Buenos días, bienvenidos todos a este Foro sobre ¨Perspectivas Económicas y Desafíos para Centroamérica y el Caribe en la Economía Global¨.

Permítanme ante todo agradecer al Presidente Dr. Leonel Fernández por honrarnos con su presencia en el día de hoy y por abrirnos las puertas de FUNGLODE para realizar este importante encuentro que reúne a ministros y autoridades de Economía, Comercio, Industrias y de Relaciones Exteriores, así como a representantes del sector privado de América Central y del Caribe. Deseo reconocer también a la Primera Dama, Doña Margarita Cedeño, por acompañarnos en el día de hoy.

Un especial agradecimiento al Dr. Andrés van der Horst, ministro y director de Centro Nacional de Competitividad de República Dominicana, por co-organizar y apoyar la organización de este encuentro en el marco del V Foro de Competitividad de las Américas.

Deseo también agradecer al Sr. Marco Herrera, Asunción Sanz y a todo el equipo de FUNGLODE por co-organizar junto con la OEA esta reunión en el día de hoy.

A todos los ministros, embajadores y representantes del sector privado

Damas y caballeros, gracias por acompañarnos.

Hace a penas un mes y medio, los Jefes de Estado de SICA y CARICOM se reunieron en San Salvador para relanzar una nueva era en la integración entre Centroamérica y el Caribe. El gobierno de El Salvador, bajo el liderazgo del Ministro Hugo Martínez, puso la integración SICA-CARICOM como prioridad y organizó la Tercera Cumbre SICA-CARICOM. LA OEA y la Presidencia pro-tempore del SICA organizamos el Encuentro Empresarial SICA-CARICOM para facilitar y promover oportunidades de negocios, comercio e inversión entre Centroamérica y el Caribe.

Para la OEA es muy grato contribuir y tomar parte en este proceso histórico del relanzamiento de la integración entre Centroamérica y el Caribe, pero también hacerlo en la compañía del Presidente Leonel Fernández, quien siempre ha mostrado su vocación por la integración y la de República Dominicana como país puente entre las dos regiones.

El presidente Fernández lanzó en 1997 su visión de construir un puente entre el Caribe y Centroamérica y una alianza estratégica entre las dos regiones. Una visión para una mayor integración SICA-CARICOM que incluía un acuerdo de libre comercio entre ambas regiones, con énfasis en la promoción empresarial conjunta, el turismo y el fomento de inversiones y exportaciones.

Señor Presidente, su sueño de una integración SICA-CARICOM no solo está vivo sino que hoy se ha tornado en una necesidad. Solo con una mayor integración ambas regiones podrán enfrentar desafíos comunes y de importantes proporciones como la crisis económica global, la inseguridad, el cambio climático, los desastres naturales y altos niveles de pobreza. Ambas regiones tienen el reto de promover una diversificación productiva que tenga en cuenta el potencial humano, los mercados laborales, y la capacidad institucional para sostener las condiciones clave para el crecimiento y la prosperidad en sus sociedades.

Ladies and gentlemen, this meeting today is a follow up to the SICA-CARICOM Summit and to the Meeting of CEOs which we organized last August in San Salvador. We believe that the meeting of CEOs contributed not only to build support for the re-launching of trade negotiations between Central America and the Caribbean but to strengthen business, personal ties and alliances between leaders of the private sector of both regions. We look forward to the next meeting of CEOs which the Government of Trinidad and Tobago has so kindly offered to host next year May. Today, we want to hear your ideas on the way forward and to address common challenges in the face of the global economic downturn.

The principal question and challenge for the leaders of this hemisphere is how to create peaceful societies and sustainable economies that can provide prosperity and security on the basis of existing domestic and international opportunities and capacities, including human potential and creativity in society, taking into account the existing volatility, distortions and threat to our societies.

At the OAS we are firm believers that the time has come for greater SICA-CARICOM integration, that we have some important strategic opportunities ahead and therefore we must persevere to strengthen economic relations, increased business development, trade and investment between these two regions.

I would like to highlight the important role that Belize, one of CARICOM’s Member States and also a member of SICA, has played in recent years in enhancing and deepening the CARICOM-Central America relationship.

The current global economic crisis has hit several countries in our hemisphere hard, particularly in Central America and the Caribbean. Today we have the privilege of having with us Alicia Barcena to shed some light on the state of the Caribbean and Central American economies as well as President Figueres, Minister Tewarie and SICA Secretary General Juan Daniel Aleman to discuss essential elements for charting the course of SICA-CARICOM development in the global economy. We are also happy to have with us Julissa Reynoso, Deputy Assistant Secretary of State of the United States, and João Aguiar Machado, the European Commission Deputy Director of the Directorate General for TRADE, in charge of Services and Investment and Bilateral Trade Relations with Asia, Africa and the Americas, to offer comments on the cooperation and development agenda of Central America and the Caribbean.

It is well known that the consequences of globalization in our economies depend on the manner in which our countries integrate into the global economy. Diversifying the markets for exports is a strategy that produces higher returns in times of crises. Often, however, our small states have been locked in to export to certain markets via preferential schemes, the most important being the ones with the European Union.

