Haiti and Its Financial Perspectives
Haiti is located in the western part of Hispaniola Island. Two peninsulas of this country are separated by Gonave Gulf (Wordatlas). The current work provides the general overview of Haiti and the connection between its biophysical characteristics, natural catastrophes, history, economy, politics, and international relations. This island country with the unusual flora has the developing economy.
Geographical Position of Haiti
This country is washed by the Atlantic Ocean in the North and Caribbean Sea in the South. The biggest lakes are Lake Azuei and Lake of Miragoane (Wordatlas). The main river of the country is Artibonite. The climate is humid tropical with fogs and drizzle from November till January and wet weather from February till May. Average annual rainfalls vary in different parts of the country from 140 cm in the northern peninsula to 200 cm in the southern peninsula (“The climate of Haiti”). Average winter temperatures range from 15 C to 25 C. The average summer temperatures vary from 25 C to 35 C (“The climate of Haiti”).
The landscape of the country is rugged and mountainous with three major massifs: the Massif du Nord (in the northern part of the country), the Massif de la Sell (in the eastern part of the country), and the Massif de la Hott (in the western part of the country) (“Geography”, n.d.). The highest point is Pic La Stelle in the East. It elevates 8,793 ft. above the sea level (Wordatlas). One of the most notable landscape features are fluctuating elevations with various microclimates.
The flora and fauna of Haiti is rather diverse. More than 4,500 flowering plants can be found in this country. One third of them are considered as endemic. Unfortunately, there is no concrete statistics concerning the fauna of Haiti because of poor records and elevations. Some species have rather small populations or live in isolated areas.
The population of Haiti is roughly three hundred and fifty persons for every square kilometer. However, the most densely populated regions are the urban centers, valleys and areas within the coast. The population comprises less than twenty million, and it was estimated by the UN in the year 2011 to be 10.1 million. The modern Haitians are those who descend back to the black slaves, while the rest of population is instituted by the revolt survivors. It is the law that everyone in Haiti is black regardless of his or her skin color. The minorities are comprised of those with Italians, French, Polish, Armenians Dutch, Arabs and Spanish. There are also Haitians who live abroad in the United States, Cuba, France, and Jamaica among others. Most Haitians have no access to health facilities and children do not get vaccinated. The common death causes in this country are diarrhea, respiratory infection, meningitis, and HIV/ AIDS. Ninety percent of children in the country suffer as a result of water-borne diseases, as well as intestinal parasites. Thirty thousand Haitians get infected with malaria every year. Water-borne diseases comprise protozoa and bacteria, typhoid fever, diarrhea, and hepatitis. It is known that at least seventy-five percent of the citizens do not get any form of running water. Hospitals have insufficient resources and personnel of healthcare. There have not been enough houses and thus living conditions are very pathetic.
Nowadays, the population of Haiti is 10,480,000 people and it tends to increase only by about 1.9 % annually (“Haiti population clock”). Due to political instability, economic downfall, and numerous diseases, people prefer to leave this country. There are about 70,000 emigrants each year (“Haiti population clock”). There is no open statistics concerning immigrants because people tend to leave this country due to the stated issues. Major health issues are cholera, malnutrition, and AIDS/HIV (Moloney). Only 1.9% of Haitians have access to health insurance (Forbes) The Haitian Human Development Index (HDI) is rather low – 0.456 (United Nations Development Programme). This figure is formed by increasing life expectancy and education and decreasing Gross National Income.
Demographic situation plays a huge role in the economic development of any country as a part of economically active population defines the opportunities and capacities of this state. It is rather important for the definition of country’s place in the system of the international economic relations. According to the data of UNCTAD, the population of Haiti by 2013 comprised of 9.7 million people. Annual increase of population is 1.84%, which ranks the country at the 67th place in the world. The male population composes 4.8 million people and the number of the female population is 4.9 million respectively (UNCTAD).
