The Council for Trade and Economic Development (COTED), Caricom’s trading and development arm, has issued a ruling against Jamaica’s soap manufacturing process.

This adverse ruling will affect Jamaican soap exports to the region.

In its recent, ruling COTED found the process of manufacturing soaps in Jamaica wanting and has directed Jamaica through the trade board not to issue any Certificates of Origin for soaps manufactured under the current manufacturing process in the island.

Lack of a Certificate of Origin from Jamaica may require an importer in a Caricom country to pay a tariff on imported Jamaican soaps. This will result in Jamaican soaps being more expensive and likely to be uncompetitive within the Caricom market.

However, one of Jamaica’s leading soap manufacturers, Blue Power Group, advised on Tuesday that it has been notified of the adverse ruling by the relevant Government ministries in Jamaica. Blue Power, which is listed on the Jamaica Stock Exchange, has issued an advisory to the exchange stating that the ruling will not affect the company’s sales within Jamaica and exports to non-Caricom countries such as the United States and the United Kingdom.

BLUE POWER WILL TAKE A HIT IN CARICOM MARKETS

However, Blue Power exports to Caricom, which is its major market, will definitely take a hit given the additional duties that will be imposed on Jamaican manufactured soaps, which is already facing fierce competition in Caricom markets.

The situation has got so bad that the company reported lower levels of export sales in its October quarter, which was compounded by the fact that retail sales for Blue Power soaps in the United states market have been drying up.

COTED ADOPTS ‘MADE IN CARICOM’ PROMOTIONAL INITIATIVE

On a separate matter, COTED has adopted a proposal put on the table at its recently concluded meeting to develop a ‘Made in Caricom’ promotional initiative, which seeks to drive local production while capitalising on opportunities on trading and business development presented by the global pandemic. Trade ministers at their COTED meeting unanimously endorsed the ‘Made in Caricom’ proposal.

The promotional initiative also won the support of Caricom assistant secretary general, Trade and Economic Integration, Joseph Cox, who said that the promotional campaign would have the effect of driving support to regionally produced items at the national level. Cox explained that changes in consumer tastes and spending as a result of the disruptions in trade caused by the pandemic is creating new markets and new dynamics that regional businesses can exploit.

According to the Caricom assistant secretary general, “there is considerable opportunity for “regional suppliers to step up and reorient their business models and rise to the challenges and the opportunities that emanate from the COVID-19 pandemic.” During their two-day meeting, Caricom trade ministers discussed macroeconomic responses to the pandemic such as tax reform, the reintroduction of growth resilience, countering supply chain disruptions and the restoration of fiscal discipline.

DIGITAL TRANSFORMATION

With the shift of businesses onto the digital platform in the COVID-19 environment, Cox pointed to the necessity for digital transformation, since it was the new frontier for the Caribbean region and its development. The discussions at COTED on digital transformation ranged from joint procurement of ICT equipment to age limits on equipment.

The Caricom trade ministers also discussed value added tax (VAT) holidays and issues associated with bandwidth. There were varying responses to the proposals, some of which will necessitate further discussions at the national level.

The ministers discussed the multilateral air services agreement, which formally came into force in August 2020 to liberalise the regional air transport sector.