Central America and the Caribbean have not taken advantage of opportunities steaming from complementarities and geographic location to insert themselves more successfully in the global economy. The high dependency on the US and European markets for exports and investments have had an adverse effect in the SICA and CARICOM economies during the global economic crisis.

The fall in export demand of goods and services; a decline in remittances from migrant workers; reduced foreign direct investment; reduced access to financial credit; some depreciation in the exchange rate; increased unemployment and deterioration of the fiscal balance and the balance of payments are among the most salient impacts of the global economic downturn in Central America and the Caribbean.

But, in addition, as more recent studies on productivity indicate, even though in the 1990s Latin America and the Caribbean experienced important growth rates and gains in the fight against poverty, our productivity performance has not been able to regain the levels seen before 1975s.

So productivity is one of the most important challenges facing not only SICA and CARICOM but the whole Latin American region in this global economy.

Therefore, it is my hope that you take advantage of networks such as the Inter-American Competitiveness Network, which we at the OAS are proud to support, to strengthen the SICA-CARICOM institutions responsible for promoting competitiveness and set out clear long term objectives for productivity increase, entrepreneurship, innovation and regulatory frameworks to develop innovation-driven, participative and inclusive economies.

It is a fact that all the countries represented here have the capacity to generate significant trade, open markets and foster strategic alliances in the face of the economic downturn. Sectors such as tourism, transportation, agribusiness, banking, energy and recycling have more to offer. We must find ways to overcome barriers to the full expansion of these sectors in Central America and the Caribbean.

Both regions need to increase market size and opportunities and to stimulate competition among countries and enterprises of roughly similar size and stage of development as is the case with CARICOM and Central America.

Combined, Central American and Caribbean region make up a market of more than 55 million people and 21 countries. Both regions must make the most of this, for the benefit of all of our people.

At present, trade in both regions is relatively modest, with the potential to increase. Trade with Central American countries accounted for only 2% of CARICOM’s trade with the world in 2010. This morning Alicia Barcena told us that intrarregional trade in Asia Pacific is 50% of total trade despite geographic dispersion. There is much that can be done to tap into the economic potential of both regions and enhance existing trade, which reached $ 754 million in 2010.

The Caribbean Community has had a Free Trade Agreement (FTA) with Costa Rica since 2006. The FTA accession clause provides for other Central American countries to accede to the FTA. Regrettably negotiations stalled in large part due to other negotiating demands on both parties. One of our main challenges remains transportation as it would facilitate increased trade and investment relations between the countries. The lack of direct or regular air and sea links is a real problem.

While there are opportunities for enhancing trade and investment between both sub-regions, there are also challenges and obstacles to achieve this objective, including the security environment, investment laws and business climate, business friendly legislation, sustainable energy availibility and pricing, quality and quantity of labor force, language issues, etc.

But we have no choice than to overcome these challenges and obstacles through political will and effective policy making.

I am therefore encouraged by the statements of CARICOM and SICA leaders that they intend to relaunch negotiations for a free trade agreement between both sub-regions, following conclusions of on-going negotiations with other countries and regions.

What next?

A focus on productivity and competitiveness in Central America and the Caribbean is necessary in light of the recent global economic crisis. Both regions can cooperate in their efforts to promote diversification that takes into account human potential, labor markets, the vulnerability of small countries, and institutional capacity to sustain the key conditions for growth and prosperity in their societies. Large gaps in labor productivity between the traditional and modern parts of the economy and labor flows from low productivity activity to high productivity activities are key for the development of both regions.

We also need to help develop private sector capacity, for which both regional and country approaches are needed, encouraging formation of networks and associations of entrepreneurs. Companies have an important role as agents of regional integration and are a source to share best practices related to production processes that result in increased productivity and growth of our economies.

Donors and international agencies should join forces to strengthen SICA-CARICOM relations by including in their objectives support to the SICA-CARICOM integration process as both regions seek to transform their economies and to meet the challenges of globalization, especially in terms of education and business development. We should take advantage of information technology and electronic commerce to overcome current challenges due to limited sea and air transport.

Regional international organizations, such as ECLAC, could provide great support to SICA-CARICOM integration by developing an anual review and analysis of the integration process, with an emphasis on opportunities and challenges for trade, investment and business alliances between CARICOM and SICA. Other issues that would benefit from the analysis are potential gains from collaboration in the areas of climate change and natural disasters. The OAS would be happy to organize a meeting annually for the presentation of the study.

With this meeting we hope to facilitate long lasting relationships between the Central American and the Caribbean ministries of Economy and Trade, Foreign Affairs as well as the business communities, helping re-energize SICA-CARICOM integration for economic growth, job creation and societies that are stable, peaceful and sustainable and continue governing under a strengthened democratic framework.

Mr. President, Ministers, Government representatives, Ambassadors, Private Sector representatives, Ladies and Gentlemen, I thank you again for your participation in today’s meeting.