Struggling Haiti

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Realization of economic development and prosperity remains the key objective of virtually all governments in the world. However, due to capital limitations, most governments, especially from developing nations resort to lending from financial institutions such as World Bank, and International Monetary Fund (IMF), or regional development banks such as Inter-American Development Bank (IADB) (White, 2012). Additionally, such governments also borrow from their bilateral friends. This is in earnest to enable them pursue their most ambitious development projects, and sometimes to correct balance-of-payment deficits. Nevertheless, such governments must adhere to some outlined conditions that are spelt out in the article of agreement in order for them to secure the loans; otherwise, the loans are withheld (White, 2012).

Equally, a healthy population significantly contributes to economic development of a nation in various ways. In this line, human development and gender inequality, also affects the economic development of a nation in many ways (Acemoglu, Robinson, 2012). This paper outlines how Haiti, one of the developing and a very poor nation in the western hemisphere has used loans and grants to develop herself. In addition, the paper also outlines how a healthy population, affects her economic development.

How Funding from IMF and World Bank and Other Financial Institutions Affects Her Economic and Political Development

Since her independence to date, Haiti remains to be heavily indebted because she not only borrows from World Bank and IMF but also from bilateral friends and from regional banks such as IADB. By June 2009, her debts totaled to anincredible figure of $1.2 billion(Frankema and Masé, 2014). Most of these debts are taken with an aim of funding development projects and correcting her balance-of-payments. However, the funds are never directed to the intended

purpose, but they are misused and embezzled by corrupt government officials and military regimes who have been ruling the country. For instance, it is estimated that $900 million, of the loans were taken by Baby Doc, one of the former dictators, when he fled the country (Frankema and Masé, 2014). As a matter of fact, were it not for the loan relief granted by World Bank, IMF and IADB and other bilateral creditors in 2009, Haiti would be heavily indebted by now, and would be on her knees struggling to repay unending loans.

It is quite discouraging to note that even after severally being granted loan reliefs she continues to take new loans, and increasing her foreign debts. For instance in 2010, after she was hit by a fierce earthquake, she was granted a loan of $102 million by IMF to assist in her recovery (Hiatt, 2007). As a result, she remains to be a victim of financial neo-colonialism, since the funds are misused by her leaders, whereas the citizens remain responsible for the debts. As a result, she remains extremelyunderdeveloped. In fact, she is the poorest nation in the Western world with over 80% of her populace living below poverty line (Hiatt, 2007). Therefore, neither her funding by World Bank, IMF, IADB, and her bilateral creditors contribute to her political nor economic development.

How a Healthy Population Contributes To Economic Development

To a great extent a healthy population is tantamount to a better economic development, not only for Haiti but also for any nation, as can be demonstrated in various ways. At first, a healthy populace improves the productivity of a nation. This is because healthy workers who are physically and mentally robust tend to concentrate more in their economic activities as compared to workers who are suffering from diseases and disability (Acemoglu, Robinson, 2012). Therefore, a healthy population in Haiti improves her productivity.

Secondly, a healthy population means reduced treatment cost both to the government and to the families. As a result, the government can use the saved funds to steer economic development in other areas such as education, or development of infrastructure. Equally, the households can also use the saved money to improve their living standards or invest it (Frankema and Masé, 2014). Therefore, a healthy population in Haiti enables the households to lift their economic standards, and the government to invest in other economic development projects, culminating to overall economic development.

Thirdly, a healthy population also leads to improved learning. This due to the fact that households and the government can invest in education as they save on treatment. Besides, healthy learners also tend to retain more in school. As a result, the nation is able to produce more manpower that can drive her economy (Frankema and Masé, 2014). Therefore, a healthy population in Haiti means that more investment can be directed towards education; hence enable it to train and produce more manpower that can drive her economy. Ultimately, her general economy can improve six-fold.

Lastly, a healthy population means reduced levels of poverty due to adoption of family planning methods. It is almost natural knowledge that large families normally lead to high levels of poverty, especially in households that are economically deprived (Aristide, 2013). Therefore, smaller families through adoption of family planning methods tend to reduce poverty levels. For that reason, a healthy population in Haiti means that it can adopt family planning methods to control its size; thus reduce poverty levels.