The Worldstat Info states that in the Republic of Haiti the birth rate exceeds mortality (23.87 born per 1000 people and 8.1 dead per 1000 people respectively). However, a bigger problem in the demographics of the country is high maternal and infant mortality rates (300 dead per 100000 childbirth and 52.44 dead per 1000 born). The average age of the male population is 21.1 years in comparison to 21.6 years of the female population. The life expectancy of men is 60.8 years and women – 63.5. The density of population constitutes 350.3 people per square kilometer. Haiti is characterized with the shortage of resources because of a big population of a small country, which results in poverty, hunger and diseases. These are the reasons for a low level of average life expectancy (Worldstat Info).
The number of urban population in 2010 composed 52% of the total population, whereas rural – 48% respectively. The coefficient of urbanization of the population is 3.9% a year. The balance of migration based on a difference between a number of immigrants and emigrants is 6 migrants per 1000 people. The HIV-infection is the main health care problem of the Haitian nation. The level of illiteracy is 53% of the whole population, which is rather low. The population of the country is almost uniform in terms of the ethnic structure. It means it has a powerful potential. Consolidation of a society, development of education and sciences and an increase in the level of literacy of the population are necessary for the improvement of the situation in the system of international economic relations (Worldstat Info).
Language and Religion
The population of Haiti speaks the Haitian Creole language developed on the basis of French. The language represents a modified French lexicon of the 18th century finding the influence of the languages of the Western and Central Africa with small Arab, Spanish, Portuguese and English impregnations. The grammar is significantly simplified and spelling, as a rule, corresponds to pronunciation. The language has two dialects: Fablas and Plateau. Since 1961, the Haitian Creole is the second official language of Haiti along with French.
About 80% of the population of the country are Catholics and 16% – Protestants. However, up to 70% of Haitians along with Christian doctrines also practice “voodoo”, a pantheistical Afro-Christian syncretic cult. Voodoo is considered one of the directions of Catholicism. It was recognized by Vatican in 1860, but the Haitians claim that their religion is more ancient and deeper than Christianity as it absorbs the best of all religions of the past and the present.
Given that Blacks were brought to Haiti from Africa, but were not local natives like in the majority of other American colonies of the European states in West Indies, led to the fact that African features prevailed in the life and culture of Haitians. Present Haitians kept the African way of life in many respects. In particular, although almost all Haitians consider themselves Catholics, the African pagan voodoo religion dominates slightly diluted with the Catholic terms and ceremonies.
After the earthquake in 2010, the human values shifted toward a desire to survive and receive necessary health care. In addition, the population believes in the existence of zombie in Haiti.
The Republic of Haiti is a presidential republic with a multi-party system. The president is the head of the state and a prime minister is the head of the government. The prime minister is appointed by the president and approved by the National Assembly. The executive power belongs to the president and prime minister, whereas the legislature belongs to the government and two chambers of the National Assembly of Haiti. Modern structure of the political system is regulated by the Constitution adopted on March 29, 1987. Rene Preval is the president of Haiti.
The president is the commander-in-chief of the armed forces of Haiti. He conducts negotiations and concludes international agreements, publishes laws and proposes the prime minister’s candidacy. All decisions of the head of state are subjects to the approval by the National Assembly (Parliament). The president holds executive power together with the government.
The National Assembly is in charge of the legislature and consists of two chambers – the Senate and the Chamber of Deputies. Both chambers are chosen by the universal direct ballot of citizens – senators for 6 years and deputies for 4 years. The structure of the Chamber of Deputies and the Senate is not constant and defined by the electoral law. The National Assembly elected in 2006 consists of 30 senators and 99 deputies.
The value system in Haiti is the result of the mixture of French and African cultures with a noticeable influence of Catholicism. Spiritual culture of Haiti composes the core of the value system. Under the influence of French, black women wore the French toilets and sent children to study the national culture hence inoculating the cultural and moral values to their children.
Trend of the Haitian HDI
This country has a rather high death rate (84 deaths per 1,000 people) and birth rate (20 per 1,000 people) (“Demographic statistics for Haiti.” n.d.). Haiti is at the third stage of demographic transaction characterized by the establishment of business connections that provide manufacturing of commodities (they serve as the labor supply regions), industrial activities, self-constructing houses, and shift of the population from rural to urban life.
