International Lenders Prepare To Reopen Lines of Credit to Haiti
THREE weeks into the US military occupation of Haiti, international donors are anxious to see strong signs of stability before they start disbursing funds to the Caribbean nation.
The poorest country in the Western Hemisphere, Haiti will need roughly $800 million over the next year to reestablish its government, pay for necessary imports, provide adequate humanitarian aid, and rebuild basic infrastructure, estimates exiled-President Jean-Bertrand Aristide.
He is counting on a steady flow of cash to combat the widespread malnutrition, diminishing job opportunities, and other profoundly negative trends.
A central point in his ``Strategy of Social and Economic Reconstruction'' is reestablishing ties with international lending organizations. As soon as his constitutional authorities are restored, Mr. Aristide says he plans to invite a joint mission of the International Monetary Fund, the World Bank and the Inter-American Development Bank to Haiti and make a formal request for their support.
But he has to clear the country's slate first. Haiti is $80 million in arrears to countries and the world's major lending institutions. All told, the country owes over $800 million.
International banking sources say that once Aristide assumes power - which could be as early as Oct. 15 - his government will negotiate a bridge loan from one or more countries that will allow Haiti to repay its foreign debts and begin borrowing again from the multilateral banks. Part of this fresh infusion of funds will go toward repaying the bilateral obligations and the bridge loan.
In the short term, there seems to plenty of money waiting in the pipeline. The World Bank, owed $15.5 million, says it has $100 million in a portfolio of funds already set aside but never tapped for old Haitian projects. Once the ``constitutional crisis is over,'' says a Bank official, the money will be rerouted to help Haiti finance basic imports and other pressing needs.
The IDB is also retargeting $132 million in funds already allocated for Haitian projects. ``Until we can send people to Haiti, we cannot assess the country's needs,'' says Carlos Brezina, IDB spokesman at the Washington headquarters. But ``Haiti has no working institutions at this time, and no counterpart for us to talk to. We have a wish list of things we'd like to do,'' he adds.
For its part, the 12-nation European Union plans to extend $300 million to Haiti over a 10-year period, ``once a democratic government is securely installed.''
In the interim, while these donors wait to ante up, US soldiers and civilians are working to shore up Haiti's utilities and meet its people's basic needs.
The US military is helping Haiti to rebuild its broken down public works, says Defense Department spokeswoman Lt. Colonel Stephanie Hoehne. She reports that the US military has repaired electric power grids - restoring service to Cap-Haitien and doubling the energy supply to Port-au-Prince. It has fixed the water pump to fill the reservoir with clean water, and has embarked on a program to fix up dilapidated or structurally unsound schools across the country.
Currently in Haiti, the US Agency for International Development feeds almost 1 million children, pregnant women and elderly; it provides 2 million Haitians with health services; and it pays over 100,000 unemployed to work ``short-term jobs'' cleaning streets, repairing drains and canals, and planting trees.
This effort to develop self-help is essential for sustained progress in Haiti, a nation that has been ravaged by civil strife and helplessness that has accompanied years of repressive rule.
At a Monitor breakfast earlier this week, Senate minority leader Robert Dole (R) of Kansas, readily endorsed food and health assistance to Haiti, but he cautioned against ``getting into the nation-building'' help Aristide is seeking and the Clinton administration is giving. Mr. Dole blasts economic sanctions against Haiti, which he says ``didn't give people any choice'' but to flee the privation. ``Why do they get on boats - they can't find a job, they can't find food for their family.'' There should be ``...no precondition to humanitarian aid,'' he says, for ``hungry people.''
But others caution against limiting the focus to relief. ``If we adopt an approach that turns Haiti into a feeding program, we'll be doing that for the next century,'' says a congressional staffer.
``What is critical is to do something to encourage the private sector to develop there,'' he says. ``We have to prime the pump so that employers [foreign investors in the clothing assembly sector, agriculture, and manufacturing sectors] have incentives to absorb their losses and return. The sooner we get these people back in there, the better.''