By: Mark Schuller - HaitiAnalysis
Executive Summary
The interim government submitted an Interim Cooperation Framework (in French, Cadre de Coopération Intérimaire, CCI)[1] to the international community at a donor’s meeting hosted by the World Bank on July 19-20, 2004. The CCI outlined various development priorities such as governance (and especially “economic governance”) and food security as well as “cross-cutting themes” such as gender/women’s equality and HIV/AIDS prevention. The CCI is hailed a groundbreaking attempt on the part of the donor groups to coordinate their efforts, outlining a single plan and timetable and creating a specific coordinating mechanism that includes representatives from the major donor organizations and the interim government of Haiti. At a donors’ meeting on July 25, 2006, the CCI was extended, and with minor changes became the current strategy governing international aid under President Préval. Many sectors of Haitian civil society and their Northern partners have criticized the CCI as lacking transparency and genuine participation of Haitian people and promoting strategies that align with foreign interests to the detriment of Haiti’s long-term development.
Introduction
Aristide’s hasty departure provided international financial institutions with the opportunity to convene and coordinate their political and economic agenda for Haiti through the CCI process. The World Bank candidly argued that “the weakened capacity of government often found in post-conflict settings magnifies the need for an external aid coordination role” (1998:24-5). According to all but one of the donor representatives I interviewed in Pòtoprens,[2] Brussels, and Washington (n=21), the CCI is an unparalleled success, a groundbreaking new era in cooperation, especially for a post-conflict situation. In addition to the coordinated plan and donor pledges – amounting to just over a billion dollars over a period originally specified for two years – the CCI also calls for a collaborative, donor-led process of implementation with the interim government with different donors leading up work groups based on their interests and expertise. For example, the World Bank leads the team charged with economic governance, USAID with HIV/AIDS, and the E.U. with education.
The process began at a meeting in Washington on April 22. A team of 250 experts, most of them foreign, went to work assembling a plan, charged with meeting with representatives of Haitian “civil society.” As I argued elsewhere (Schuller forthcoming), the term civil society is ideologically loaded. In Haiti’s contemporary context, it was taken up by Aristide’s opposition in ideological struggle (Jean 2002). A list of 168 Haitian civil society groups that participated in this process was listed in the annex of the CCI (Interim Cooperation Framework 2004-2006: Summary Report 2004). One group was listed twice, and several umbrella organizations were listed along with constituent members, padding the numbers. A close reading of the titles of the groups suggests that the Group of 184, Aristide’s civil society opposition, notably organizations comprising bourgeois interests of the private sector, were over-represented, 32 of 168 groups. In addition, at least 29 of the groups were foreign, some of them even governmental agencies like Sweden’s International Development Agency. Within a period of three weeks, documents were prepared and assembled into a single document that interim Prime Minister Latortue presented at a donors’ conference hosted by the World Bank on July 19-20, 2004.
Promises Made
The CCI promised a large and specified amount of aid that was not met. This document highlighted almost a billion dollars in unmet financial need. The donors pledged this billion dollars over the interim period, at the time specified to the middle of 2006, by which time a new, constitutionally-elected government would have had six months in office after its inauguration on February 7. Despite the pledges, and the relatively widespread dissemination of them, the funds have been slow to arrive. While it was still possible to view web pages offering exact pledges, the CCI, and documents leading up to the CCI, no such information was available about implementation, funds spent, and results or evaluation.[3]
While bilateral donors such as the U.S. and Canada gave funds to the interim government in 2004, it was difficult to track what exactly was part of the CCI process. In addition, in 2004, the IDB had begun disbursing a portion of loans it had earlier approved for Aristide. While individual governments, such as the U.S., Canada, and France fronted Latortue’s government with grants early on, funds for the CCI mainly trickled in after January 2005, from the World Bank, after the interim government paid 52.7 million dollars in arrears. The World Bank began the process for disbursing 73 million dollars for “economic governance” on January 6, 2005. Other donor agencies slowly followed suit. By October 2005, almost 20 months after Aristide left and 15 months after pledges were made, only 324 of the pledged 1,084 million was disbursed (IMF 2005:28).
By way of explanation, the E.U. representative pointed to the slow, deliberative process of the E.U., itself an experiment in multilateral cooperation (personal communication, June 2005). Some people at the World Bank said that the slowness was expected. Some at USAID pointed their finger at other agencies, saying that the U.S. government has kept its promises. Others at USAID, along with staff at the IMF and IDB, argued that the issue at hand was really Haiti’s “absorptive capacity.” Whatever the reason, the effect has been that very little of the promised improvements have been made. Route National #1 just outside of Gonayiv was submerged under a new lake, nine months after Tropical Storm Jeanne struck, and repair work was only begun in the summer of 2006, two years after the storm.