Economic and Resource Characteristics
Haiti has the developing economy. The majority of the population works in such fields as agriculture, forestry, fishing and mining industry (extraction of bauxite, copper, marble, and calcium carbon). The country is mostly oriented on import. Haiti’s top imports are rice, pal, oil, raw sugar, and refined petroleum from such countries as the USA, China, Peru, Indonesia, and India. Haiti exports knit apparel and vetiver oil to the USA, Canada, Mexico, Vietnam, and China. The Gross Domestic Product is only $8 billion with the growth rate of 3.4% annually (Forbes). Haiti has a tremendous unemployment rate (40.6 %) (Forbes). “Haiti is the poorest country in the Western Hemisphere, with a per capita income of $400, in rural areas $100” (Haiti Health Ministries). This creates the background for one of the major advantages of this country, which is cheap labor force. That is why, in in the nearest future global companies will move their manufacturing facilities to this country as it has been done by a Korean textile manufacturer called Sae-A Trading Company (Watkins).
Haiti’s economy is very low in terms of GDP per capita as a result of corruption, poverty, and poor education. Haiti’s market economy and the labor costs are low. Its export access to the US market is tariff-free. Farming in small scale supports about twenty percent of the entire population. Frequent natural disasters are also a giant problem in Haiti. Inflation rate is greater than anywhere else. The fiscal sustainability is aided by the international assistance. Improvement of business has got lots of undermining by corruption and ineffective framework of the judiciary. The institutions mandated to govern are weak and limited in reconstruction since the 2010 earthquake. Public spending has faced rough times because the politics are very unstable. Those in government are abusing and misusing the public money for personal use.
Major Internal Issues
Nowadays, the Haitian government develops various initiatives for the improvement of the economic situation. It closely collaborates with the UN for launching the Development Program called the Laboratory for Innovation and Economic Development (IDE) Project directed at training young specialists in the field of business management who have innovative ideas and can present their own projects (United Nations Development Programme)
The UN also renders support in the establishment of 39 long-term projects directed at the improvement of governance, reduction of the negative influence of disasters, and protection of the environment (United Nations Development Programme). One of the top priorities of the cooperation between the UN and the Haitian government is the raise of the capacity and human resources of public administrations in order to meet such issues as the lack of civil servants. The emphasis is made on regional ad urban planning, election process, and justice. This initiative is reflected in the performance of trainings for judges and clerks concerning registry techniques and violence.
Additional attention is paid to finding a solution to such a problem as an extremely high disaster risk. Location of this country makes it very vulnerable to various disasters. The UN provides operational support in preparation for emergencies, establishment of the Haitian disaster risk management system, organization of disaster response simulation exercises, and rendition of support for the recovery of ruined objects. Low level of living, lack of means of living, and amenability to various disasters have created the background for another environment issue. Haitians have cut down almost 99% of forests because they need fuel for cooking (United Nations Development Programme). Furthermore, deforestation leads to soil erosion and disappearance of some species of flora and fauna. For the rectification of this issue, the UN provides support in the ecosystem management in the form of planting seedlings.
Besides, this organization helps Haitians with management of their health issues like tuberculosis and AIDS. For the last five years, two thirds of people with tuberculosis have been cured, 1 million people have been tested on HIV, and more than 190,000 people have received the antivirus therapy (United Nations Development Programme). Special medical education programs have been established all over the country.
However, at the current moment there is one more problem in Haiti. Both community and public infrastructures have suffered from a tremendous decay. Numerous roads are destroyed. Hence, there is no connection between cities. People cannot receive medications, buy products outside of their towns, or go to work in other locations. The majority of Haitians travel by bicycles, motorbikes, private cars, or on foot. Almost all Haitian roads are unmarked or unpaved.
There are two major reasons for the stated problems: harsh climate and insufficient funding. Additional attention should be paid to the inobservance of traffic laws because there are no training programs or licensing for drivers. Speed limits are seldom posted and are usually ignored by drivers. The police do not have manpower to enforce them. That is why, there are numerous accidents on Haitian roads. Moreover, the situation is worsening due to the following factors: overloading of vehicles, absence of brakes on vehicles, mechanical failures, mountainous roads, and poor maintenance. Besides, Haitian drivers are quite aggressive to each other, police officers, and foreigners. Moreover, notwithstanding the fact that drunk driving in Haiti is strictly prohibited, people frequently sit down behind the wheel after drinking, especially at night. Usually, the right way of driving is not observed in this country. Hence, it is advisable to stop and check that there is no oncoming traffic even if the person has the right to way in order to eliminate any possibility of accident. The overall situation on Haitian roads is chaotic. Unfortunately, the government has no ability to change this situation because of the lack of adequate resources.
