or mandatory standards, and are developed in 
essentially the same manner as standards.  The pr ocess begins when a need is identified, and a 
proposal is developed.  OE CS countries generally favour the use of  international standards (preferably 
CARICOM standards) as the basis for their technical regulations.  A draft specification is developed 
and discussed by a technical committee, then submitt ed to the Standards Council;  a period of public 
comments (e.g., 60 days) is allowed.  Following th e receipt and review of comments, the standard 
may be amended and reconsidered by the Standard s Council.  Technical regulations, are notified to 
the WTO prior to implementation of the measure, w ith 60 days for circulation and comments.  In 
some countries, the Ministry of Legal Affairs may also be asked to comment on legal matters.  The 
relevant minister publishes the technical regulation or standard in the Government Gazette . 
                                                     
 
55 WTO document G/TBT/CS/2/Rev.13, 2 March 2007. WT/TPR/S/190 Trade Policy Review 
Page 30 
 
 
134. Only Grenada, St. Kitts and Nevis, and St. Lucia undertake certification.  The Grenada 
Bureau of Standards conducts batch, product, and qu ality certification.  In St. Lucia, certification is 
done only against an existing standard, and is generally based on 100% testing. 
135. Testing and inspection activities are restricted  by the limited resources available to the 
standards bureaux, but a regional accreditation programme  for laboratories is under consideration.  In 
Dominica a proposed National Center of Testing Exce llence is at the preconstruction phase.  Resource 
constraints limit other activities of standards bur eaux.  For example, the Antigua and Barbuda 
authorities acknowledge that they lack the technical  regulations and resources necessary to carry out 
market surveillance.  In Dominica, market surve illance is currently limited to locally manufactured 
products.  Grenada checks compliance with labelling requirements at the point of entry, and by 
random inspection of goods at retail outlets. 
136. St. Lucia’s bureau of standards is the only OE CS institution to have member body status in 
the International Organization for Standardizati on.  The institutions in Antigua and Barbuda, 
Dominica, and St. Vincent and the Grenadines have s ubscriber membership status.  All of the OECS 
countries are members of the CARICOM Regional Or ganisation for Standards and Quality, and the 
Inter-American Metrology System.  They are neither  full nor associate members of the International 
Electrotechnical Commission, although Antigua and Barbuda, Dominica, Grenada, and St Lucia have 
been affiliate members since 2001-02. 
(ix) Sanitary and phytosanitary measures 
137. Antigua and Barbuda is the only OECS Member to have notified any SPS measures to the 
WTO.  None of the OECS countries has any formal  procedures in place to notify trading partners 
when SPS measures are put in place.  Instead contact is  made on an ad hoc and peer-to-peer basis;  
with counterpart agencies in partner countries.  These  contacts may, in practice, be largely limited to 
countries in the Caribbean Basin.  Antigua and Ba rbuda is developing a website that would include 
bilateral agreements, the list of quarantined pests,  legislation, entry requirements, and other related 
materials. 
138. OECS countries generally do not maintain inve ntories of the SPS measures adopted, and the 
authorities could not provide statistics on the number adopted during the review period. 
139. Document inspection as well as any product sampli ng is generally carried out at the border.  
However, there are few or no domestic facilities ava ilable to conduct tests of any samples.  These 
often need to be sent for testing to another country in the region (e.g., Barbados ), or outside the region 
(e.g., the United States).  Their lack of laboratory facilities may make it difficult for the OECS 
countries to ensure that any SPS measures they ad opt are based on an evaluation of actual risks. 
140. In general, imports of plants and unpr ocessed products must be accompanied by a 
phytosanitary certificate issued by  the exporting country.  Imports of live plants and all unprocessed 
plant products and commodities, and non-commerc ial untreated seeds are generally subject to 
quarantine regulations, and imports of soil or products containing soil are prohibited.  Import licences 
may also be required for imports of live animals or their products. 
141. Some OECS countries are considering legislative reforms in the area of SPS.  In addition to a 
CARICOM model law on animal disease and impor tation, national legislative reforms are under 
active consideration in Antigua and Barbuda, Dominica, Grenada, and St. Vincent and the 
Grenadines. OECS-WTO Members WT/TPR/S/190 
 Page 31 
 
 
142. In St. Kitts and Nevis, permanent measures ma y require the enactment of legislation by 
Parliament, but the Minister also has the authorit y to impose measures on an emergency basis.  While 
measures are published in the Gazette , provision is not made for the solicitation or consideration of 
comments on the measures from other WTO Memb ers prior to their entry into force. 
143. Most OECS countries do not have any laws or ru les that deal explicitly with the import and 
sale of genetically modified organisms (GMOs) or animals fed hormones (or their products).  
However, a draft Plant Protection Act under consid eration in Antigua and Barbuda would extend the 
scope of the phytosanitary trade protocol to include importation GMOs. 
144. All of the OECS countries are members of Codex Alimentarius, but not of the World 
Organization for Animal Health.  They are all contr acting parties to the International Plant Protection 
Convention (IPPC):  only Grenada and St. Kitts and Nevis adhered to this  agreement at the time of the 
last Review, the others joined in 2001 (St. Vincent and the Grenadines), 2002 (St. Lucia), and 2006 (Antigua and Barbuda;  Dominica). 
(2) M
EASURES DIRECTLY AFFECTING EXPORTS  
(i) Documentation, export taxes, and restrictions 
145. The OECS countries generally require two or  three documents for all exports, and may 
require additional documents for items on which preferences are claimed or that are subject to licensing (Table III.6).  World Bank data shows th at there are differences in the amount of time 
required for export. 
Table III.6 
Comparative procedures and expenses for exports, 2006 
 ATG DMA GRD KNA LCA VCT 
Documents required for all exports (additional documents are required for 
preferences, licensed goods, etc.) 3 2 3 2 3 3 
Time for export (days) 13 11 19 11 9 15 
Source:  Data on documents from the national reports.  Data on the time and cost to export are from World Bank Doing 
Business online information.  Viewed at:  http:// www.doingbusiness.org/ExploreTopi cs/TradingAcrossBorders. 
146. The main export restrictions are based on CITES standards:  all OECS Members ban exports 
of wild birds and wildlife.  Exports of narcotics and drugs are prohibited or subject to licensing in 
several countries, as are exports of goods bearing th e country’s coat of arms or flag.  Grenada bans 
exports of unfermented cocoa. 
147. The OECS Members generally do not use e xport-licensing.  The exceptions include 
vegetables, monkeys, and several types of seafood in  St. Kitts and Nevis;  and swine, sheep, goats, 
lobsters, fish, and seafood in St. Vincent and the Gr enadines.  St. Lucia's export-licensing requirement 
on ginger and dry coconut is not enforced.  Gren ada allows cocoa exports only with the written 
approval of the Grenada Cocoa Association, a nd bananas may be exported only by the Grenada 
Banana Co-operative Society or persons licensed by the Society. 
148. The only taxes or levies on exports are as follows:  Antigua and Barbuda applies taxes on 
exports of lobsters and fish;  Dominica imposes e xport royalties on sand and stone;  and St. Kitts and 
Nevis taxes exports of live animals,  cotton, and some other products. WT/TPR/S/190 Trade Policy Review 
Page 32 
 
