US Investors Hesitate To Reopen Former Business Links With Haiti
The embargo is gone, but instability and bad infrastructure remain
HAITIAN President Jean-Betrand Aristide is trying to woo Florida business interests to invest in his impoverished country.
When he recently came to the United States, he was carrying plenty of bargains: Half off on all phone calls. Cheap electricity. Admittance slashed for oranges and wheat flour.
So far, though, US investors aren't completely buying it.
South Florida businesspeople who once traded with Haiti say it may be awhile before they reestablish links with Port-au-Prince.
Fred St. Amand, a Haitian-American who owns a money transfer company in Miami, says that despite his excitement about the restoration of democracy in the island nation, he's apprehensive about going back right away.
``Despite the fact US troops are there right now,'' St. Amand cautions, ``the question is how long will they remain, to keep the country stable. Foreign investors need to feel safe at all times, especially after dark.''
With President Aristide back in power, the enormous task of rebuilding Haiti's moribund economy has begun.
Back in the United States for the Summit of the Americas and the Conference on the Caribbean, Aristide proclaimed that any US investor establishing trade with Haiti by June 1, 1995 will receive a 50 percent reduction in phone, electricity, and customs fees. He announced plans to reduce tariffs - primaily on foodstuffs.
Foreign donors have pledged $550 million over the next year, but analysts say private-sector investment will be essential to Haiti's ability to rebuild.
The Miami market is a significant part of any plan to resurrect an economy devastated by a US-led international embargo. According to Charles Jainerain, the director of international research for Miami's Trade Office, the Beacon Council, Miami is Haiti's largest trading partner.
``Before the embargo, trade between the US and Haiti amounted to about $1 billion per year, with Miami accounting for over half of that,'' Mr. Jainerian says. ``As a result of the embargo, trade coming into Miami from Haiti dropped dramatically, to about $200 million last year.''
Political stability isn't the only issue of concern for possible investors in Haiti. Miami businesspeople say an environment conducive to foreign investment is also of major importance.
``Foreign investors are looking for a sound ground transportation infrastructure, a working phone system, and a reliable electrical operation,'' says Pierre Wilfrid, a Miami mortgage banker. ``Unfortunately, these are all areas in which Haiti right now is not up to speed.''
The Clinton administration has pledged $200 million next year to Haiti. With congressional approval, the aid would be used to help rebuild roads, bridges, schools, and other infrastructure largely ignored by the military-run government.
The investment is crucial. Private businesses, especially the large manufacturers that Mr. Aristide seeks most, are not likely to enter the Haitian market until the aid money is actually approved and ready to be appropriated.
John Macho, the director of the International Trade Office for Latin America of the Florida Department of Commerce, says investors are taking a ``wait-and-see'' approach to Haiti.
Mr. Macho says: ``Haitian businesspeople in Miami are making their investment decisions based on two criteria: the degree of contracts that they have in the new Haitian government, and their ability to tap into these new aid funds.''
But even without the foreign aid, some Miami businesses have wasted no time in resuming their business ties with Haiti.
Patrick Lafortune of Arrow Air, a Miami-based air-cargo business says, ``Business has been booming since Oct. 15 [the return of President Aristide]. We've been shipping a tremendous amount of food for AmeriCares and the World Health Organization.''
But even an optimistic investor like Mr. Lafortune acknowledges, ``Foreign investors will only do business in Haiti if they see Miami's Haitians leading the way. So far, that's not happening.''
South Florida's business community has welcomed Aristide's pro-business attitude. Royal Caribbean Cruise Lines last week announced the resumption of cruises to Haiti. Aristide said the port of call to the northern city of Labadee will earn $10 million annually.
While this business venture won't bring recovery to Haiti's economy, it has enormous symbolic value. ``The cruise line announcement was very significant,'' says Anthony Bryan, director of Caribbean studies at the University of Miami's North-South Center. ``It's definately a comforting sign to Miami investors.''
But symbolism only goes so far. ``Long term investors, like the assembly and apparel industries, are not rushing to Haiti,'' says Mr. Bryan. ``They want to see a market economy, and they are not seeing that right now.''