IMF Meeting on Haiti.

From pretty much the time Haiti became an independent country in 1804 it has been plagued by debt and political strife. These problems were made much worse under the Duvalier regimes who stole international aid money, ran up huge international debts and forced some of the most talented and well educated Haitians to flee the country.

By the time the Duvalier's had been deposed globalisation and free market capitalism were on the rise. This meant that in order to pay it's debts Haiti was forced to turn much of it's main industry, farming, over to growing cash crops such as coffee and sugar cane. This left only the lowest quality farmland available to grow food to feed Haiti's population. It also, in part, led to massive deforestation that further degraded the available farmland. The economic re-structuring also brought an end to trade tariffs that meant Haiti was flooded by imports of cheap staples like rice from places like the USA. Although these food import were still very expensive for the Haitians they were produced by foreign farmers who were being paid subsidies which meant they were able to undercut the food being produced by Haitian farmers. This forced many of the farmers out of business and into shanty towns where they remained unemployed and dependent on international food aid as the struggled to exist in abject poverty.

While Haiti remains the poorest nation in the western hemisphere the situation has improved dramatically since the election of Rene Preval as President. The economy has grown steadily with the level of exports increasing while the level of imports has fallen. Social indicators such unemployment, literacy and mortality rates have also improved. In 2009, thanks in no small part to the Paris club of creditors Haiti was able to cut it's international debt from $1.8bn to just $428million. Crucially it also had no outstanding debts to the IMF.

Then the earthquake struck and the IMF provided Haiti with $100million loan to help with reconstruction. They have claimed that they were forced to offer this money as a loan because no mechanism existed for them give it as grant. Now the Directors of the IMF are meeting to discuss what, if any, help they can give to Haiti. Due to the immense progress that Haiti has made in recent years the answer is probably not much. Obviously they can keep their word and turn this reconstruction loan into a reconstruction grant by forgiving the re-payments. They could also allow Haiti to place tariffs on food imports while they slowly rebuild their farming industry. Apart that there is nothing else in the IMF's remit that can be done to help Haiti because the country seems to have very talented, if not charismatic, President who with the help of the UN is slowly and steadily rebuilding the nation.

It is crucial though that this new debt is cancelled so Haiti doesn't have to endure a decade of economic mourning for what has been a horrific natural disaster.