Haiti-Economy: Getting Priorities Right

By: Alejandro Kirk – Inter Press Service
PORT-AU-PRINCE, Mar 12, 1996 (IPS) — The big problem with being prime minister of the poorest country in the Western Hemisphere is that just about everything requires urgent, top priority, must-do-now, can’t-wait, top-of-the-list attention.
     And this consideration must be given to most of the population. For the poor-rich equation in Haiti is 80-20. There’s nothing in between. The Caribbean nation has virtually no middle class: the 20 percent rich are of the rotten-rich variety, the 80 percent poor tend to be mostly dirt-poor.  
     No wonder Rony Smarth is in such a great hurry.
     Haiti’s 55-year-old prime minister even manages to find solace in the paradoxes that forever torment this country of six million people which covers 27,750 square kilometres of Hispaniola, the sprawling island it shares with the Dominican Republic.
One such paradox is that poverty is not only a major national problem but also an ”advantage” of sorts, in that it could make economic reforms easier.

In an interview with IPS here, Smarth explains it thus: the ”advantage” of having 80 out of every 100 persons deeply submerged in misery is that there is no middle class which would suffer during the hard transition towards a free market economy.

For Smarth, a lawyer and agricultural economist who studied in Chile and Mexico, the new Haitian government is facing the challenge of laying the foundations for sustained economic growth, and of institutionalising a still fragile democracy.

It doesn’t take much learning to understand the magnitude of such a challenge. No study of the picture painted by statistics is necessary. The extent of the ecological disaster and poverty still strike the most indifferent visitors. Shorn of tree cover, Haiti’s landscape, patchy and brown, accentuates the deprived state of most of its people.

Everything seems to be urgent in this desperate country.

Hunger, disease, ignorance and soil erosion conspire against Smarth’s proposals as do the dictatorial economic and military elite which lost power after the United States sent troops into Haiti in 1994 to return the ovetrhrown president, Jean Bertrand Aristide to power.

They lost political power, this elite, but succeeded in holding on to vast wealth and weapons. The occupation force, held in check later by the United Nations, has dissolved the Haitian army and dispersed the paramilitary forces known as Tontons Macoute, formed during the dyanastic dictatorship of the Duvalier family (1958- 86).

Aristide, forced into exile in 1991, handed power to Rene Preval a month ago. Aristide’s ally in the Lavalas Party, Preval was elected in elections generally endorsed as free and fair by observers.

Preval told IPS last week that he proposes to change the course of government policy set by Aristide, who wanted to pump money into social programmes.

Meeting Preval in northeast Haiti the other day, one local peasant leader defined the new course with this mixture of street savvy and words of almost Biblical resonance. ”To get an education we must be in good health,” he said, ”and to have good health we first must eat, but to be able to eat we need the resources to grow food”.

But Prime Minister Smarth’s plans go far beyond simple attempts at poverty amelioration. He told IPS it was a question of building a medium-term economic model based on agricultural exports and agro-industry in a way similar to that adopted by Chile during the 1970s.

What Preval and Smarth are betting on is that in Haiti the polarisation of society is so strong that there is no intermediate social force which could be impoverished by this policy and sabotage the whole process, as occurred under Venezuelan President Carlos Andres Perez between 1988 and 1992.

Haitian peasant organisations are demanding agrarian reforms which would enable them to have access to land ownership, farm credits and technical assistance.

Most of the agricultural land in Haiti is in the hands of ”half-caste” peasants, who rent their parcels of land from absentee landlords, the majority of whom are linked to dictatorial regimes.

Some radicalised groups also propose the collectivisation of agricultural production through cooperatives or state farms.

Smarth rejects outright this last option. ”A process of collectivisation here is impossible, it would be sheer lunacy. Our plan is to give land to the peasants, and help those who already have land but have no registered land title to obtain the proper documents” from the land registry office.

Smarth’s participation in the process of agrarian reform in Chile under the governments of the Christian Democrat, Eduardo Frei Montalva (1964-70), and the Socialist Salvador Allende (1970- 73), has taught him that the government must not try to impose on the peasants a way of organisation alien to their aspirations.

Since the 1791 revolt of Haitian slaves, ”there has been in Haiti a rejection – of libertarian inspiration – of large land holdings and of the state,” said Smarth.

”The old slaves, the peasants, fought (against the French settlers) to have their plot of land, and the Haitian agricultural economy was sufficiently prosperous in the 19th century, thanks to these small family properties,” he added.

In the time of slavery Haiti was the most prosperous of the Caribbean islands, with flourishing exports of cocoa, coffee, mangoes, bananas, sugar, vetiver (used in perfume essences) and other products.

Smarth considers that the structure of property then established after Haitian independence was achieved in 1804 – a species of capitalism or family cooperatives – could lay the basis for a resurgence of an agroindustrial export economy.

One priority of the Smarth government, not only for political reasons, is the institutionalisation of the country, in the sense of an autonomous functioning of the powers of the state and the administrative apparatus.

The state is incapable of assuring its own revenues, said Smarth. ”Very few people pay taxes, and 50 percent of the state budget comes from foreign aid. This is why we propose fiscal reform and the establishment of rigorous financial discipline.”

Such words are probably music to the ears of the International Monetary Fund, the Inter-American Development Bank and the World Bank.

But the new political leadership of Haiti is not happy with the proposals being made by foreign donor agencies in return for multilateral assistance. Such plans give priority to humanitarian aid as against productive investment.

The question many are asking is, whether these long-term plans will succeed in placating the desperation of those who already have little to lose. Social explosions in Haiti are sudden and unexpected, and although spontaneous, astonishingly organised and violent.

Smarth says that the construction of a more or less solid economy depends on the active incorporation of the population who live in the mud of subsistence, in other words, the great majority of the country.

The alternative, he adds, is more of the same that Haitians have suffered since time began.