Caribbean basin initiative
The Caribbean Basin Initiative (CBI) is a broad program to promote economic development through private sector initiative in Central American and Caribbean countries. A major goal of the CBI is to expand foreign and domestic investment in nontraditional sectors, thereby diversifying CBI country economies and expanding their exports. The Caribbean Basin Economic Recovery Act of 1983 (CBERA) (amended in 1990) and the Caribbean Basin Trade Partnership Act of 2000 (CBTPA), collectively known as CBI, provides customs duty-free entry to the United States on a permanent basis for a broad range of products from CBI beneficiary countries. The most recent piece of CBI legislation, the CBTPA, provides beneficiary countries certain trade benefits similar to Mexico's under the North American Free Trade Agreement (NAFTA).

The major elements of the CBI program available to all CBI beneficiary countries that are presented in this guidebook are:
  • Duty-free entry to the United States for a wide range of products grown and manufactured in CBI countries as an incentive for investment and expanded export production, and other special tariff statuses.
  • CBI Textile Program: Under the CBTPA, apparel manufactured in eligible CBI countries from U.S. yarns and fabric, as well as non-textile products excluded from earlier CBI legislation, will enter the United States free of quota and duty.
  • CBI Government Procurement: National treatment for producers in CBI countries in bidding for certain types of U.S. Government procurement opportunities.
  • Exemption for CBI exports to the United States from U.S. Import Merchandise Processing Fees, a fee based on a percent of value-based customs duty surcharge levied on incoming goods to cover costs of U.S. Customs operations.
  • A wide range of U.S. Government, state government, and private sector business development programs, including trade and investment financing, business missions, and technical assistance programs partially supported through U.S. foreign economic assistance (see Section IV).

​For CBI beneficiary countries that have signed a Tax Information Exchange Agreement (TIEA) with the United States, the following initiatives are also available.
  • CBI Convention Tourism Tax Credit: A deduction on U.S. taxes for companies that hold business conventions in an eligible country.
  • Foreign Sales Corporation status, which enables the establishment of a specialized sales subsidiary of a U.S. export company in a CBI country and allows the organizer to receive U.S. tax benefits.
 
In addition to the United States' CBI program, Canada has implemented CARIBCAN, a package of trade development and economic assistance measures for certain Caribbean countries that includes duty-free entry for products to Canadian markets. The European Economic Community (EEC) provides certain CBI countries with duty-free access for a multitude of products and economic assistance through the Lome Convention. CBI Beneficiary Countries As of October, 2000, the following 24 countries have been designated CBI beneficiaries. To qualify for CBI benefits, countries must meet the designation criteria outlined in the Caribbean Basin Trade Partnership Act:
Current nations included in the CBI:
Antigua and Barbuda
Aruba
Bahamas
Barbados
Belize
Costa Rica
Dominica
Dominican Republic
El Salvado
Grenada
Guatamala​
​Guyana
Haiti
Honduras
Jamaica
Montserrat
Netherlands Antilles
Panama
St. Kitts and Nevis
St. Lucia
St. Vincent and the Grenadines
Trinidad and Tobago

Description:
The Caribbean Basin Initiative would establish economic cooperation between nations throughout both Central America and the Caribbean.
Inquiry Questions: 
  • What is the overall aim of the Caribbean Basin Initiative?
  • What similar program is referred to in the first paragraph as a comparison?
  • Based on one of the elements of the CBI program, address the purpose and why the beneficiaries would agree to such an initiative.