 
(ii) Export subsidies, financing, support, and promotion 
149. The OECS-WTO Members have similar fiscal incentives acts, which provide for, among 
other things, exemptions from income tax on export profits (see also section (3)(ii) below).  Each 
country has notified its Fiscal Incentives Act to  the WTO Committee on Subsidies and Countervailing 
Measures, as well as any free-trade zones, where they exist, as providing export subsidies.  The 
Committee has agreed to continue  until 31 December 2007 the extension granted for these acts under 
Article 27.2(b) of the SCM Agreement, for the elimin ation of export subsidies that take the form of 
full or partial exemptions from import duties and in ternal taxes that were  in existence under the 
programme on 1 September 2001. 
150. The OECS countries, together with eight other WTO Members, made a proposal in early 
2006 that would extend export subsidies to 2018.56  In the view of these countries, export subsidies 
are necessary because they consider themselves to be "particularly vulnerable and unable to fully and 
better integrate into the multilateral trading system and benefit from the positive aspects of 
international liberalization".  In July 2007, the General Council decided to extend the date fro the 
dismantlement of export subsidies to end 2015.  Members benefiting from the extension must take, 
from 1 January 2008, the necessary internal steps w ith a view to eliminating export subsidies under 
the programme before the end of the final two-year  phase-out period.  In addition, from 1 January 
2008 and no later than 31 December 2009, the Me mber must notify each beneficiary under the 
programme indicating that no export subsidies with in the meaning of SCM Article 3.1(a) will be 
granted or maintained beyond the end of calendar year 2015. 
151. Antigua and Barbuda, St. Lucia, and St. Vincen t and the Grenadines have adopted free-zone 
legislation.  The free-zones regime is outside th e scope of the Fiscal Incentives Act;  a company may 
benefit from either of these two regimes, but not  from both simultaneously.  The only operating free-
zones are in Antigua and Barbuda and St. Lucia.  While the zones in St. Lucia have manufacturing 
enterprises as well as regional distribution companies. 
152. Antigua and Barbuda's free-zone  legislation provides exemption from the payment of customs 
duty and other taxes on imports of machinery, equipm ent, spare parts, and items needed to construct 
and operate facilities within the zone or of good s to be incorporated in products produced or 
assembled within the zone.  The decision to gran t a licence is based on investment;  employment 
generation;  foreign exchange  generation;  and technology transfer considerations. 
153. Under St. Lucia’s free-zone law, merchandise im ported into a zone is duty free, and is not 
subject to quotas or any import restrictions other th an those imposed for safety or health reasons.  
Other benefits include tax credits in accordance with  the number of nationals employed;  exemption 
from income tax during the first five years of opera tion;  and the possibility to deduct total net losses 
during this five-year tax holiday from profits following the tax holiday. 
154. The standard corporate tax rate in St. Vincen t and the Grenadines is 37.5% but certain export 
manufacturers qualify for reduced rates;  profits ar e taxable at 30% on goods for the local market or 
other OECS countries, 25% for non-OECS CARICO M countries, and 15% for outside of CARICOM. 
155. OECS countries do not have national programmes for export credit, insurance or guarantees.  
Manufacturing exporters may make use of the ex port insurance facilities pr ovided by the Eastern 
Caribbean Central Bank (ECCB), covering political and commercial risks.  The ECCB also provides 
preshipment financing, allowing the exporter to obtain direct financing at competitive rates for 
purchases of raw materials and other working capital needs against confirmed export orders.  In 
                                                      
56 WTO document G/SCM/W/535, 12 April 2006. OECS-WTO Members WT/TPR/S/190 
 Page 33 
 
 
addition, the ECCB provides post-shipment financing,  allowing exporters to convert trade receivables 
into cash to enhance working capital.  The ECCB may, alternatively, provide guarantees to 
commercial banks for advances made to exporters  of non-traditional manufactured goods through the 
ECCB Export Credit Guarantee Scheme, although the au thorities have indicated that this is used 
infrequently;  only a few companies from St. Vin cent and the Grenadines have used these schemes 
during the period under review. 
156. Exporters may also receive export promotion support from the OECS Export Development 
Unit.  Some OECS countries are in the process of establishing or reforming their export- and 
investment-promotion agencies.  Do minica is developing an action plan to enhance the efficiency and 
accountability of the Dominica Export and Import Agen cy.  In St. Vincent and the Grenadines, a 
newly created Export Development Office is  developing a national export strategy. 
(3) MEASURES AFFECTING PRODUCTION AND TRADE  
(i) Legal framework for business and taxation 
157. Foreign or local individuals may establish:  sole proprietorships;  partners hips;  corporations;  
joint ventures;  and branches of foreign corporations .  Businesses are generally required to obtain an 
annual business licence. 
158. Corporate tax rates have converged somewh at during the review period, following the 
reduction of rates in some countries.  The rate is  37.5% in St. Vincent and the Grenadines, 35% in 
St. Kitts and Nevis, and 30% in Antigua and Barbuda, Dominica, Grenada, and St. Lucia. 
159. According to a World Bank study comparing the business climate across 175 countries, all of 
the OECS countries are more business-friendly than th e median country, with St. Lucia ranked 27th.  
Among the separate items taken into account in the st udy, the OECS countries do best on dealing with 
licences;  St. Vincent and the Grenadines was in fi rst place for the world, and none of the countries 
did worse than 34th place.  All were tied at 19th place for "protecting investors"  By contrast the OECS countries score below the world average as rega rds access to credit, enforcement of contracts, 
and closure of businesses.  
160. The six OECS Members are among the 41 countri es and other jurisdictions that the OECD 
identified in 2000 as "tax havens".  In early 2002 each of them signed a letter of commitment with the 
OECD on transparency and the exchange of in formation, and were t hus removed from the 
uncooperative list.  Some OECS Members have enacte d laws and/or established financial intelligence 
units in order to comply with these commitments
. 
(ii) Incentives and assistance 
161. All OECS-WTO Members maintain similar in centives schemes, under a Fiscal Incentives 
Act, that provide for duty-free imports, tax holidays,  and the like for certain investments.  The laws 
stem from an original effort to harmonize th e various national incentives schemes that CARICOM 
countries offered to industry.  With some varia tions, they all provide for tax holidays and other 
benefits that are, by statute, calibrated to the size of the investment and the activity.  While the 
incentives laws generally make bene fits contingent upon local value-added, officials in some OECS 
countries noted that these considera tions have never played a part in  the actual decisions regarding the 
granting, duration, and level of concessions.  Ra ther, these decisions are based on the anticipated 
gains in employment, economic diversification, and i nvestment in disadvantaged areas.  Benefits also 
vary according to the export content. WT/TPR/S/190 Trade Policy Review 
Page 34 
 
 
162. The effectiveness of the incen tives schemes used by the OECS Members and other countries 
has been questioned in a number of studies.  Acco rding to a recent World Bank study, the various 
incentives schemes may serve to distort the return s to investment across activities, sectors and 
enterprises leading to less efficient resource allocation;   the study also noted that, when applied in a 
discretionary manner, they create uncertainty among investors and open the door for rentseeking.  The 
analysis also found that incentives have not resu lted in the expected job creation and income 
generation but, on the contrary, have consumed public resources that could have been used to raise the 
quality of the broader investment climate.57  
163. The IMF has also questioned the efficacy of tax incentives to spur investment and growth;  in 
particular, because the region's share in world FDI h as been declining.  An IMF report notes that tax 
holidays can have pernicious effects, such as er oding tax bases, forcing higher tax burdens on non-
favoured sectors, and squeezing resources availabl e for social and infrastructure expenditures 
contributing to debt build up, with negative implic ations for fiscal sustainability and growth.  The 
same study estimates the average annual revenue  forgone from concessions at between 10-16% of 
regional GDP over 2000-03.58 
164. The OECS Member's authorities have a more nuanc ed view with respect to the effectiveness 
of investment schemes.  In their view, incentives of  the sort included in th e Fiscal Incentives Act and 
in tourism legislation are vital to attract foreign capital.  In several countries, however, initiatives have 
been undertaken to reform various aspects of the schemes.  The most significant changes have been 
made in Grenada, which effective 1 June 2006, has not granted any new tax holidays or renewed 
existing ones;  incentives will instead be provided in  the form of tax write-offs for investments and 
accelerated depreciation with loss carry-forward.   
165. The authorities in St. Lucia have stated that th ey intend to revise the incentives laws to make 
them WTO-compatible;  they expect amendments to  be developed before the next review.  Antigua 
and Barbuda and Dominica created new investment authorities in 2007 to promote foreign investment 
and administer incentives schemes;  St. Kitts an d Nevis also plans to establish an investment 
promotion agency as a one-stop shop for local and foreign investors. 
(iii) Competition policy and regulatory issues 
(a) Competition policy 
166. The small size of the OECS markets contributes to economic concentration.  It is therefore 
important to be able to enforce competition.  Ho wever, only two of the OECS countries have taken 
steps (albeit incomplete), towards establishing a competition law and an administering authority. 
167. In St. Lucia the Ministry of Consumer Affa irs is responsible for the administration of 
competition policy, but its authority is circumscribe d by the limited extent of national law.  In 
St. Vincent and the Grenadines the national legislat ion provides for a Fair Trading Commission, but 
this institution has not yet been established.  In Antigua and Barbuda there are plans to draft 
additional competition policy legislation.  In St. K itts and Nevis, the Government’s legislative work 
plan for 2007 contemplates the drafting of competition policy legislation. 
168. The integration progress for competition polic y is under way:  it has produced a model 
CARICOM competition law and a proposal that the OECS countries establish a subregional competition authority.  Chapter VIII of the CARICOM Treaty, which provides for harmonized 
                                                     
