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Macro economic policy coordination

Posted in: Pages by admin | 29 October 2015 | 2752

A fully functioning  CSME requires  an environment that  is competitive and encourages investment.  In this context,   economic, fiscal and monetary measures are required to support the CSME, given its ultimate goal as “the basis for growth and development through the creation of a single economic space for the  production of competitive goods and services”. These  measures are all supported by the Revised Treaty of Chaguaramas.

On the monetary front,, the focus is on coordinating exchange rates and interest rate policies, as well as establishing the regional architecture for financial stability. It includes, for example:

  • measures to allow the  movement of capital for investment purposes across the Community and access to capital at the national level by intra-regional investors, on the same basis as domestic investors;
  • arrangements to enable  individuals to have access to their bank accounts across the Community through the appropriate ATM infrastructure, with a view to currency convertibility.

On the economic front, steps are being taken to coordinate macro-economic policies and performance; harmonise foreign investment policies and adopt measures to acquire, develop and transfer technology.

 On the fiscal front,  the focus is on policy coordination and harmonization to create a level tax playing-field to facilitate the movement of goods and factors of production by eliminating or  minimizing the likelihood of tax arbitraging of transactions, as well as to provide complementary measures to support regional monetary policy cooperation. Fiscal policy measures include coordinating indirect taxes and national budget deficits.

CSME stands for CARICOM Single MARKET & Economy.

The CSME Unit of the CARICOM Secretariat is the implementation office which assists the Member States in fulfilling the requirements of the Revised Treaty of Chaguaramas.

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