CARICOM examines possible integration of local content legislation with existing treaty
A section of the gathering at the breakfast seminar
A section of the gathering at the breakfast seminar

A WORKING group within the Caribbean Community (CARICOM) is currently looking at the development of measures that allows for the application of local content legislation within the context of the Revised Treaty of Chaguaramas (RTC).
This is according to the Director of External Trade at the CARICOM Secretariat, Dr. Chantal Ononaiwu, as she addressed questions about how local content fits into the provisions of the RTC which focuses on integration. She was delivering a presentation at a breakfast seminar last Saturday at the Ramada Princess Hotel.

“The issue of local content is such an important one in the community that the Heads of Government have actually mandated a working group on local content to make recommendations, amongst other things, the development and application of local content legislation in the context of the revised Treaty and I stressed in the context of the revised Treaty because initiatives like this have to be situated within the context of the obligations that Member States have assumed under the Treaty and the framework that the Treaty provides for the Member States to exercise flexibility,” Dr. Ononaiwu said.

Established in 2001, the RTC governs the establishment of the CARICOM and the Caribbean Single Market Economy (CSME), which seeks to implement provisions for the removal of trade and professional restrictions and facilitate the free movement of capital and the coordination of economic policies.

This Treaty provides, inter alia, for integration of efforts in economic matters, co-ordination of foreign policies and functional cooperation in a list of areas including labour administration and industrial relations and social security among subscribing states.
However, this has brought into question the need for countries to make provisions to ensure that its own citizens benefit from their patrimony and unfair disadvantage some States may be subjected to from competition by larger firms from other nations.

To counter this, Guyana is implementing its local content legislation, which enshrines in law provisions that give preference to native citizens. Local content are policies imposed by governments that require firms to use domestically-manufactured goods or domestically supplied services.

With Guyana operating a nascent, but burgeoning oil and gas industry, and many foreign businesses circling the wagons to get in on a share of the pie, the government in 2021 secured a safeguard for Guyanese with the signing of the Local Content Act 2021.
Other Caribbean nationals, largely those from Trinidad, have questioned the compatibility of Guyana’s local content law with the provisions of the RTC.

However, both the Guyanese government and business community have remained firm that Guyanese must benefit from our resources.
On Saturday, the issue came up for discussion during the seminar, which was hosted by the Guyana Manufacturing and Services Association (GMSA). Dr. Ononaiwu noted that Guyana was not the only country in CARICOM concerned about having some level of local content.

“I don’t want to make a definitive pronouncement on how the local content legislation of Guyana is situated within the context of the Treaty. The court may at some point have to engage on that issue and I’m sure they will, whether it’s through their advisory jurisdiction or otherwise, provide guidance,” Dr. Ononaiwu said.

“This is more systemically being addressed. It’s not just about Guyana’s local content legislation but the policy that is occupying the attention of the Community. The policy is clear that there are mechanisms like this that countries feel that they have to have at their disposal. And so, the issue really is how do we develop measures like these within the context of the Revised Treaty.”

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