The CCI has been severely criticized by Haitian NGOs as being an attempt from foreign powers to take over. Interestingly, seven groups that were listed as participants also denounced the process as representing a loss of sovereignty, as an attempt by the international organizations to obtain greater control. At least one of the organizations listed as a “participant” in the CCI process was only sent a single invitation letter for a meeting that staff did not attend. An ad-hoc coalition of 44 organizations pointed out that the process was rushed and coercive: “the CCI’s approach concretely reflects the reality of the occupation of our territory by foreign military forces” (SOFA, PAPDA, and SAKS 2004:3).[4] These groups that were considered “partners” in the process critiqued it for being roughshod, without meaningful dialogue and participation, no mechanisms in place for debate, not enough time to discuss, nothing in Kreyòl, the only language of 90 percent of Haiti’s population, and a lack of real dissemination plan (SOFA, PAPDA, and SAKS 2004:4). Two years following the CCI’s passage, a civil society coalition decried the process for continuing to lack transparency and true participation (CoEH and CoHE 2006). As a result, the process rubber-stamped and gave legitimacy to the interests of the international community, who spent almost two million U.S. dollars employing the 250 experts, the vast majority of whom were foreign. The plan itself is a vast assemblage of propositions that have been long promulgated by the international community, many of them not specific to Haiti. A coalition argued that, “Haiti isn’t Afghanistan, nor Liberia, and still less Iraq. One has to avoid the ‘ready to wear’ solutions and procedures that elsewhere in certain national contexts have led to relentless failures” (SOFA, PAPDA, and SAKS 2004:3).[5] The sections that follow will outline these “ready to wear” solutions, the first of which is privatization.
Privatization
Privatization was mentioned several times in the CCI as paving the way to development (pages 19, 23, 24, and 28). This echoes Latortue’s public promotions of privatization. At a Caribbean conference held in Miami on December 8th, 2004, and again at a conference held in Haiti the following week, Latortue said that Haiti needs to get over this notion that privatization is a “mortal sin,” and vowed to do better to privatize the Haitian government’s industries, such as electricity, power, and water.[6] State-owned enterprises in service provision (e.g., water, electricity, telecommunications, ports) generate a half a billion dollars annually. For example, in 2000, public services generated 8,311.4 million goud in revenue, or $476 million (IMF 2002:42-47). Publicly owned enterprises are among the only productive resources remaining in Southern countries like Haiti, the only surplus value to extract from a country already devastated by environmental destruction and centuries of underdevelopment. The interim government also laid the groundwork for privatizing the phone company, and even gave the rights to Columbian contact-period archaeological resources to a foreign company. A former ambassador and high-ranking government official stated that it was clear that this interim period was a context for more, deeper, control by foreigners (personal communication, December 2005). Interestingly, these moves towards privatization run counter to warnings by the World Bank (1998:34).[7]
A project outlined by the CCI and taken up by the U.S. government was temporary electricity provision (p.23). Providing electricity in urban areas, particularly those prone to violent conflict, was outlined as a step in providing security (OTI websites). Given that institutional reinforcement is seen as a key to successful development in the new focus on fragile states (World Bank 1998:2; USAID 2005:5), it would be a logical assumption that the CCI’s plan, short-lived as it was, would have focused on developing the institutional capacity of the state-run electric company, EDH. The opposite took place. The U.S. government gave support to multinational corporation Alstom Power that has large operations in the U.S. Gulf Coast to ship in large generators to provide electricity for Pòtoprens using a U.S. petroleum distributor, Texaco, to provide the carburant. In addition, contracts were drawn for permanent privatization. Since the revenues barely passed through the government-run EDH, service provision was anything but sustainable. For example, a USAID contract expired on March 1, 2005. At least Pòtoprens was without power for a week afterward, despite a steady six-to-ten hour daily ration for the weeks leading up to this date. Now that the transition period is over, the same situation might again arise once the CCI funds run out, or it is possible that future aid is contingent on privatizing EDH. During president Rene Préval’s first term (1996-2001), multinational organizations successfully obtained the privatization of cement and sugar-processing industries as promised by the Governor’s Island Accord (Clement 1997:34).