In the regional and global context, Haiti has a rather weak position. It serves as the raw materials base and the location of cheap labor force for more developed nations. The Haitian government cannot build steady relationships with governments of other countries and international organizations. Further development of the country is limited by the considerable poverty cycle, high level of income inequality, political instability, indebtedness, and political barriers to international investments. The Haitian government establishes peaceful relations with numerous countries all over the world, including the Dominican Republic (the only neighboring country), Canada, the USA, Taiwan, Chile, France, Spain, etc. It is one of the original members of the United Nations (the former League of Nations). These relationships have the aim of obtaining support from these countries and developing trade. However, compared to other developing nations, the level of living in Haiti is rather low. Hence, the country can propose only cheap labor and resources to other countries. It is also worth noting that the country controls the Windward Passage that could be easily closed for the disruption of the maritime traffic.
Political instability that has been present for several centuries has a considerable negative influence on the economy and social life of people. Haitians suffer from earthquakes and natural disasters, but cannot obtain financial, medical, and technical help from other countries and international organizations because of poor governance and decay of the transportation system. People live in the constant economic downfall that creates the barrier to further economic development. Nowadays, Haiti is considered to be the country that can supply only cheap products and minerals, as well as the low-cost labor force. Hence, future development of this country is connected with the transition of manufacturing facilities of global corporations to Haiti.
The History of Haiti
Haiti has a rather complicated history. This island was explored by Columbus in 1492 (“Haiti”). During that century, native citizens were ruled by Spanish conquerors. In 1697, this island became the French colony and the motherland of slaves for French aristocrats. The slave rebel in 1791 led to the proclamation of the declaration of independence in 1801. During the rule of Napoleon, the slave movement was suppressed. However, in 1804 a new independent country called Haiti was formed. For several centuries, this country suffered from revolutions and shifts of power. The situation sharpened by constant disputes with Santo Domingo. However, the economic and political situation in the country was improved in the beginning of the 20th century after its occupation by American mariners and acceptance of American receivership. This brought stability into the country. Further political situation is also characterized by shifts of power, which have led to economic, health, and social crises. In the second part of the 20th century, Haiti suffered from AIDS, starvation, and cholera. These diseases have led to the collapse of the tourism industry. Additional attention should be paid to the catastrophic earthquake of January 12, 2010 (with the 7.0 magnitude) that killed thousands of people and destroyed hundreds of buildings and objects of infrastructure (“Haiti”). The situation has been worsened by endemic poverty and cholera. Various countries and international organizations have tried to render financial and medical assistance to Haiti. However, due to political instability, people have not received this help till recently: “hundreds of thousands were still living in tent camps while tens of thousands were staying in buildings badly damaged during the earthquake” (“Haiti”).
Haiti occupies the western third of the Haiti Island in the group of the Big Antilles. The other part of the island belongs to the Dominican Republic. The history of Haiti has been surreal and bloody since its discovery by Christopher Columbus on December 6, 1492. Indians that were occupying the island called it Haiti, which means “mountainous”. When in 1493 he returned to Espanola, Columbus found out that all garrison was killed by Indians in revenge for a bad treatment.
Historical and Settlement Characteristics
The brother of the admiral Columbus, Bartolomé, continued the discovery further and colonized the island. Spaniards, who declared the whole island to be their possession, colonized mainly its eastern areas. In 1625, English and French pirates came to the island, turned it into a base and increased a number of raids against Spaniards. In 1697, Spain conceded the western third of the island, called San Domingo, to France. During the 18th century, San Domingo turned into one of the richest French colonies. Sugar crane, indigo, coffee, cocoa and cotton were grown on the plantations. By the end of the 18th century, the population of a colony totaled 42 thousands of white people, 50 thousands of free mulattos and the Blacks who had property but were limited in rights, and 452 thousands of Black slaves (UNCTAD).
