International Trade in Haiti

News Related to International Trade in Haiti

Business outline for Haiti

Economic Overview

Although having suffered a series of shocks (food crisis, hurricanes, the global economic crisis), the Haitian economy grew after 2005. From 0.8% in 2008, growth reached 2.9% in 2009. However, the terrible earthquake which hit the island in January 2010, causing large damage, had a strong impact on the economy, which has shrunk by 8.5% in 2010 and should recover in 2011, sustained by the reconstruction and massive international aid.

The government's priority remains the humanitarian crisis provoked by the earthquake. The Action Plan for national recovery and development, adopted shortly after the catastrophe, emphasizes the creation of decentralised points of economic growth, the reduction of vulnerabilities to natural disasters, improvement of access to basic social services and a strenghtening of institutions. Poor infrastructure, drug trafficking, organized crime, social unrest and extensive deforestation which leads to natural major disasters are the main barriers to country's economic growth. Haiti is also heavily dependent on international aid.

Haiti is the poorest country in the Western Hemisphere, with more than 80% of its population living below poverty line, two thirds of the population are affected by unemployment or under-employment and more than one in four Haitians is malnurished.

FDI in Figures

The inflows of FDI into the country have been very slow during the recent years. However, FDI stocks, as a percentage of GDP, have increased since 2000. The FDI influx then slowed down following the earthquake which ravaged the island, yet they should accelerate along with the reconstruction of the country.

Although there are some barriers to the development of foreign investment in the country, such as corruption, long-term political instability and heavy bureaucracy, the government continues to offer tax exemptions to investors.

FDI has been mainly attracted into the telecommunications and oil sectors. Recently, clothing manufacturing and automobile spare-parts production have aroused the interest in foreign investors. The United States and the countries of the European Union are Haiti's major investing countries.

Foreign Trade Overview

Although Haiti does not grant tariff preferences to any nation, the country is open to trade. Foreign trade represents roughly 50 % of the GDP.

Custom duties are not too high (from 0% to 20%), with the exception of oil (90%). The country does not have many trade barriers. However, custom duties on finished goods are higher than those on raw materials .

The country is vulnerable to natural disasters. Moreover, the high cost of ports and the lack of investments are the main hurdles to foreign trade. In spite of everything, the country offers tax incentives such as access to free-trade.

Haiti imports much more than what it exports and the result is an enormous trade deficit, a situation that should not improve during the next coming years. The island main trade partners are the United States, the Netherlands (mainly Netherlands Antilles) and the Dominican Republic