In the abstract, especially to a Northern audience that has been familiarized with privatization of public utilities, this move might appear banal, especially given Haiti’s ranking in 2005 as the “most corrupt” country in the world by Transparency International’s “corruption perception index.” But privatization of public utilities would be disastrous to Haiti’s poor majority. First of all, prices for these daily basic needs would almost certainly increase, pricing it beyond the range of Haiti’s poor majority (80 percent live within a budget of a dollar a day or less). For example, monthly local phone service is 225 goud, or $6.25. For those with a tap, water for households is $14.89 per month. While critiques of state-run utilities come from all sectors, business and hotel owners have been particularly vocal and prolific, arguing that they should receive more than residential clients and neighborhoods. Blackouts were a fact of life in Pòtoprens during the research period. But they affected everyone, not just well-to-do people and businesses who own diesel-powered generators. And a public utility has responsibility to provide service to all of the public. This responsibility is eroding under a logic of privatization. On the invitation from the neighborhood association, I visited a shantytown just outside of Petion-Ville, a wealthy suburb of Pòtoprens, that was only added to the electric grid and received electricity after a long organizing campaign by their neighborhood association. When the transformer blew, a representative from the interim government told this community of 10,000 people that they will never have electricity because it was not a good “return on their investment.” Privatization will only further concentrate these public goods in the hands of the well-to-do. Water is an even more dire concern – already it is a service that few Haitian households have regular access to. The majority of Haiti’s people have a daily chore of walking up to 20 minutes to the nearest tap (if there is one in the area), where usually they have to buy the not-completely-treated water for as much as five goud per gallon.
Structural adjustment
In addition to process and privatization, progressive Haitian NGOs have other criticisms of the CCI. While there were some positive aspects according to these groups, such as gesturing toward women’s equality and decentralization, two main pillars triggered heated criticism. The “economic governance” plan simply legitimated de-facto Bank and IMF control over the country’s finances and planning. While some of the specifics may prove helpful in the long run, like tighter financial accounting measures, the overall plan keeps more power in the hands of international organizations to set priorities through control of the state’s finances.[8] According to an NGO staff person, “they are just selling the country wholesale to the blan (Haitian term for foreigner)… and our leaders accept.” Another argued, “in the IMF’s and World Bank’s structural adjustment plan, you will find that with every (Haitian) government that comes to power, more and more, they support the IMF’s and World Bank’s plan.”
The CCI also promises Haiti’s cooperation in structural adjustment measures: “the Government is also committed to developing a plan for the clearance of external arrears and ensuring regular debt service” (p.23). Haiti’s external debt was estimated at 1.4 billion dollars at the end of the transition period, with rising debt service projections: 56.3 million for fiscal year 2005, and 58.3 million for fiscal year 2009 (IMF 2005:27-28). While this figure seems small compared to some countries in sub-Saharan Africa, forcing Haiti to continue repaying the debt deprives Haiti’s people from services (Schuller 2006). In 2003, Haiti’s scheduled debt service was 57.4 million, whereas the entire scheduled grants for education, health care, environment and transportation combined was 39.21 million (IMF 2005:88; World Bank 2002:vii). A result is that 500,000 children do not have access to school, and only 35 percent finish primary school (CCI, p.33). Structural adjustment measures include such direct, forced reduction in social spending. In 2000/2001, the IMF demanded that Haiti reduce its social spending from three percent of the Gross Internal Product to two percent (Duhaime 2002). In addition to direct cuts, international financial institutions have demanded user fees for services such as education and health care. Education is one of the primary expenses for a family. The average cost of registration and tuition for a Pòtoprens school is 4000-4500 goud a year, about three months’ salary working minimum wage.[9]
On April 14, 2006, following the election of President Préval, the World Bank announced that Haiti would be eligible for the Heavily Indebted Poor Countries (HIPC) program. The HIPC program is a formula for debt cancellation, approved en masse after a proposal at the July 2005 G8 meetings in Gleneagles, Scotland.[10] The earliest Haiti could receive debt cancellation, assuming a best-case scenario, is 2009. Staff at international institutions I interviewed did not know why the boards of directors of their institutions had not approved Haiti before this time. Haitian NGO employees theorized that it was part of their plan to bring Haiti to the brink of disaster by starving Aristide,[11] and the interim government, widely seen as beholden to international agencies, did not raise this issue. In the mean time, Haiti will be paying over $220 million in debt service. The HIPC program requires that a country successfully implement an IMF staff-monitored program for a period of at least two years. This is the context in which the structural adjustment measures (now called Poverty Reduction Plans or Development Policy Loans) are imposed. Another condition is the World Bank’s acceptance of the country’s Poverty Reduction Strategy Paper. This is the context in which a host of other neoliberal measures are imposed.
