Anastasia Moloney, writing for Reuters Alerts, looks at the poor prospects for long-term economic growth in Haiti.
Last month, Haiti’s Prime Minister Jean-Max Bellerive visited Florida to attract potential foreign investors to help rebuild the earthquake-ravaged nation.
He encouraged international textile firms to set up shop in Haiti and touted the country’s infrastructure, telecommunications, agribusiness, and tourism sectors as growth areas.
But that’s a hard sell for a country known for high levels of corruption and red tape, which is facing heightened insecurity and rising political instability.
“Major new investment is still in the wait-and-see status,” said Mark Schneider, a senior analyst at International Crisis Group (ICG). “There are limited commitments from investors.”
Major donors to Haiti, such as the Inter-American Development Bank (IDB), say that rebuilding the Caribbean nation is impossible without private sector participation, which is crucial to kick-start the local economy and generate much-needed jobs for the country’s millions of jobless.
But so far, few foreign investors are willing to bet on Haiti.
The lack of infrastructure and a master plan to revive Haiti’s crippled energy sector — a patchwork electrical grid – doesn’t help. Haiti’s main port at Port-au-Prince is crucial to the country’s recovery but the facility remains impaired six months after the earthquake along with long delays in customs clearance.
With growing frustration at the slow place of recovery and the few jobs around, social unrest and violence in the tent cities where 1.5 million or so displaced Haitians live, is likely to rise.
“Things are not moving as fast as anyone wants,” ICG’s Schneider told AlertNet.
“Haitians need to see reconstruction mechanisms, like the Interim Haiti Recovery Commission, actually functioning in a visible way, projects being approved and aid money being spent. They also need to see some economic investment that begins to show itself in a visible way to both micro and macro-businesses,” he added.
The post-quake atmosphere of insecurity and uncertainty about the future only exacerbates simmering tensions resulting from decades of entrenched poverty, and political instability punctuated by military coups and dictatorships. This climate provides a breeding ground for social unrest, analysts say.
“The potential for demonstrations is high. The potential for demonstrations that provoke excessive reaction is high,” Schneider said.
One likely flashpoint is presidential and parliamentary elections scheduled for Nov. 28.
“No election in the past 20 years in Haiti has gone smoothly, so I wouldn’t expect to see this one to go smoothly either with the added pressure of a post-quake situation. But it is critical that ultimately they are seen as credible by the Haitian people and acceptable by the international community,” Schneider said.
Anti-government sentiment is already evident.
In May, some 2,000 Haitians took to the capital’s streets to demand President Rene Preval’s resignation, some accusing him of exploiting the disaster to stay in power while demanding the return of exiled former President Jean-Bertrand Aristide.
Yet for some intrepid investors, crisis is opportunity.
Last month, Coca-Cola and the Inter-American Development Bank teamed up with TechnoServe, a U.S. non-governmental organisation (NGO), in a $7.5 million initiative to boost the yields and incomes of Haiti’s 25,000 mango farmers. Coca-Cola has already launched a new drink made from Haitian mangoes – Odwalla Mango – that is being sold in major supermarkets in the U.S.
Through his foundation, Mexican Carlos Slim, the world’s richest man, together with former President Bill Clinton and philanthropist Frank Giustra have set up a $20 million dollar fund to help local small and medium-sized companies grow and create jobs. But such initiatives are the exception rather than the rule.
The few jobs that are available for displaced Haitians are mostly being provided by the international aid community.
Cleaning toilets in the scores of tent camps sprawled across the capital, clearing the rubble, and employment as liaison officers for NGOs are the staple jobs around, and even these are hard to come by.
But such jobs can’t lift Haiti from the rubble and turn around the negative economic growth (the economy is expected to contract by 8.6 percent) predicted this year. For that to happen, major cash injections from private companies will have to pour in. And that’s still a long way off.
The report appeared at http://www.alertnet.org/db/blogs/59877/2010/06/30-175224-1.htm