The Economy

Haiti is the poorest nation in the Western Hemisphere and among the twenty-five poorest in the world. Per capita income, reported as $377 in 1985, dropped to $330 in 1987. The elite, a very small percentage of the population, earn over 60% of the national income, while unemployment ranges from 30% to 70%.

Although in decline since the 1950s, agriculture remains the mainstay of Haiti's economy. Coffee is the number-one cash crop; most peasants grow it alongside other food crops. Other cash crops include sugar, cotton, cocoa, and essential oils. To supplement food and grain imports, food crops are also grown. These consist of corn, rice, beans, bananas, mangoes, avocados, and various other tropical fruits and vegetables.

In 1987, the agricultural sector employed 66% of the labor force and accounted for 35% of the gross domestic product (GDP). Services employed 23% of the labor force and accounted for 42% of the GDP, while industry employed only 6% of the labor force and accounted for 23% of the GDP. Based on these statistics, Haiti is the most agrarian and least industrial country in the Western Hemisphere.

Like many other islands in the Caribbean, Haiti has limited mineral resources. Bauxite, at one time the country's second leading export, was mined extensively by the Reynolds Metal Company to extract aluminum, but the declining metal content of the ore, among other things, forced the mine to close in 1983. Other mineral resources, such as gold and copper, are largely undeveloped.

In recent years, there has been a precipitous decline in agriculture. One reason for this decline is Haiti's policy on land tenure. Perhaps as a backlash to the colonial slave-holding system, large plantations were parceled into smaller plots to be worked by individuals and families. While increasing individual freedom and personal stability, this policy also contributed to lower output and fewer exports. Moreover, during the American occupation in the 1920s, many North American companies leased large tracts of land without establishing new farms or plantings. Left without land to cultivate, thousands of peasants were forced to the cities, where they became a source of cheap labor for foreign investors.

Another factor is Haiti's extreme state of deforestation. With wood fuels accounting for 75% of the country's energy consumption, deforestation of the once green, tree-covered land is now critical; as of 1988 only about 2% of the country was tree-covered. The most direct effect of the destruction of trees has been soil erosion, which has made most of the land unsuitable for farming.

The fluctuation of prices for agricultural products in the world market has also contributed to the decline in agriculture. The fall in coffee prices as well as the fluctuation of sugar prices has had a major impact on agricultural production and planning.

As agriculture declined and poverty increased in the rural areas, many again flocked to the increasingly overcrowded city of Port-au-Prince in search of work. From the 1970s to the early 1980s, an abundance of cheap labor and favorable tariff rates drew U.S. assembly manufacturers to Haiti. During that time, the United States was criticized for not encouraging the development of transferable skills and for not supporting efforts to improve working conditions. Political instability and increased regional competition in the 1980s led to a decline in U.S. investments in Haiti.

These factors, combined with political upheaval and the chaotic effects of the U.S. embargo, have currently brought the Haitian economy to a halt. Haitians are presently in a near-famine state, with close to a million people being fed by private aid agencies.

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