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IDB approves Haiti transition strategy 2005-2006 for $270 million program of operations

The Board of Executive Directors of the Inter-American Development Bank today announced the approval of a Transition Strategy for Haiti for the period 2005-2006. This strategy represents the IDB’s short-term response to the Haitian interim government’s request of support for its national reconciliation and reconstruction agenda.

The strategy supports Haiti’s efforts to alleviate pressing social needs, stabilize its economy, lay a foundation for pro-poor growth and pave the way towards a new elected government in 2006 and beyond the transition.

The IDB Transition Strategy, which reflects the priorities established in the Haitian government’s agenda, will guide the implementation of a $270 million program of operations. These include policy-based and investment loans as well as technical assistance grants to support project execution and strengthen Haiti’s public sector.

To meet Haiti’s priorities, the IDB will continue to support economic recovery by financing investments in key roads, ports and airports. The strategy also sustains efforts to revitalize agriculture by promoting the development of rural production chains capable of generating farming and non-farming jobs.

The implementation of the strategy will help improve Haitian living conditions by increasing access to water and sanitation and improved education and health services at the community level. Complementing these efforts, it will help strengthen natural disaster prevention and environmental management.

In addition, the strategy, as well as ongoing IDB operations, favor labor-intensive activities involving local communities in the rehabilitation of infrastructure. It also promotes the recovery of small and medium-size enterprises and industries, as well as the improvement of conditions for investment. Assistance is already being provided to foster community development initiatives at the national level and will be expanded. 

A key element of the strategy is to help Haiti deepen economic governance reforms, including anti-corruption initiatives, and promote institutional development by increasing transparency, efficiency in the budgetary process and its corresponding legal framework and the quality of human resources of the public sector.

The IDB Transition Strategy was developed in consultation with national and international stakeholders and coordinated with the donor community within Haiti’s Interim Cooperation Framework (ICF), which articulates the government’s national agenda around priority axes. With the new program of operations, the IDB will honor fully the pledge of $263 million it made at a Haiti donor conference in July 2004.

This new strategy builds upon and complements the IDB’s ongoing activities in Haiti, totaling $400 million, which started under the 2003-2004 re-engagement strategy. Since July 2003 some $80 million have been disbursed to support projects that are aligned with the Haitian government’s priorities, leaving an available balance of $320 million. This available IDB financing contributed to reducing the external financing requirements of the Government’s national agenda.  Given the progress made in implementing projects and the special measures taken to streamline procedures and speed up preparation and execution, the IDB expects to reach higher disbursement levels.

The IDB’s program emphasizes a flexible approach through the facilitation and implementation of activities and special strengthening measures to help ease Haiti’s capacity constraints. These activities have also helped the Haitian state maintain key institutional capacities, start major economic governance reforms and finance high-impact investments to rehabilitate basic and social infrastructure and services. All IDB projects include institutional building components to reinforce local executing capacities and ownership.

In addition, the IDB has maintained a strong field presence through a fully staffed country office in Port au Prince, which has always remained in operation. The Country Office is being strengthened to meet the demands of the IDB’s growing involvement in Haiti and respond to evolving country priorities. These efforts rely on close collaboration with Haitian agencies and other donors to assess and monitor execution capacities, make adjustments to facilitate implementation and maintain strong aid coordination.

Under the transition strategy, this flexible approach will pursue innovative approaches and streamlined procedures to reduce demands on Haiti’s limited institutional capacity. In agreement with the Haitian government, the IDB will continue to apply and adjust special measures to speed up portfolio execution and the preparation of new operations for prompt implementation.

In coordination with other donors, the IDB will continue to strengthen aid coordination mechanisms and participate actively in the implementation and monitoring of the ICF. These efforts emphasize a balance of short- and longer-term approaches to help Haiti build local human and technical capacities, address priority needs of its people and restore economic, institutional and stability conditions for sustainable growth and effective poverty reduction.

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