In 1789, the revolution burst out in France, which was directly reflected in the Haitian history. The armed struggle between the royalists and republicans has led to a creation of a colony. Conflicts among the white led to the strengthening of mulattos who started the revolt and demanded the same rights with Europeans. At last, in 1791 a grandiose revolt of Black slaves burst out. On January 1, 1804, the general Dessalines declared the independence of the Haiti state. The history of Haitians can still evoke sympathies. Due to the first in the history victorious revolt of slaves, Haiti became the first independent Latin American country and the first state of Blacks (UNCTAD).
In the beginning of the 20th century, there were many revolutions. The governments changed fast and the agriculture was in a full decline as there were almost no industries. In 1915, USA arranged an intervention in Haiti, having occupied the country without any resistance. Haiti stayed under American occupation until 1934. Americans created telecommunications and constructed a number of secondary educational institutions in Haiti. Tyrannical dictatorship of a notorious Francois Duvalier has prevailed for 23 years in Haiti.
Haiti the Less Developed Country
Haiti is the oldest republic of the Afro-American people in the world and the second independent state (after the USA) in North America. It is also the first country in the world where black people won in 1804. Considered the descendants of slaves, they compose the majority of inhabitants of Haiti, namely 90% (Worldstat Info). Once being one of the richest and highly productive colonies in the world and a pearl of France, at present Haiti is the poorest state in the Western hemisphere and in the world. Given essay will provide a brief overview of the country’s history, demographics, language, religion, government, value system, business practices and attitudes toward foreign investments as well as consumer behavior and marketing mix of Haiti.
Haiti, a full official name – the Republic of Haiti, is the state in the western part of the Haiti Island. The eastern half of the island is occupied by the Dominican Republic. The city Port-au-Prince is the capital of Haiti. The population of the country is 10,033000 million people. The Republic of Haiti also includes the coastal islands of Tortue and Gonav. In the north, it is washed by the Atlantic Ocean and in the south by the Caribbean Sea. Haiti is the third biggest country in the Caribbean Sea after Cuba and Dominican Republic (UNCTAD).
Similar to other developing states and regions, Haiti has many factors obscuring its economic development, as well as general development in the country. Haiti has a very impressing history, being the second country to gain independence and the first black republic. The good history is going down the drain with overwhelming issuing marring the day-to-day life in Haiti. Political and civil unrest, as well as the lack of proper governance, has been a great hindrance to the development of Haiti. After gaining freedom from a dictatorial regime, Haiti is struggling to gain political stability, as well as to establish the rule of law. Weak exercise of the rule of law and poor government is the key factor, affecting the use of public resources. With an uncertain political climate, Haiti experiences low investments with government screening undermining investment in other regions. Just like any other developing nation, Haiti goes through political and civil unrest. Historically, Haiti helped its neighbors in their fight for independence, but the current fight in Haiti is hard to be resolved by the international community. The US tried to assist in removing the dictatorial president from power, but the great support that he had made things very complex (Hallward). Haiti has great potential, which can be unraveled for the advantage of its economy. Emigration from Haiti to the United States is considerably high as people seek for better opportunities.
Haiti has rich natural resources, which are close to depletion as a result of neglect. The forest cover in Haiti is less than 10 percent of the entire country’s land. In comparison with Dominican Republic, Haiti is far much bare than the latter. The ecosystem of Haiti is adversely affected by human activities of farming and poor mining practices. The coastline is still tampered with since fishing in Haiti has not been expanded or modernized. There are few parks (the La Visite National Park and Pic Macaya National Park), in which animals are fed by people. Mostly, animals live in the forest, which is quite small and sparsely populated (Smartt).
