Conference PaperPDF Available

The Caribbean also needs to pivot

Authors:
  • Ministry of Foreign Affairs and Foreign Trade of Barbados
1
Barbados also needs to pivot to China
A paper prepared for the Central Bank of Barbados’ Annual
Review Seminar, July, 2015
François Jackman
1
, Senior Foreign Service Officer, Ministry
of Foreign Affairs and Foreign Trade of Barbados, 1
Culloden Road, St Michael, Barbados
fjackman@foreign.gov.bb
1
These are the views of the author and not those of the Government of
Barbados. The author thanks Ms. Ashleigh Cohen, Intern, Ministry of
Foreign Affairs and Foreign Trade for her assistance and advice in
researching and editing this paper.
2
Overview
1. This paper will discuss new policy imperatives for
Barbados in light of the changing international
environment in general and the rise
2
of the People’s
Republic of China (“the PRC” or “China”)in particular.
2. Section one will provide a brief overview of Barbados'
existing foreign policy, including its external economic
relations. Section two will look at the rise of China
and the response of major countries and regions to this
development. Section three will discuss the impact of
the rise of China on Barbados. Finally, section four
will set out some specific suggestions for rethinking
policy research and implementation.
Section I: Brief overview of Barbados' foreign policy
and external economic orientation
Diplomacy
3. Although not much has been written specifically about
Barbados’ foreign policy
3
, the pronouncements of Prime
Ministers in international fora over the years provide a
strong sense of its overall thrust. In this regard, the
most well-known enunciation of Barbados’ foreign policy
is the “friends of all, satellites of none”
4
speech,
given by then Prime Minister, the Right Excellent Errol
Walton Barrow at the General Assembly of the United
Nations in 1966 shortly after Barbados became
independent.
2
There is a nomenclatural debate around the use of the term “rise”.
Although it seems first to have been used by the Chinese authorities
themselves, it appears to have given way to a less threatening
expression: “peaceful development” (see, for example, The rise and
descent of “Peaceful Rise”, Robert L. Suettinger, China Leadership
Monitor, 2004,
www.hoover.org/sites/default/files/uploads/documents/clm12_rs.pdf ).
However, for the purposes of this article, the word “rise” will be used
given the power of the idea that the image conveys.
3
A notable exception to this is the doctoral dissertation by Ricardo
Kellman, a Foreign Service Officer in the Ministry of Foreign Affairs
and Foreign Trade of Barbados: A history of Barbados’ Foreign Policy,
1966-1988, University of the West Indies, 2010.
4
Diplomacy and Development, Ministry of Foreign Affairs of Barbados,
1987
3
4. A useful exegesis of this statement was produced some 42
years later, also at the United Nations General Assembly,
by then Prime Minister the Honourable David Thompson. In
referring to Barrow’s speech, he then set out some
further elements:
Because we are a small island, we will champion
the issues of greatest concern to Small Island
Developing States (SIDS) and argue for the need
for special recognition of their inherent
vulnerabilities, and for sensitive responses to
the critical challenges, such as climate change
and susceptibility to natural disasters, that
constrain their sustainable development. Because
a one-size-fits-all mentality threatens to
further marginalize us in the new international
trading arrangements, we will continue to show
leadership, within the Small Vulnerable Economies
Group, in the advocacy efforts to create a regime
of special and differential treatment to cater to
our unique circumstances.
Because we are a middle income developing country,
deemed too successful to qualify for
concessionary financing, but too high-risk for
favourable terms on the capital markets we will
join with like-minded colleagues to lobby for
adequate support mechanisms to ensure that our
development process is not derailed.
Because we are a Caribbean country we will
partner with our fellow Caribbean states to
protect our shared patrimony, the Caribbean Sea,
from over-exploitation and environmental
degradation, and to secure our borders from the
threats of drug and arms trafficking, money
laundering and terrorism. We are fervent
advocates of the notion of the Caribbean as a
zone of peace and we view with great concern any
action, from whatever quarter, that seeks to
reintroduce the anachronism of cold-war rivalry
into our peaceful regional community of nations.
And finally, because we are a responsible member
of the international community, and we believe in
the positive role that small states can play in
advancing the cause of international peace and
equitable economic and social development, we
4
rededicate ourselves to the building of an
international system that operates on the
principle of multilateralism and that respects
the sovereign equality of states and the tenets
of genuine non-alignment.
