Mercy Mean

January 29, 2010

The IMF and the World Bank have been warmly applauded for their willingness to drop Haiti’s debts, but their generosity is in reality extremely shallow.

The World Bank has opted to waive interest payments for five years on the $38 million it has lent to Haiti, while the IMF has approved a $102 million loan upon which interest will be due from 2012.

So ruined Haiti, having lost perhaps 60 percent of its GDP, and with some suggesting that it will take decades to recover, if it does, will have to start paying the angels of mercy in 2 years. Reuters reports that 2012 will see the first interest payments, but the Hindu says there will be a five-and-a-half year grace period.

Either way, for a so-called “Marshall Plan” this is woefully insufficent and penny pinching. Don’t be fooled by earlier write-offs. Although the IMF and World Bank wrote off some $1.2 billion in Haitian debt last year, and the Inter-American Development Bank are considering forgiving a further $441 million, the game remains the same.  The Haitian government has no surplus to divert to interest payments at this time. In five years, perhaps they will, and the IMF will get its pound of flesh – courtesy of rebuilding budgets – schools, hospitals, housing.

It will be interesting to see how the Dodd-Lugar Bill, which has been introduced this week into Congress, will fare. According to its proposers, the Bill would seek to set up a reconstruction fund for Haiti based on grants and not loans – a major improvement. But how this will emerge from Capitol Hill is far from clear.

And the nature of the reconstruction fund is important. The Bill suggests that it be focused on large scale infrastructure – “electric grids, roads, water, sanitation facilities” – which is fine. But Haitians need support to build urban and rural communities on a local level – supporting small scale energy, agriculture, education and social institutions. Large-scale projects can, moreover, fall prey to venal contractors. It is no coincidence that such projects are favoured in the Bill. That’s where Bechtel’s expertise lies, not in micro-hydro or agroecology.

———–

In other news, good news, Venezuela has cancelled its debt to Haiti, relieving the nation of a $295 million burden. Additionally, Caracas has promised a $100 million “special humanitarian fund” which will focus on health and education. So, despite some odd utterances recently concerning the origins of the quake, Hugo Chavez has responded to it more effectively than Washington (or almost any other government).

——–

According to the New York Times and Reuters, aid efforts are being hindered by “mobs.” Apparently, “Several people fell and risked being trampled as a crowd rushed the grounds of the ruined Ministry of Culture” and UN forces have had to fire warning shots elsewhere.

This is echoes other articles which have warned of mob violence and looting. But it’s almost the reverse of reality. Struggling for copy, the Reuters stringer involved has come up with a non-story, slyly puffing up its significance by writing that “Despite these incidents, not all handouts have been chaotic.”

Actually, chaos is rare. The rule seems to be orderly devastation. U.S. troops in Cite Soleil are telling reporters of their surprise at how peaceful their task is, and how friendly the people are despite their suffering.

It’s depressing that Haitians are still written off as “mobs” just as they were “looters” last week.

Advertisements

2 Responses to “Mercy Mean”

  1. kiosa Says:

    Turns out, Haiti is sitting on HUGE oil reserves. So now we have a better idea why the US MIC moved in to close down their 5 airports and cut off international aid. The last thing they need is for word to get out.

    Haiti’s US embassy is the 5th largest in the world!

    $38 million indeed. LOL.

    Who’s going to get the contracts? That’s the question.

  2. kiosa Says:

    i forgot that i have to change my website every time. sorry. here’s the Haitian oil link.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: