25622: Simidor (news): Lance Durban and Michael Deibert; an excellent analysis (fwd)

[Bob Corbett <corbetre@webster.edu>]

From: daniel simidor <danielsimidor@yahoo.com>

Trying to invest in Haiti:
Years of political turmoil, violence foil efforts to
build a successful economy on impoverished island
nation.

Thursday, July 07, 2005

BY MICHAEL DEIBERT
For the New Jersey Star-Ledger

PORT-AU-PRINCE, Haiti -- Lance Durban first arrived in
Haiti in 1979 to help construct a low-cost housing
project in the capital's Cite Soleil shantytown.

Today, he owns one of the few factories in Haiti that
export everything from electronics to Levis to the
United States. His company, Manutech, makes
electronics transformers and inductors, a key part of
any power supply.

"I like to say that our real product is inexpensive
people fairly close to the United States," says
Durban, a 57 year-old upstate New York native as he
surveys some of his company's 400 employees on the
factory floor, located just a 90-minute flight from
Miami.

But the reality, he said, is that Haiti has failed to
turn that advantage into the profits needed to spark a
devastated economy.

"The governments here have been trying to solve the
political problems of the day, which may or may not be
solvable, and as a result job creation has sort of
taken a back seat," says Durban, as he sits in his
air-conditioned office in an industrial park near the
airport. "Increasing job opportunities should be job
No. 1 for any government."

Job creation in Haiti is no idle concern in a nation
where 80 percent of the population lives in poverty
and the rate of hunger in the country is now ranked as
the world's third highest, surpassed by only Somalia
and Afghanistan. Haiti's economy shrank 3.5 percent in
2004 and two-thirds of the labor force have no formal
jobs.

Haiti's tumultuous political situation -- which saw
the ouster of President Jean-Bertrand Aristide amid an
armed rebellion and street protests against his rule
in February 2004 -- has repeatedly scuttled any
effective attempts to create long-term development
projects.

The current interim government, headed by President
Boniface Alexandre and Prime Minister Gerard Latortue,
is beset on one side by a violent urban campaign in
the capital launched by street gangs supportive of
Aristide and a series of natural disasters on the
other.

With elections coming up in October and November, the
violence has escalated. Just last week, a kidnapped
International Red Cross worker was found shot to
death. Earlier, the U.S. Peace Corps departed the
island and other nonessential U.S. residents were
requested to evacuate. Tension over illegal
immigration issues with the Dominican Republican,
which borders Haiti continues to simmer.

These problems have kept Haiti officials largely too
busy to spend time on issues such as job creation and
the country's chronic poverty.

Many observers wonder if an economic renaissance is
ever possible.

"Haiti used to be the home of low-wage assembly
industries and they used to be relatively successful,
but it's hard to envision a scenario where that
happens again," says Terry McCoy, Director of the
Latin American Business Environment Program at the
University of Florida in Gainesville.

"The global scene is so different now than it was when
Haiti was a manufacturing player. Because of China's
low wages, Latin American and Caribbean countries need
to compete further up the chain, you need an educated
force and good infrastructure, and that's where Haiti
comes up really short."

The problem has been worsened by the collapse of
Haiti's system of agriculture that has resulted in
tens of thousands of people flooding cities such as
Port-au- Prince, Cap Haitien and Gonaives in search of
work.

Haitian farmers at one point exported substantial
quantities of coffee, essential oils, cocoa and
mangoes. But a significant blow was dealt by the
U.S-Canadian funded Program for the Eradication of
Porcine Swine Fever and Development of Pig-Raising
(PEPADEP) in the early 1980s. The program destroyed
1.2 million Creole pigs (cochon Creole in Haiti's
native Creole language) in the country that formed one
of the backbones of its peasant economy when tests
showed nearly a quarter of the island's pig were
infected with African Swine Fever.

Haiti, which had also produced low-cost, inexpensive
rice for domestic consumption for many years up until
the 1990s, lost the ability to do so competitively in
1995. That stemmed from a move by the Aristide
government to implement an economic adjustment plan
mandated by the International Monetary Fund that cut
tariffs on rice imports to the country to 3 percent,
from 35 percent.

Massive deforestation, which has seen 90 percent of
Haiti's tree cover destroyed for charcoal and to make
room for farming over the last 50 years, has only
exacerbated the problem, leaving little left to hold
the topsoil when the rains fall.

As the environmental crisis continues, Haiti's current
exports now hover at around $338 million per year,
with 83 percent of that going to the United States.

Those trying to develop Haiti's economy feel that, in
order to improve its investment and manufacturing
climate, Haiti must first get a handle on its
environmental worries.

"We have a serious environmental crisis in the
country," says Camille Chalmers, director of the
Haitian Platform to Advocate Alternative Development,
which pushes for grassroots developmental initiatives
on behalf of Haiti's poor. "But the first cause is
misery, people are born here with a lot of desperation
and their sole source of liquidity are the trees."

Manufacturing-centered jobs such as those Manutech
provides, are centered around the capital, where
thousands of workers compete for a few thousand
assembly jobs, which pay on average about U.S. $2 per
day.

To help offset such meager wages in a country that has
been hard-hit by petroleum prices, Manutech subsidizes
a daily meal program, served twice a day, and has
instituted maternity leave and school loan programs as
well.

But many experts say the only real solution is a
long-term investment in rebuilding Haiti by the
international community, which maintains a force of
7,600 United Nations troops in the country, in advance
of elections this fall.

"We can't just look at the elections as if that's end
game, that's the beginning of it, of the real process
for getting Haiti on a track for development," said
Abby Maxman, Haiti country director for the aid
organization CARE, speaking in the group's
headquarters in the capital, Port-au-Prince.

Michael Deibert's first book, "Notes From the Last
Testament: The Struggle for Haiti," will be published
by Seven Stories Press in October.


© 2005  The Star Ledger

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