Op-Ed by Sandra Casanova, Regional Council Member for Martinique
On July 28, 2026, the Minister for Overseas Territories, Naïma Moutchou, announced that the 2027 budget bill would preserve the social security contribution exemptions under the LODEOM (Law for the Economic Development of the Overseas Territories) and the RAFIP (Tax Incentive Program for Productive Investment). The decision was expected. It is a welcome move. Gérard Dorwling-Carter’s article published in Antilla under the title «LODEOM and RAFIP: Enshrining a Reprieve» accurately describes what this decision is—and what it does not fully address.
What a Suspended Sentence Teaches Us
The announcement concerns a bill, which is still subject to debate and a vote in Parliament. Its continuation has been confirmed, but the structure of the measures remains open: an evaluation mission entrusted last April to the Comptroller General of the Armed Forces, Philippe Leyssenne, and the Inspector General of Finance, Gilles Lara-Adelaide, has submitted its findings, and work to streamline the system will begin after the summer recess. Businesses in Martinique know that the program will be in place by 2027. They do not know what form it will take by 2029.
For seventeen years, the LODEOM has mitigated real disadvantages: remoteness, the limited size of the domestic market, freight costs, and the structure of production costs. It supports jobs and entire industries. It will remain indispensable. Its limitation lies in its own economic dynamics: every budget bill reopens the debate, every national budget decision brings back the same uncertainty, and collective energy is devoted to preserving the foundation rather than building the next level. An industrial investment is decided upon over fifteen years. A compensation program is approved for twelve months.
Why the issue goes beyond the budget
The future of the overseas territories depends on their ability to produce, process, and export more from within their own regional environment. An economy organized around imports and consumption creates little value within its own territory, generates little revenue of its own, and remains dependent on transfers. An economy that processes and exports funds its own development. This is the choice of model at stake, and it will not be settled by any budget bill.
For Martinique, the answer lies in our geographic location. We are at the heart of the Greater Caribbean, a geo-economic region that stretches from Florida to the Guiana Shield and northern Brazil and is home to nearly 800 million people. Our competitiveness depends as much on this region as it does on the cost differential compared to mainland France.
The Regulatory Framework: Martinique’s Comparative Advantage
Competitiveness no longer depends solely on labor costs. It now depends, to a decisive extent, on the cost of compliance: red tape, deadlines, inspections, certifications, and regulatory uncertainty. This is what I call the cost of trust, and it is in this area that regional initiatives produce lasting results.
Martinique is simultaneously French, European, and Caribbean. Few territories in the region can claim this triple identity. It enables us to serve as a regulatory hub that provides Caribbean companies with easier access to the European Single Market and offers European companies a base of operations in the Greater Caribbean. This is a rare comparative advantage—provided we equip ourselves with the tools to make it operational.
Competitiveness is built through an economic environment that sustainably reduces the cost of producing, processing, certifying, and exporting.
The Productive Customs Free Zone
Since 2025, the Territorial Collectivity of Martinique has been implementing a logistics strategy aimed at making Martinique a Euro-Caribbean hub for production, processing, and redistribution. The Productive Customs Free Zone, which the Martinique Assembly voted to establish in January 2026, is now the main driver of this strategy. The project is underway, led in collaboration with the French government and customs authorities.
Three key factors must work together: customs procedures that expedite the flow of goods, an attractive tax system, and a streamlined administrative process. Added to this are digital traceability of goods, appropriate logistics infrastructure, and certification capabilities that enable a company based in Martinique to simultaneously meet both European and Caribbean requirements. The agribusiness sector, cosmetics and dietary supplements, medical devices, aircraft maintenance, and the industrial circular economy are among the primary sectors involved.
This framework does not replace any existing measures: customs suspension, the new-generation free trade zone, and LODEOM exemptions may be combined for the benefit of a single production site. LODEOM thus becomes a tool within a broader strategy, and the annual budget debate is no longer the sole focus of our economic policy.
The Productive Customs Free Zone and the economic system it underpins are poised to become one of the driving forces of Martinique’s economy. Many economic sectors share common needs: easier access to markets, reduced logistics costs, and compliance with regulatory requirements. This is where the logistics strategy comes into play, serving as a cross-cutting lever for competitiveness that benefits the entire economic fabric.
A question regarding the 2027 deadline
As the presidential election approaches, there is one question that should be posed to all the candidates: What economic strategy do they propose to sustainably strengthen the competitiveness of the overseas territories within their respective geoeconomic environments?
It seems to me that there are three requirements that must be addressed jointly by elected officials and the business community in Martinique.
– The multi-year nature of the programs, so that the predictability they offer businesses aligns with the actual duration of investment cycles.
– The explicit link between the LODEOM, the RAFIP, and the free trade zone regime provided for in the Union Customs Code: the work to be undertaken this fall can help shed light on this issue.
– Incorporating the competitiveness of overseas territories into a clear strategy for regional integration, with the corresponding engineering resources.
Compensatory measures will remain necessary as long as structural disadvantages persist.
It is therefore these very obstacles that must now be addressed: freight costs, compliance costs, and the time it takes to access markets. Martinique has never undergone a phase of industrialization in the full sense of the term: its productive capacity has been built around an export-oriented agribusiness sector inherited from the colonial economy, never around a diversified industrial base.
It now meets the geographic, regulatory, and human conditions necessary to launch it.
The reprieve secured for 2027 gives us time to build the foundations that will, in the future, make this debate less pressing. Let’s make the most of this reprieve and make this industrialization the cornerstone of the next economic strategy for the overseas territories.