 
57 World Bank (2005), pp. 43 and 45. 
58 IMF (2007). OECS-WTO Members WT/TPR/S/190 
 Page 35 
 
 
competition legislation in CARICOM members.  Ther e is currently a draft agreement to establish an 
OECS competition authority and draft harmonized competition bills for enactment by OECS members.  Once it enters into force, it is expe cted that the member states will create national 
competition authorities to deal with domestic co mpetition issues, while the CARICOM authority will 
deal with issues at the regional level. 
(b) Price controls 
169. Dominica has made the greatest progress in reduc ing the formal application of price controls, 
reducing the number of items subject to controls fro m 40 to 5 during the review period.  The lists of 
items subject to controls in Antigua and Barbuda, Gr enada, and St. Lucia have changed little or not at 
all.  While St. Kitts and Nevis and St. Vincent a nd the Grenadines maintain relatively long lists of 
items subject to price controls on a de jure basis, officials in both countries indicate that, in practice 
the controls are applied to a more limited range of essential products. 
(c) State-owned enterprises, marke ting boards, and privatization 
170. Dominica is the only OECS Member to have notified the existence of any state-trading 
enterprise, as defined by Article XVII of the Gene ral Agreement on Tariffs and Trade of 1994, to the 
WTO.  In 2001, it notified the Dominica Import Export Agency (DEXIA) and Dominica Banana and 
Marketing Corporation.  The latter has been repl aced by the Dominica Banana Producers Limited, 
which does not have a monopoly on the export of bana nas.  DEXIA still has the exclusive right to 
import most sugar, as well as bulk rice.  The Government plans to restructure DEXIA in order to improve its efficiency and accountability. 
171. Marketing boards in operation in all OECS-WTO Members, exercise exclusive powers, 
primarily in the agricultural field (Table III.7).  Some institutions have gone out of business during the 
period of this review:  the St. Kitts Suga r Manufacturing Corporation, was the sole de jure  producer 
and exporter of sugar until its closure in 2005.  Th e former St. Vincent and the Grenadines Marketing 
Corporation had a monopoly on the importation of edible  oils and fats, sugar in bulk, and (until 2000) 
bulk rice, but its functions were revised and tran sferred in 2003-06 to National Properties Limited and 
the Agricultural Input Warehouse.  Also in St. Vincent and the Grenadines, the monopoly of Diamond 
Dairies Ltd. on the importation of milk ceased in 2002. 
Table III.7 
Marketing boards or similar arrangem ents in place over the 2001-07 period 
Country Marketing board Products marketed exclusively by board 
Antigua and 
Barbuda  Central Marketing Corporation 
(CMC), established in 1973 The CMC no longer enforces its monopoly on imports of carrots, cabbages, 
onions, sweet peppers, and tomatoes.  The system of import licensing is being 
phased out. 
Dominica Dominica Export and Import 
Agency (DEXIA), established in 1986 DEXIA has the exclusive right to import sugar (brown and white sugar, except 
EEC No. 1 used by bottlers, and icing sugar) and bulk rice (white and parboiled). 
Grenada Marketing and National Importing 
Board (MNIB), established in 1973  Exclusive importation of bulk rice a nd sugar in 50 kg polypropylene bags 
Centralized importer of rice in bulk, fu ll cream powdered milk in bags, refined 
sugar in bags, and unrefined sugar in bulk. 
 Grenada Banana Co-operative 
Society (GBCS);  Grenada Cocoa 
Association (GCA);  Grenada Co-operative Nutmeg Association 
(GCNA);  Grenada Minor Spices 
Co-operative Marketing Society Limited (GMSCMS) The GBCS is the sole authorized purchaser of bananas for export to countries 
outside the Caribbean area, and bananas may be exported only by this group or 
persons they may license.  Grenada allo ws the exportation of cocoa only with 
the written approval of the GCA.  The GCNA  is the sole authorized exporter of 
nutmeg.  The GMSCMS has the exclusiv e right to export cloves, cinnamon, 
pimento, and all other spices except nutmeg and mace. 
Table III.7 (cont'd) WT/TPR/S/190 Trade Policy Review 
Page 36 
 
 
Country Marketing board Products marketed exclusively by board 
St. Kitts and 
Nevis Central Marketing Corporation 
(CEMACO)  
Ministry of Trade and Industry Marketing agent for non-sugar agricultural produce;  its monopoly rights on the 
non-sugar sector have been abolished.  
Monopoly on importation of bulk rice, wheat flour, and evaporated milk 
St. Lucia Ministry of Trade, Industry and 
Commerce Monopoly on importation of bulk rice, wheat flour, and sugar. 
 St. Lucia Marketing Board (SLMB) Imports out-of-season goods such as cabbages, lettuce, tomatoes, carrots, and 
sweet potatoes, but does not have a monopoly 
St. Vincent and the Grenadines Agricultural Input Warehouse 
Diamond Dairies Ltd. Has a de facto  monopoly on the importation of dry fertilizers, and a legal 
monopoly on the importation of sugar.  Also  imports other inputs such as tools, 
seeds, and pesticides, but does not have a monopoly for these items. 
 National Properties Limited The Produce Division is re sponsible for domestic sales and exports of fresh 
produce, but does not have a monopoly over either activity.  The Supermarket Division sells both domestically  produced and imported produce 
 
Source : Information provided by the different national authorities. 
(iv) Government procurement 
172. None of the OECS countries has joined the WTO Agreement on Government Procurement.  
The relative size of government procurement in th e OECS varies from a low of 4.7% of GDP in 
Grenada and St. Lucia to a high of 9.7% in St. Kitts and Nevis. 
173. OECS Members generally provide for both pub lic and selective tendering.  Data are not 
available on the frequency with which different moda lities are used, but public tendering is generally 
used for larger projects and when required by a don or's rules.  Tenders boards generally choose the 
bid with the lowest price, but other issues can be  taken into consideration (e.g., qualitative issues and 
the credibility of a bidder). 
174. OECS Members generally do not explicitly gran t preferences to their own nationals or to 
other OECS or CARICOM countries.  Local providers may be preferred when after-sales service is considered crucial to the procurement decision.  The authorities in some Members indicate that there 
may be some implicit preference, especially for smaller and local projects. 
175. There are still a number of gaps related to the procurement process in some OECS countries.  
In Antigua and Barbuda there are as yet no legislated guidelines on how choices are to be made, 
though there is a draft bill for consultation.  Do minica has no office or board specifically devoted to 
procurement, and most purchases are made by ministri es.  The Ministry of Finance is responsible for 
all government procurement;  tenders boards may nevertheless be established on an ad hoc  basis for 
large projects.  New procurement legislation is u nder consideration in Dominica, based on examples 
from similar laws in other OECS countries and best practices. 
176. Government procurement is referred to in th e Revised CARICOM Treaty as part of a built in 
agenda for future negotiations aimed at deve loping disciplines in the area.  The COTED has 
nevertheless launched an action plan to create a cen tral regional information coordinating agency, and 
a promotional programme has been put in place to increase procurement of regional goods and 
services, within CARICOM. 
(v) Intellectual property rights 
177. Although, none of the OECS Members has comp leted the revision of all their intellectual 
property laws, in order to  fully reflect the TRIPS Agreement,  substantive progress has been made 
since 2001 (Table III.8).  Half of the IP laws approved by OECS Members since 1995 were enacted 
during the review period. OECS-WTO Members WT/TPR/S/190 
 Page 37 
 
 
Table III.8 
Intellectual property ri ghts legislation enacted since the Uruguay Round 
Field Antigua and 
Barbuda Dominica Grenada St. Kitts and 
Nevis St. Lucia St. Vincent and 
the Grenadines 
Copyright Enacted: 2003 
In force: 2006 Enacted: 2003 
In force: * None Enacted: 2000 
In force: 2002 Enacted: 1995 
In force: 2000 Enacted: 2003 
In force: 2004 
Patents Enacted: 2003 
In force: 2006 Enacted: 1999 
In force: * None Enacted: 2000 
In force: 2002 Enacted: 2001 
In force: * Enacted: 2004 
In force: * 
Industrial designs Enacted: 2003 
In force: 2006 Enacted: 1998 
In force: * None None Enacted: 2001 
In force: 2003 Enacted: 2005 
In force: * 
Layout designs Enacted: 2003 
In force: 2006 Enacted: 1999 
In force: * None None Enacted: 2000 
In force: 2003 Enacted: 2004 
In force: * 
Plant varieties None Enacted: 1999 
In force: * None None Enacted: 2001 
In force: * None 
Trade marks Enacted: 2003 
In force: 2006 Enacted: 1999 
In force: * None Enacted: 2000 
In force: 2002 Enacted: 2001 
In force: 2003 Enacted: 2003 
In force: 2004 
Geographical 
indications Enacted: 2003 
In force: 2006 Enacted: 1999 
In force: * None Enacted: 2007 
In force: * Enacted: 2003 
In force: 2003 Enacted: 2004 
In force: * 
 * Not yet in force (mid-2007). 
 