5
5. This then, is the foreign policy of a micro-state,
driven by the pragmatic imperative of survival in a
tough, post-colonial, post-cold war, globalized
international system where the protective niches of the
past no longer exist.
6
6. Looking at the implications of these principles in terms
of diplomatic practice, Sir James Tudor, then Minister
of Foreign Affairs, wrote in the foreword of a 1987
Ministry publication
7
:
Those Overseas Missions that we have set up, and
there are nine in all, are all in locations of
priority importance to Barbados in the promotion
of its national interests, whether in trade,
regional integration, development financing,
investment or tourism and for the protection of
its citizens abroad.
7. Sir James’ words represent the operational expression of
the general principles enunciated by Prime Ministers
Barrow and Thompson. Although they were written almost
thirty years ago, at a time when Barbados had four fewer
diplomatic missions than it does today, a glance at the
deployment of diplomatic resources reveals that those
pragmatic approaches are still being applied.
8. Table 1 shows the clear geographic and functional
emphasis of Barbados’ foreign policy: the proximate
regions of the Caribbean and South America and the
historically significant regions of North America and
Western Europe. In this regard, the outlier, both in
terms of geography and purpose, is Barbados’ lone
diplomatic mission in Asia.
5
Speech by the Hon David Thompson at the United Nations General
Assembly. 2008
6
Strategic Repositioning: Foreign Policy Shifts In Barbados And Trinidad
and Tobago, Jessica Byron, 2000; see also Chapter 1 of Kellman, 2010
7
Diplomacy and Development, Ministry of Foreign Affairs of Barbados,
1987, p.i
5
Table 1. List of Barbados diplomatic missions overseas
as at 2015
Mission
Region
Nature
Embassy of Barbados
at Washington D.C.
North America
Traditional
Permanent Mission
of Barbados to the
United Nations
Headquarters at New
York
North America
Traditional
Consulate-General
of Barbados at New
York
North America
Traditional
Consulate-General
of Barbados at
Miami
North America
Traditional
Consulate-General
of Barbados at
Toronto
North America
Traditional
High Commission of
Barbados at Ottawa
North America
Traditional
High Commission of
Barbados at London
Western Europe
Traditional
Embassy of Barbados
at Brussels
Western Europe
Trade
Permanent Mission
of Barbados to the
United Nations at
Geneva
Western Europe
Trade
Embassy of Barbados
at Caracas
South America
Geographic
proximity
Embassy of Barbados
at Brasilia
South America
Geographic
proximity
Embassy of Barbados
at Havana
Caribbean
Geographic
proximity
Embassy of Barbados
at Beijing
Asia
Emerging
interest
Trade
9. Barbados' foreign trade profile also reflects this
orientation towards the Western Hemisphere and Western
Europe and mirrors perfectly the focus of Barbados'
diplomatic outreach.
6
Figure 1.Origin of Barbados' imports, Ministry of
Foreign Affairs and Foreign Trade of Barbados, 2014
Figure 2. Destination of Barbados' exports, Ministry of
Foreign Affairs and Foreign Trade of Barbados, 2014
10. More than 90% of both Barbados’ exports and imports go
to or come from the same group of six countries, all
either traditional or proximate partners.
7
Investment
11. Ensuring sustained and sustainable receipts of Foreign
Direct Investment (FDI) constitutes an important part of
Barbados' economic model.
8
In this regard, Barbados
continues to rely heavily on inflows from its
traditional trading and diplomatic partners such as the
United States and countries of Western Europe.
Figure 3. FDI flows into Barbados by country of origin,
2001-2012, UNCTAD FDI/TNC database
Tourism
12. With regard to tourism, one of the key sectors of the
Barbados economy, there is a similar concentration on
traditional markets. The striking characteristic here is
how flat these markets have been over the long term and
how little growth there has been overall in tourist
arrivals since the 1970s.
8
Barbados Growth and Development Strategy, 2013-2020, Economic Affairs
Division, Ministry of Finance and Economic Affairs of Barbados, 2013
www.economicaffairs.gov.bb/download.php?id=327
8
Figure 4. Year-on-year growth in tourist arrivals to
Barbados by market (US, UK, Canada, CARICOM), Central
Bank of Barbados Working Paper WP/14/7 Predicting
tourist arrivals during downturns, Rudolph Browne and
Winston Moore
13. This then is a quick overview of Barbados' external
relations posture: pragmatic and turned towards its
traditional and proximate partners. Let us turn now to a
brief examination of the state of the international
system.
