Curaçao’s Potential for Trade Facilitation:The Island’s Best Kept Secret

“Curaçao is a place for trade; from the time of salt and slaves, to modern products and industries and knowledge… People come here for solar energy, windpower, IT connectivity, undersea cables… that sets Curaçao apart.” – Toine Knipping, CEO and Co- Founder, AmiCorp

TEXT NEELAM MELWANI

Despite its small 444 kilometer squared area and 153,000 population, Curaçao is, and always has been, a place for trade. Its unique location, natural harbor, diversified economy and immigrant population are all important aspects of its role as a center for trade facilitation, not only for the region, but also for the international market.
According to Toine Knipping, CEO and co-founder of AmiCorp, an international trust company based in Curaçao, there is a lot of potential that we still could tap into, and a lot of ways to improve the already promising position of Curaçao as a hub for international trade facilitation.

What is Trade Facilitation?
Trade Facilitation is a service that can be offered by a country to assist companies in the efficient import and export of goods and services. It is a process through which procedures and controls governing the movement of goods across national borders can be improved to reduce cost burdens and maximize the efficiency of trade, while ensuring the implementation of regulatory objectives and international legislation.

With the world becoming smaller, it is increasingly important for Curaçao to utilize its assets and unique selling points to continue to diversify its economy and live up to its potential as a center for trade facilitation in the region, whether it be for physical products, knowledge exchange or services. Be it through its multilingual and multicultural population, its ideal position between North and Latin America, its natural resources, or its role as a logistical service hub, Curaçao most definitely could increase its role as a center for international trade facilitation.

Curaçao and International Trade Barriers
The World Trade Organization (WTO) is the only international body that deals with the rules of trading between states. In order to do this, the WTO produces agreements that must be signed and ratified by 2/3 of its members, or the larger portion of the member states, which also happens to be the largest portion of countries of the world. These agreements are like contracts and function as the legal ground rules for international commerce, ensuring that there are some rights and restrictions placed on all countries. The main aim of the WTO is to liberalize trade, however some of its restrictions are in place to maintain trade barriers, protecting consumers, local producers and the environment, and preventing the flow of disease.
Among its agreements, the WTO has been working to refine the articles for trade facilitation in one of its main agreements, the General Agreement on Tariffs and Trade (GATT). The articles pertaining to trade facilitation in the GATT relate to the transit of goods, fees and procedural documentation, and the transparency of international laws and regulations. The aim of these negotiations is to ease border protection and improve procedures related to the movement, release and clearance of goods.
Curaçao is represented in the WTO through the Kingdom of the Netherlands. Nevertheless, the export and import of goods is most often hindered by the excessive amounts of paperwork necessary for the importer or exporter to complete. On that note, Knipping explained that it is as important as ever for Curaçao to become more involved in international trade blocs and the international trading system, focusing on the harmonization of international trade legislation, and easing up on local legislation that may currently inhibit trade.

The Imaginary Barriers
There is little to be done about the existing trade barriers put in place by the WTO, to limit trade and protect local production. However, according to Knipping, there is something to be said about the barriers that we’ve (consciously or unconsciously) created:
• Local Legislation and Restrictions on Immigration: The Government of Curaçao needs to continue to work towards legislation that makes it easier for the knowledge industry to grow in Curaçao by loosening up on immigration restrictions. Essentially, any person who has sufficient funds to support him/herself (and family where relevant), should be able to immigrate to Curaçao with limited hassle.
• The Local Mindset on Competition: Local businesses should focus on improving their own business operations in order to compete better in the international market place, rather than looking towards a single competitor and competing directly with them. Local companies should set goals based on the international market.
• Playing the Victim Card: More often than not, people, the government and businesses in Curaçao play the victim card to justify their challenges or failures. Like any country in the world, there are restrictions to the situation in Curaçao, and it is important that business owners, the government and individuals stop hiding behind these barriers. Although Curaçao is a small place, and there is legislation that compromises the success of business, business owners should find creative solutions to their problem and change their mentality to help them get ahead.

The Pros and Cons of a Small Community “There are new opportunities for business in Curaçao every day. We live in an open society, where people often pass through. You are able to meet new people and there are several events, forums and activities that connect different people from different fields.”

According to Knipping, it is important that Curaçao finds a balance between protecting the interests of Curaçao’s local entrepreneurs and opening up its borders to healthy competition. “The ‘small town mentality’ is making our world of business inefficient. Curaçao needs to open up to new opportunities and work to improve the situation of our economy through encouraging consistent and sustainable growth.”

What next?
Knipping used Singapore as an example with regards to how to tackle trade facilitation and opening up borders to stimulate economic growth. In Singapore, as long as you have the adequate resources to support yourself, you are able to enter the country and stay without too much hassle. According to Knipping, “In order to give business a boost in Curaçao, we [too] need to open up our borders. That’s the only way forward.”
When asked what Curaçao’s next step should be, Knipping explained that we really do need to focus on trade. We already have the necessary infrastructure in place to be a leading logistics hub in the region; the harbor and airport are newly renovated, so it’s just a question of better utilizing our resources. While there are already other trade facilitation hubs in the region, they are either overburdened, lack the appropriate infrastructure, or have paperwork systems that make import and export inefficient. In order to better compete internationally, Knipping remarked that international cooperation will be as important as ever. “We need to start working with partners in Shanghai, for example, to improve our harbor. We should also focus on starting airline travel with Middle Eastern airlines.” In order to accomplish these things, Knipping believes that we should start to look at our internal legislation, breaking local monopolies that only benefit the interests of a vested few, lower the price of doing business in Curaçao, and make business processes less bureaucratic.

The world is getting smaller, and Curaçao’s small size can be seen as both an advantage and disadvantage. In order to remain competitive in the shrinking world, Curaçao needs to create opportunities for investment and employment. The only way forward is indeed to attract more trade and secure more sustainable capital flows. The time has long passed to join the international trading world, and it’s time that Curaçao not only hops on the bandwagon but becomes a leader for trade facilitation in the region.