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#4769: Haitians fear for economy after contested vote (fwd)


WIRE:08/04/2000 11:07:00 ET
 Haitians fear for economy after contested vote
 PORT-AU-PRINCE, Haiti (Reuters) - Haiti is "heading toward a
catastrophe"  with the troubled economy of the  western hemisphere"s
poorest nation threatened by possible renewed international sanctions
following controversial elections, economic and political observers say.
The value of Haiti"s currency, the gourde, plunged this week to 22
gourdes to the U.S. dollar, the biggest drop since July 1994, just
before a United Nations economic embargo ended, a local economist said.
The exchange rate was 18 gourdes to the dollar before the country"s
first round of elections. The depreciation stems from fear of sanctions
after international observers declared that the May 21 elections were  
flawed. The legislative and local elections, Haiti"s first national vote
in more than three years, had been considered a critical step in the
country"s struggle to build a stable democracy after decades of
dictatorship and military control, as well as paving the way for the
release of $500 million in foreign aid. But the vote  instead sparked
political controversy, sporadic violence and the possibility of
international sanctions.In June, the Organization of American States
said Haiti"s Provisional Electoral Council (CEP) had miscalculated
voting percentages for senatorial seats in the first round, giving a
stronger victory than was  earned to the popular Lavalas Family party of
former President Jean-Bertrand Aristide. The CEP said it had followed an
internationally approved tallying method used in prior elections and
adamantly refused to recount the votes. Haiti proceeded with the
inauguration of its newly elected mayors two weeks  ago, and was poised
to publish official election results.Haiti"s position has prompted the
international community to criticize sharply the elections and
reevaluate relations with the country. The Port-au-Prince residence of
the ambassador from Canada, one of the nations to question the
elections"legitimacy, was the target last week of a grenade attack. No
one was hurt but the ambassador"s car and garage were damaged.


 Instead of imposing outright sanctions, many observers expect the
international community gradually to withdraw foreign aid. Japan froze
its aid to Haiti last month and the European Union began a review in
July that eventually could halt a $194 million five-year aid package.
"It will be pulled in a slow  manner, as a time-consuming process," said
Jean-Claude Bajeux, director of the Ecumenical Center for Human Rights,
who said Haiti is deeply dependent upon foreign aid because of its
crumbling infrastructure. "Haiti doesn"t have the means to finance any
projects," said Bajeux. "We need $1 billion a year at least to take care
of water, electricity,and telephone. Here, life is hell. The country i  
heading toward a catastrophe." Even though talk of sanctions is on
everybody"s lips in the Haitian capital, locals doubt the international
community will impose  them. "I don"t think we"ll have another embargo,"
said Hans Tippenhauer, an analyst for Group Croissance, an economic and
business consulting firm in  Petionville. "The first embargo didn"t bear
any fruits. It  was supposed to restore democracy, but we came  back to
the same problems."


 The United Nations imposed an embargo in the early 1990s that aimed to
punish a military regime that ousted Haiti"s first freely elected
president, Aristide,in a 1991 coup and ruled until 1994. "It didn"t
work,and it was destructive to the population, especially to the poor
people," said Tippenhauer, who estimates the embargo killed 80 percent
of Haitian production. The embargo was lifted in 1994 after Aristide was
restored to power by a U.S.-led invasion force. Parliamentary      
elections held in 1997 were declared fraudulent, leaving Haiti"s
government paralyzed for much of the last three years. President Rene
Preval dissolved the parliament in early 1999 and has ruled by decree
since. Aristide is widely expected to run for and win the presidency
this year. Haiti"s annual per capita income is less than $400 and the
United Nations estimates that more than 80 percent of the population
does not earn enough to meet basic daily needs.