Section II: China emerges, the US and others “pivot”
14. The “rise” or “emergence” of the People’s Republic of
China in particular and Asia in general is, undisputedly,
one of the main features of the international system of
the late 20th and early 21st century. China has moved from
being economically and geopolitically peripheral from
the perspective of North America and Western Europe to
9
being their principal commercial partner and strategic
competitor.
15. The effect of this rise on the system in its totality
and on particular actors within the system has been
well-documented.
9
Amongst other key points, China and the
United States of America are now locked in a global
competition for influence
10
while at the same time
forming the world’s second largest trading partnership.
11
16. In recognition of this emergence and consequent upon,
inter alia, the declining importance to it of Middle
Eastern oil, the United States has been undertaking a
well-publicized “pivot” (more recently described as “re-
balancing”)
12
towards Asia in general and China in
particular.
13
The pivot is in fact a monumental
geopolitical, strategic and economic insight which is:
premised on the recognition that the lion’s share of
the political and economic history of the 21st century
will be written in the Asia Pacific region.
14
9
The literature relating to this matter is extensive.
See, for example, The Promise and Pitfalls of China’s ‘Peaceful Rise’,
Esther Pan, 2006, http://www.cfr.org/china/promise-pitfalls-chinas-
peaceful-rise/p10446
China’s “Peaceful Rise” to Great-Power Status, Zheng Bijian, 2005,
https://www.foreignaffairs.com/articles/asia/2005-09-01/chinas-
peaceful-rise-great-power-status ;
The Emergence of "Greater China”, David Shambaugh, 1993
10
China-US relations, Kevin Rudd, 2015
http://belfercenter.ksg.harvard.edu/files/Summary%20Report%20US-
China%2021.pdf
11
U.S.-China Trade Facts, Office of the United States Trade
Representative, 2014,
https://ustr.gov/countries-regions/china-mongolia-taiwan/peoples-
republic-china
12
As was the case in China with regard to the use of the word “rise”,
there has been a debate in the United States around the use of the word
“pivot”.
See, for example, Pivot, Rebalance, or Reinvigorate? Words Matter in
U.S. Strategy toward Asia, Ken Liebenthal, 2014,
http://www.brookings.edu/blogs/brookings-now/posts/2014/04/pivot-
rebalance-reinvigorate-words-matter-us-strategy-toward-asia
13
Explaining the US ‘Pivot’ to Asia, Kurt Campbell and Brian
Andrews,2013,
http://www.chathamhouse.org/sites/files/chathamhouse/public/Research/Am
ericas/0813pp_pivottoasia.pdf
14
Ibid, p. 2
10
17. The United States is thus refocusing its entire public
policy apparatus, its military structures and its
private sector towards Asia in general and China in
particular.
18. The European Union (EU) as a whole and a significant
number of its member states individually have also been
looking increasingly towards China as a critical trading
partner and geopolitical actor.
15
The EU has become
China’s largest trading partner while China is now the
EU’s second biggest trading partner after the United
States.
16
In the case of Germany, the economic powerhouse
of the EU, China is the fourth largest client for its
exports and second largest provider of its imports.
17
19. The EU and China have also extended cooperation beyond
the purely commercial into, inter alia, security.
China’s navy and the EU’s anti-piracy mission in the
Gulf of Aden have, for example, been coordinating their
activities with considerable success.
18
20. Africa is also an important partner for China. The
modern Sino-African relationship dates back to the early
post-colonial period and the beginning of the Non-
Aligned Movement.
19
Initially centred on ideological
solidarity, the relationship has turned resolutely
towards the commercial and pragmatic.
