28907: Durban (comment): Dominican Border Blues (fwd)

[Bob Corbett <corbetre@webster.edu>]

Lance Durban <lpdurban@yahoo.com> posts this comment and would
appreciate any informed insight, corrections, updates, or comment:


Our company had been considering a new investment that would require
the sourcing of raw material from the Dominican Republic, so I asked a
Haitian friend about the relative ease or difficulty of importing raw
material from the DR.  Did I get an earful.

He claimed that for years he had been importing occasional truck-load
shipments of components from a Dominican supplier who shipped the
product over in one truck, and that he had even sold several truckloads
of his product back into the DR.  He claimed to be paying full duty on
material imported into Haiti, but he didn?t have any problem with that.
 The problem was that many Haitian importers had found it expedient to
have Haitian truckers (reportedly from Fonds Parisien, near the border)
come to the Dominican side of the border, transfer the goods over to
their trucks, and then, somehow, slip through to Port-au-Prince paying
little or no Haitian duty.

The "system" reportedly worked fine until the Latortue Government
changed someone in Customs who decided it was time to tighten things
up.  And he did, reportedly increasing tax collections at the
Jimani/Malpasse border from 9 million gourdes to 60 million gourdes per
month!  The losers:  those Haitian truck drivers, importers, and
(presumably) the helpful folks on the border facilitating duty-free
entry.  The winners:  the Haitian Treasury and those who would like to
see Haiti lifted out of the basement on Transparency International?s
list of least corrupt countries.

But since May, Haiti has a new President, and although the instigator
of change at Haitian Customs is still on the job, the losers are
fighting back, testing, if you will, the resolve of the new
Administration.  The test involves shutting the border completely and
effectively stopping all commerce.  Unfortunately so far, the Preval
Administration is failing the test.  A border closed to commerce has
impacted a number of Haitian manufacturers, my friend?s factory
included, who have simply had to close operations.  I am guessing that
fewer imports means less need for dollars, so this may be a factor in
the strengthening of the gourde in the last few weeks, but the long
term implications for Haiti are dire.  It is a lot easier to close a
factory than it is to open one, and new investors will think twice
before building a plant in a country where a critical source of raw
material can be closed at the whim of a few truck drivers.  In essence,
the Preval Government needs to decide if it will support Haiti?s honest
importers who pay their taxes or those dishonest importers who use
border connections (truckers and customs agents) to evade Haitian
duties.  One would think this would be a pretty easy decision, but the
jury is still out?

Lance Durban