07-11-2018, 10:49 PM
*** 12-Jul-18 World View -- Haiti blames IMF for fuel price increases triggering riots
This morning's key headlines from GenerationalDynamics.com
****
**** Haiti people riot after announcement of fuel price rises during World Cup match
****
![[Image: g170803c.jpg]](http://Media.GenerationalDynamics.com/ww2010/g170803c.jpg)
People dump trash and raw sewage into canals that run through Port-au-Prince, Haiti. When it rains, the canals overflow and flood poor neighborhoods. (NPR)
On Friday, as Haitians were watching the World Cup game between Brazil
and Belgium, Haiti's government announced the end of large subsidies
on fuel prices, resulting in dramatic price increases -- 38% for
gasoline, 47% for diesel fuel, and 51% for kerosene. The increases
were blamed on the International Monetary Fund (IMF).
The price increases for fuel appeared to affect everyone. The
gasoline prices affected those in the middle or upper classes who own
automobiles, the diesel prices affected businesspeople who use diesel
fuel for trucks and heavy equipment, and the kerosene price increases
hit poor people especially hard, as they burn kerosene to light up
their homes, lacking electricity.
Haiti was the poorest country in the world, even before the major
earthquake the country suffered in 2010. There was a huge outpouring
of international aid after the earthquake, including a large fund
organized by former president Bill Clinton, but none of the people
seem to have benefited, and almost all the money was apparently lost
in corruption.
The government had apparently hoped that by announcing the price
increases during Friday's World Cup game, nobody would notice. That
turned out to be a major miscalculation. Most Haitians fervently
supported Brazil over Belgium in Friday's World Cup game, and were
shocked when the game ended in a loss for Brazil. The rioting began
five minutes after the game ended. Burning tires blocked major routes
in Haiti's capital city Port-au-Prince, and sporadic gunfire could be
heard around the city. Store and car windows in the affluent sections
of Port-au-Prince were reportedly smashed. Affluent hotels were also
targeted. Three people were killed on Friday.
As the rioting became increasingly violent, Haiti's president Jovenel
Moïse, accompanied by his wife Martine, appeared in a televised
address to the nation on Saturday evening:
<QUOTE>"You sent me the message and I got it. I corrected
what needed to be corrected.... I asked the Government to
reconsider the decision to withdraw subsidies on the prices of
petroleum products. The Prime Minister did it. The price of fuel
remains what it was before, throughout the national territory.
There is no longer an increase in gas prices. ... Now I ask you to
stay calm and go home. ... I know that it is to me that you gave
the power, but I cannot run alone. I have to have a lot of people
around me before making a decision."<END QUOTE>
The protests didn't end. On Monday, workers went on strike and shut
the capital down. Many analysts have stated that the continuing riots
are being caused by massive government corruption. According to one
NGO analyst:
<QUOTE>"Having had over ten deployments to Haiti following
the earthquake in 2010, including during their elections, I do not
think that the increase in fuel prices is the root cause of this
crisis.
They know that sacrifices have to be made to improve their
economy, and they have made them in the past. However, after
suffering for so long, the Haitian people hate being tricked
Their political candidates promised to address mismanagement and
corruption if they were elected. The people expected improvements
in government efficiency, and arrests of those accused of
corruption, before being targeted for austerity.
However, to have austerity forced on them, without the promised
efficiency and arrests, appeared to be too much for the people to
bear from a government that promised to be
different."<END QUOTE>
The United States has warned Americans living in Haiti to shelter in
place in their homes, to avoid the violence. A marine security
detachment of 13 marines has arrived in Haiti to provide security at
the US embassy there.
Both the United States and Canada have policies to deport Haitians who
fled from the violence following the 2010 earthquake. Activists in
Canada is demanding that because of the current violence, deportations
back to Haiti should immediately end, and Haiti should be put back on
the government list of countries to which migrants may not be
returned. AFP (7-July) and Barbados Today and Military.com and Canadian Broadcasting
****
**** International Monetary Fund blamed for austerity triggering riots
****
The fuel price increases announced on Friday were caused by a
termination of subsidies as demanded by the International Monetary
Fund (IMF) in return for $96 million in loans and grants from the IMF
and the World Bank.
When the price increases were announced, Prime Minister Guy Lafontant
said, “I ask for your patience because our administration has a
vision, a clear program." He defended the price increases because the
subsidies make Haiti's fuel prices the lowest in Latin America among
the non-petroleum producing nations. Furthermore he claimed that many
people regularly crossed the border from neighboring Dominican
Republic, where oil prices are 43% higher, to take advantage of the
subsidized prices in Haiti, which meant that the subsidies were
supporting both Haiti and the Dominican Republic.