Other neoliberal measures
A third plan within the CCI is a traditional part of the “ready-to-wear” neoliberal program. The proposal for agriculture and food security was a further recitation of globalization, with high-value crops for exports, benefiting few Haitian farmers, and importation of subsidized or monetized (PL-480) rice, draining Haitian peasants’ productive capacity to feed Haiti (Richardson 1997). U.S. “food security” policy has destroyed national production in two ways, by flooding the market with subsidized U.S. agricultural products, underselling the Haitian peasantry, and by the trade liberalization measures tied to receipt of food aid, removing protective tariffs (ibid.). Once an exporter of rice, Haiti is now unable to feed itself, producing only 18 percent of rice consumed, importing $200 million per year (MOREPLA and PAPDA 2004). In addition, the interim government authorized a U.S. company, T&S Rice, to operate in Haiti and increase rice imports, further weakening Haiti’s national production. According to a national coalition and campaign, this move will cost 28,000 jobs (ibid. 2). Continuing and providing legitimation for these neoliberal policies for food security, an explicit goal in the CCI is to further integrate Haiti into regional markets such as the Free Trade Agreement of Americas (p.25). The plan for agriculture in the CCI proposes the promotion of specialty items for consumption in the U.S. market, a longstanding USAID platform (e.g., USAID 1997), instead of for national production and consumption. As the ad-hoc group of progressive NGOs argued, the best produce gets shipped out, benefiting the U.S. with cheaper exotic produce, and benefiting a small percentage of Haitian farmers (UNNOH, SOFA, and PAPDA 2004). Over time, this globalization of agriculture has destroyed national production. A woman’s NGO staff person expressed the frustration of many others:
We used to have Creole pigs, they destroyed that. We used to have factories that used to make tomato paste, they destroyed that. We had factories that used to make milk, they destroyed that. Well, we used to have factories that made sugar, they destroyed that.
If they are truly helping us… If it’s aid they give us, why don’t they rather support our national production, so they can assure that the money, it goes toward production?
The monetization further accelerates both capital flow out of the country and a growing imbalance between rich and poor within Haiti. Neoliberal agricultural measures were a primary “push” factor in the massive urbanization in the 1980s, creating in Marxist terms a “reserve army” of unemployed, the lumpenproletariat, justifying low-wage industrial jobs as beneficial to this desperate and vulnerable population (DeWind and Kinley III 1988; Trouillot 1994).
Another plan within the CCI was to create more free trade zones, exploiting Haiti’s “comparative advantage” of extremely low wages (the minimum wage is 70 goud, or about $1.80 per day) and proximity to the U.S (p.9). Bracketing the question of workers’ condition or rights, there are still other concerns. Criticizing this short-term development strategy, a network of both European and Haitian NGOs cited Haiti’s Minister of Finance in saying that export-processing industries are “the sector with the least value added and the lowest annual wage” (CoEH and CoHE 2006:2). Many Haitian civil society organizations are calling for reinforcement of long-term national production as Haiti’s priority, focusing on agriculture, not short-term export-processing subcontracting (CoEH and CoHE 2006).
Finally, the CCI is also notable in its silences. Despite its specificity in pointing to Aristide government abuses, and a vast collection of human development indexes, the CCI does not offer statistics on the concentration of wealth in the hands of a very privileged few in Haiti, the second most unequal country in the world (Jadotte 2006:9). As such, the question of the link between Haiti’s extreme inequality and underdevelopment never arises, and so solutions do not get posed. The link between neoliberal measures and the destruction of national production is similarly silenced. Also not mentioned was the external debt except to promise Haiti’s dutiful payment of regular debt service.
Conclusion
While the international community promised another $750 million for the fourteen-month period following the July 25, 2006 donors’ meeting, several civil society groups hoped for another approach to international assistance. First was the full, immediate, unconditional cancellation of Haiti’s debt (see Schuller 2006 for further information). Second, importantly, many were hoping for a return to a cooperation based on respect for Haiti’s sovereignty:
Following the elections of 2006, the national context in Haiti has changed and the population has clearly demonstrated its determination to put an end to the interim transition. Haitians now want a new national development plan that reflects the new political, economic and social reality of the country and enables them to become actors in their own destiny. (CoHE and CoEH 2006:9).