20
Trade between the
two has grown quickly in the last decade. China has
become Africa’s largest trading partner even though the
15
EU-China 2020 Strategic Agenda for Cooperation, European Commission,
2013,
http://eeas.europa.eu/china/docs/20131123_agenda_2020__en.pdf
16
EU-China Factsheet, European Commission, 2013,
http://eeas.europa.eu/factsheets/docs/eu-china_factsheet_en.pdf
17
Ranking of Germany's trading partners in foreign trade 2014, German
Statistics Authority, 2015
18
An Overseas Naval Presence without Overseas Bases: China’s Counter-
piracy Operation in the Gulf of Aden,Susanne Kamerling and Frans-Paul
van der Putten, 2011
EU and China work together in the Gulf of Aden, Delegation of the
European Union to China, 2014,
http://eeas.europa.eu/delegations/china/press_corner/all_news/news/2014
/20140331_en.htm
19
Africa in China’s Foreign Policy, Yun Sun, 2014
http://www.brookings.edu/research/papers/2014/04/10-africa-china-
foreign-policy-sun
20
Chinese Engagement in Africa: Drivers, Reactions, and Implications
for U.S. Policy, Rand Corporation, 2014
http://www.rand.org/content/dam/rand/pubs/research_reports/RR500/RR521/
RAND_RR521.pdf
11
proportion of total trade each party represents for the
other remains relatively low. Africa represents about 4%
of China’s trade and China represents about 13% of
Africa’s trade.
21
21. Latin America too has consolidated its relationship with
China in the last decade. By and large, this
relationship has been driven by China’s growing need for
commodities and Latin American countries’ ability to
supply them. Trade has grown 22-fold in the period 2000-
2012 and foreign direct investment has followed.
22
22. This review of China’s relationship with the United
States, the European Union, Africa and Latin America
clearly shows a trend of significantly enhanced
interactions. In the case of China-US relations, a vast
and mutually-beneficial trade relationship has propelled
China into the position of being the sole real rival
with the US for global influence. In the case of China-
EU relations, the relationship has significant trade
components and has developed increasingly significant
non-economic cooperation in areas such as security. With
regard to the relationship with Africa, it has clearly
moved beyond its early, ideological phase, into a
relationship heavily skewed towards the economic. With
Latin America, the commodities super-cycle has been the
cornerstone of the relationship. China has emerged, and
the world is paying attention.
Section III: Barbados also needs to pivot to China
23. It is in the context described above, of China’s
emergence and the consequent restructuring of the
diplomatic and commercial posture of several major
countries and regions, that the question arises as to
whether or how Barbados should also “pivot” to China.
24. It is worth underlining briefly the extent to which the
China of 2015 is not the China of 1995, far less 1977
21
China’s growing interest in Africa, David Shinn, Congressional
hearing, 2011
www.foreign.senate.gov/imo/media/doc/David_Shinn_Testimony.pdf
22
First Forum of China and the Community of Latin American and
Caribbean States; Exploring opportunities for cooperation on trade and
investment, ECLAC, 2015
http://www.cepal.org/en/publications/37578-first-forum-china-and-
community-latin-american-and-caribbean-states-celac
12
when Barbados established diplomatic relations. Bicycles
have been replaced by automobiles (China is now the
world’s largest market for cars
23
) and the middle class
now numbers more than 200 million people with an
expectation that this will triple in the next decade.
24
China is sending men into space and is building a space
station for 2020.
25
This is a China with a dream to make
the country prosperous and strong, revitalize the
nation and make the people build better lives”
26
and the
means to make that dream come true.
25. If the world’s major powers and regions have pivoted to
China in recognition of its new global presence in the
economic and diplomatic realm and its vast and expanding
consumer should Barbados not be developing a similar
strategy?
Diplomacy
26. Barbados’ relationship with the PRC dates back to 1977
when ties with Taiwan were severed. Since then, the
relationship has remained politically very stable. China
opened an Embassy in Barbados in 1979 and Barbados
reciprocated some 31 years later by opening its Embassy
in Beijing in 2010.
27. In recent times, largely at China’s behest, Barbados has
been participating in a number of China-organised
cooperation fora, including the China-Caribbean Trade
and Economic Cooperation Forum
27
, the China-Caribbean
Consultations, the China-Latin America and Caribbean
Business Summit,
28
the China-CELAC summit
29
as well as a
23
The Global Automotive Retail Market, KPMG, 2013
https://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/D
ocuments/global-automotive-retail-market-study-part1.pdf
24
Michael Spence, China’s rising middle class, Stefan Theil, 2014,
https://www.gsb.stanford.edu/insights/michael-spence-chinas-rising-
middle
25
A Dragon In Space: China's Space Programme Can No Longer Be Ignored,
Kadhim Shubber, 2013,
http://www.wired.co.uk/news/archive/2013-07/01/china-space-programme
26
The Chinese Dream will benefit not only the people of China, but also
of other countries, Xi Jinping, 2014
27
3rd China-Caribbean Economic Trade Cooperation Forum, China-Caribbean
Economic Trade Cooperation Forum, 2011
http://cncforumenglish.mofcom.gov.cn/
28
Deepening Ties Between China and Latin Americas Highlighted at the 8th
China-LAC Business Summit, Inter-American Development Bank, 2014
13
host of seminars and workshops for the public and
private sectors.
