Haiti: Moïse administration raises tax on fuel to help public finances

Haiti’s government announced on Sunday fuel price increases of up to 20 percent in an effort to shore up the country’s public finances.

The Moïse administration had been negotiating with transport unions for more than a week so Haitians knew an increase was in the works.

Haiti exports only about US$1 billion worth of goods each year and imports more than three times that.
With that kind of deficit and meager tax revenues, the government cannot even keep up with interest payments on debt it has with Venezuela, for instance.

For the past 12 years, Haiti has benefited from a program instituted by the late Venezuelan socialist leader Hugo Chavez under which Caracas provided some countries of the Caribbean and Latin America with petroleum products at cut rate prices, with the bills payable over 25 years at an interest rate of 1 percent.

Since 2008, Haiti has in effect received US$2 billion in loans from Venezuela. But it has not effectively invested the money in economic development policies – the idea behind the Chavez plan – that would raise living standards and put the government in a position to pay back the debt.

Previous Haitian governments have shied from keeping fuel prices in sync with world market prices, fearing inflation that would anger the population.

Source: AFP