There are alternatives, as well as a series of movements that are bringing them about. Following a long civil society organizing campaign, President-elect Préval met with Venezuelan president Hugo Chavez to enter into Petro Caribé, securing lower gas prices for Haiti. In August 2006, Haiti’s Parliament overwhelmingly ratified Petro Caribé. Prices for public transport have returned to pre-transition levels for most local routes (5 goud). Two coalitions formed in 2003/4 to debate and propose alternative development proposals, arguing for land reform, debt cancellation, national production, and worker protection. Drawing inspiration from the World Social Forum, one such coalition published a treatise, “Yon Lòt Ayiti Posib” (Another Haiti is Possible) in December 2004, offering a roadmap of alternatives to neoliberal globalization. This work depends on a respect for Haitian solidarity and builds upon a quiet revolution as grassroots groups keep Haiti’s collective youn-ede-lòt (one helping another) traditions alive in both lavil and andeyò (in the cities and countryside).
Schuller is a Ph.D Candidate in anthropology editing a dissertation at the University of California, Santa Barbara. The present analysis is part of a larger work to be published by Alta Mira Press in an upcoming edited volume, Capitalizing on Catastrophe.
[1] The title refers to a critique from a former government minister that multinational agencies control the process of Haiti’s development.
[2] Spelling is in Kreyòl, the first language of all Haitians and only language of the poor majority.
[3] The IMF published a partial accounting of the funds in a November (2005) report.
[4] “La démarche du CCI reflète concrètement la réalité de l’occupation de notre territoire par des forces militaires étrangères.”
[5] “Haïti n’est ni l’Afghanistan, ni le Libéria et encore moins l’Irak. On doit éviter les solutions et les procédures prêt-à-porter qui d’ailleurs dans certains contextes nationaux ont conduit à des échecs retentissants.”
[6] There was also an exploration of foreign governments collecting customs duties as ships left their ports, after the interim government shut down provincial ports, triggering a strike of dock workers.
[7] “As the Cambodia and Haiti case studies show, the norms of behavior of the private sector and the degree of corruption and cronyism within or between the private and public sectors may be such that privatization may well not enhance the prospects for sustained, equitable development, and may even make them worse.”
[8] During the years following the 1994 return of Aristide, 90 percent of Haiti’s governmental budget was financed externally (Morton 1997:1).
[9] I do not have data for rural schools. This includes private as well as public schools. Eighty percent of Haiti’s schoolchildren go to private school (CCI, p.33).
[10] Haiti was not on the list of HIPC-eligible countries in this proposal.
[11] Scheduled payments – a higher number than the actual disbursements, especially after donors withheld promised aid pending resolution of Haiti’s political crisis – went down from 188.3 million disbursed in FY 2001, 142.59 in 2002, 96.36 in 2003, and 80.34 in 2004 (World Bank 2002:vii).
Works Cited:
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———. 2005. Haiti: Selected Issues. Washington: International Monetary Fund.
———. 2005. Haiti: Use of Fund Resources—Request for Emergency Post-Conflict Assistance—Staff Report; Staff Supplement; Press Release on the Executive Board Discussion; and Statement by the Executive Director for Haiti. Washington: International Monetary Fund.
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Schuller, Mark. 2006. Break the Chains of Haiti’s Debt. Washington: Jubilee USA.
———. forthcoming. Seeing like a ‘Failed’ NGO: Globalization’s impacts on state and society in Haiti. Political and Legal Anthropology Review 30 (1).
SOFA, PAPDA, and SAKS. 2004. Deuxieme déclaration des organisations de la société civile haïtienne sur le processus du CCI. Port-au-Prince.
Trouillot, Michel-Rolph. 1994. Haiti’s Nightmare and the Lessons of History. NACLA Report on the Americas XXVII (4):46-52.
UNNOH, SOFA, and PAPDA. 2004. Troisième déclaration des Organisations de la société civile haïtienne relative au processus d’élaboration du CCI et à la conférence des bailleurs de fonds tenue à Washington les 19 et 20 juillet 2004. Port-au-Prince.
USAID. 1997. USAID Strategic Plan for Haiti, Fiscal Years 1999-2004. Port-au-Prince: USAID - Haiti.
———. 2005. Fragile States Strategy. Washington: USAID. World Bank. 1998. The World Bank’s Experience with Post-Conflict Reconstruction. Washington: World Bank.
———. 2002. Haiti: External Financing Report: October 1, 2000 - September 30, 2001. Washington: World Bank.