Source: Information provided by the authorities. 
178. Antigua and Barbuda has made the most progr ess in revising its laws:  only a law on plant 
varieties is pending.  Grenada, at the other end of the spectrum, has neither enacted nor brought into 
force any new intellectual property legislation sinc e the negotiation of the TRIPS Agreement.  The 
other four OECS Members have enacted laws in some  or all of the main areas of intellectual property 
law but have yet to bring them into force.  In Do minica, for example, most of the laws were passed by 
Parliament in 1998-99, but are not expected to en ter into force until late 2007.  The authorities note 
that the main reason for the delays is the complexity of the laws, and the need for technical assistance.  
These issues are being dealt with, often with the assistance of WIPO. 
179. The TRIPS Council examined the intellectual pr operty legislation of Dominica and Grenada 
in 2001, and Antigua and Barbuda in  2003.  Questions were raised on the scope of protection, national 
and most-favoured-nation treatment provided to na tionals of other WTO Members, the types of 
intellectual property covered, the compliance of th ese laws with TRIPS provisions, the procedures 
followed in the granting of intellectual property righ ts, and the provisions for enforcement.  Answers 
were provided to these questions. 
180. Some of the OECS Members signed intellect ual property agreements during the review 
period (Table III.9). 
181. Under the 2002 Cooperation Agreement Between  the OECS and WIPO, the two parties 
agreed to act in close cooperation, on matters of mutual interest with a view to harmonizing their 
efforts towards greater effectiveness.59  The agreement identifies nine fields for cooperation, including 
updating information on IPR laws and regulations in the OECS member states through mutual 
exchange of data and information. 
                                                      
59 The full text of the agreement is available in WIPO document WO/CC/48/2, 24 July 2002.  
Viewed at:  http://www.wipo. int/documents /en/document/govbody/wo_gb_cc/pdf/cc48_2.pdf. WT/TPR/S/190 Trade Policy Review 
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Table III.9  
Membership in international instruments on intellectual property rights 
 Entry into force 
Convention/Agreement ATG DMA GRD KNA LCA VCT 
The Convention Establishing the Worl d Intellectual Property Organization 
(1970) 2000 1998 1998 1995 1993 1995 
The Berne Convention for the Protection of  Literary and Artistic Works, Paris 
Text (1886) 2000 1999 1998 1995 1993 1995 
The Paris Convention for the Protection  of Industrial Property, Stockholm  
(1883) 2000 1999 1998 1995 1995 1995 
The Patent Cooperation Treaty (1970) 2000 1999 1998 2005 1996 2002 
Nice Agreement Concerning the International Classification of Goods and 
Services for the Purposes of the Registration of Marks (1957) n.a. 2000 n.a. 2005 2001 n.a. 
International Convention for the Protection of Performers, Producers of 
Phonograms, and Broadcasting Organizations (Rome Convention, 1961) n.a. 1999 n.a. n.a. 1996 n.a. 
Convention for the Protection of Producers of Phonograms Against 
Unauthorized Duplication of Their Phonograms (1971) n.a. n.a. n.a. n.a. 2001 n.a. 
Vienna Agreement Establishing an In ternational Classification of the 
Figurative Elements of Marks (1973) n.a. n.a. n.a. n.a. 2001 n.a. 
World Intellectual Property Organization Copyright  Treaty (1996) n.a. n.a. n.a. n.a. 2002 n.a. 
WIPO Performances and Phonograms Treaty (1996) n.a. n.a. n.a. n.a. 2002 n.a. 
 
n.a. Not applicable. 
 
Source:  World Intellectual Property Organization. 
IV. TRADE POLICIES BY SECTOR 
(1) AGRICULTURE  
182. Agriculture has continued to lose share of GDP in the OECS countries as a group, falling 
from 7.2% of GDP in 2000 to 5.5% in 2005.60  The decline reflects the stronger growth of services 
and construction, but also the cont raction of activity in traditional agriculture, particularly bananas 
and sugar. 
183. The banana industry has continued to lose gr ound in the Windward Islands;  it accounted for 
just about 1% of nominal GDP in 2005, compared with some 3% in 2000.  In 2004-05, the banana 
industry was severely affected by plant disease and by  the destruction of banana cultivation areas by 
hurricane Ivan.  The restructuring of the indus try has been taking place amid changes in the 
preferential regime for banana exports.  According to the IMF, changes in the EC banana regime 
introduced in 2006 may be a challenge for OECS banana producers, since their unit costs are high.61 
184. Banana producers in the OECS Members may be nefit from subsidies for fertilizers and other 
key inputs, and income tax exemptions.  Farmers have also benefited from actions by the Windward 
Islands Banana Development and Exporting Company Limited, which has tried to ensure more 
benefits to the farmers, as well as from EC as sistance under the Special Framework of Assistance 
(SFA), and (previously) under the STABE X export revenue stabilization scheme. 
185. The sugar industry in St. Kitts and Nevis closed during the review period:  the St. Kitts Sugar 
Manufacturing Corporation (SSMC), the sole producer  and exporter of sugar,  continued to make 
heavy losses up to 2005, when the Government deci ded to close it.  The industry's production costs 
                                                      
60 Including forestry and fisherie s, but excluding agri-business. 
61 IMF (2006). OECS-WTO Members WT/TPR/S/190 
 Page 39 
 
 
were about twice as high as the average selling price, and the lower prices offe red by the EC.  Sugar 
exports had taken place under quotas that gave acces s to the protected U.S. and EC markets. 
186. Agricultural policies in the OECS Members ar e formulated at the domestic level by the 
Ministries of Agriculture.  In all OECS Members ag ricultural products receive higher tariff protection 
than non-agricultural goods (Table III.2).  Some ag ricultural products, for example, such as fruit and 
vegetables, animals and products thereof, bevera ges and spirits, coffee, and tobacco benefit from 
substantially higher than average protection.  Non-automatic import licences for a number of agricultural products from non-CARICOM countries are required in most OECS countries, with the 
exception of Dominica, where due to tariffication, th e use of licensing is limited.  In St. Kitts and 
Nevis quantitative restrictions are applied on some agricultural products including eggs and 
vegetables.  
187. Most OECS Members maintain marketing boards for some agricultural imports;  
(Chapter III(3)(iii)(c)).  Fiscal incentives available to the agriculture sector in most OECS Members 
include partial or complete waiver of import duti es, and consumption and excise taxes on most inputs 
for the production of primary or processed agricultural commodities. 
(2) M
ANUFACTURING  
188. The manufacturing sector, including food processi ng, accounted for 5.2% of current GDP in 
2005, down from 5.6% in 2000.  Manufacturing co ntracted over 2000-02, but has recovered since, 
particularly in 2005, when the value of output increased by almost 11%.  The main value-added 
industries are food and beverages, soaps and deterg ents, paper and paperboa rd, and some electrical 
and machinery and equipment products. 
189. Exports of manufactured goods from the region are limited in value, but there are a few 
exceptions.  For example, exports of electrical pr oducts, mainly to the United States and Europe are 
expanding in St. Lucia.  Exports of switches, rela ys, fuses, and electrical capacitors, mainly to the 
United States, were the most important export item in  2005 for St. Kitts and Nevis.  Also, 60% of 
Dominica's exports are manufactured goods, mainly so aps and toothpaste;  and a third of St. Vincent 
and the Grenadines' exports are manufactures. 
190. The 2006 average MFN tariff on imports of i ndustrial products (ISIC-2 definition) was 
10.3%.  The highest average tariffs are applied on food, beverages and tobacco , clothing and apparel 
articles, and footwear, with a peak of 165% in Do minica (Table III.2).  Licensing requirements apply 
to a number of manufactured goods (e.g. oxygen in cylinder, acetylene, bleach, candles, PVC pipes, 
tyres, wooden doors, galvanized sheets, aluminium windows and doors) in most OECS countries, with 
the exception of Dominica. 
191. Incentive schemes for manufacturers include re lief from corporate tax and customs duties for 
approved manufacturing enterprises for up to 15 years, under the Fiscal Incentives Act 
(Chapter III(4)(iii)).  Free zones have been establishe d in St. Lucia to encourage the development of 
export-oriented manufacturing (Chapter III(3)(iv)(b)). 
(3) SERVICES  
(i) GATS commitments 
192. OECS Members have made a limited number of GATS commitments:  ranging between 4 and 
6 of the 12 main service areas, and ranging between  8 and 32 of the 160 subsectors (Table IV.1).  
There is some commonality among OECS countries in the sectors scheduled:  all OECS Members WT/TPR/S/190 Trade Policy Review 
Page 40 
 