28. For its part, in 2008, the PRC undertook the hitherto
unprecedented step of issuing a “white paper” regarding
its policy towards Latin America and the Caribbean.
30
While the paper itself contained little that was not
already known and observed in practice, its very
existence was an indication of Latin America and the
Caribbean’s new-found level of importance in China’s
foreign policy.
29. This White Paper has been followed up by a series of
visits to the Caribbean by very high-level Chinese
delegations, including one led by President Xi Jinping
in 2013, when he met in Port of Spain with all the Heads
of Government of CARICOM states which have diplomatic
relations with the PRC.
31
At that meeting, he pledged
32
some 3 billion US dollars in funding for projects in the
Caribbean.
30. Two years earlier at the 3rd China-Caribbean Trade and
Economic Cooperation Forum, held in Port of Spain, in
2011, PRC Vice Premier Wang Qishan, made three
http://www.iadb.org/en/news/news-releases/2014-09-12/8th-china-lac-
business-summit,10910.html
29
China is Watching as US seeks to Smooth Ties with Latin America,
Shannon Tiezzi, 2015
http://thediplomat.com/tag/china-celac-forum/
Barbados sees value in CELAC-China Forum, Barbados Government
Information Service, 2015
http://www.nationnews.com/nationnews/news/62101/barbados-value-celac-
china-forum
30
China policy paper on Latin America and the Caribbean, Xinhua News,
2008,
http://news.xinhuanet.com/english/2008-11/05/content_10308117.htm
31
Chinese President Xi Jinping Tours the Americas: Why Does It Matter?,
Carl Meacham, 2013,
http://csis.org/publication/chinese-president-xi-jinping-tours-
americas-why-does-it-matter
President Xi Visits Trinidad and Tobago, Costa Rica, Mexico, US; China
Daily, 2013
http://www.chinadaily.com.cn/china/2013xivisit/
Sun, Sand and Xi, The Economist, 2013
http://www.economist.com/blogs/americasview/2013/06/china-and-caribbean
32
China’s Xi Offers Caribbean Nations $3 Billion in Loans, Joshua
Goodman, 2013
http://www.bloomberg.com/news/articles/2013-06-03/china-s-xi-offers-
caribbean-nations-3-billion-in-loans
14
significant points
33
about the state of relations between
the Caribbean and China:
Two-way trade has been growing at an annual
rate of 24% on average and reached US$7.2
billion in 2010…
…the accumulative Chinese investment in the
Caribbean now stands at US$400 million.
China will provide US$1 billion in loans of
preferential nature to the Caribbean
countries in support of local economic
development. China encourages exchanges and
cooperation between the commercial banks of
the two sides. The China Development Bank
will set aside US$1 billion to be used as
special commercial loans for infrastructural
development.
31. China’s interest in Latin America and the Caribbean is
thus quite manifest. For obvious reasons linked
primarily to size and economic and geopolitical
importance, Latin America receives and is likely to
continue to receive the bulk of China’s attention. But
even the small countries of the Caribbean are the object
of the attention of the Chinese state and commercial
sector. The seriousness of China’s intent can be
measured in part by the quantum of funds being made
available to the region as indicated by President Xi and
Vice Premier Wang as well as the mere fact of their
unprecedented visits to the region.
32. Originally, one can discern in China’s outreach to the
Caribbean, the flavour of its rivalry with Taiwan.
34
But
as that rivalry has developed into a very successful
commercial relationship, so has the diplomatic
competition abated. In this regard, China can arguably
33
Remarks by Vice Premier Wang Qishan at the Opening Ceremony of the
3rd China-Caribbean Economic and Trade Cooperation Forum, Embassy of
the People’s Republic of China in the Republic of Trinidad and Tobago,
2012,
http://tt.chineseembassy.org/eng/zt/3rdCNCForum/t860706.htm
34
The Dragon in the Caribbean: ChinaCARICOM Economic Relations,
Richard L. Bernal, 2010
15
have said to have won.
