Name: Republic of Haiti Population: 10 million Capital: Port-au-Prince Other major cities: Cap Haitien, Gonaives, Carrefour, Jacmel Area: 10,714 sq miles Currency: Gourde GNI per capita: US$670 Main exports: Apparel, light manufactures, plant oils, cocoa, mangoes, coffee Language: Creole, French Religion: Christianity, 55% Roman Catholic Life expectancy: 60 years (men), 63 years (women) WB Development Indicators
The magnitude 7.0 earthquake that struck Haiti on January 12, 2010 significantly deepened existing challenges and created massive reconstruction needs for a country that was already the poorest country in the Western Hemisphere. In spite of the enormity of the task, two years later, reconstruction is gaining momentum with tangible changes on the ground.
The earthquake was a devastating national tragedy. Over 220,000 people perished, 300,000 more were wounded, and 1.5 million were displaced. The earthquake ravaged cities destroying whole neighborhoods, wiping away roads, collapsing public buildings, and damaging businesses. The disaster struck the country's political, economic and administrative nerve center, Port au Prince, where an estimated 65 percent of GDP and 85 percent of government revenues are generated.
Post-Disaster Needs Assessment (PDNA) conducted by the World Bank and other donors, under the leadership of the Haitian Government, estimated damages and losses at around US$8 billion or 120 percent of GDP and set total reconstruction needs at US$11.5 billion. In March 2010, donors pledged US$9 billion overall to support the Government's Action Plan for National Recovery and Development. This plan, aims to use reconstruction as an opportunity to spur sustainable development by improving infrastructure, decentralizing economic activity, reducing vulnerability, and developing agriculture, manufacturing and tourism. By December 2011, the international community had delivered over half of the pledges intended in the first 24 months: US$1 billion in debt relief and US$2.4 billion spent (out of US$4.5 billion approved) on projects and programs.
In October 2010, the situation was compounded by a cholera epidemic. There are nearly 500,000 cases and 7,000 deaths to date. Although the number of cases continues to rise, progress has been made with intensity of the epidemic, transmission rates, and mortality rates declining.
Two years since the earthquake, the response has moved from recovery to reconstruction. Although reconstruction is a complex process taking many years (reconstruction took at least 4-6 years in Aceh, Indonesia after the Tsunami and in New Orleans after Hurricane Katrina), there are tangible signs of progress in Haiti:
• Camps and temporary shelter programs are making way for neighborhood repair and reconstruction programs, with camp occupancy down to 520,000 from 1.5 million people initially displaced.
• Approximately half of the 11 million m3 of debris has been removed, making most of Port au Prince's roads passable again.
• Schools have reopened, with 900,000 children attending school this year without having to pay tuition and 2 million children receiving a hot meal every day as part of a national school feeding program.
Political Situation
Though long and contentious, in May 2011, the presidential election ended in the first peaceful handover of power to a President from the opposition in Haiti's history. It took five more months for President Michel Martelly to obtain Parliamentary agreement on a new Prime Minister and Government. With the new Government having in office since October 2011, it is hoped that the swift and decisive action needed to accelerate the pace of reconstruction will materialize.
Haiti remains the poorest country in the Americas and one of the poorest in the World (GDP per capita of US$670), with significant needs in basic services. It is also one of the most unequal, with a Gini coefficient of 0.59. Over half of its population of 10 million lives on less than US$1 per day, and 78% live on less than US$2 per day. Before the earthquake, the country lagged in social indicators and had suffered from repeated exogenous and political shocks. In 2008, rising food and fuel prices led to riots and the fall of the Government. Tropical storms and hurricanes that same year caused losses estimated at US$900 million (15 percent of GDP). Despite this, Haiti experienced modest but stable growth in the 2000s, with an average real growth of 2.2 percent p.a. 2004-2009. Today, Haiti ranks 158th out of 172 in the 2011 Human Development Index.
