Paul Collier’s Report on Economic Security in Haiti

Robert Maguire

Haiti is not hopeless or doomed to failure. Oxford University economics professor Paul Collier makes this essential and oft-overlooked point in discussions on Haiti in his report on how to establish economic security in Haiti for the United Nations Secretary-General. It is a much-needed change in discourse that, until recently, included the discussion of ‘trusteeship.’

Collier does not ignore Haiti’s dire circumstances nor does he dismiss the challenges it will confront in 2009. Yet, he concludes that Haiti has “fundamentals that favour economic development,” including political leadership that is “good by the standards of most post-conflict situations.” This new kind of Haitian political leadership with “integrity, experience and ability, and a deep concern with the maintenance of social peace,” as Collier describes it, is an important change in a country known more for leaders who serve themselves, than the nation.

Time is of the essence, says Collier, pointing out the need for rapid action culminating in a donors meeting in April and the implementation of two or three-year strategies agreed upon by all key actors including the government of Haiti, beginning in May. Implementation, however, will depend on how his ideas revolving around jobs, basic services, food security and environmental sustainability, are received from within Haiti.

Collier acknowledges the important role Haitian actors must have in determining strategies and programs for their own country, a persistent problem that has undermined the government’s ability to act. In December 2008, speaking at the United States Institute of Peace, former Haitian prime minister Jacques-Edouard Alexis lamented the tendency of international actors to prescribe programs for Haiti, often without input from the Haitian government. In mid-January 2009, Jean-Max Bellerive, the Minister of Planning and External Cooperation, said Haitian officials are tired of donors pledging money without coordinating with the government. Both men seek better awareness and coordination of activities undertaken by non-governmental organizations (NGOs) in Haiti. Of the estimated 3,000 NGOs operating in Haiti, said Bellerive, only 400 were registered with his office.

Haitians are not the only ones making this point. World Bank President Robert Zoellick, speaking in mid-January 2009, concluded that Haiti is “the site of too many feel-good projects draped in national flags.” He suggested the creation of a trust fund for donors to pool resources to achieve a convergence of strategies. Collier’s complementary idea of a quasi-independent, public coordinating agency—an “Independent Service Authority”– to regulate and coordinate the provision of basic services in a context where the state seems willing but not able to provide services, merits serious consideration.

Haiti’s structural problems are not benign. Despite significant foreign aid, Haiti remains a society where benefits accrue at the top and most Haitians remain deeply impoverished. Seventy-eight per cent of Haiti’s people survive on less than US$2 per day.

“Haiti does not have the intractable structural socio-political problems that beset most other fragile states,” claims Collier. However, he underestimates the obstacles that Haiti’s deeply rooted inequality and social division based on skin color, prejudice, class and geography, present to achieving economic security for all. There are good reasons scholars have assessed Haiti’s political economy as ‘apartheid in the Caribbean.’

Thus, Collier’s proposals to move Haiti from natural catastrophe to economic security must address two key questions:

1. Who are the beneficiaries of the proposed initiatives?

2. How do these initiatives help to resolve the underlying cause of Haiti’s poverty and underdevelopment: long-standing, uneven social, economic, and political relationships among Haitians?

Asking these questions is important when promoting the garment industry as a key component of economic security as Collier does.

Without doubt, HOPE II, which gives Haiti preferential market access to the United States, is an important part of the overall equation for creating jobs and providing work opportunities to destitute people. It is important not to repeat the mistakes of the Seventies and Eighties, when Haiti was predicted to become the “Taiwan of the Caribbean.” This earlier experience with assembly plants did not address uneven, exploitive relationships that under-gird Haiti’s chronic poverty and instability. Factory workers are among those struggling to survive on less than $2 per day. Indeed, highly concentrated, urban-centric investment exacerbated inequalities between rural and urban, and between ‘haves’ and ‘have-nots.’

Collier’s suggestion of several ‘export zones’ will help to mitigate some past mistakes. Equally important, employers must exhibit social responsibility toward workers. Low cost gestures by factory owners —subsidized child care, cafeterias, and transportation— will help to alleviate workers’ burdens. Upward wage adjustment is warranted. The garment sector must generate a Haitian government revenue stream for strengthening institutional capacity, perhaps in the area of port management and taxation authority.

Collier’s endorsement of the Rapport d’Evaluation des Besoins post-Desastre (PDNA) presupposes actions to extend crucial investment for jobs and production to rural locations—where some 60 per cent of Haitians live. Neglect of rural investment in the Seventies and Eighties doomed Haiti to dependence on increasingly costly imported food and sent farmers onto hillsides to make charcoal, into urban slums or to south Florida.

Before the 2008 hurricanes, Haitian government investment was heavily weighted toward improving the ability of the country to feed itself. This indicates not just the government’s priority, but also that lessons have been learned.
Obstacles identified by Collier to expand the garment sector will take precious time to overcome. The ‘youth tsunami’ Collier cites as accelerating already acute pressure on Haiti’s fragile landscape is a potential geyser of instability. Given the need to pay urgent attention to this tsunami, ‘shovel ready’ labor-intensive job creation to rehabilitate Haiti’s natural environment and productive infrastructure as well as provide youth with a stake in their country’s future is needed. The government’s interest in creating a National Service Corps merits serious consideration. Real wages,not ‘food-for-work,’ should be paid.

Regionally, Collier identifies narco-trafficking as the principal problem in Haiti’s neighbourhood. Narco-trafficking and the corruption and violence it brings are ‘game changers’ in a negative sense. Any economic gains made in the next year could be undermined by this criminal activity.

Haitian President René Préval has been pleading for help on narco-trafficking since becoming president in May 2006. Little has been forthcoming. He has expressed concerns about narco-traffickers gaining a foothold in his government.

This is a recipe for catastrophe and a problem that Haiti cannot solve on its own. The United States and Canada can —and should— address this challenge.

Dr. Robert Maguire, on sabbatical from Trinity Washington University, is a Jennings Randolph senior fellow at the United States Institute of Peace in Washington, D.C.