What is Currency Convertibility?

The Movement of Capital for the full functioning of the CSME depends to a large degree on two conditions already pointed out in the Revised Treaty provisions –

  • abolishing exchange controls and

  • the free convertibility of currency within the CSME

Currency Convertibility means the ability to freely exchange the currency of one Member State into the currency of another Member State.

For example, a Barbadian should be able to easily purchase goods in a store in Port of Spain with his Barbadian dollars and receive his change in Trinidad and Tobago dollars.

However, this does not always happen because of the existence of two different exchange systems in CARICOM – Fixed and Floating.