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TEST CODE 01216032

FORM TP 2009057 MAY/JUNE 2OO9

CARIBBEAN EXAl\,TTNATIONS COUN CIL

SECONDARY EDUCATION CERTIFICATE
EXAMINATION

ECONOMICS

Paper 0312 - General Proficiency

I.t1 ,
nours

1. There are FIYE questions on this papèr; Answer ALL questions.

2, Silent electronic ealculatore may be used, but ALt necessar¡r \ilorking should be
clearþshown,

3. Answer the questions on the Answer Booklet provÍded and return it.

DO NOT TURN TIIIS PAGE UNTIL YOU ARE TOLD TO DO SO

Copyright @ 2007 Caribbean Examinations Council @

All rights reserved.
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Read the passage below and answer the questions that follow.

Why Integrate: The Case of the Caribbean Region

Territories that comprise the Caribbean Community (CARICOM) exhibit certain common
features including: small size; vulnerability to hurricanes and other natural disasters; a high
prevalence and rising incidence of HIV/AIDS infections; persistent poverty in several
countries; and, violence and crime linked to the narcotics trade. Additionally, CARICOM
countries as a bloc have been experiencing balance of payments deficits and slow and sluggish
growth. According to the International Monetary Fund (IMF), CARICOM countries over the
period 1984 - 2004 had an annual average real gross domestic product (GDP) growth rate of
1 .8 per cent, while that of the developed world grew by an annual average of 4.3 per cent over

the same period. In fact, only Barbados, Jamaica, Suriname, and Trinidad and Tobago have
seen accelerated growth over the period with Trinidad and Tobago outpacing the other
Caribbean territories. These negative trends are not only affecting economic growth, but also
economic development in the region.

To address some of these challenges, the region is seeking to intensify its economic integration
process under the CARICOM Single Market and Economy (CSME). This integration is also
urgently required to address the challenges posed by globalization and the loss of trade
preferences or concessions. It is the expectation that integration will lead to an improved standard
of living for the region's populace; more efficient operations of social services; increased
productivity; improved competitiveness of products produced in the region; economic
expansion; and, full employment of the region's factors of production. As such, the region is
seeking to both improve the quality of life of its populace and expand economic activities.
However, integration must be viewed as a means to an end and not an end in itself. Hence, there
will be need to improve other complementary measures to ensure that this integration process
is successful.

1. (a) Outline the role of the International Monetary Fund (IMF).

( 2 marks)

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(b) List TWO objectives of the Caribbean Community (CARICOM).

( 2marks)

(c) Explain how 'small size' affects the Caribbean region economically.

( 2 marks)

2. (a) Give TWO examples of EACH of the following tems:

(Ð Economic growth

(iÐ Economic development

( 4 marks)

(b) According to the passage, which territory showed the fastest rate of growth?

( lmark)

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 List FOUR reasons for the slow economic growth in the region.

( 4 marks)
(b) Outline TWO effects of a low economic growth rate in the region.

( 4 marks)

4. (a) List ONE item in the capital accounts of your country's balance of payments statistics.

( lmark)
(b) Explain how the Caribbean region mieht benefit from economic intesration. Include
TWO benefits in your response.

( 4marks)
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5. (a) Describe THREE types of unemployment that affect the Caribbean region.

( 6marks)

(b) Outline TWO complernentaxy measures that regional governments might need to put in
place to take advantage of regional integration.

( 6 marks)

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(c) Outline TV/O ways in which the loss of trade preferences or concessions might affect
the Caribbean region.

( 4 marks)

END OF TEST

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