Tuesday, May 6, 2008

Food Prices in Haiti

The global food crisis has been severely felt in Haiti. The phenomenon that is locally known as ‘La Vi Che’ or (the Expensive Life) is talked about in tap-taps, on radio stations, in government and comes up in virtually every financial interaction. Escalating prices of food coupled with ever present unemployment have put the average Haitian family in a devastating position. Though commodity price increases are felt virtually across the board, there are few staple products which testify to the genuine burden placed on Haiti’s people.

Gladys Desviné, a forty-five year old Port-au-Prince resident, expressed that last year she paid $1.35 per tin (approximately 12 cups) for imported rice from the United. KPL is now monitoring local prices and found that the same quantity of rice now sells for $3.42, a 60% price increase. In contrast, a year ago Haitian Yellow Rice sold for $3.78 USD while today its market value is $5.48.

In Haiti, canned evaporated milk is commonly used in juice, coffee, porridge and a myriad of other foods. In June of last year a small can (1 Cup) of evaporated milk sold for 0.34 cents. Currently, the same cans sell for 0.54 cents. This reflects a 37% increase.

In December 2008, Haiti closed its borders to Dominican poultry products after 115 cases of the bird flu were reported. Despite this, Haiti’s markets continue to be flooded with Dominican eggs. One Haitian company, Jaune D’or, has started a poultry farm that produces eggs of consistent quality. Jaune D’or eggs are being seen more consistently in Haiti, however most local eggs sold in the market are laid naturally. Though these natural eggs can be extremely nutritious, and are what we might call ‘free range,’ a lack of quality control means that in a dozen eggs, generally 3 eggs are stale, have an unstable yolk or excessively watery egg white. This is often a result of continuing to use too-old laying hens. A dozen of these local eggs cost approximately $3.20 at the supermarket, whereas eggs from the Dominican Republic cost about $2.60. However, since about 3 of every dozen local eggs are not suited for consumption, the price per egg increases significantly.

Peanut butter is a Haitian staple with various types and tastes ranging from sweet to spicy. Haitian’s have mastered peanut butter production, but still imported brands are sold in supermarkets. In fact, the average price of imported peanut butter (10 ounces) in one super market in Port-au-Prince: $1.36, whereas 10 ounces of Haitian-produced peanut butter averages at: $1.81 USD. This makes Haitian Peanut butter is 25% more expensive than imported Peanut Butter.

Not only do price augmentations cause incredible burden on the pocket-books of Haitian families, but the cost differences between local and imported foods make it nearly impossible for the average Haitian to ‘buy local’. When Haitian rice is 38% more expensive than its imported equivalent, most Haitian’s do not have a choice but to opt for the later. What’s curious is that although local rice is considerably more expensive, this price margin clearly does not reflect a considerable profit for Haitian producers. Rice farmers in Haiti struggle to make ends meet and though local peanut better sells for 45 cents more than imported, I have a hunch the Jiffy* and Cap’n Kid* aren’t too worried that local brands have a higher profit margin.

Saturday, May 3, 2008

Connecting Debt and Food Security in Haiti

In Haiti, the influx of food and resources from the United States, Canada and Europe severely undermine the Haitian economy and agriculture systems. Forty-six percent of all imports to Haiti come from the United States, followed by 12.5% from other Caribbean countries (predominantly the Dominican Republic) and 11.4% from Europe. Haiti is strikingly open to foreign trade with currently tariffs on imported products averaging at 2.9%, though the vast majority of goods enter tariff-free. Liberal trade agreements have crushed Haiti’s agriculture sectors and have significantly contributed to unemployment and rural-urban migration. Haiti’s local agricultural economies have virtually collapsed and “can barely produce 48% of the food consumed in the country.” In fact, an estimated 830,000 jobs have been lost as a result of trade liberalization. More than 2/3 of the labor force do not have formal jobs (2002 estimate).
Despite public outcry, the Haitian government lacks adequate funding to support agricultural development or to bolster national production.
Forty-five percent of Haiti’s debt was accumulated under the nefarious Duvalier dictatorships with no direct benefit to the Haitian people. From 1956-1986, foreign assistance was used for the personal benefice of the Duvalier family. Since the collapse of the Duvalier regimes, Haiti’s attempts to rebuild her social and economic infrastructure have been undermined by required debt repayments. Only recently has Haiti qualified for debt relief, under the HIPC initiative, but the benefits of debt relief may not be realized until 2009 or 2010. Today, Haiti pays $56 million annually in to multilateral creditors to service its $1.3 billion dollar debt while her people suffer in poverty. If Haiti is forced to wait until the end of 2010 they will pay an additional 90-120 million dollars just to the IDB. Canceling Haiti’s debt would allow increased spending on priorities the country established in its 2007 Poverty Reduction Strategy: including agriculture, food security, health and education.
To combat the problems of food insecurity, Haiti has objectives to: grant loans to farmers and agricultural enterprises in order to enhance productivity; provide declining subsidies for agricultural production, which would aid in the purchase of fertilizers, tools and equipment. Specifically, Haiti’s Poverty Reduction Strategy prioritized the development of a sustainable agriculture system based on: environmentally sound agricultural practices: increased clarity on the ownership and use of land; watershed protection; and ensuring the broader availability of basic foodstuffs through the stimulation of agricultural production (livestock farming; poultry production).

Haiti owes over one billion USD to multilateral financial institutions: $21 million to the IMF; $507 million to the WB; $534 million to the Inter-American Development Bank. The IDB will grant Haiti interim relief of 20 million over the next two years and (if it complies with economic reforms set by HIPC creditors) could obtain full debt relief from IDB by 2009 or 2010.

A Glimpse of Why We Buy Local

Haiti, the ‘Pearl of the Antilles,’ was once known for its natural beauty and abundant agricultural capacity. Though Haiti’s land and her producers have suffered significantly as a result of mistreatment and exploitation, Haiti’s national agriculture has incredible potential. Kore Pwodiksyon Lokal: Buy Local Haiti aims to assist in the renewal of Haiti’s land, in the revival of her producers, and in the education of Haiti’s Northern neighbours so that we can work together to contribute to sustained positive development in Haiti.
Imported products harm Haitian producers and increase dependency on foreign products and aid. Often, imported products are subsidized by their local governments and are therefore sold in Haitian markets for the fraction of the price of Haitian products. For example, in Port-au-Prince, imported rice from the United States sells for about $3.40/ 12 cups, where as the same amount of Haitian Yellow Rice is sold for $5.50. When local products are forced to compete with subsidized imports the livelihoods of farmers and small businessmen in Haiti are threatened. As farmers face a diminishing market for Haitian products, they are pressured to leave their gardens and seek alternative employment in urban centers. This rural-urban migration contributes to overpopulation in Port-au-Prince, high unemployment rates and tensions within the population.
When we in Haiti chose to consume what is produced locally we empower Haitian producers and boost the Haitian economy. The New Economics Foundation in London found that a gourde “spent locally generates twice as much income for the local economy” (FTD, 2006). In addition, the support of Haitian farmers will serve to challenge the current patterns of dependency and will contribute to a more self-sustaining Haiti. Environmentally, eating locally produced foods decreases pollution, carbon emissions, traffic, and food is less susceptible to contamination.