The Haitian economy is recovering from the earthquake. After a contraction of 5.4 percent in 2009/10, GDP grew 5.1 percent in 2010/2011. In 2011/12, it is projected to grow by 7 percent, mainly driven by agriculture, textile and construction. The macroeconomic situation is improving with domestic tax revenues rising to 13 percent of GDP in 2011 due to increasing imports and recovery efforts. Increasing capital expenditures, providing an enabling environment for private sector investment, and making effective use of reconstruction resources will be important in coming years to drive and accelerate growth and poverty reduction.
To help Haiti recover from the January 12, 2010 earthquake, the World Bank Group pledged support US$479 million for the first two years. This support was delivered through new funding, disbursements, private sector support, and debt relief.
On December 1, 2011, the World Bank approved its 2012 Interim Strategy for Haiti, programming US$255 million of Haiti's IDA16 Crisis Response Window exceptional allocation of US$530 million for the country. The World Bank's strategic objectives for the next year in Haiti will be: 1) reducing vulnerability and increasing resilience, 2) sustainable reconstruction in housing and electricity, 3) building human capital through education, 4) revitalizing the economy, as well as, a crosscutting theme of governance. The World Bank also approved the second phase of the Education for All Project (US$70 million), the Disaster Risk Management and Reconstruction project (US$60 million), and the second phase of the Strengthening Agriculture Public Services project (US$50 million, including US$10 million from the Global Agriculture and Food Security Program).
The Bank portfolio currently includes 17 active projects for a total of US$495 million. Of this amount, US$202 million have been disbursed. IDA has disbursed US$8 million per month on average since the earthquake.
Support for the private sector
Since the quake, IFC has committed 5 new investment transactions. The IFC portfolio to date amounts to US$45 million, including US$15 million mobilized from others, in the finance, energy, mining, garment and hospitality sectors. Advisory commitments from various donors amount to US$9.7 million in areas such as investment climate, access to finance, access to skills, and public private partnerships. Undisbursed balance to date is US$2.7 million on ongoing. Through its advisory services, IFC structured the largest foreign direct investment since the earthquake, a US$100 million investment by Viettel in Haiti's TELECO, to upgrade the telecommunications system. IFC's combined investment and advisory projects are supporting the creation of 5,000 new jobs as well as safeguarding 5,000 existing jobs.
The HRF is the main resource for strategically closing financing gaps to achieve a balanced recovery. It is the largest source of unprogrammed funding and accounts for 18 percent of all reconstruction financing provided to date. Contributions to the HRF total US$370 million, of which US$335 million has been received. US$274 million has been allocated to 17 projects since the Fund began operation in June 2010. New contributions by donors (Finland, France, Norway, United States) at the end of 2011 indicate a renewed momentum for reconstruction finance through the HRF.
The World Bank wears four hats in the HRF: i) Trustee (CFPMI); ii) Secretariat (LCRRF); iii) Partner Entity (LCCHT); and iv) donor (US$2 million contributed from the State and Peace-Building TF). The World Bank is the Partner Entity for the Emergency Development Policy Grant (US$25 million, entirely disbursed in August 2010), the Neighborhood Upgrading, Housing Reconstruction Project (US$65 million, launched in May 2011), and the Targeted Education Support Operation (US$15 million, under preparation).
•Housed and equipped Ministry of Economy and Finance and Tax Office (over 500 staff), allowing salaries to be paid, revenues to be collected and economic governance efforts to continue.
• Conducted building assessments of Port au Prince (400,000 buildings), developed and disseminated building guidelines for housing reconstruction; developed building guidelines for public buildings, schools and hospitals; trained a cadre of engineers who are training others on better building techniques, and is disseminating information in neighborhoods on safe building practices.
• Developed a multi-hazard risk management tool (floods, mudslides, hurricanes and earthquakes) with neighborhood-level detail, which the government and donors can use to make investments that will be safer for people and more effective.
