December 12, 2013

The earthquake in Haiti, rebuilding and effectiveness of development aid

Although NGOs have helped to save the lives of tens of thousands of Haitians, the aid has failed to kick-start the country’s development.

The earthquake that left the Haitian capital Port-au-Prince in ruins on January 12, 2010 was the latest in a long line of tragedies to befall Haiti. Haiti has long been the poorest and most unstable country in the Western Hemisphere – the only failed state in the region – allowing a direct parallel to be drawn to the problems faced by Sub-Saharan Africa. Similarly to Somalia, the Democratic Republic of the Congo and Mali, Haiti’s state institutions do not function at even a satisfactory level, and it is questionable whether intervention from the international community in the last few decades has been successful. For the last three decades, Haiti has been completely dependent on foreign aid and has often been cited as an extreme example of development aid ineffectiveness. Thus it is important to see the issues related to the Haitian recovery in the context of the aid effectiveness debate.
When I visited Haiti in spring 2012, I saw the old problems still very much in evidence: poverty and lack of opportunity go hand in hand with the lack of a trustworthy national government. And the snail’s pace at which rebuilding has progressed since the earthquake can clearly be seen on the streets of Port-au-Prince. Buildings destroyed in the earthquake have still not been completely razed. Residential construction has proceeded very slowly and four years after the disaster, close to 300,000 people still live in refugee camps. There is a wide array of reasons for the slow progress of rebuilding efforts.
After the earthquake, it was clear that the long-term process of rebuilding in Haiti would depend completely on support from the international community. The Haitian government estimates that 230,000 people died in the quake, and some 1.3 million people needed temporary shelter. On top of it all, the island nation lost 20 percent of its public servants and 60 percent of its administrative buildings. Neighboring countries and UN agencies pumped close to $3.8 billion (€2.8 billion) in humanitarian aid into Haiti in 2010-2011. Only the countries hit by the 2005 Indian Ocean tsunami received a comparable amount of aid. In the aftermath of the earthquake, international donors vowed unprecedented sums for rebuilding Haiti. For example,  $9.35 billion (€6.81 billion) was pledged at a UN New York donors’ conference, of which $4 billion (€2.9 billion) was supposed to reach the recipients in the first two years of reconstruction; donors also promised to apply the aid effectiveness principles agreed upon at the OECD development forums.

Haiti’s past and present

The second New World colony to achieve independence, in 1804 (the first being the US), Haiti experienced chronic political and economic turmoil all through the 20th century. A country considered the pearl of the Antilles in the late 18th century is now the hemisphere’s poorest and most violence-plagued nation. From 1957-1986, Haiti was ruled by the iron-fisted Duvalier dynasty – one of the bloodiest dictatorships in the history of Latin America. The first democratic elections were held in 1990, but just seven months later, Jean-Bertrand Aristide was toppled by a military coup orchestrated by the supporters of the Duvaliers. Democratic consolidation failed and since that time, violence has kept the country in an iron grip.
After coups in 1991 and 2004 the international community intervened – the first time by the US and the second in the form of a UN stabilization mission. Since 2004, MINUSTAH – the United Nations Stabilisation Mission in Haiti – has been in charge of the security situation in the country. Haiti’s public institutions such as parliament, the judiciary and local governments are in a catastrophic state and the central government’s power does not extend past greater Port-au-Prince. It is no surprise to find that Haiti is ranked eighth in Foreign Policy’s Failed States Index.1
Already before the earthquake, Haiti’s human development indicators were similar to those of Sub-Saharan Africa. Close to 70 percent of the educated class lives below the international poverty line – that is, they live on  less than two dollars per day . The economy has been at a standstill since the decline of the Duvaliers in the late 1980s; and in spite of close ties to North America and Europe, the Haitian government has not been capable of creating a climate conducive to attracting foreign investments. The despoliation of the natural environment is a concern – a large part of the tropical rain forest has been cleared for firewood, which has led to surface erosion and increased the island’s vulnerability to tropical storms.

