Dominican Republic and Haiti: Country Studies

1990s, Haiti's assembly sector operating at fraction of capacity.
In mid-1999 Prime Minister Alexis decided to resume
privatization process of various enterprises after a two-year
hiatus.
Currency: Gourde (G). Official exchange rate originally set at
G5 to US$1 in 1919. Black market trading began in early 1980s
in response to high inflation and fiscal shortfalls. Political
crises of early 1990s, international embargo, and sharp drop in
government revenues reduced value of gourde by about 80
percent by 1994. Although the Central Bank pumped more
than US$37 million into foreign exchange market in 1996,
gourde continued to fall to G16.9 = US$1 in August 1997. In
1999 gourde fluctuated between 17.5 and 18.3 to US$1.
Imports: Primarily food, tobacco, chemicals, machinery, and
transportation equipment; fell from US$449 million in 1991 to
US$141 million in 1994.
Exports: Mainly coffee and manufactured goods from assembly
plants; declined from US$202 million in 1991 to US$57 million
in 1994.
Balance of Payments: Since mid-1960s and continuing into late
1990s, Haiti has incurred substantial trade deficits. Deficits
partially offset by remittances from Haitians working abroad
and official aid. During 1992-94 international trade embargo,
public deficit financed mainly by Central Bank credit and
accumulation of arrears. External current account deficit,
estimated at 19 percent of GDP in FY 1994-95, projected to
drop gradually to 10 percent of GDP by FY 1999-2000.
Fiscal Year (FY): October 1 through September 30.
Fiscal Policy: Effects of gourde depreciation, together with
rising food prices, raised inflation rate from 15.6 percent in
December 1996 to 17.2 percent in July 1997. To protect gourde
stability, government adopted stringent fiscal policy and
aggressive tax collection program. New legislation broadened
base of sales tax and unified its rates, reduced tax evasion
among larger companies, and minimized number of tax and
customs exemptions.
Transportation and Communications
Roads: Of 1999 total of 4,050 kilometers of roads, 950
kilometers are paved, another 950 kilometers are gravel or
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