 
have taken commitments in:  financial services;  t ourism and travel related services;  and recreational 
and sporting services;  most have also schedul ed commitments for communications services and 
transport services.  Antigua and Barbuda, Dominica , and Grenada made commitments in the extended 
WTO Negotiations on Telecommunications and have si gned the Fourth Protocol.  None of the OECS 
Members participated in the extended WTO Negotiations on Financial Services. 
193. Horizontal commitments scheduled by OECS  Members all included provisions regarding 
natural persons and commercial presence.  Th e provision of services through commercial presence 
generally requires local incorporation of the fore ign service provider, and a licence must be obtained 
to hold property in accordance with the different Alien Landholding Acts.  In the schedules of some 
countries, certain small business opportunities are re served for nationals (Dominica, Grenada. 
St. Kitts and Nevis, St. Lucia and St. Vincent and the Grenadines).  Employment of foreign natural 
persons is subject to work permit regula tions and labour a nd immigration laws. 
Table IV.1 
Sectors in which GATS specific commitments were made  
Sector-specific commitments Antigua 
and 
Barbuda Dominica Grenada St. Kitts 
and 
Nevis St. 
Lucia St. Vincent 
and the 
Grenadines 
◨  Part of sector/subsector has been scheduled 
■ All of sector/subsector has been scheduled 
..  No commitments scheduled 
Number of sectors in which commitments taken 6 4 4 5 5 5 
Number of subsectors in which commitments taken 32 20 19 8 9 8 
1. Business services  ◨ .. .. .. .. .. 
A. Professional Services  ◨ .. .. .. .. .. 
B. Computer and Related Services  ◨ .. .. .. .. .. 
C. Research and Development Services ■ .. .. .. .. .. 
2. Communications services  ◨ ◨ ◨ ◨ .. .. 
 B. Courier services .. ■ ■ ... .. .. 
 C. Telecommunication services ■ ■ ◨ ◨ .. .. 
7. Financial services ◨ ◨ ◨ ◨ ◨ ◨ 
 A. All insurance and insurance-related services  ◨ ◨ ◨ .. ◨ ◨ 
 C.  Other financial services .. .. .. ◨ .. .. 
8. Health and related social services   .. .. .. .. ◨ ◨ 
 A. Hospital services .. .. .. .. ■ ■ 
9. Tourism and travel related services   ◨ ◨ ◨ ◨ ◨ ◨ 
 A. Hotels and restaurants (incl. catering) ◨ ◨ ◨ ■ ◨ a ◨ 
 B. Travel agencies and tour operators .. .. .. .. .. .. 
 C. Tourist guides services .. .. .. .. .. .. 
10. Recreational and sporting services ◨ ◨ ◨ ◨ ◨ ◨ 
 A. Entertainment services ■ ■ ■ ■ ■ ■ 
 D. Sporting and other recreational .. ■ ■ ■ ■ ■ 
11. Transport services ◨ .. .. ◨ ◨ ◨ 
 A. Maritime Transport Services ◨ .. .. ◨ ◨  ◨ 
 H. Auxiliary services  .. .. .. .. ◨ ◨ 
 
Note Maximum number of sectors=12;  subs ectors=160.  The table reflects commitments with respect either to market access or 
 national treatment, and in any mode of supply. 
 a The commitment scheduled includes CPC 5126, which is with in the scope of general construction work for buildings. 
 
Source:  WTO GATS Schedules. OECS-WTO Members WT/TPR/S/190 
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194. All OECS Members, with the exception of Anti gua and Barbuda have submitted initial offers 
on services in the DDA negotiations;  however, as at mid 2007 none had submitted revised offers. 
(ii) Telecommunications 
195. Only Antigua and Barbuda, Dominica, and Grenad a participated and presented an offer in the 
WTO Negotiations on Basic Telecommunications Services.  The commitments made during the 
Uruguay Round reserved commercial presence in voice telephony and other services for the 
incumbent, Cable and Wireless, during the period of  its original exclusive licensing arrangement.  
After this period, the offers generally give unr estricted market access for all services, with the 
exception of Antigua and Barbuda.  The provision of electronic mail, internet, and other services was 
opened, provided the network of exclusive operators  is used for the provision of those services. 
196. Telecommunications is a notable case of where liberalization and great er regional cooperation 
have moved forward hand-in-h and.  Up until 2000, Cable and Wireless provided all 
telecommunications services in five of the OECS Members (Dominica, Grenada, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines) und er exclusive licences, with expiry dates ranging 
from 2000 in St. Lucia to 2024 in St. Kitts and Nevis. 
197. Liberalization of the telecommunications ma rket began in 1998 under the OECS Economic 
Diversification Programme.  The process was give n significant impetus when Marpin Telecoms and 
Broadcasting Ltd was granted a licence to provide telephone services in Dominica following a court proceeding with Cable and Wireless over the legalit y of its monopoly rights.  The five countries 
participated in the OECS Telecommunications Refo rm Project funded by the World Bank and, in May 
2000, signed a Treaty Establishing the Eastern Ca ribbean Telecommunications Authority (ECTEL):  
the market was to be liberalized within a mi nimum of 12 months and a maximum of 18 months 
beginning 1 April 2001.  New national Telecommunica tions Acts were promulgated in the respective 
countries in 2000 and 2001 and national telecommuni cations regulatory commissions (NTRCs) were 
established. 
198. ECTEL has an advisory and coordinating role with respect to NTRCs on telecommunications 
regulation, and is charged with ensuring a compe titive, efficient, universally available service to 
OECS member states.  It is head ed by a Council of Ministers (comprising ministers responsible for 
telecommunications in the ECTEL states, and the Di rector-General of the OECS).  The Council of 
Ministers gives policy direction to a board of  directors consisting one  member fro m each ECTEL 
contracting state, appointed by Ministers.  The ECTEL Directorate is responsible for the day to day 
operations of the organization and is headed by  a managing director.  The national NTCRs are 
responsible for regulation of the telecoms sector in  each contracting state.  They are required by law 
to liaise and consult with ECTEL on various regulat ory issues, including licensing, interconnection, 
spectrum management, pricing and tariffs, numbering,  and dispute resolution.  Individual licences 
may only be granted by national Ministers upon the recommendation of ECTEL.
62 
199. The national Telecommunication Acts are largely the same in all OECS ECTEL member 
states, as are the various implementing regulations.63  These regulations have been developed and, at 
                                                      
62 ECTEL online information.  Viewed at:  http ://ectel.int/ectelnew-2/Ne wsletters/ECTEL%20Mag% 
20LOWRES.pdf. 
63 ECTEL is responsible for putting together draf t template acts and regulations.  ECTEL Member 
countries are then responsible for enacting national laws and regulations, and during this process national governments may make small changes to the uniform legislation. WT/TPR/S/190 Trade Policy Review 
Page 42 
 
