Towards economic reconstruction

From the International Liaison Office of President Aristide,
Update 21 June 1995

The government of Haiti recognizes the need to strengthen civil society as a fundamental component of economic reconstruction. Efforts to modernize and decentralize the State and to revitalize the economy will not improve the situation of Haiti's majority unless civil structures can be strengthened at the same time.

This is because the Haitian formal economy, which is concentrated mainly in Port-au-Prince, has employed less than 300,000 people (less than 5% of the population) even at its best moments. Over 70% of the population lives in the countryside. Thus economic revitalization will depend largely on the social and economic activities of the Haitian people and their civic organizations.

The pace of economic revitalization has been slow, since the return of President Aristide on October 15, 1994, for a number of reasons, including:

• The social and practical challenges involved in transforming many decades of corrupt, parasitic governments, and reorienting the country's institutions towards democracy and productivity.
• A development deficit created by the coup regime, which had to be overcome, and included: ignoring debt payments to the international community and building up tens of millions of dollars in arrears; targeted destruction of civic organizations and productive infrastructure; the looting of government ministries; driving out international investors.
• The international community's slowness in delivering on commitments of development assistance.
• The weak bureaucratic structure of the Haitian government.
• Continued insecurity due to the limited effectiveness of the Interim Public Security Force.
The slowness of the Haitian private sector to launch economic initiatives.

Economic revitalization is very much tied to the strengthening of Haitian democracy and the creation of a new social contract for the country. Key steps along the way are: 1) the June elections for Parliamentary and local officials, 2) the full deployment of a new, civilian Police force, and 3) advances in creating an effective judicial system and carrying out the work of the National Truth and Justice Commission.

Some of the governmental initiatives to revitalize and strengthen Haitian civil society, which was targeted for repression and devastated under the coup regime, include:

• Lowering the Price of Basic Goods: community stores and community restaurants are being established around the country, as part of the presidential small projects program, in order to offer basic foods at lower prices, and perhaps eventually to bring down the market price of food. For example, a new community store opened last week in the public market at Leogane managed by a committee of local popular organizations. The selling price for the primary products are : 305 gourdes (US$ 21.80) for a sack of rice, compared to 350 (US$ 25) in the parallel market; 375 gourdes for sugar (compared to 430); 60 gourdes for a gallon of oil (compared to 70).
• Credit for the Rural Sector: The government is currently examining methods for providing vitally needed credit to Haiti's poor majority, particularly in the rural sector where 70% of the population is located. Credit in the Haitian countryside (as well as for the urban poor) has always been extremely limited, controlled by a few people and provided at usurious interest rates of over 240% per year. The decapitalization of the rural population under the coup regime has only made the problem more severe. The government is also examining a number of institutions and mechanisms to help make credit more readily available.
• Training: Mechanisms to provide vitally needed training to civic and citizens organizations are being explored, in particular those involved in production and marketing (artesanry and peasant cooperatives, market women, etc..) Training would be targeted to enhance productive activities, including refining artesanry, basic management of finances, project administration, etc.
• Collective Infrastructure: The government hopes to further revitalize the rural economy by providing collective infrastructure which will improve the well-being of broad sectors of the population and enhance their ability to foster social and economic development. Such infrastructure would include roads, potable water wells and cisterns, and irrigation projects.

In addition, various government initiatives --the Economic and Social Assistance Fund (FAES); the Central Implementation Unit of the Prime Minister's Office; the Ministry of Public Works-- are beginning to advance more rapidly in implementation of basic infrastructure and job creation programs.