ANTIGUA-Regional paint stakeholders and retailers want increased tariffs for products imported from the US.

ST. JOHN’S, Antigua, CMC – Antigua and Barbuda’s Ambassador to the Caribbean Community (CARICOM), Dr. Clarence Henry, has reiterated a call for an “independent and comprehensive” analysis of claims being made by regional paint manufacturers who have been calling for an increase in the tariffs on paint imports from the United States.

Henry met with local manufacturers on Tuesday to discuss the issue and said that the analysis must be done independently of the manufacturers.

The local manufacturers insisted that when the government implemented Article 164 of the Revised Treaty of Chaguaramas, while they had experienced some tough times, they could still survive. They called for the government here to maintain vigilance against the creation of monopolies, which they claim would result from the support of the regional paint manufacturers’ request.

Henry had, in a September 26, 2023 letter to Trade Minister E.P. Chet Greene, said that the “so-called study cannot be taken at face value since an independent consultant did not conduct it.”

The veteran trade official said it had not been coordinated by the CARICOM Regional Organization for Standards and Quality (CROSQ), and “for this reason, the document cannot be relied on as one that provides a transparent and fair comprehensive analysis.”

In their September 20, 2023 letter to Greene, signed by Marguerite Desir, the CARICOM Paint Manufacturers said they were seeking the support of the Gaston Browne administration “for remedial measures via an alteration of the Common External Tariff (CET) on paints.

The CET is a single tariff rate agreed to by all CARICOM members on imports of a product from outside the CARICOM. Informed sources told the Caribbean Media Corporation (CMC) that when the CARICOM Private Sector Organization (CPSO) presented the study to the Council for Trade and Economic Development (COTED), almost all of the member states of the Organisation of Eastern Caribbean States (OECS) did not support the request.

In their letter, the regional manufacturers said they commissioned the study and “its conduct has been coordinated by the CARICOM Private Sector Organization (CPSO), at the invitation of the CARICOM/Regional Paint Manufacturers.”

The regional paint manufacturers argue that the CARICOM paint market has suffered significant incursions due to “substantial under-pricing of paints” from the United States.

“Individual regional paint producers have raised this matter with their national Governments over the past several years. While a few Governments have attempted to address the issue, the actions have fallen short in their efficacy to the need for a ‘whole of community’ response via the Council for Trade and Economic Development (COTED) (i.e., a CET alteration, rather than an individual country response, via a CET suspension).”

They said that member of the OECS and the paint industry in the lesser developed countries (LDC) are beneficiaries of Article 164 “and has shown tremendous promise as a successful Community enterprise.

“The incursions from the US have hindered the success of OECS producers by significantly eroding price competitiveness and market share within both LDC and MDC markets. By this measure, left unaddressed, the under-pricing will completely nullify the intended benefit of Chapter Seven and Article 164 of the Revised Treaty of Chaguaramas (RTC),” which governs the regional integration movement.

“Before now, the Paint Manufacturing Industry has been unable to have the complex analytical work undertaken to justify the approach to the COTED. The advent of the CPSO and the Caribbean Manufacturers Association (CMA) has facilitated the coming together of all the Regional Paint Manufacturers around this single issue, severely harming their market share, investment, intra-regional trade in paints, and employment.

“An opportunity to present the Study will highlight the egregious extent of under-pricing to an extent that now threatens innovation, industry expansion, and for some manufacturers, even their business continuity as producers,” the regional paint manufacturers wrote.

During the meeting on Tuesday, the local manufacturers maintained their call for the increase in tariffs on paints coming into the region from North America, warning that consumers could be adversely affected in the future.

They argued that the study implies a market dominance by a few regional paint companies.

Henry has maintained that the study is “self-serving favoring regional manufacturers,” adding that they are aware “that the threshold to prove their case would be tough to pursue a country by country approach and would also call into question the implications of setting the tariff at 50 percent for extra-regional paints”.

He said the study failed to prove an injury to paint manufacturers in the region, adding, “There was no evidence to show a loss in profits or inability to compete or any sort of loss in the market.”

Henry also recommends that “there must be national stakeholder consultation by the Cabinet to determine whether to support remedying action.”

He also wants the CROSQ to be consulted and involved in the independent study, noting “there was an absence of information to show where CROSQ and its standards for paints intersected with this body of work.”

Henry also wants the Suriname-based CARICOM Competition Commission (CCC) to be “integrally involved in the investigation of unfair competition claims.”