Common Market

An economic unit, formed of nations, intended to eliminate or markedly reduce trade

barriers among its members
Single market
A group of countries that have few or no restrictions on the movement of goods, money
and people between the members of the group
Economic integration
The process by which the economies of a group of countries are drawn more closely
together so that the group as well as the individual countries becomes stronger or more
developed.
Independent State
self-government of a county , nation or state by its residents and population
Underdeveloped country
a relatively poor country with little or no material wellbeing.
Developing country
a country that has not yet reached the stage of economic growth to stand on itsown for
further growth.
Developed country a country that has high level of development and high gross domestic product(GDP) per
capita.
Trade Liberalization
the movement towards the removal of trade barriers among the members of theWorld
Trade Organization (WTO)
Globalization the process by which countries all over the world are becoming connected or similar
because large companies are doing business in many different countries.
Multinational Corporation
Sometimes called transnational corporation is a corporation or enterprise that manages
production and delivers services in more than one country.
Regionalism -

the expression of a common sense of identity and purpose combined with the creation
and implementation of institutions that express a particular identity and shape collective
action within a geographical region. / Development of a political or social system based
on a distinct region with a homogeneous population
Regional Integration
A number of groups, societies or countries within an area joining together to
cooperateand operate under one system or as one group
Trading Bloc
made up of a large number of countries, with the same political and economic aims,
linked by special trading arrangements among them.
Free trade Area
an arrangement whereby a group of countries agrees to remove the tariff and non-tariff
barriers to trade among them.
Free Trade Area of the Americas (FTAA) The FTAA is an expansion of NAFTA. It is an organization of34 countries of the
Americas including North and South America, Canada and the Caribbean except for
Cuba.
North American Free Trade Agreement (NAFTA) This agreement allows duty free entry of goods among Canada, United States and
Mexico.
Intra-Regional Trade
countries in the region buying locally produced goods from or selling locally produced
goods to, other countries in the region.
Fiscal Policy
the use of government spending and revenue collection to influence economy.
Monetary Policy
the process a government, central bank or monetary authority of a country uses to
control the supply of money, availability of money and cost of money or rate of interest to
attain a set of objectives oriented towards the growth of the economy.
Caribbean Basin Initiative (CBI) -

CBI allows certain Caribbean and Central American products duty free entry into the
United States. Products exported include chemicals, manufactured goods, fresh fruits
and vegetables.
World Trade Organization (WTO) The WTO is an international organization that monitors andregulates trade among the
nations of the world based on trade agreements by member states. The WTOreplaces
the General Agreement on Tariffs and Trade (GATT).

The Major Challenges Facing the Caribbean Region

Caribbean countries face similar economic problems, for example, the difficulty of
getting imports priced to a level they can afford as well as the difficulty competing with
their exports. Also most Caribbean countries lack the proper local infrastructures to
create suitable employment for their populations. Major Challenges:(a) Small size, small
national markets(b) Lack of diversification(c) Unemployment and underemployment
Unemployment - (or joblessness) occurs when people are without work and
actively seeking work.
The unemployment rate is a measure of the prevalence of unemployment and it is
calculated as a percentage by dividing the number of unemployed individuals by all
individuals currently in the labor force. Globalization has contributed significantly to
unemployment in the Caribbean. With the removal of trade barriers, some industries
have not been able to compete globally. The lack of adequate skills that are required for
the new industrial paradigm for example, information technology skills have also
contributed to the problem of unemployment. A high level of unemployment among the
young people of the Caribbean may results in various social problems, as survival may
depend on illegal activities.
Reasons for unemployment
Businesses e.g. multinationals closing down
lack of investment to create new businesses

lack of skills training

Underemployment refers to an employmentsituation that is insufficient in some
important way for the worker,relative to a standard.
Examples include holding a part-time job despite desiring full-time work,
and overqualification, where the employee has education, experience, or skills beyond
the requirements of the job.
(d) Low levels of production and productivity
(e) Differences in resource distributions
(f) High levels of indebtedness (debt burden)
Many Caribbean countries have high debt- to-GDP ratios. This ratio is the amount of
national debt of a country as a percentage of its Gross Domestic Product. High debt-toGDP can stifle an economy as a large portion of its GDP is consumed in debt payment
and very little is left for investment in the economy. A very low debt- to- GDP ratio is
desirable for economic growth and development.
(g) High level and cost of imports
(h) Shortage of skilled workers
(i) Inadequate technology
(j) Low value of exports