 
May 2007, a number of additional regulations were  at various stages of adoption by the OECS 
ECTEL contracting states.64 
200. As part of the World Bank Telecommunicati ons and ICT Development project, the ECTEL 
Treaty, and national Telecommunicati ons Acts and regulations are bei ng reviewed.  According to the 
authorities, there are, inter alia , some concerns about possible conflicts between the 
Telecommunications Act and regulations;  and th e responsibilities of ECTEL and the NTRCs need to 
be delineated more clearly.  The review is under way and the estimated time of delivery is 
December 2007. 
201. As specified in national Telecommunication Acts, the provision of telecommunications 
services and the operation of a network require licen ces;  these may be individual or class licences, 
and their terms and conditions are determined by th e Minister in charge of telecommunications in 
consultation with ECTEL.  Individual licences are largely for infrastructural services, and class 
licences are for value-added services.  The criteria to  be taken into account for granting a licence are, 
in general, include the legal status, and the fina ncial and technical capacities of the applicant.  
Regulations are being developed to  establish universal service funds;  in the absence of these, there 
are no universal service requirements in force (mid 2007).  Quality of service regulations, stipulating 
the broad parameters that providers are obligated  to meet, have been developed and have been 
approved by the ECTEL Council of Ministers for adoption by the contracting states. 
202. The Telecommunications Acts and Interconnecti on Regulations stipulate that interconnection 
rates should be cost-oriented.  ECTEL is in th e process of consulting on cost models for the 
determination of cost-oriented interconnection rates.  All inte rconnection agreements must be 
approved by the NTRCs.  The authorities note that they are seeking to revise the Interconnection 
Regulations to improve NTRC capacity to regulate interconnection.  The interconnection agreements 
that have already been signed between providers are for five years, and may be revised when they are 
up for review. 
203. In principle tariffs are determined freely by  the suppliers.  Where there is not enough 
competition to determine tariffs by market forces, and where services are provided by a major 
supplier, tariffs are regulated by the NTRCs and by ECTEL under a Price Cap Plan. 
204. There are no limits on foreign ownership of telecommunications companies in any of the 
OECS ECTEL members, nor are there citizenship  requirements applied to directors.  All 
telecommunications licensees, however, must be estab lished or registered as local companies.  Cross-
subsidization is not permitted.  Some OECS ECTEL members apply tel ecommunications-specific 
taxes, and in some others these have been replaced by the VAT. 
205. Since 2001, there have been a number of new en trants (individual licensees) into the basic 
telecoms market, particularly with respect to mobile and internet services.  There was some 
consolidation in the mobile market, however with  the takeover of Cingular Wireless by Digicel in 
2005.  A number of providers have obtained both in dividual and class licences but have not yet started 
operations. 
                                                      
64 Regulations have been developed on:  interconnection;  licensing and authorization;  fees structure; 
confidentiality in networks and services;  private networ k leasing;  terminal equipment and public networks;  
spectrum management;  retail tariff;  numbering;  and licensing classification.  According to ECTEL, aspects of 
the numbering regulations remain outstanding.  Regulations are also being developed on quality of services, exemptions; universal service;  and dispute resolution. OECS-WTO Members WT/TPR/S/190 
 Page 43 
 
 
206. The incumbent, Cable and Wirel ess, remains the sole provider of fixed-lined services in the 
ECTEL member states, with the exception of Dominica:   nevertheless, certain fixed-line tariffs have 
fallen.  International rates (outsi de of the Caribbean region) gene rally fell quite significantly as a 
result of tariff rebalancing by Cable and Wireless fo llowing liberalization: it raised the price of local 
calls and cut the price of international calls.  Tari ffs for local calls were subsequently reduced as the 
result of a Price Cap Plan agreed between ECTEL, its member states, and Cable and Wireless on 30 July 2004;  they are now below pre-liberalizatio n levels.  Tariffs for fixed-line calls within the 
Caribbean region have not changed and were fixed as part of an agreement between OECS countries 
and Cable and Wireless in 2002.  The fixed-line rent al charge, however, has been increased, almost 
across the board. 
207. One of the key outcomes of liberalization h as been the rapid growth in cellular phone 
penetration rates across all ECTEL members.  This  has been driven prim arily by increases in the 
availability of pre-paid mobile services and afford able handsets.  Competition in the cellular market 
began in 2003 with new entrants in the market.  Ho wever, mobile call tariffs  between networks have 
not changed substantially since liberalization.  
208. Internet penetration has grown gradually in each OECS ECTEL member, but remains 
relatively low overall;  ranging from 5% in St. Luci a to 18% in St. Kitts and Nevis (March 2006).  
Market competition does appear to have had an impa ct on the price and quality of services:  according 
to the authorities, price reductions implemented by Cable and Wireless, the main provider of 
broadband in most countries, have stimulated a significant shift from dial-up to broadband usage. 
209. A new fibre optic cable, owned by Global Cari bbean Network has been landed in all of the 
ECTEL members, and has been licensed in four (St. Kitts and Nevis, St. Vincent and the Grenadines, 
Dominica, and Grenada) to sell capacity to existing providers.  According to ECTEL, no applications 
have yet been made for licences to provide tel ecommunications services directly to the end user. 
210. Antigua and Barbuda is the only OECS-WTO Member that did not sign the ECTEL Treaty.  
The state-owned Antigua and Barbuda Public Utilities Authority (APUA) has a monopoly on all 
domestic services.  It is the only provider of domestic fixed-line services, but competition has been 
introduced in the mobile market, as it has sub licenced two companies (Digicel and Cable and 
Wireless) to provide mobile services, as well as providing these services itself.  Cable and Wireless still has a monopoly on international fixed-line servic es;  however, according to the authorities a new 
Telecommunications Bill currently under consider ation would open up international fixed-line 
services to competition.  Eleven licences have been gr anted for the provision of internet networks and 
services:  four of the companies are operational.  Call back and by-pass are explicitly prohibited. 
211. The authorities indicate that Antigua and Barbuda has no immediate plans to participate in the 
ECTEL Treaty, since the government owns APUA.  They indicated that its structure makes 
membership problematic.  APUA simultaneously provides water, electricity and domestic 
telecommunications services and the company facilit ates cross-subsidies from the telecoms sector to 
electricity and water utility sectors.  Another consid eration is that the Government of Antigua and 
Barbuda does not pay APUA for its telephone calls. 
(iii) Financial services 
212. All OECS Members operate both on-shore and o ff-shore financial services.  In general, 
offshore and onshore financial-services companie s and banks are incorporated under different 
legislation and are subject to different provisions.  OECS Members are at various stages of WT/TPR/S/190 Trade Policy Review 
Page 44 
 
 
consolidating regulation of their onshore and offs hore sectors under a single unit (excluding domestic 
banks, which are regulated by the Eastern Caribbean Central Bank (ECCB)). 
213. None of the OECS Members participated in  the WTO extended Negotiations on Financial 
Services;  most have made GATS commitments on reinsurance services. 
(a) Banking 
214. Onshore banking across the OECS is open to fore ign investment.  There are no limitations on 
foreign investment and foreign- owned banks may establish subsidiaries or branches in each of the 
OECS Members.  There are no residency or citizen ship requirements applied to bank managers or 
directors, only that they must be considered fit and proper to do the job in accordance with certain 
criteria.  Banks (both local and foreign financial in stitutions) must have a place of business within the 
member state in which they are licensed. 
215. Weighted average spreads between deposit and lending varies from 5.3 percentage points in 
St. Kitts and Nevis to 7.9 percentage points in St . Lucia.  Exchange controls have been removed 
during the review period, and none of the OCES Memb ers has legislation that prevents borrowing or 
placing deposits with banks located abroad.  Credit  unions play an important role in the domestic 
financial sector in a number of the OECS Members. 
216. The ECCB Agreement (1983) gives the ECCB the authority to regulate banking businesses on 
behalf of, and in collaboration w ith, participating governments.  Banks must be licensed by the 
respective Ministry of Finance.  In all cases, app lications are investigated by the ECCB, which makes 
a recommendation to the Ministry of Finance in the respective Member.  Licences are specific to the 
country where they are granted. 
217. In the early 1990s, ECCU Members harmonized their onshore banking legislation, based 
upon a template Uniform Banking Act.  In 2005, the Uniform Banking Act was amended and by all 
OECS countries have incorporated the revisions into their domestic banking legislation.65  In general, 
the revisions upgrade legislation in relation to th e Basle Core Principles.  A foreign financial 
institution intending to open a branch or affiliate is now required to provide certification that the 
banking supervisor in the jurisdiction in which it w as incorporated has no objection to its application 
for a licence, and evidence that it is  subject to comprehensive superv ision on a consolidated basis by 
the authorities in its home jurisdiction. 
(b) Insurance 
218. There are no limitations on foreign investment in  insurance companies in any of the OECS 
countries and, in most jurisdictions, insurance co mpanies are foreign-owned.  The only reinsurance 
company is registered in Grenada.  In most ju risdictions there are no laws preventing citizens and 
companies from obtaining insurance coverage from firms located abroad;  however in Grenada and 
St. Vincent and the Grenadines this is allowed onl y when similar protection is not available from 
locally registered companies. 
219. Each OECS Member has its own insurance legisl ation.  However, new insurance legislation, 
which will be harmonized among all Members, is in an advanced stage of drafting (mid 2007). 
                                                      
