a499: Haiti-Rice Scandal (fwd)

[Bob Corbett <corbetre@webster.edu>]

From: Greg Chamberlain <GregChamberlain@compuserve.com>

   By MICHAEL NORTON

   PORT-AU-PRINCE, Jan 27 (AP) -- Police fired bullets and tear gas Sunday
at hundreds of poor Haitians who ransacked warehouses and demanded rice
under a program that critics say is illegally subsidized and benefits some
ruling party officials financially and politically.
   Protesters had poured out of the Cite Soleil seaside slum and surrounded
hundreds of trucks and official state vehicles loaded up with cheap rice.
Rice is a staple in Haiti, a Caribbean nation with one of the hemisphere's
worst hunger problems.
   Riot police fired shots into the air and tear gas canisters into crowds
demanding a share of the so-called "Rice for Peace." But they were unable
to control the crowd, which ransacked port-side warehouses.
   A nonprofit arm of President Jean-Bertrand Aristide's Lavalas Party has
been importing the rice from Asia and the United States free of taxes and
customs duties. Party officials say the program is a legitimate way to
bring down living costs, but some lawmakers from within the party are
accusing one other of profiting from it inappropriately.
   One lawmaker accused others of taking a cut of profits from sales of the
subsidized rice. A high-ranking Senate official confirmed that most Lavalas
Party senators were allowed to take some of the rice to distribute to poor
people in their electoral districts.
   "We voted for Aristide -- not these fat cats or the riot police," Oscar
Francisco, a 19-year-old member of a pro-Aristide grass-roots group,
shouted amid Sunday's melee.
   Lavalas Party spokesman Jones Petit said the party's nonprofit Pou Nou
Tout (For Us All) cooperative imported 70,000 tons of rice between May and
November -- the latest figures he had available -- and distributed it on
the open market, driving the wholesale price down from $26 to about $20 for
a 110-pound bag. Haiti imports a total of 300,000 tons of rice a year.
   Most Haitians buy the subsidized rice for about $1.40 for six pounds,
compared to $1.60 for rice imported with taxes.
   Haitian-grown rice is even more expensive because soil here is eroded,
agricultural practices are archaic and farmers suffer transport problems.
   A single cent can make a big difference to the 8.2 million people of
this Caribbean island nation, where the average daily income is $1.
   Petit justified the rice program as a legitimate "struggle against the
high cost of living."
   But businessmen and economists disagreed.
   "It's an unfair trading practice, and illegal," said Chamber of Commerce
President Maurice Lafortune, adding that the cheap rice threatens to force
importers and rice farmers out of business.
   According to Petit's figures, the subsidies from May to November lost
the Haitian treasury $4.7 million in sales taxes and custom duties. That is
enough to pay 17,000 public school teachers for three months.
   Since flawed local and legislative elections in 2000, the international
community has frozen hundreds of millions of dollars in aid for Haiti.
Meanwhile, Haiti's budget deficit has soared to an unprecedented $80
million.
   Independent economist Kesner Pharel said continued rice subsidies "will
lead to the rise in the market price of other products," and could fuel
migration from the countryside to city slums.
   Opposition politicians said the government was looking out for its own
party members to the detriment of ordinary Haitians.
   "The government is financing the activities of the governing party with
public finds, sacrificing the welfare of Haitians to the profit of its
members," said opposition politician Serge Gilles.