How she has Used Funds from Financial Lending Institutions Such as World Bank and IMFto Improve Her Health Care System

Parts of the loans that are given to Haiti are meant to improve her health care system. For instance, between 2005 and 2009, she had received an approximate of US$278 million from World Bank, and most of which was expected to fund health care projects. In line with this, she was able to implement a HIV/AIDS treatment and prevention plan. Additionally, she has managed to improve immunization against measles amongst young children. Moreover, she has also managed to raise the immunization and prevention of diphtheria, pertussisand tetanus (DPT3). Therefore, to some extent she has managed to put the funds into good use, though most of it remains unaccounted for.

Conditions Set Out

In line with this, it is important to note that the loans are normally given under strict conditions that even demand macroeconomic policy reforms of the beneficiary countries. These conditions are spelt out in disguise of ensuring commitment by the government to repay the loans. However, they are colonial in nature and meant to exploit the beneficiary countries economically (Hiatt, 2007). For instance, for the loans to be given Haiti she was required to strengthen her management of public expenditure by observing asset declaration law, and auditing government accounts (Herlinger and Jeffrey, 2011).

In addition, she was required to strengthen her tax collection mechanism. Moreover, she was expected to favor foreign investors, open her market and lower tariffs on imports and exports (Aristide, 2013). From a critical analysis of the latter conditions, it is very clear that they were only meant to benefit foreign investors. Therefore, many developing nations that take loans from international and regional financial institutions end up being exploited when they follow the strict and colonial conditions that are set out to enable them secure the loans (White, 2012).

Recommendations

For Haiti to salvage herself from the cruel hands of neo-colonialism and heavy debts, the following must be adhered to:

  • She must work towards fighting corruption to a zero tolerance level, by enacting strict laws, so as to ensure that the funds meant for development are used prudently.
  • She must invest in education to ensure that more manpower is available to drive her economy.
  • She must invest in improving her health care system to ensure that a healthy manpower is readily available to run her economy at all times.
  • She should avoid borrowing in a reckless manner, but work towards creating her own wealth to develop her economy.
  • Her citizens must learn to elect responsible leaders who can lead them into prosperity.
  • Her creditors should stop imposing selfish conditions that are only meant to benefit foreigners when lending loans not only to Haiti, but also to other developing nations.

Conclusion

In summary, it is apparent that Haiti has neither been using the funding from World Bank and IMF to develop herself economically nor politically. Contrarily, the funds have always been misused and embezzled by corrupt government officials and the military regimes that have been ruling the nation. On the other hand, a healthy population greatly improves her economic development because the population is able to save on treatment cost and hence invest in other areas. In addition, the populace is more productive. Furthermore, the nation is able to produce more human power that can drive her economy due to investment in the education sector. However, she has managed used some funds to develop her healthcare system for instance, by implementing a HIV/AIDS prevention and treatment program. Nevertheless, if she can follow the outlined recommendations, she can definitely realize more benefits from the funding.

 

 

References

Acemoglu, D., & Robinson, J. A. (2012).Why nations fail: The origins of power, prosperity, and poverty. London: Profile Books.

Aristide, J. B. (2013). Haiti, Intervention in (2004) 275|.Encyclopedia of US Military Interventions in Latin America [2 volumes], 274.

Frankema, E., & Masé, A. (2014).An Island Drifting Apart. Why Haiti is mired in poverty while the Dominican Republic forges ahead. Journal of International Development, 26(1), 128-148.

Herlinger, C., & Jeffrey, P. (2011).Rubble nation: Haiti’s pain, Haiti’s promise. New York: Seabury Books.

Hiatt, S. (2007).A game as old as empire: The secret world of economic hit men and the web of global corruption. San Francisco: Berrett-Koehler Publishers.

White, E. J. (2012). Modernity, freedom, and the African diaspora: Dublin, New Orleans, Paris. Bloomington: Indiana University Press.

 

 

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