35
Having developed its relations
with the Caribbean on the back of a diplomatic
competition with Taiwan, China has broadened and
deepened its interaction with the region in all areas as
set out in its 2008 White Paper. Let us examine more
closely the data which illustrate the results of this
strategy.
Trade
Figure 5. China’s rank as trading partner, 2000 and 2013
First Forum of China and CELAC, Exploring opportunities
for trade and investment, ECLAC, 2015
33. Figures 1 and 2 show China as occupying only a low rank
in terms of its importance as a trading partner. Of
interest, however, is that Figure 5 clearly indicates
that China is moving up through the ranks from the
bottom to the top for Latin America and the Caribbean in
35
Of the fourteen independent states members of the Caribbean
Community, 9 have diplomatic relations with China (Antigua and Barbuda,
Bahamas, Barbados, Dominica, Grenada, Guyana, Jamaica, Suriname and
Trinidad and Tobago) and only 5 have relations with Taiwan (Belize,
Haiti, Saint Kitts and Nevis, Saint Lucia and Saint Vincent and the
Grenadines).
16
general. In Barbados' case, China has moved from
occupying the 42nd rank among destinations for Barbadian
exports in 2000 to being ranked 11th in 2013. Likewise,
whereas China was Barbados' 9th-ranked source of imports
in 2000, it moved to being 4th-ranked in 2013.
Aid
34. The picture relating to Official Development Assistance
(ODA) is not quite as clear. The Chinese government
published a White Paper in 2014
36
on its foreign aid in
which it appeared that the Latin American and Caribbean
region received 8.4% of total Chinese ODA (see Figure 6)
during the period 2010-2012 of just over 14 billion US
dollars. This is equivalent to just over 1.17 billion US
dollars for Latin America and the Caribbean. While this
is a significant quantity, the paper does not indicate
which country received how much or for what purpose. In
addition, China consolidates into its data relating to
“foreign assistance”
37
three different types of
assistance: grant aid, interest-free loans and
concessional loans.
38
The picture then for ODA is not so
clear and there seems to be no comprehensive publicly-
available data for Barbados. Having said that, a cursory
36
China's Foreign Aid, Information Office of the State Council
The People's Republic of China, 2014,
http://news.xinhuanet.com/english/china/2014-07/10/c_133474011.htm
37
Ibid
38
The Development Assistance Committee of the Organisation for Economic
Cooperation and Development (OECD), which has done considerable work
relating to best practice in development cooperation financing, defines
Official Development Assistance as follows:
Grants or loans to countries and territories on the DAC List of
ODA Recipients (developing countries) and to multilateral
agencies which are: (a) undertaken by the official sector; (b)
with promotion of economic development and welfare as the main
objective; (c) at concessional financial terms (if a loan, having
a grant element of at least 25 per cent). In addition to
financial flows, technical co-operation is included in aid.
Grants, loans and credits for military purposes are excluded.
Transfer payments to private individuals (e.g. pensions,
reparations or insurance payouts) are in general not counted).
DAC Glossary of Key Terms and Concepts, http://www.oecd.org/dac/dac-
glossary.htm#ODA
In other words, China’s definition of “foreign assistance” is broader
than the definition used by the OECD for ODA.
17
glance at the press suggests that Chinese grant funds
total several tens of millions of dollars in the last
decade.
39
This is occurring at a time when the United
Nations has found that ODA to Small Island Developing
States has fallen sharply.
40
Figure 6: Geographical Distribution of China’s Foreign
Assistance Funds, White Paper on China’s Foreign Aid,
2014
Investment
35. Figure 7 provides a striking illustration of the growth
of Chinese Foreign Direct Investment (FDI) in the
Caribbean in the period 2003-2011. Although the total
remains comparatively small, the change represents an
increase of in excess of 500% in eight years.
39
“China, an invaluable partner for Barbados”, Barbados Government
Information Service website, 2013
http://gisbarbados.gov.bb/index.php?categoryid=9&p2_articleid=11247;
40
Trends and progress In International development cooperation,
Department for Economic and Social Affairs, United Nations, 2014
18
Figure 7. Total Chinese FDI stock in the Caribbean,
2003-2011, from Bernal, 2013, citing Chinese Statistical
Bulletin of Outward Foreign Direct Investment 20111
36. The quantum of Chinese FDI for Barbados specifically
remains quite modest (see figure 8) although recent news
reports
41
suggest that a major Chinese investment in
Barbados is nearing fruition. At any rate, the overall
growth trends for Chinese FDI suggest that there is room
for considerable growth.
