Besides these long-term investments, which largely target areas beyond the capital, Port-au-Prince, the IDB is providing Haiti urgently needed financial support as its government strives to alleviate the hardship caused by rising fuel and food prices.
In May the IDB moved quickly to disburse $27 million for the Haitian government, which had recently announced emergency measures to contain the price of staples such as rice, create jobs through public works programs and boost agricultural output.
Most of the IDB’s operations, however, are focused on three of Haiti’s strategic goals: building a stronger base for economic growth, improving access to basic services and strengthening the public sector.
Backed by $698 million in soft loans and grants, the IDB’s portfolio in Haiti includes major programs to rebuild roads and other transportation infrastructure, expand coverage of electricity and potable water services, increase production in key farming areas, improve access to education, health and job training; and boost government revenues by strengthening the tax and customs agencies.
To leverage its own financing, the IDB pursues agreements with other donors who can provide complementary resources for key projects in Haiti. To date, the IDB has secured more than $100 million in grants from Canada, $22.6 million from OPEC, and $6.7 million from the European Union.
In order to accelerate project execution, the IDB has reinforced its Port-au-Prince office, hiring more specialists to work on priority sectors, including additional experts in water, agriculture, roads, energy, education and private sector development, bringing the total to 22 full-time professional staff.
The IDB, which has been present in Haiti without interruption for nearly half a century, has also streamlined operational rules and adopted flexible criteria to enable more local firms and NGOs to participate in projects as contractors or service providers.
Along with other multilateral creditors, the IDB is assisting Haiti in its efforts to complete the process of the initiative for Highly Indebted Poor Countries (HIPC). While it is currently receiving partial relief in the form of reduced principal repayments, once it reaches the HIPC completion point Haiti will obtain full debt relief totaling $525 million from the IDB.
Work on water
The Haitian government has set itself bold goals for water and sanitation, like expanding coverage of potable water to 70% of the population by 2010, up from about half the population at present. The IDB, the leading source of financing for water projects in Haiti, has focused its activities in promoting institutional reform in the sector and expanding services in secondary cities and rural communities. It is also funding studies on water services in the Port-au-Prince metropolitan region.
A $54 million loan is financing the improvement of potable water services in Jacmel, Les Cayes, Ouanaminthe, Port-de-Paix and Saint-Marc. In Saint-Marc, $10 million in civil works have been completed and clean water is flowing to dozens of public water kiosks and to thousands of individual connections. Currently the Haitian government is holding a tender to select a consulting firm to provide technical advice to the SNEP utility on managing of Saint-Marc’s water system.
Work in the other four cities should be completed over the next two years. A favorable sign is that there now is a foreign company participating as a contractor. Until recently, one of the problems hindering progress of infrastructure projects was the lack of foreign competitors due to their perception of Haiti’s security risks. A Dominican firm and a Haitian firm are due to carry out a $7.4 million project in Port-de- Paix, which Public Works Minister Frantz Vérella estimates will be finished in 10 months.
Besides that urban program, late in 2006 the IDB approved a $15 million soft loan for a project to bring potable water and sanitation services to rural areas. Studies have been completed and construction is to begin by end-2008 in the region surrounding Jeremie, the largest city on Haiti’s southwestern coast. These small-scale projects will be carried out through a participatory process, in which local residents will decide whether to take part in the program, choose the systems best suited to their needs and their capacity to operate and maintain them, and establish local water user committees to run the services.
“Beyond completing the investments to expand water and sanitation services, the challenge for the Haitian government and the international community is keep up the efforts to establish appropriate conditions for developing accessible services for the Haitian people,” said IDB operations officer Sarah Matthiessent Romain.