Haiti's business community seeks to help rebuild economy

Go to Original >

Haiti's business community seeks to help rebuild economy 
By Jim Wyss,
McClatchy Newspapers
Stars and Stripes online edition,
Sunday, February 7, 2010

PORT-AU-PRINCE, Haiti — A few blocks from where men lined up for backbreaking jobs digging corpses from the rubble for about $3 a day, a hotel was selling a ham sandwich for five times that amount.

And as throngs of anxious Haitians jostled for bags of rice being tossed from the back of a U.N. truck, women at a market struggled to find buyers for their overflowing sacks of fruits, grains and vegetables.

Haiti's earthquake pulverized concrete and twisted metal, but it also distorted the nation's economy, as it wiped out thousands of jobs and sparked a rush on humanitarian aid.

Now, as Haitians still dig for their dead and the government struggles to reorganize, the business community is trying to figure out how to jump-start the economy amid a historic opportunity to reshape the nation.

No one knows the exact economic toll of the Jan. 12 earthquake that is thought to have killed 170,000 and left 1 million homeless. But economists speculate that it wiped out at least half of the nation's gross domestic product, or about $3 billion to $4 billion.

In downtown Port-au-Prince, where much of the nation's industry was clustered, about 80 percent of the buildings were destroyed. 'Downtown was the lung and heart of the economy of Haiti and now it's completely a ghost town,' said Reginald Boulos, president of the Haitian Chamber of Commerce.

In the days after the earthquake, many businesses saw their stores looted or merchandise lost to fires, he said. Even worse, the administration has failed to articulate a recovery plan. 'We have no idea yet what the government's plans are for downtown,' said Boulos, who lost an auto dealership and grocery stores to the earthquake. 'Not knowing where we are going may be as bad as what happened that day.' Wearing jeans and blue Converse sneakers without laces, Boulos was preparing to host some of the nation's top business leaders at his home to try to begin sketching out a recovery plan.

Among the ideas are bulldozing downtown Port-au-Prince and providing tax breaks for those willing to set up factories in the long-neglected countryside. 'We have to decentralize,' he said. 'This catastrophe is an opportunity to create the new Haiti Inc. where every single Haitian is a shareholder.'

Already the poorest nation in the hemisphere, 80 percent of the population toils under the poverty line.

Unemployment before the quake was thought to be as high as 70 percent and Haiti is heavily reliant on imports and remittances to stay afloat.

But things had been looking up for the country of 9 million. Kidnappings, which had scared away tourists and investors, were dramatically down.

Garment exports were booming under a new trade pact. Inflation was under control. 'I really thought this was going to be Haiti's year,' said Norma Powell, the liaison officer for Brasseire Nationale d'Haiti, which runs the nation's biggest bottling plant and brews the country's only beer, Prestige.

'We were so gung-ho. Tourists were coming back, life was picking up. Now, it's like we crashed and burned.' The quake disrupted the plant's water, milk and beer production lines. Of its 1,450 employees, only about a third have been put back to work. With a little luck, the company hopes to have its factory running at full speed again within two months, she said.

As global aid agencies continue to flood the seaport and airport with food and water, it would be easy to believe that Haiti had lost the ability to feed itself.

While the nation does import food, about 66 percent of workers are involved in agriculture.

And unlike the hurricanes that wiped out crops, the earthquake left farms virtually untouched.

'There are goods and services that are being produced locally, but Haitians don't have the money to buy them,' explained Eric Overvest, the country director of the United Nations Development Program. UNDP has started a work-for-cash program, which hopes to inject money into the economy by hiring up to 220,000 people to clear rubble. But the United Nations has not reached out to the private sector yet, and that is a mistake, said Boulus from the chamber of commerce.

Haiti has water-bottling companies, bakeries and pasta factories, he said, yet aid agencies are flying in many of those products. 'None of these Haitian companies have been used so far to produce things that the international community could have purchased here locally,' he said.

Some also fear that the influx of rice, oil and other staples could undercut local farmers.

Marcus Prior, spokesman for the World Food Program, is sensitive to those concerns and said the rice distribution effort is designed to cover about half the caloric needs of the targeted population. 'We fully expect people to supplement what we give them with other produce,' he said. 'But we are aware that there may also be an associated drop in food prices with this large scale distribution. But that will help the people that have been worst affected by the earthquake.'

Prices may still drop, but a recent stroll through a local market suggested they haven't yet. Vendors said the prices of oil, beans, rice, bread and noodles were increasing, and the price of goods imported from neighboring Dominican Republic have soared. 'Prices are up at least 30 percent,' said Cherlange Rosius, who buys food wholesale and distributes it to local vendors. And a roll of Dominican salami that cost 15 gourdes, or about 45 cents, before the earthquake cost almost six times that much.

Responding to the influx of journalists and aid workers, the service sector has also jacked up prices: $4 Coca-Colas are not uncommon, and at hotels too damaged to rent rooms, guests can spend up to $100 a night to pitch tents in the parking lot.

The massive inflow of aid dollars has also caused the local currency to spike about 25 percent. It has since retreated, but an overpriced gourde could strangle Haitian exports, which may emerge as one of the bright spots in the post-earthquake economy.

There will be other bright spots, too.

Much of the city needs to be razed and rebuilt, which already has local and foreign companies jockeying for contracts, and scrap and cement-recycling companies are eyeing the mountains of rubble the earthquake generated."