42
41
Chinese to make up bulk of Sam Lord’s labour, Barbados Today, 2015,
http://www.barbadostoday.bb/2015/01/09/chinese-to-make-up-bulk-of-sam-
lords-labour/
42
China’s investment abroad, East Asia Forum Quarterly, 2012,
http://epress.anu.edu.au/wp-content/uploads/2012/05/whole2.pdf
19
Figure 8: Chinese Foreign Direct Investment in the
Caribbean, 2003-2011 (US$ millions), Bernal, 2013 citing
Chinese Statistical Bulletin, 2011
Tourism
37. A similar observation applies to the tourism sector,
another key determinant of Barbados' external posture.
China is well-documented as the world’s leading source
of outbound tourists and tourism spending. Having
produced no more than 10 million outbound tourists in
2000
43
, there were just over 100 million outbound Chinese
travellers in 2014 and they spent some 165 billion US
dollars during their travels.
44
43
The 21ST Century Game-Changer Up Close: China Outbound Tourism, Daniel
J. Voellm, 2012
http://www.hvs.com/Content/3109.pdf
44
United Nations World Tourism Organisation Annual Report, United
Nation Tourism Organisation, 2015
http://www.e-unwto.org/doi/pdf/10.18111/9789284416899
20
Figure 9. Arrival of Chinese visitors to Barbados, 2009-
2013, Barbados Tourism Authority, 2014
38. Compared to the heroic growth in numbers of Chinese
visitors worldwide and the billions of dollars that they
spend when they travel, the rather flat trajectory of
Chinese tourism arrivals to Barbados depicted in Figure
9 and the extremely small numbers suggest a vast
potential for development.
39. Overall trends with regard to China globally and within
Latin America thus, by and large, show growth and in
some cases, spectacular growth. This is occurring at a
time where there is much discussion and some empirical
data pointing to something of a decline, at least in
relative terms, of that North Atlantic world to which
Barbados and the Caribbean has been so firmly anchored
for so long.
45
The decline of traditional partners and
the rise of a powerful new one thus constitute the
background against which Barbados must “pivot”. Having
said that, this does not justify an abandonment of
important existing relations. In fact, the policy
discourse in the United States has moved away from
describing the new policy towards Asia as a pivot. In
recognition of the importance of existing relations, US
policy-makers are referring to a “re-balancing”.
46
45
How the West Was Lost: Fifty Years of Economic Folly-and the Stark
Choices Ahead, Dambisa Moyo, 2012
46
Pivot, Rebalance, or Reinvigorate? Words Matter in U.S. Strategy
toward Asia, Fred Drew, 2014 http://www.brookings.edu/blogs/brookings-
21
Section IV: Implications for rethinking economic and
financial policy research and implementation
40. The preceding sections considered the significant shifts
both geopolitical and economic caused by China’s global
rise. In light of this, an argument can be made for
Barbados to review its traditional foreign policy and
external economic posture and reposition it in order,
not merely to take into account the emergence of China
but to take advantage of it.
41. There are several elements to be considered in this
regard. First and foremost, there is China itself. This
emerging superpower is hardly a clone of the established
superpower, the United States. By virtue of its location
in relation to the Caribbean China is never likely to
exert the kind of influence over the Caribbean that has
been, is being and will be exercised by the United
States. The cultural affinities, including a common
language, that bind together the peoples of the English-
speaking Caribbean and the United States simply do not
exist with China.
42. As a consequence, deepening Barbados' understanding of
China calls for a genuine effort on the part of Barbados
to understand and reach out to China on its own terms.
This will require training in language and culture,
enhanced people-to-people and institutional exchanges
and academic research. Some of this is already taking
place. Increasing numbers of Barbadians are studying in
China and acquiring proficiency in Mandarin.
47
The Cave
Hill Campus of the University of the West Indies is
setting up a Confucius Institute designed to disseminate
Chinese language and culture.
