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Haiti Haiti: The Economy
![[GIF]](http://lcweb2.loc.gov/frd/cs/haiti/ht08_00a.gif)
Figure from a painting by Prosper Pierrelouis
HAITI'S LOW-INCOME, PEASANT-BASED economy faced serious
economic and ecological obstacles to development in the
late
1980s. The country's gross domestic product
(GDP--see Glossary)
in 1987 was approximately US$1.95 billion, or about US$330
per
capita, ranking Haiti as the poorest country in the
Western
Hemisphere and as the twenty-seventh most impoverished
nation in
the world. The only low-income country--defined by the
World Bank (see Glossary)
as a country with a per capita GDP in 1988
below
US$425--in the Americas, Haiti fell even farther behind
other
low-income countries in Africa and Asia during the 1980s.
Haiti's economy continued to be fundamentally
agricultural in
the 1980s, although agriculture's role in the economy--as
measured by its share of GDP, the labor force, and
exports--had
fallen sharply after 1950. Highly inefficient exploitation
of the
scarce natural resources of the countryside caused severe
deforestation and soil erosion and constituted the primary
cause
of the decline in agricultural productivity. Manufacturing
became
the most dynamic sector in Haiti during the 1970s, as the
country's abundant supply of low-cost labor stimulated the
growth
of assembly operations. Services such as banking, tourism,
and
transportation played comparatively minor roles in the
economy.
Tourism, a potential source of foreign-exchange earnings,
expanded rapidly in the 1970s, but it contracted during
the 1980s
as a consequence of political upheaval and news coverage
that
erroneously identified Haiti as the origin of acquired
immune
deficiency syndrome (AIDS--see
Fertility and Family Planning
, ch. 7).
Haiti's agricultural wealth, coveted by many in
colonial
times, had waned by the mid-nineteenth century as land
reform
divided the island's plantations into small plots farmed
by
emancipated slaves. Changes in land tenure contributed
significantly to falling agricultural output, but the
failure of
Haiti's leaders to manage the economy also contributed to
the
country's long-term impoverishment. Haiti's economy
reflected the
cleavages (i.e., rural-urban, black-mulatto, poor-rich,
CreoleFrench , traditional-modern) that defined Haitian society
(see Social Structure
, ch. 7). The mulatto elite dominated the
capital, showed little interest in the countryside, and
had
outright disdain for the black peasantry. Disparities
between
rural and urban dwellers worsened during the twentieth
century
under the dynastic rule of François Duvalier (1957-71) and
his
son, Jean-Claude Duvalier (1971-86); Haiti's tradition of
corruption reached new heights as government funds that
could
have aided economic and social development enriched the
Duvaliers
and their associates. By the 1980s, an estimated 1 percent
of the
population received 45 percent of the national income, and
an
estimated 200 millionaires in Haiti enjoyed a life of
unparalleled extravagance. In stark contrast, as many as
three of
every four Haitians lived in abject poverty, with incomes
well
below US$150, according to the World Bank. Similarly,
virtually
every social indicator pointed to ubiquitous destitution.
As a result of the traditional passivity of the
government
and the country's dire poverty, Haiti has depended
extensively,
since the mid-1970s, on foreign development aid for budget
support. The United States has been the largest donor, but
it has
frequently interrupted the flow of aid because of alleged
human
rights abuses, corruption, and election fraud. Most other
development agencies have followed the United States lead,
thus
extending United States influence over events in Haiti
(see Foreign Relations
, ch. 9). Although the major multilateral
and
bilateral development agencies have provided the bulk of
foreign
funding, hundreds of nongovernmental organizations have
also
played a prominent role in development assistance. These
nongovernmental organizations, affiliated for the most
part with
religious groups, have sustained hundreds of thousands of
Haitians through countrywide feeding stations. They also
contributed to the country's political upheaval in 1986 by
underscoring the Duvalier regime's neglect of social
programs.
The accomplishments of the nongovernmental organizations
have
proved that concerted efforts at economic development
could
achieve results in Haiti.
The prospects for development improved temporarily
following
Jean-Claude Duvalier's February 1986 departure; some
important
economic reforms took place, and the economy began to
grow.
Subsequently, however, renewed political instability
forestalled
continued reform. Economic progress was feasible, but
entrenched
political and social obstacles prevented Haiti from
reaching that
goal.
Data as of December 1989
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