6118: Re: 6092: DOLARIZATION OF THE HAITIAN ECONOMY (fwd)

[Bob Corbett <corbetre@webster.edu>]

From: JVoordouw@aol.com

Re: message of Carline Brice Webb

Close to all the prices in the shops are linked to the rate of the US dollar. 
 All of the more expensive articles are already quoted in US$ and people may 
pay in Gourdes after the price is calculated against the rate of the day (the 
high rate, to buy dollars, of course).  Because of oil, transport prices are 
linked to the US$.  So in effect, only the cost of vegetables and services 
(people's labour) is somewhat "delayed" in catching up with the rate of the 
US$.

It would help to get rid of the Gourde and introduce the US$, a la Ecuador, 
El Salvador and long ago Panama.  But it would be resisted, because: (1) a 
decrease in the value of the Gourde makes it easy to enforce decrease in 
salaries, without people immediately noticing it; (2) businesses and 
supermarkets do make sometimes more profits in a situation where the Gourde 
is devaluing (because they tend to raise prices even more than the decrease 
in value of the Gourde would dictate, "based on the expectation that the 
Gourde will fall further.")

Jan Voordouw
Port-au-Prince