The aid effectiveness debate

As noted, the problems related to development aid in Haiti bear noteworthy similarities to the development dilemmas faced by Sub-Saharan Africa. In the last two decades, Haiti has been completely dependent on foreign aid – official development assistance (ODA) makes up a larger share of Haiti’s budget than domestic revenue.2 Haiti is one of the countries with a high level of corruption and weak institutions that has been unable to gain donor trust;  thus, in the last three decades, donor states and international organizations have preferred to channel aid via international NGOs or corporations in their home country. Haiti is known as a NGO republic – in 2010 there were as many as 3,000 foreign non-profits operating there.
Thus, while development aid doesn’t go straight into the pockets of the local rulers, the aid is used by NGOs to carry out their projects – and the effectiveness of these projects has long been deeply in question. International NGOs provide medical services and education for a large part of the population in Haiti and have essentially been a surrogate for the Haitian government in this area. Higher salaries at foreign aid organizations have resulted in a temporary brain drain in the public sector. Although NGOs have helped to save the lives of tens of thousands of educated Haitians, the aid has failed to jump-start the country’s development and a strengthening of local government institutions has not followed. A key reason has been the weakness of Haitian public institutions, the fragmentation of the aid system and the lack of coordination between government and NGOs.
After the earthquake, bilateral donor states and international organizations tried to re-evaluate their approach to Haiti’s problems and harmonize activities with the OECD aid effectiveness principles (Paris Declaration 2005, Accra Agenda for Action 2008). These principles were born in mind at the Haiti Donors Conference in March 2010 in New York held under the aegis of the UN, where over 150 donor countries and international organizations participated. On the strength of the Haiti example, there was an attempt to come up with a new model for providing development aid to other fragile states, one that would better take into account local conditions and offer greater support for state building.
To better coordinate the flows of aid, the Interim Haiti Recovery Commission (IHRC) which was to provide the go-ahead to all reconstruction projects and ensure transparency of use of the aid. It encompassed members of the Haitian government and parliament, as well as representatives of civil society and international NGOs. The Haiti Reconstruction Fund, HRF, was also established. Among others, Estonia contributed a share in 2010 – $50,000 (€37,000).  All these steps were to demonstrate greater commitment on the part of donors to involve Haiti’s government and civil society in the reconstruction process, while keeping in sight the goal of offering donors guarantees regarding of the spending of the aid money.. Part of the aid had to be delivered as budget support, which would have allowed the functioning of the Haitian government to be restored faster.

Reconstruction – quo vadis?

How has compliance with these targets fared? The data collected by the UN Haitian special envoy show that in the first four years, the international community has not fulfilled the financial obligations pledged. Donors contributed a total of around 3 billion US dollars in the period 2010-2012, which is only 56 percent of the amount promised for this timeframe at the New York conference.3 The constant non-fulfillment of the pledges taken by the largest donors US and Venezuela is especially worrying. The largest European donors, Spain, France and Norway, and multilateral institutions such as the European Commission and the World Bank have acted more responsibly.
It’s clear that Haiti’s continuing political instability has plagued the rebuilding process. The total paralysis of the administration of René Préval, who was president at the time of the earthquake, was an obstacle to the beginning of the rebuilding process in early 2010. General elections in November 2010 led to a deepening of the crisis of confidence; as observers noted,  there were many significant shortcomings in the first round of the elections. Yet since taking office in May 2011, President Michel Martelly has been able to preserve a gossamer political stability, allowing the trust of donors to be gained, at least at the higher political level.
A serious problem for Haitian reconstruction is the extreme inefficiency of the government apparatus, above all at the micro level. In an interview conducted by this author, a senior UN Development Program  official explained that the main reason for the slow implementation of projects is the weakness of ministries and local governments, which keeps progress from being made in rebuilding. It is also evident that the donors’ plans to support the government apparatus have  failed completely up to this point.
Neither the Haitian presidency nor its legislature have been part of the HRC’s decision making process. The Haitian people essentially lack a way of influencing the course of the rebuilding process; accordingly,  Haitian civil society organizations have started calling for greater project transparency from aid agencies. This lack of influence has led to several anti-US demonstrations as well as rallies against the UN and World Bank. An additional source of attention was the cholera epidemic in November 2010, which MINUSTAH peacekeepers from Nepal were accused of introducing.
Yet another concern is that the structure of aid has not changed compared to the period before the earthquake. The percentage of budgetary support has remained lower than initially planned due to problems with the elections. Moreover, a large part of the money in Haiti is still spent by foreign NGOs;  Haitian institutions (ministries, local governments, and NGOs) have only a very limited link to the rebuilding. Haitians continue to look to international organizations for public services such as medical care and education, not to their own government.
Are there any rays of hope given the current situation in Haiti? For one thing, fortunately Haiti does not have deep-seated ethnic and religious conflicts and thus the country has a relatively good outlook for development in the long term. One promising factor is the political stability that has characterized Michel Martelly’s government. Another is the  economic growth of 5% in the last two years. A number of major projects have been launched to create jobs. The most important of these is the Caracol industrial park in northern Haiti, financed by the Inter-American Development Bank (IDB) and the US government. A stable economic environment would attract more foreign investment, and this has been the best formula for economic growth in the Caribbean. The Dominican Republic is a good role model in this sense. All this would allow Haitian dependence on foreign aid to be reduced in future, helping to create a situation where the government is capable of providing healthcare services and education for its own people.
From the point of view of the aid effort, it is clear that, like Afghanistan, and for many aid-dependent countries in the African region, support for Haitian state building is the most efficacious means of increasing the influence of development aid. Here the primary instrument would be training for public servants and development of new information systems, based in IT solutions. Budgetary support must continue at a higher volume to instil motivation in Haitian agencies for implementing good governance practices. A new public agency could also be established, tasked with coordinating the activity of the Haitian government and international NGOs. This could be the point at which  donor confidence could start to be gained.
Translation from Estonian to English by Kristopher Rikken.
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1 Foreign Policy – Failed States (01.08.2013) (www.foreignpolicy.com/articles/2013/06/24/2013_fai…)
2 UN Office of the Special Envoy for Haiti (01.08.2013) (www.lessonsfromhaiti.org/)
3 UN Office of the Special Envoy for Haiti (01.08.2013) (www.lessonsfromhaiti.org/)

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