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ACS
Okays Transport Agreement |
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The Greater Caribbean
This Week
Norman Girvan (1) |
 The
7th Intersessional Meeting of the Association of Caribbean States Ministerial
Council was held in Port of Spain on July 10-11, 2003. The meeting provided a
useful opportunity to evaluate progress in building the Greater Caribbean region
as a Zone of Cooperation, as the ACS looks toward its 4th Summit later this
year.
One
of the significant decisions of the meeting was to recommend that the ACS Air
Transport Agreement (ATA) be open to signature at the upcoming Summit. The ATA
has been under negotiation for the past four years. It is a basic instrument for
liberalising air services among member countries. The objective is to encourage
regional airlines to provide more intra-regional services at lower cost;
stimulating more intra-regional travel for trade, investment and tourism.
Multi-destination tourism would be another spin-off.
There
have always been two major sticking points to a region-wide multilateral air
agreement. One is the very idea of granting rights multilaterally instead of
holding a series of bilateral negotiations among the parties. A multilateral
agreement saves time and money in the negotiation process and is consistent with
the worldwide trend towards air services liberalisation.
But
some countries prefer a bilateral negotiation framework, seeing it as better
suited to protecting their national interest. Or they may also find that a
multilateral agreement is inconsistent with their obligations with other
parties. Mexico is an example of the first; while France (an Associate Member of
the ACS) is an example of the second. Both countries have participated in the
ACS negotiation meetings, providing technical advice, but have signalled that
they will not be Party to the ATA right now.
This
is not a problem, as the ACS Convention does not require universal participation
of member countries for agreements to be made. Wisely, Article 20 of the
Convention explicitly provides that “… a number of Member States may undertake
initiatives and conclude integration agreements among themselves……Any such
agreement or initiative may be open to any other Member State which is able and
willing to participate therein”.
This
flexibility allows for a group of countries within the ACS membership to make an
agreement without requiring all members to adhere. At present account, the
expectation is that as many as 24 of the 25 ACS members and two of the Associate
members will sign the ATA.
The
second difficulty, which is linked to the first, has been the multilateral grant
of “fifth freedom” rights. These are the rights of an airline to operate routes
that do not originate or terminate in its own home country. Within the Greater
Caribbean region, the exercise of fifth freedom rights by regional airlines
would be a big step towards creating a single air transport space. But some
routes are well traveled and highly lucrative. Governments with a financial
stake in national airlines - - notably some CARICOM countries -- are wary about
granting them multilaterally in the ACS ATA.
So
negotiators came up with a compromise. Under the ATA, countries can choose
either to grant fifth freedom rights multilaterally, or to grant them on a
‘bilateral and reciprocal’ basis, by indicating which of the two options it has
selected at the time of signing. It can also shift subsequently from the
bilateral to the multilateral mode merely by providing the appropriate legal
notification.
The
hope is that most countries will feel comfortable and confident enough to end up
with the multilateral Option 1.
As
airlines in the region talk consolidation to meet the challenges of a difficult
world situation, the possibility of having an ACS ATA by the end of the year
must be welcome news.
1.) Professor Norman
Girvan is Secretary General of the Association of
Caribbean States. The views expressed are not
necessarily the official views of the ACS.
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July 21, 2003
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