65 ECCB online information.  View ed at:  http://www.eccb-central bank.org/About/legal-banking.asp. OECS-WTO Members WT/TPR/S/190 
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(c) Offshore banking and insurance 
220. All OECS Members have offshore banking and in surance legislation.  Offshore banks may 
conduct banking business only in currencies other than  the EC$;  and, generally, offshore banks and 
insurance companies are precluded from conducting bus iness with citizens in the country in which 
they are registered.  Offshore companies benefit from various tax exemptions (e.g. corporate tax and 
stamp duty).  In some jurisdictions, there are citizenship requirements for directors of offshore companies. 
221. In June 2000, the G7 Financial Action Task Fo rce (FATF) issued a report on the state of 
money laundering in various offshore centres.
66  On the basis of this re port, Dominica, St. Kitts and 
Nevis, St. Vincent and the Grenadines, and Grenad a were considered to be non-cooperative, with 
differences between these countries regarding the ex tent of the shortcomings in their regimes.67  As a 
result of the report and the changing international e nvironment, legislative and institutional reforms to 
combat money laundering were strengthened in all six of the OECS countries.  The four countries 
identified as non-cooperative had been removed from th e FATF list by 2002.  As a result of the report 
there were a number of bank closures in Dominica, Grenada, and St. Vincent and the Grenadines.  
The authorities have indicated that such closures we re also related to the strength of the regulatory 
regime which is in place with respect to the sect or and that the regime was relatively stringent in 
comparison to other jurisdictions. 
222. There are no offshore insurance companies in Dominica and Grenada;  12 in Antigua and 
Barbuda;  14 in St. Vincent and the Grenadines;  17 in St. Lucia, and 48 in St. Kitts.  Information is 
not available for Nevis. 
(iv) Air transport 
223. Air transport is considered to be crucial in supporting the tourism sector on which most OECS 
Members rely.  All but two OECS Members (Dominica and St. Vincent and the Grenadines) have international airports;  developing the capacity to accept flights from major international destinations 
is considered a priority by both.  In most OECS  Members, significant investment has been made to 
upgrade airport infrastructure during the period under review. 
224. The main airports in the OECS are the V.C. Bird International Airport in Antigua, and the 
Hewanorra and G.F.L Charles Airports in St. Luci a.  There were just over 400,000 passenger arrivals 
in each of these countries in 2006, significantly  more than in the other OECS countries. 
225. Air transport policy is coordinated and set at  the OECS level by the OECS Civil Aviation 
Regulatory Board, which brings together the OECS  Ministers responsible for civil aviation.  The 
Board formulates and manages aviation policy and is  in charge of reviewing aviation laws and 
regulations within the OECS.
68  The Directorate of Civil Aviation of the Eastern Caribbean States, 
headquartered in Antigua, provides safety and securi ty oversight through a system of inspection, 
investigation, maintenance, monitoring, and licensi ng, and is in charge of ensuring that all civil 
aviation activities in OECS ICAO contracting parti es (all OECS countries except for Dominica) are in 
accordance with the applicable IC AO annexes.  The Directorate operates under the direction of the 
OECS Civil Aviation Regulatory Board. 
                                                      
66 FATF online information.  Viewed at:  http://www.fatf-gafi.org/dataoecd/57/22/33921735.pdf. 
67 Grenada was added to the list of noncooperative countries in September 2001. 
68 OECS online information.  Viewed at:  http://www.oecs.org/dca_website/General_information.htm. WT/TPR/S/190 Trade Policy Review 
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226. The main civil aviation legislation in each OECS Member is the Civil Aviation Act;  new 
Civil Aviation Acts were promulgated between 2003 and 2005.  In general terms, licensing decisions 
take into account the existence of other air service s in the area, the period for which air transport 
services have been operated, safety, continuity, re gularity, and efficiency concerns, the financial 
resources of the applicant, and the type of aircraft to be used. 
227. In Dominica and Antigua and Barbuda there ar e no investment restrictions on the ownership 
of domestic carriers.  In Grenada, domestic carri ers must be substantially owned by citizens of 
Grenada or CARICOM.  No information was available with respect to St. Lucia, St. Kitts and Nevis, 
and St. Vincent and the Grenadines. 
228.  There are no domestically incorporated airlines in  Dominica, Grenada, or St. Kitts and Nevis.  
LIAT, Caribbean Star, and Carib Aviation are incorp orated in Antigua and Barbuda;  Carib Aviation 
operates flights mainly between Antigua and Barb uda and Antigua and St. Kitts and Nevis.  In 
St. Lucia one airline, Inter-Caribbean Express, offers  charter flights to the Grenadines.  St. Vincent 
and the Grenadines has two domestically incorpor ated airlines:  SVG Air and Mustique Air. 
229. Cabotage is not restricted in Antigua and Barbuda .  In Grenada it is in principle reserved for 
domestic carriers, but since there are no locally in corporated airlines, SVG provides these services;  
its permit to do so is renewed annually. In St. Vin cent and the Grenadines cabotage is restricted to 
local carriers. 
230. During the period under review there has been some  consolidation within the airline industry.  
In February 2007, the two main OECS airlines, LIAT and Caribbean Star, merged their flight 
schedules under the LIAT name as a first step towa rds a full merger.  According to the authorities, 
both airlines had been running at a loss, and within  the introduction of the combined schedule, the 
number of flights was reduced and ticket prices were increased.   
231. All commercial airports in OECS Members are owned by the Government and there are no 
plans to privatize them.  In all except St. Vin cent and the Grenadines, airports are managed by 
government-owned statutory bodies;  in St. Vincen t and the Grenadines, they are managed by the 
Ministry of National Security, Air and Sea-Ports De velopment.  In all Members private and foreign 
participation is permitted only with respect to some  auxiliary services;  for example, in most, ground 
handling services are provided by private companies. 
232. Aviation agreements with third parties are negotia ted through bilateral a nd regional channels.  
Several OECS Members have bilateral agreements .  A Multilateral Transport Agreement exists at 
CARICOM level. 
(v) Maritime transport 
233. As estimated by UNCTAD, the costs of freight as a percentage of the value of imports in 
2003 generally ranged from 7.4% in Domini ca to 11.5% in St. Kitts and Nevis.69  The developing 
country average for that year was 9.1%.  Grenada,  however, was an outlier at 20.1%.  The authorities 
suggest that this high figure may have been the re sult of a container surcharge applied by shipping 
companies on cargos to Grenada. 
234. The efficiency of ports, as measured by the av erage number of containers unloaded per hour, 
varies widely between OECS countries:  from 10- 12 containers per hour in St. Vincent and the 
Grenadines to 22 containers per hour in St. Lucia. 
                                                      