• Provided major support to the education sector. Since the earthquake, the Bank has financed 210,000 tuition waiversand school meals for 75,000 every day. Access is being expanded and quality enhanced over the next 3 years.
• Set up the first environmentally and socially sound debris management site in Haiti – with capacity sufficient to treat bulk of earthquake debris from Port au Prince.
• Started implementing a Neighborhood Rehabilitation and Housing Reconstruction Program of US$95 million (of which US$65 million from the Haiti Reconstruction Fund) to repair or rebuild houses for 85,000 people, upgrade neighborhoods and provide basic services for 3,000,000 and help families move out of camps by providing rental subsidies.
• Fighting the Cholera epidemic through a US$15 million Emergency Response Project, which has provided health and hygiene education in 500 localities, trained over 3,000 health and hygiene agents and medical personnel, prepared six departmental cholera management plans, and supported 83 cholera treatment units and oral rehydration posts with personnel and/or supplies.
• Provided employment for 1,700 persons through IDA programs (cash for work, debris sorting, canal clearing, etc.) and 5,000 persons through new IFC investments. IFC activities also safeguarded 5,000 existing jobs.
• Improved Haiti's capacity to protect against, prepare for, and respond to natural disasters. Robust preparation for Hurricane Tomas in October 2010 and for the 2011 hurricane season has resulted in fewer fatalities than in previous years.
• Completed six water supply systems, benefiting 37,000 people in rural communities
• Camps and temporary shelter programs are making way for neighborhood repair and reconstruction programs, with camp occupancy down to 520,000 from 1.5 million people initially displaced.
Haiti remains the poorest country in the Americas and one of the poorest in the World (GDP per capita of US$670), with significant needs in basic services. It is also one of the most unequal, with a Gini coefficient of 0.59. Over half of its population of 10 million lives on less than US$1 per day, and 78% live on less than US$2 per day. Before the earthquake, the country lagged in social indicators and had suffered from repeated exogenous and political shocks. In 2008, rising food and fuel prices led to riots and the fall of the Government. Tropical storms and hurricanes that same year caused losses estimated at US$900 million (15 percent of GDP). Despite this, Haiti experienced modest but stable growth in the 2000s, with an average real growth of 2.2 percent p.a. 2004-2009. Today, Haiti ranks 158th out of 172 in the 2011 Human Development Index.
The Haitian economy is recovering from the earthquake. After a contraction of 5.4 percent in 2009/10, GDP grew 5.1 percent in 2010/2011. In 2011/12, it is projected to grow by 7 percent, mainly driven by agriculture, textile and construction. The macroeconomic situation is improving with domestic tax revenues rising to 13 percent of GDP in 2011 due to increasing imports and recovery efforts. Increasing capital expenditures, providing an enabling environment for private sector investment, and making effective use of reconstruction resources will be important in coming years to drive and accelerate growth and poverty reduction.
To help Haiti recover from the January 12, 2010 earthquake, the World Bank Group pledged support US$479 million for the first two years. This support was delivered through new funding, disbursements, private sector support, and debt relief.
Since the quake, IFC has committed 5 new investment transactions. The IFC portfolio to date amounts to US$45 million, including US$15 million mobilized from others, in the finance, energy, mining, garment and hospitality sectors. Advisory commitments from various donors amount to US$9.7 million in areas such as investment climate, access to finance, access to skills, and public private partnerships. Undisbursed balance to date is US$2.7 million on ongoing. Through its advisory services, IFC structured the largest foreign direct investment since the earthquake, a US$100 million investment by Viettel in Haiti's TELECO, to upgrade the telecommunications system. IFC's combined investment and advisory projects are supporting the creation of 5,000 new jobs as well as safeguarding 5,000 existing jobs.
•Housed and equipped Ministry of Economy and Finance and Tax Office (over 500 staff), allowing salaries to be paid, revenues to be collected and economic governance efforts to continue.
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