The austerity demands were in an agreement that Haiti signed with the
IMF in February. The agreement defines a "Staff-Monitored Program"
(SMP), where IMF closely monitors government activities in Haiti in
return from the loans and grants. The agreement requires that it is
necessary "to eliminate excessive subsidies, including on retail
fuel." According to the agreement:
<QUOTE>"“Under the SMP, fiscal policy will focus on
mobilizing revenues and rationalizing current expenditure, to make
room for critical public investment in infrastructure, health,
education and social services. This will include measures to
improve tax collection and efficiency, and to eliminate excessive
subsidies, including on retail fuel. Other reforms will focus on
stemming the losses of the public electricity company (EDH), which
in recent years have amounted to a sizeable portion of the public
deficit, by improving the efficiency of billing, and by reforming
contracting practices. Fiscal reforms also aim to increase the
transparency of public accounts. These reforms are to be
accompanied by a substantial package of mitigating measures to
protect the most vulnerable members of society. ...
IMF staff will work closely with the authorities to monitor
progress in the implementation of their economic
program.."<END QUOTE>
By Wednesday, relative calm had been restored in Haiti. The president
and prime minister are under pressure to resign, and it's not known
how the IMF will react, now that the subsidies have been restored.
Atlanta Black Star and IMF (27-Feb-2018)
and Miami Herald
Related Articles
KEYS: Generational Dynamics, Haiti, Bill Clinton,
Jovenel Moïse, World Cup, Brazil, Belgium, Canada,
International Monetary Fund, IMF, Guy Lafontant,
Dominican Republic
Permanent web link to this article
Receive daily World View columns by e-mail
Contribute to Generational Dynamics via PayPal
John J. Xenakis
100 Memorial Drive Apt 8-13A
Cambridge, MA 02142
Phone: 617-864-0010
E-mail: john@GenerationalDynamics.com
Web site: http://www.GenerationalDynamics.com
Forum: http://www.gdxforum.com/forum
Subscribe to World View: http://generationaldynamics.com/subscribe
This morning's key headlines from GenerationalDynamics.com
- Haiti people riot after announcement of fuel price rises during World Cup match
- International Monetary Fund blamed for austerity triggering riots
****
**** Haiti people riot after announcement of fuel price rises during World Cup match
****
People dump trash and raw sewage into canals that run through Port-au-Prince, Haiti. When it rains, the canals overflow and flood poor neighborhoods. (NPR)
On Friday, as Haitians were watching the World Cup game between Brazil
and Belgium, Haiti's government announced the end of large subsidies
on fuel prices, resulting in dramatic price increases -- 38% for
gasoline, 47% for diesel fuel, and 51% for kerosene. The increases
were blamed on the International Monetary Fund (IMF).
The price increases for fuel appeared to affect everyone. The
gasoline prices affected those in the middle or upper classes who own
automobiles, the diesel prices affected businesspeople who use diesel
fuel for trucks and heavy equipment, and the kerosene price increases
hit poor people especially hard, as they burn kerosene to light up
their homes, lacking electricity.
Haiti was the poorest country in the world, even before the major
earthquake the country suffered in 2010. There was a huge outpouring
of international aid after the earthquake, including a large fund
organized by former president Bill Clinton, but none of the people
seem to have benefited, and almost all the money was apparently lost
in corruption.
The government had apparently hoped that by announcing the price
increases during Friday's World Cup game, nobody would notice. That
turned out to be a major miscalculation. Most Haitians fervently
supported Brazil over Belgium in Friday's World Cup game, and were
shocked when the game ended in a loss for Brazil. The rioting began
five minutes after the game ended. Burning tires blocked major routes
in Haiti's capital city Port-au-Prince, and sporadic gunfire could be
heard around the city. Store and car windows in the affluent sections
of Port-au-Prince were reportedly smashed. Affluent hotels were also
targeted. Three people were killed on Friday.
As the rioting became increasingly violent, Haiti's president Jovenel
Moïse, accompanied by his wife Martine, appeared in a televised
address to the nation on Saturday evening:
<QUOTE>"You sent me the message and I got it. I corrected
what needed to be corrected.... I asked the Government to
reconsider the decision to withdraw subsidies on the prices of
petroleum products. The Prime Minister did it. The price of fuel
remains what it was before, throughout the national territory.