69 Estimates were not available for Antigua and Barbuda. OECS-WTO Members WT/TPR/S/190 
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235. Maritime transport policy is formulated and im plemented at the national level.  Antigua and 
Barbuda, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines made commitments in 
maritime transport under the GATS;   no commitments were made by other OECS Members with 
respect to transportation other than maritime transport. 
236. In volume terms, the vast majority of the OECS's cargo trade is transported by sea.  No 
government or other cargos reserved for domestically  flagged vessels or for ships owned or operated 
by the Government. 
237. In all OECS countries there are limitations to  foreign ownership of domestically flagged 
vessels.  In St. Lucia and Antigua and Barbuda, St. Kitts and Nevis, and St. Vincent and the 
Grenadines, a locally incorporated co mpany must be established to be e ligible to fly the domestic flag.  
In St. Vincent and the Grenadines the companies' main office must also be in the country.  In 
Grenada, citizenship requirements are more onerous as a foreign company wishing to register a vessel 
under the national flag must establish a company with  its head office in Gr enada and the majority 
ownership of the company must be vested in Grenad ian citizens.  No information is available on the 
situation in Dominica. 
238. There are no restrictions on international p assenger and cargo maritime transport services in 
any of the OECS Members.  St. K itts and Nevis does not restrict cabotage;  in all other Members it is 
restricted to domestically flagged ships, and in St . Vincent and the Grenadines a trading licence must 
also be obtained. 
239. Almost all commercial ports are government-own ed and are generally managed by a state-
owned port authority in each country (the authorities in St. Lucia, St. Kitts and Nevis, and Dominica 
have responsibility for both air and sea ports).70  The port authorities in most OECS countries indicate 
that the law does not prevent them from contractin g out port services to the private sector, including 
to foreign companies.  In practice, however private sector participation is limited. 
240. Over the review period, all OECS countries have  made investments in order to bring their 
ports into compliance with the ISPS code;  in some, the project is ongoing. 
241. All except St. Lucia and Grenada maintain an In ternational Ships' Registry, and St. Lucia is 
considering establishing one.  Ships registered unde r the respective national flags are subject to a 
number of fees, some of which vary according to the size of the vessel.  Information was not generally available on the revenue accruing to OECS governme nts from their respective international maritime 
registers. 
(vi) Tourism 
242. All OECS Members made commitments in th eir GATS Schedule of Specific Commitments 
for hotel development.  They generally bound market  access for the development of hotels in excess 
of 50 rooms, subject to alien landholding and excha nge control regulations.  Hotel development of 
less than 50 rooms (100 in St. Lucia) may be subject  to an economic needs test, and remains unbound.  
In all countries, national treatment was bound for co mmercial presence, but subject to the payment of 
a withholding tax.  In some cases, other restrictio ns were scheduled:  in St. Kitts and Nevis, for 
example, ownership of non-ethnic restaurants was reserved for nationals.  St. Vincent and the 
Grenadines made commitments with respect to travel agencies and tour operators, and tourist guide 
services. 
                                                     
 
70 Exceptions include Campden Park, in St. Vincent and the Grenadines, in which 49% of the shares are 
owned by the private sector. WT/TPR/S/190 Trade Policy Review 
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243. The main sources of stayover tourists to the OECS include other Caribbean countries, the 
United States, the United Kingdom, and to a much lesser extent, Canada. 
244. Tourism policy is formulated at the country level.  In each Member, the Ministry of Tourism, 
or the ministry in charge of tourism is responsib le for policy formulation and implementation.  The 
role of the tourist board is generally confined to  marketing and promotion activities.  Private sector 
associations are also active in each country. 
245. All OECS Members offer fiscal incentives for hot el development.  These include exemptions 
from customs duties and other taxes on imports, ge nerally under the respective Hotels Aid Acts, as 
well as corporate income tax exemptions.  The maxi mum period for corporate income tax exemptions 
varies from 10 to 25 years depending on the country, a nd longer tax breaks are generally available for 
larger projects.  Antigua and Barbuda, St. Kitts and Nevis, and St. Lucia introduced specific fiscal 
incentives schemes for a finite period, to encour age hotel development in preparation for the 2007 
Cricket World Cup.  The authorities indicated that, although the legislation governing tax exemptions provided for making them conditional on employment of local labour in Dominica, Grenada and St. 
Kitts and Nevis, they did not in fact  use this as a basis for incentives.  
246. While figures were available for some countries on the revenue forgone as a result of customs 
duty exemptions, no figures were available on revenue  forgone as a result of corporate income tax 
exemptions, hence it was not possible to ascertain  the full fiscal impact of these measures. 
247. All OECS Members raise a number of tourism related taxes, including on hotels and 
restaurants, on airline carriers, cruise ship passenge rs, and passengers leaving the country.  Passengers 
departing from OECS countries by plane are liable for various embarkation and other taxes ranging 
from EC$40 in St. Vincent and the Grenadines to EC $68 in St. Lucia (in some cases, lower rates are 
charged for nationals).  Departure taxes are also le vied on passengers leaving the islands by boat.  
Cruise passenger head taxes are levied by all exce pt for St. Vincent and the Grenadines, and range 
from US$1.50 in St. Kitts and Nevis to US$6.50 in St. Lu cia.  Hotel and restaurant taxes, levied in all 
OECS countries range from 7.5% to 10%.  Other, add itional taxes are specific to individual countries.  
Information on the revenue gains from some of these taxes, was available but a full picture of the 
revenue importance of these taxes was not. 
(vii) Professional services 
248. Only Antigua and Barbuda undertook specifi c commitments under the GATS on professional 
services:  legal services (only for consulting in the ho me law of the service provider, and international 
law);  accounting, auditing and boo k-keeping services;  taxation services;  architectural services;  
engineering services;  and medical services. 
249. OECS countries have different regimes with respect to professional services.  In some 
specific laws regulate certain professional services, and in others, most professional services are totally unregulated.  According to the authorities in each OECS Member, no professional services are 
exclusively reserved for nationals.  In addition, none of the OECS Members have signed mutual 
recognition agreements in professional services. 
250. Beginning in 2003, steps have been take n to develop harmonize d legislation across 
CARICOM countries for professionals (including pr ofessional service suppliers as defined under the 
GATS) to facilitate the movement of persons within the region.  According to the authorities, a Draft 
Model Professionals Bill has been developed at the CARICOM level.  This, inter alia , deals with 
requirements and procedures for registration and licen sing, which should form the framework of laws OECS-WTO Members WT/TPR/S/190 
 Page 49 
 
 
for specific professions.  Discussions with the medical  profession are the most advanced:  legislation 
for specific medical professionals has been drafted a nd is forming the basis for national consultations.   
251. All OECS Members have enacted the Caribbean  Community Skilled Nationals Act.  This 
allows CARICOM nationals who are university graduates to enter and work in any other participating 
CARICOM state without requiring a work permit.   This may, indirectly, assist the market access of 
professional service providers once implementing regula tions are in place.  In addition, all OECS 
Members are contracting parties to the CARICO M Agreement Establishi ng the Council of Legal 
Education.   In signing on to the agreement, the respective governments unde rtake to recognize that 
any person holding a Legal Education Certificate fu lfils the training requirements for practice in its 
territory. 
(viii) Other offshore services 
252. Besides financial institutions71, international ship registries, and economic citizenship 
programmes, the offshore industry consists of  management companie s and other commercial 
companies,  all of which are generally referred to as international business companies (IBCs). 
253. Only limited information was available from OECS Members on the number of registered 
IBCs and the contribution of offshore activities to employment, investment and government revenue.  
St. Vincent and the Grenadines reported 6,632 regist ered IBCs, and Grenada reported 868;  Dominica 
reported that government revenue from the offshore sector in 2006 was EC$2.23 million. 
254. The registration and licensing of IBCs is gene rally regulated by an International Business 
Corporation Act (with the exception of St. Kitts and Ne vis);  this is distinct from the Companies Act, 
which applies to on-shore enterprises.  In the main , IBCs are free to invest in the local economy only 
to the extent that the investment relates to the development of their business and the delivery of the 
services offered.  IBCs enjoy a wide range of be nefits including exemption from all local taxes, 
duties, and other similar charges. 
  
                                                     
 
71 Offshore banks, insurance companies, trusts, foundations, and mutual funds. OECS-WTO Members WT/TPR/S/190 
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REFERENCES 
 
IMF (2006), St. Vincent and the Grenadines:  2005 Article IV Consultation-Staff Report, and Public 
Information Notice on the Executive Board Discussion , IMF Country Report No. 06/205;  June. 
 
IMF (2007), Eastern Caribbean Currency Union:  2006 Regional Discussions-Staff Report, and 
Public Information Notice on the Executive B oard Discussion on the Eastern Caribbean Currency 
Union .  IMF Country Report No. 07/96, March 2007. 
 
Mlachila, Montfort and Paul Cashin (2007), "The  Macroeconomic Impact of Trade Preference 
Erosion on the Windward Islands" , Eastern Caribbean Currency Union: Selected Issues , IMF 
Country Report No. 07/97, March.  OECS High Commission in Ottawa (2007), About the Eastern Caribbean States .  Viewed at:  
http://www.oecs.org/ottawa/ecs.html. 
 
World Bank (2005), Organization of Eastern Caribbean States: Towards a New Agenda for Growth,  
Report No. 31863-LAC.  Viewed at:  http://site resources.worldbank.org/LACEXT/Resources/258553-
1122984920359/OECS.pdf.  
WTO (1998a), Trade Policy Review:  Jamaica , Geneva. 
 WTO (1998b), Trade Policy Review:  Trinidad and Tobago , Geneva. 
 
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