After its exploration by Columbus, Haiti came under the Spanish rule in 1492 and later became a colony of France in 1697 leading in the sugarcane production by slaves. Haiti gained independence in 1801 after a serious revolt considered the largest in the world history. Haiti is the worst country when it comes to poverty in the Western Hemisphere. This is because of the black inferiority, slavery heritage, and racism among others. Ninety percent of Haitians are descended from slaves. The story of Haiti withstanding and resisting every effort made by outside invaders in the name of colonists was a surprise. The blacks were able to defeat and gain a victory over French soldiers. However, after the defeat, the French demanded compensation for the plantations taken away from their people in Haiti. It cost the Haiti thirty percent of the national budget. Haiti’s birth was violent. Democracy was fragile. The problems of the country were internal. Some leaders wanted to rule for life. There were divisions that created chaos. Brutality moved on for centuries. Terror spread beyond the limits killing innocent mortals. Beginning from 1915, the United States occupied the waters of Haiti. The aim was to eliminate the constitution that was forbidding foreign ownership of land and solidify American economy control. American officials made a declaration that the government of Haiti needed reforms as it was in bad shape. The Americans started another fight amongst themselves. The war came to an end, and schools, clinics, and roads were left for the Haitians. Nevertheless, Haiti was so badly hurt that the wound remains in memory till today. The problems that Haitians have cannot be solved externally. The real freedom has to flow from the citizens themselves.
Doing Business in Haiti is hectic because the procedures required are lengthy and slow. A business can be opened after 204 days (Hallward). Criminal dealings have heightened in Haiti.
The police and political elites are in cooperation with criminals to do drug trade. The Haitians survive with the subsistence economy. There is export of fishing, agriculture, and forestry. Hills have hindered agriculture in the rural area since they have sheltered much of the terrestrial of Haiti. Coffee, mangoes, and cocoa yield big profits. Ferocious rivalry in the global market has seen deterioration in sugarcane production. Timber production declined because woodlands have vividly dispersed. The fish breeding brings almost five thousand tons per year. Minerals comprise calcium carbonate, copper, gold, and marble. Industries produce detergents, flour, edible oils, butter, and cement.
The major issues in Haiti have brought about suffering to both the economy and the citizens. Conflict has existed since independence. There are constant disagreements between the government, the citizens and the outside nations, especially the US. The economy also experiences conflicts. The exports are low and of poor quality. Land is occupied by mountains, and the government is doing nothing to aid the citizens. The governments are always creating chaos. They do not work on the things that help the mortals. The major concern of the citizens has been from public spending to drug trafficking by government officials and police. Governance is poor with corruption levels beyond limits (Farmer, & Kozol). Opening a business, which is meant to be a simple task, takes ages so that those who bribe get through faster. The police are not protecting people, but rather working in corruption zones. There are not enough hospitals, and the available ones have no facilities. Medical professionals are insufficient, poorly trained, and low compensation demotivates them. Children never get vaccinated. Most of them die because of diseases that the government could prevent. The citizens never access clean water for drinking. Separatism is in existence. Some citizens support the overthrown governments. There is no unity as the nation is divided into groups of persons with similar interests, such as drug cartels, and politicians with those supporting them. The environment is in crisis. Deforestation is happening in Haiti with forests declining (CIA). Earthquakes are destroying humanity and resources. Poor housing has led to poor living conditions. There are no toilets for both public and private use leading to the diseases like diarrhea.
Over the years Haiti has had good international relations. With the onset of a dictatorial rule, the United States tried to offer help to liberate the country from the dictatorial rule. With that aid, Haiti got rid of the dictator. They conducted presidential elections on 2012 December, which were marred by irregularities. The dictatorial president accused the US of forcing him out of power, but the Americans dismissed the accusations (Fry). The international community in conjunction with the Haitian authorities denied the dictator entry to Haiti regardless of his passports. In 2004, American Forces were keeping peace and order in the Haitian town Port-au-Prince. One of Port-au-Prince’s streets was declared by the UN as the most dangerous in the world (Koplow). There had to be a rerun of the elections in 2013. In the history of Haiti, it offered financial aid to its neighbors to help fight the colonialists in return of the slavery eradication. In addition to the help of the World Bank and the IMF, other developed countries have also extended their financial aid to Haiti for years. When Haiti could not pay off the debt, they were wavered in 2005. The international community has made efforts in assisting Haiti to maintain stability, which does not seem to be bearing fruits. All the same, as many developing countries take to respond to international efforts, Haiti may also respond sooner or later to these efforts.
