In a context of persistent political turbulence, the Haitian economy finds itself facing major challenges, as highlighted by the Bank of the Republic of Haiti (BRH) in its recent monetary policy note. Published on May 10, 2024, this document highlights the difficulties facing the country, exacerbated by political instability which hampers the proper functioning of the agricultural and labor sectors.
The current political crisis is placing overwhelming pressure on the country’s economic activity, compromising its ability to function optimally. In particular, the agricultural sector, with around 25% of GDP, is severely affected by the recent disruptions. “The unfavorable weather conditions of the first half of the year resulted in food production below the five-year average,” indicates the BRH.
This drop in production due to the reduction in arable land has had significant consequences on the population. Indeed, according to “the latest analysis by the National Food Security Coordination (CNSA), half of the population faces acute food insecurity for the projection period, compared to 44%, according to previous forecasts”, informs the central bank. Moreover, the closure of ports and airports has only disrupted the supply of public markets and increased the prices of essential products in particular.
At the same time, the labor market is suffering the repercussions of this crisis, with an increase in job losses and a reduction in the capacity to create new positions. In addition, the temporary closure of businesses, particularly in the textile sector, which represents the largest share of GDP, contributes to aggravating the already precarious situation. Indeed, “the number of personnel in the textile industry decreased by more than 45% from September 2023 to March 2024 (to 29,000 employees)”, notes the monetary policy note. A similar situation is developing in the banking sector, which, after losing more than 10% of its employees over the financial year, is facing difficulties in hiring qualified staff, according to observations from the Bank of Banks.
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