There is no longer an increase in gas prices. ... Now I ask you to
stay calm and go home. ... I know that it is to me that you gave
the power, but I cannot run alone. I have to have a lot of people
around me before making a decision."<END QUOTE>
The protests didn't end. On Monday, workers went on strike and shut
the capital down. Many analysts have stated that the continuing riots
are being caused by massive government corruption. According to one
NGO analyst:
<QUOTE>"Having had over ten deployments to Haiti following
the earthquake in 2010, including during their elections, I do not
think that the increase in fuel prices is the root cause of this
crisis.
They know that sacrifices have to be made to improve their
economy, and they have made them in the past. However, after
suffering for so long, the Haitian people hate being tricked
Their political candidates promised to address mismanagement and
corruption if they were elected. The people expected improvements
in government efficiency, and arrests of those accused of
corruption, before being targeted for austerity.
However, to have austerity forced on them, without the promised
efficiency and arrests, appeared to be too much for the people to
bear from a government that promised to be
different."<END QUOTE>
The United States has warned Americans living in Haiti to shelter in
place in their homes, to avoid the violence. A marine security
detachment of 13 marines has arrived in Haiti to provide security at
the US embassy there.
Both the United States and Canada have policies to deport Haitians who
fled from the violence following the 2010 earthquake. Activists in
Canada is demanding that because of the current violence, deportations
back to Haiti should immediately end, and Haiti should be put back on
the government list of countries to which migrants may not be
returned. AFP (7-July) and Barbados Today and Military.com and Canadian Broadcasting
****
**** International Monetary Fund blamed for austerity triggering riots
****
The fuel price increases announced on Friday were caused by a
termination of subsidies as demanded by the International Monetary
Fund (IMF) in return for $96 million in loans and grants from the IMF
and the World Bank.
When the price increases were announced, Prime Minister Guy Lafontant
said, “I ask for your patience because our administration has a
vision, a clear program." He defended the price increases because the
subsidies make Haiti's fuel prices the lowest in Latin America among
the non-petroleum producing nations. Furthermore he claimed that many
people regularly crossed the border from neighboring Dominican
Republic, where oil prices are 43% higher, to take advantage of the
subsidized prices in Haiti, which meant that the subsidies were
supporting both Haiti and the Dominican Republic.
The austerity demands were in an agreement that Haiti signed with the
IMF in February. The agreement defines a "Staff-Monitored Program"
(SMP), where IMF closely monitors government activities in Haiti in
return from the loans and grants. The agreement requires that it is
necessary "to eliminate excessive subsidies, including on retail
fuel." According to the agreement:
<QUOTE>"“Under the SMP, fiscal policy will focus on
mobilizing revenues and rationalizing current expenditure, to make
room for critical public investment in infrastructure, health,
education and social services. This will include measures to
improve tax collection and efficiency, and to eliminate excessive
subsidies, including on retail fuel. Other reforms will focus on
stemming the losses of the public electricity company (EDH), which
in recent years have amounted to a sizeable portion of the public
deficit, by improving the efficiency of billing, and by reforming
contracting practices. Fiscal reforms also aim to increase the
transparency of public accounts. These reforms are to be
accompanied by a substantial package of mitigating measures to
protect the most vulnerable members of society. ...
IMF staff will work closely with the authorities to monitor
progress in the implementation of their economic
program.."<END QUOTE>
By Wednesday, relative calm had been restored in Haiti. The president
and prime minister are under pressure to resign, and it's not known
how the IMF will react, now that the subsidies have been restored.
Atlanta Black Star and IMF (27-Feb-2018)
and Miami Herald
Related Articles
- Thousands of Haitians living in Miami scheduled for deportation in January (14-Oct-2017)
- US will deport tens of thousands of Haitian immigrants surging toward California (25-Sep-2016)
- Thousands of migrants flee to Canada, fearing deportation in the US (04-Aug-2017)
- Violence and cholera spread in Haiti (09-Dec-2010)
- History of Haiti (04-Mar-2004)
KEYS: Generational Dynamics, Haiti, Bill Clinton,
Jovenel Moïse, World Cup, Brazil, Belgium, Canada,
International Monetary Fund, IMF, Guy Lafontant,
Dominican Republic
Permanent web link to this article
Receive daily World View columns by e-mail
Contribute to Generational Dynamics via PayPal
John J. Xenakis
100 Memorial Drive Apt 8-13A
Cambridge, MA 02142
Phone: 617-864-0010
E-mail: john@GenerationalDynamics.com
Web site: http://www.GenerationalDynamics.com
Forum: http://www.gdxforum.com/forum
Subscribe to World View: http://generationaldynamics.com/subscribe