Apparently, Haiti performs poorly economically, ranks low in life expectancy as well as in education. The international community has made efforts to improve the infrastructure of Haiti with little or no success. The greatest menace of Haiti’s development is corruption. The aid that the international community, the IMF and the World Bank direct to Haiti for the development of infrastructure goes to personal accounts. Poor governance, weak execution of the rule of law, and weak judiciary have made it impossible to apprehend corrupters in the country. Corruption is also a reason behind poor policies in the country, which mar investment and business operation. Being an agricultural economy, Haiti has a long way to go to see the development. There is a dire need for political upgrading to ensure proper policies are in place for development. A stable political climate is necessary for the civil unrest to come to an end. Even though the post-development ideology has worked for many developing countries, Haiti needs to reconsider its approach to the same. The key need in Haiti for the country to achieve development is political stability. With political stability, development policies will be in place, peace will be achieved, civil unrest will come to an end, and regional relations will be extended. With those achievements, Haiti will be in the way to development.
The Republic of Haiti occupies the western part of Hispaniola Island. The previous and current economic and political events are closely connected with the country’s biophysical overview and history. In this work, additional emphasis will be made on international relations with various countries and organizations. The current essay will show a close interrelation between biophysical and demographic factors, history, economy, and politics of Haiti.
Business Practices and Foreign Investments
International movement of the capital has an essential impact on Haiti in terms of international economic relations as it erases the borders between the national farms of various countries. A special value of this purpose belongs to the development of foreign direct investments (FDIs), which lead to the formation of multinational corporations. Haiti participates in the international movement of the capital mainly as the country-recipient of the international economic aid. UN and its dedicated organizations including non-governmental organizations, private companies and the country’s government provide economic support to Haiti. A destructive earthquake that happened on January 12, 2010 became a huge tragedy for the country. As a result, 220 thousands of people including 102 UN employees died, thousands were wounded or remained disabled and 1.5 million people became homeless. The earthquake caused a serious damage to the insufficiently steady economy and weak infrastructure of Haiti and slowed down the promotion of the country on the way of national formation. Many countries rendered humanitarian and financial aid to the country. However, governmental support was not enough for the country. For the rescue of Haiti, it is necessary to change its economic model. At present, robbery and theft are among the most spread practices in Haiti (World Economic Forum).
The republic of Haiti is open for foreign investments. The government of Haiti achieved a certain progress in recent years, having improved the legislative base concerning export, import and foreign investments from other states. Since 2004, the government of Haiti with the assistance of the International Monetary Fund (IMF) and the World Bank (WB) executes monetary, fiscal and currency policies directed at the creation of stable macroeconomic environment and favorable investment climate of the country. These policies include a reduction of the interest rates for the purpose of simplification of the access to credits and establishment of a stable exchange rate. In June 2009, the World Bank and the International Monetary Fund wrote off a debt of Haiti in the sum of $1.2 billion, having recognized a relative macroeconomic stability of Haiti and observance of the conditions of the IMF program (IMF).
In Haiti, there is the Center for Investment Facilitation (CFI) created in 2007. The activity of CFI includes the optimization of investment process due to the simplification of the procedures connected with trade and investments, and also the attraction of investments into the most priority sectors of the economy. Investors in Haiti have the right to run business as individual entrepreneurs, owners of the limited liability, joint stock (corporation) or branch of the foreign company and cooperative. Corporations are the most commonly used form of a business entity in Haiti. Foreign investors are allowed to own 100% of the company or a subsidiary (World Economic Forum; Caribbean Export).
Foreigners can create joint ventures on the territory of Haiti. The right of distribution of shares is reserved by the owners of the joint venture. However, the sales and purchases of shares of a company are regulated by the state. Nevertheless, business people can freely dispose own property and assets of the enterprise according to the laws of the Republic of Haiti. The main sectors of economy attractive for foreign investors include the agriculture, mining and power industry. Besides, the food manufacturing industry is the priority sector for investment. Such advantage as the existence of fields of copper, lignite (brown coal), manganese and a large-scale deposit of bauxites became the subject of interest to investors from more developed countries aimed at the exploration, production and processing of minerals (World Economic Forum).
