HAITI MONTHLY -*JANUARY 2009

UNCLAS PORT AU PRINCE 000134


STATE FOR WHA/EX AND WHA/CAR
S/CRS
SOUTHCOM ALSO FOR POLAD
STATE PASS AID FOR LAC/CAR
INR/IAA
WHA/EX PLEASE PASS USOAS

E.O. 12958: N/A
TAGS: ECON ENRG EAID EAGR EINV ETRD BEXP HA
SUBJECT: HAITI MONTHLY -*JANUARY 2009

Summary
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1. (U) This is a monthly report on a variety of topics of interest
which do not merit full reporting cables. End summary.

Foreign Economic Assistance
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2. (U) Association of Caribbean States.
Haiti hosted the Council of Ministers of the Association of
Caribbean States (ACS) from 28 to 30 January 2009. 25 Foreign
Ministers of the Caribbean participated in this meeting. It was an
opportunity to boost the image of Haiti and begin to revive the
tourism sector. ACS was created in 1994 to strengthen regional
cooperation and integration of the Caribbean countries.


3. (U) Haitian ''Marshall Plan''.
The ''International Commission for Haiti,'' (ICH),a nonprofit
organization based in the U.S., presented a revivalist version of
the Marshall Plan for Haiti at a conference on January 19. ICH said
its goal is to facilitate economic development in key areas, such as
education, health, and agriculture, and that their plan differs from
the National Document Strategy for Growth and Poverty Reduction
(DSNCRP, Haiti's name for the PRSP) which aims to reduce poverty.
ICH said that it would identify problem areas and seek to implement
the plan over the next two years.

Transportation
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4. (U) Suspension of CaribAir Flights.
The Dominican Republic's Institute of Civil Aviation (IDAC)
announced the total suspension of flights by Dominican airline
Caribair due to operational irregularities and violations of
aviation regulations. (Note: Post is following up on the subsequent
ban on Haitian carrier TortugAir flights to Santo Domingo from
Port-au-Prince by IDAC during the first week of February. End
note.)

Industry and Manufacturing
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5. (U) Digicel Lay Offs.
Caribbean-based mobile phone company Digicel announced plans to
reduce its Haiti workforce by 10 percent. (Note: During the month
of January, the GoH announced and then rescinded, following howls of
protest, the idea of imposing higher taxes on the lucrative telecoms
sector. Digicel accounts for nearly 10 percent of total ''large
taxpayer'' annual revenues of approximately USD 250M. End note.)



6. (U) Propane Stoves and Gas for Haiti.
The Dominican Republic's State Secretariat for Industry and Commerce
authorized Dominican company, Excel Gas, to transport and sell
propane gas and equipment in Haiti. Excel Gas plans to distribute
250,000 propane stoves, some free or subsidized, along with the gas
to fuel them. (Note: propane, while the fuel of choice for
prosperous Haitians, is still not quite competitive on a daily basis
with ubiquitous charcoal made locally from dwindling Haitian
forests. End note.)

Economic Conditions
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7. (U) Inflation Rate Declines Again in December.
For the third successive month, the Haitian Consumer Price Index
(CPI) decreased, this time by 2.2 percent from November. The
12-month inflation rate is now at 10 percent, down from 13.8 percent
in November. This trend is due to decreases in the Food/Beverage,
Transport, Housing and Energy categories, mostly because of falling
imported food and fuel prices(a 4.4 percent drop).


8. (U) Remittances from U.S. to Haiti Up Slightly.
Despite fears that the U.S. recession would immediately reduce money
transfers (remittances) to Haiti, they actually were up during the
first quarter of FY 09 compared to the same period in FY 08. Total
remittances during the period (USD 258 million) increased by 4
percent over the year earlier, mostly due to a seasonal peak in the
lead up to the holiday season. (Comment: Post fully expects that
remittances will be down beginning in 2009, but does not have
Haitian Central Bank figures for January yet. End comment.)


9. (U) Lower Haiti-DR Trade in 2008.
Trade between the Dominican Republic and Haiti for 2008 totaled USD
421.1 million, a drop of USD 21 million from 2007. Preliminary 2008
figures indicate the DR imported USD 50.1 million worth of products
from Haiti, while Haiti imported USD 371 million of Dominican
Republican products.


10. (U) Much Lower GDP Growth, Negative GDP per Capita Growth in

2008.
The Haitian Institute of Statistics and Data (IHSI) reported real
GDP growth of 1.3 percent for 2008. Factoring in an estimated
population growth rate of 2.4 percent, GDP per capita was actually
negative. The primary sector has been hardest hit by the fall in
real terms of 6 percent. The only sectors that were up
substantially were construction (5 percent) and services (5
percent.) Projected GDP growth for FY 09 is estimated at between
2.0 and 2.5 percent.