Abstract Ten 2003

GLOBAL

DEVELOPMENT STUDIES

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Volume Three Winter 2002-Spring 2003 Numbers 1-2.

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Theme: THE TENTH ANNIVERSARY OF THE WEST INDIAN COMISSION REPORT: ASSESSING THE

PROGRESS OF CARICOM NATIONS IN IMPLEMENTING THE COMMISSION'S RECOMMENDATIONS

THE FTAA AND THE FINANCIAL SERVICES SECTOR IN THE CARIBBEAN: ISSUES AND PROSPECTS

Lester Henry

Department of Economics

University of the West Indies

St. Augustine Campus, Trinidad

Published online: February 10, 2017

ABSTRACT

This article examines some of the critical issues facing the financial services sector in the Caribbean in the context of the Free Trade Area of the Americas (FTAA) that is due to become effective in less than two years. Generally, it is argued that the CARICOM region has been slow in addressing the potential impact of the FTAA on the financial services sector. Furthermore, it is suggested that due to the weak regulatory environment in the region the adjustments required for FTAA readiness may be quite onerous in some countries. First, a brief overview of the structure of the financial services sector in the region is presented. This is followed by a survey and assessment of some of the key liberalization issues in the FTAA process. In particular, the recently tabled United States proposal on financial services liberalization is discussed. Third, the regulatory environment for financial services in the region is examined. The fourth section assesses the level of competitiveness of regional firms, and the last section presents a summary of the analysis with some policy implications.