In addition, the geographical location of the country with an access to the sea, which allows to develop trade and economic relations with other states, has a special value. For the evident representation of the dynamics of the direct foreign investments received by the Republic of Haiti, the statistical data of the UNCTAD is presented in the Table 1. (UNCTAD).
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Since 2000, the inflow of FDIs into the economy of Haiti changed has been changing gradually. However, the tendency of its increase is observed in the dynamics. The years 2006, 2010 and 2011 were especially favorable in terms of foreign investments, which ended with $160 million, $150 million and $181 million correspondingly. However, the world financial crisis had an impact on the inflow of investments. Only in 2010, the stream of FDIs reached $150 million. In 2014, FDIs composed $230 million (UNCTAD, 2015).
Based on Haitian vision of a developed country by 2030, the economic strategy is designed to facilitate the emergence of a strong, diversified, dynamic, competitive, open and inclusive economy extending over a broad territorial base. Two major options should mark the economic path including strong growth and enhanced attractiveness of the economy in a situation that is rebalanced from a social, environmental and spatial standpoint (IMF).
Thus, Haiti is the country that regularly receives economic help from the international organizations for the restoration and development of its economy. Besides, many world countries invest into the economy of Haiti, namely into its most favorable branches. Nevertheless, the dependence of Haiti on the foreign help is great since its support covers about a third of the public expenditures. Certainly, all this affects an economic situation in the country. In relation to other countries, the national debt promptly increases as well as the influence of these countries on the Republic of Haiti.
Consumer Behavior and Marketing Mix
Majority of foreigners perceive Haiti as a concentration of poverty, dictatorship, AIDS and mystical ceremonies of Voodoo. Governmental policy aimed at the attraction of investments and tourists was based not only on the climatic advantages of the area, but also on the energetic power of the mystic place. Negative features of Haiti were veiled under the image of mystery resulting in the increased flows of tourists into the country (World Economic Forum).
The volume and structure of consumer behavior directly characterize the standards of living of the Haitian population. Consumer behavior of the Haitian population considerably changed following social losses, which escalated due to the increase of uneven income distribution, strengthening of differentiation, growing scales of poverty and deepening of social injustice in the society. If Haiti aims at the sustainable development and investments, it should receive necessary resources at the global economic level. It means that the country should represent itself as a platform for a start and implementation of the most perspective world’s projects. Haiti should become a country attractive for investments, moving, living and running a business (UNCTAD).
The marketing of Haiti includes activities undertaken for the purpose of creation, maintenance or change of the relations or consumer behavior of social communities concerning the definite territory or resources – natural, technical, financial and labor. Application of the territorial marketing in Haiti can help educate and increase patriotism of the local population, make it attractive for tourists, businessmen and investors as well as develop and promote the country. Moreover, it concerns not only the country in general, but its particular regions, municipalities, cities and settlements (World Economic Forum).
Marketing mix represents a set of practical measures influencing the market or the adaptation of country’s activities to a situation in the market, and also timely and flexible response to its changes. In recent years, practically all Haitian industries have experienced a decrease in production caused by unstable financial position of the country, lack of own current assets, insufficient investments to the country, etc. The marketing mix of Haiti is represented by various factors, the combination of which allows solving economic issues. All elements of the marketing mix should be developed on a strategic level for the long-term planning of the investment programs in the country.
To sum up, the Republic of Haiti is the poorest state in the western hemisphere and one of the poorest countries in the world. The GDP of the country is less than $5,000 per capita. More than 80% of the population is below the poverty level. Money transfers from emigrants and increasing volumes of investments represent the main source of income in Haiti. The country has the deposits of gold, bauxites and copper, which are strongly underdeveloped. The main industries include sugar, flour-grinding and textile manufacturing.
For the promotion of Haiti on the financial market, it is necessary to develop a favorable investment climate in the country. Government should apply a differentiated policy approach toward each investment project. Such marketing policy orientation will allow considering the definite requirements of investors for the potential project activity leading to a considerable increase of country’s competitiveness.