48
But Barbados will need
more than a few dozen students in China to make this
happen.
now/posts/2014/04/pivot-rebalance-reinvigorate-words-matter-us-
strategy-toward-asia
47
Speech by H.E. Wang Ke, Ambassador of China to Barbados, 2015,
http://bb.chineseembassy.org/eng/dszl/dsjh/t1258446.htm
48
Speech by H.E. Wang Ke, Ambassador of China to Barbados, 2014
http://www.fmprc.gov.cn/mfa_eng/wjb_663304/zwjg_665342/zwbd_665378/t117
3795.shtml
22
43. In keeping with this thrust of enhanced mutual
understanding, Barbadian policy-making entities within
both the public and private sector should engage in
their own “pivot” or “rebalancing” towards China.
44. Although Chinese FDI into Barbados remains modest, its
global growth trend is spectacular. Estimates suggest
that there is as much as 1 trillion US dollars’ worth of
it.
49
Barbados and China have in place agreements
relating to double taxation and investment protection
50
which should serve to encourage greater investment flows
between the two countries. Barbados should seek to
attract some of that 1 trillion US dollars of Chinese
FDI.
45. As discussed above, the extraordinary development of
outbound Chinese tourism suggests that there may well be
a significant new target market for Barbados and the
Caribbean. Given the importance of this sector to the
economy as a whole, a research and marketing agenda in
this area strongly suggests itself to give Barbados an
opportunity of attracting its share of this 100 million
person and growing Chinese outbound market.
46. One of the domestic features of China’s emergence is the
concurrent emergence of a vast middle class. McKinsey
predicts
51
that the category of persons that can be
described as upper middle class and affluent by the year
2022 will number in excess of 224 million. These are the
persons who might be tourists to Barbados but also
consumers of Barbadian niche products. In this regard,
producers of high-quality, export-ready products should
be looking closely at the Chinese market. With regard to
rum, for example, the spirits market in China is the
world’s largest and one in which the consumption of rum
increased by more than 200% between 2009 and 2013.
52
49
China Global Investment Tracker, American Enterprise Institute, 2015,
http://www.aei.org/china-global-investment-tracker/
50
Treaties Section, Invest Barbados website, 2015
http://investbarbados.org/treaties_home.php
51
Mapping China’s middle class, Dominic Barton et al, 2013
http://www.mckinsey.com/insights/consumer_and_retail/mapping_chinas_mid
dle_class
52
The Wine and Spirits Market in China, Vinexpo, 2015
http://bordeaux.vinexpo.com/media/cms_page_media/720/CHINE%20-
%20ANG.pdf
23
47. It should be noted that some of this is already
happening. The government of Barbados has established an
Embassy in Beijing and has been working with the Chinese
authorities to develop commercial and cultural
opportunities. But the scope of China’s rise requires a
proportionate response. The research and policy agenda
sketched out above constitutes just a small nudge in
encouraging Barbados, and in particular its private
sector, to undertake its own “pivot”.
24
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Chinese to make up bulk of Sam Lord's Labour. [Online]. [Accessed
  • M Madden
Madden, M. 2015. Chinese to make up bulk of Sam Lord's Labour. [Online]. [Accessed July 02 2015]. Available from: http://www.barbadostoday.bb/2015/
Global Automotive Retail Market: From selling cars on the spot to centrally managing the retail grid. [Online] Available from: https://www.kpmg
  • Barbados
Barbados: University of the West Indies KPMG. 2013. Global Automotive Retail Market: From selling cars on the spot to centrally managing the retail grid. [Online] [Accessed July 07 2015] Available from: https://www.kpmg.com/Global/en/
China is Watching as US seeks to Smooth Ties with Latin America
  • S Tiezzi
Tiezzi, S. 2015. China is Watching as US seeks to Smooth Ties with Latin America. [Online]. [Accessed July 06 2015]. Available from: http://thediplomat.com/tag/
/files/Summary%20Report%20US- China%2021.pdf 11 U.S.-China Trade Facts, Office of the United States Trade Representative, 2014, https://ustr.gov/countries-regions/china-mongolia-taiwan/peoples- republic-china 12 As was the case in China with regard to the use of the word " rise
  • David Shambaugh
The Emergence of "Greater China ", David Shambaugh, 1993 10 China-US relations, Kevin Rudd, 2015 http://belfercenter.ksg.harvard.edu/files/Summary%20Report%20US- China%2021.pdf 11 U.S.-China Trade Facts, Office of the United States Trade Representative, 2014, https://ustr.gov/countries-regions/china-mongolia-taiwan/peoples- republic-china 12 As was the case in China with regard to the use of the word " rise ", there has been a debate in the United States around the use of the word " pivot ".