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IDB announces record disbursements of $177 million for Haiti in 2010
  • Number rises to $199.5 million when third-party contributions and non-reimbursable technical cooperation are included.
  • Response to earthquake translates into more resources for key areas like education, transportation, budget support and basic services.

The Inter-American Development Bank (IDB) disbursed a record $177 million in grants to Haiti in 2010, including outlays for school reconstruction, budget support and other basic services devastated by the earthquake. The IDB’s disbursements were the most of any multilateral source of assistance to Haiti since its tragic earthquake on Jan. 12, 2010.

In addition to this record amount, the IDB in the coming weeks will disburse a $15 million emergency grant to help Haiti fight cholera, which was approved on Dec. 15 by the IDB’s Board of Executive Directors. The Bank’s anti-cholera operation is coupled with a $5 million donation from Spain for a total grant of $20 million.

The IDB disbursed $132 million in 2009.

The IDB also provided non-reimbursable technical cooperation grants for $6.5 million, including $1.5 million for improving child survival and for social safety nets programs. Haiti obtained a further $17 million in disbursements from the Canadian government, the EU and OPEC through IDB-run projects. All together, IDB grants, technical cooperation grants and third-party disbursements add up to $199.5 million for Haiti through a variety of IDB mechanisms.

“These resources show the IDB and its member countries are making a concerted effort to help Haiti amid the worst disaster to strike a country in modern times. We are grateful to our shareholders for their support,” said IDB President Luis Alberto Moreno. “Given the magnitude of the devastation, money alone will not get the job done. Looking ahead, we have also increased our full-time staff working exclusively on Haiti to nearly 50, putting us in a strong position to carry out our ambitious investment program.”

The record disbursements come as the IDB has approved an unprecedented $251 million in grants for Haiti in 2010, compared with $122 million in 2009. The high approval levels herald potentially bigger disbursements in 2011.

In addition to its unprecedented disbursal of grants, in 2010 the IDB agreed to cancel Haiti’s pending debt of $484 million to the IDB, and converted undisbursed loan balances of $144 million into grants. Since 2007, Haiti has received only grants from the IDB, the largest multilateral donor to Haiti.

Going forward, as part of the Ninth General Capital Increase (GCI-9) the IDB has pledged to provide $200 million in grants annually to Haiti through 2020, plus an additional one-time allotment from the Fund for Special Operations of $137 million. This brings the total support to the country through 2020 to over $2.3 billion for the country’s reconstruction and development. Prior to the earthquake, in 2009 Haiti received approvals for $122 million.

The IDB has been working with the Interim Haitian Reconstruction Commission (IHRC) co-chaired by President Bill Clinton and Prime Minister Jean-Max Bellerive. In coordination with the international community, the IDB is focusing on six of the 14 priorities identified in the Haitian national development plan: education, agriculture, water and sanitation, transportation, energy and private sector development.

Moreno recognized the immense challenge of rebuilding Haiti and urged donors to continue providing assistance to the poorest country in the hemisphere. “We must avoid donor fatigue,” Moreno said. “Five years ago it was almost inconceivable that we would be able to disburse $50 million a year. We’re now hoping to reach $200 million. That is a major challenge, because the Haitian government’s absorption capacity hasn’t quadrupled. If anything, it was diminished by the earthquake. The Bank is working to strengthen the country’s institutional capacity.”

Institution building

The IDB has also provided resources to help rebuild Haiti’s institutions. President Moreno said this is essential to build a foundation for Haiti to embark on a self-sustained growth path in the future, thus diminishing its dependence on non-governmental organizations and other international institutions. For instance, the IDB has helped strengthen DINEPA, the local water authority, which will be able to purchase more chlorine, water purification tablets and soap thanks to the Dec. 15 anti-cholera grant.

“Building up Haiti’s institutions is hard work that provides few photo opportunities,” said Moreno. “But it is the only way to ensure that in the long haul Haiti will break its dependence on foreign aid.”

Following the earthquake, the IDB has also redirected funds for reconstruction work. For example, a $17 million grant originally made to rebuild schools destroyed by the 2008 hurricanes was used to build temporary schools in the quake area.

Building permanent schools can take almost one year, and Haiti wants to build more than 2,500 new schools under its education reform plan supported by the IDB. In November the Bank made its first $50 million grant for that plan, out of a commitment to provide $250 million for this sector over five years.

“We must help Haiti generate more jobs,” said Moreno. “We are strengthening the financial system to unlock credit for businesses. We are building capacity at industrial parks to attract more manufacturers. We are helping the Haitian government improve the business climate for trade and local and foreign investors. All this is needed to change the long-term prospects for Haiti.”

The 2010 disbursements breakdown:

Sector

2010 Disbursements

Agriculture

8,651,280

Basic Infrastructure

8,054,651

Budget Support

50,000,000

Education

19,566,281

Energy

2,633,129

Health

1,126,732

Institutional Capacity

1,308,892

Natural Disasters

1,936,937

Transport

63,469,721

Urban Rehabilitation

6,512,908

Water & Sanitation

13,601,853

Total

176,856,384

 

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