"Haiti presents risks and uncertainties but also a great deal of opportunity"

  • Posted by Marina Vatav
  • November 19, 2012 7:03 AM EST
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The US Ambassador gives an overview on doing business in Haiti

 

On Tuesday, November 13, the US Ambassador in Haiti, Pamela White, held a webinar titled, "Doing Business in Haiti." Ambassador White and her staff responded to online questions submitted by attendees, many of them from the Haitian Diaspora, that are interested in doing business in Haiti.

Ambassador White gave a brief overview on Haiti, and on the current state of the country's economy across several sectors. The ambassador also presented some challenges that foreign investors may face in Haiti and possible solutions to overcome them.

Haiti's GDP is Growing

One of main points expressed by the US Ambassador in her presentation is Haiti's growing GDP. A graph that Ambassador White called her favorite illustrated the fact that Haiti excels when it comes to GDB growth compared to other Caribbean countries.

In 2010, the Haiti earthquake caused 7.8 billion dollars in damages and a drop of more than 5% in the GDP. The year 2011 brought a 5.6% GDP growth, which, as the Ambassador noted, "was certainly a respectful rate but less than expected". For 2012, the Haiti Central Bank predicts a 4-4.5% GDP growth.

Aid is decreasing

Peaking at around 3 billion dollars in 2010, the amount of aid received this year could finish up below 2009 levels, according to the US Ambassador.

"US Commitment, and that of others like the IDB and the World Bank, is still strong, but overall, Haiti will not be able to count on donors to keep its economy growing the way it has in the past.

Meanwhile private investment is rising. It could exceed two billion this year, but Haiti needs to attract much, much more, in order to keep up the growth needed to create jobs and reduce poverty," emphasized Ambassador White.

The US Ambassador also mentioned that in 2011 Haiti received 181 million dollars in net foreign direct investment, and that the investments in 2012 will surpass that figure.

Advantages of Investing in Haiti

Ambassador White and John Robinson, Head of Economic Section at the US Embassy in Port-au-Prince, who was also on the webinar, listed some advantages of investing in Haiti.

Foreign investors in Agriculture could benefit from zero tax rate for up to 15 years with an additional 5 years of digressive rate.

Manufacturers are especially encouraged by the US to invest in Haiti through the HOPE/HELP trade preferences that "give the most generous access to the American market that we [the US] offer to any country in the world," as expressed by John Robinson.

Robinson noted that HELP was recently extended until 2020. He also pointed out that there are 20-22 companies that are currently exporting to the US under HOPE and HELP legislation.

Other advantages for investing in Haiti listed by the US Ambassador are low labor costs, and proximity to the US, among others.

Establishing a business in Haiti is still challenging

Under the subtitle "Some Realities" of her presentation, the US Ambassador expressed some of the challenges investors face in Haiti. One of them is the procedure of establishing a business that is challenging both legally and practically. This is one of the reasons why she encouraged American investors to work with local partners, including local lawyers and accountants; stressing that it can make a big difference.

Ambassador White also added: "For many years outdated laws and regulations, not to mention inadequate infrastructure, have made Haiti a difficult and costly place to do business. Among the initiatives currently on the table is reducing the time that it takes to start a business from the current 105 days to just 10."

A revised customs code is in the works

Another major challenge in Haiti that the Ambassador referred to is the customs regulations. 

When it comes to clearing customs in Haiti, the Ambassador encourages American investors to work with a third-party customs broker. 

"Goods arriving from Miami with a third-party customs broker clear customs in approximately one week compared to six months for those without a broker," pointed out Ambassador White.

There is hope for the custom legislation to improve.

According to the American Ambassador a revised customs code is in the works and may soon be presented to the parliament. "This should address many of the inefficiencies inherent in the outdated code now in force," stressed the Ambassador.

"This customs code is back on the agenda and back on the radar screen of the government. And my understanding is that it should be presented to parliament in January," added John Robinson.

Security situation is improving

One of the questions asked online was: What were the Ambassador's thoughts on the general situation in Haiti and political conditions.

Ambassador White stressed that the security situation has been improving.

"I am very encouraged," said the Ambassador. "There have been a few kidnappings since I got here, there've been a couple of demonstrations, but there are not half what there were when I left here in the late 80s. Much, much calmer."

"Politically, one of the best situations we've had for years"

The American Ambassador also pointed out that "President Martelly cares about this country", that Haiti's parliament is finally beginning to work together, and that Haiti has "a visionary prime minister."

The Ambassador also expressed a few good words regarding several of Haiti's ministers without giving any names, calling them "top notch, first-class ministers that are working around the clock to make this place better." She continued, "Truthfully they are working around the clock. I get emails from the Prime Minister at 4 o'clock in the morning sometimes."

"Politically, I think it's one of the best situations we've had for years," concluded the American Ambassador.

Ambassador Pamela White closed the one hour webinar by emphasizing that Haiti presents risks but also tremendous business opportunities.

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