{
  "title": "IMF Executive Board Concludes 2019 Article IV Consultation with Haiti",
  "publication": "IMF News, January 28, 2020",
  "sourceUrl": "https://www.imf.org/en/news/articles/2020/01/28/pr2021-haiti-imf-executive-board-concludes-2019-article-iv-consultation",
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  "summary": "Since March 2019, Haiti has been experiencing a protracted political crisis and prolonged civil unrest that has at times shut down most economic activity.",
  "publishDate": "2020-01-28",
  "sections": [
    {
      "heading": "Context and recent developments",
      "content": "- Since March 2019, Haiti has been experiencing a protracted political crisis and prolonged civil unrest that has at times shut down most economic activity.\n- Economic effects during FY2019 (ending September 30):\n  - Inflation exceeded 20 percent year-on-year in September.\n  - Output is estimated to have contracted by an estimated 1.2 percent in fiscal year 2019.\n  - The exchange rate depreciated by 25 percent over the same period.\n  - Fiscal deficit widened to 3.8 percent of GDP in FY2019.\n  - Domestic arrears rose sharply.\n  - Public debt-to-GDP ratio jumped from 40 percent to 47 percent over the fiscal year.\n- Policy responses:\n  - The ministry of finance is implementing measures to improve revenue collection and better control spending.\n  - In November, the ministry signed a new agreement with the central bank to strengthen fiscal discipline and limit monetary financing of the government.\n  - The central bank has been adjusting its interest rates to contain inflation while trying to support the private sector through the recession."
    },
    {
      "heading": "Outlook and scenarios",
      "content": "- Baseline projection (assuming some political stabilization in 2020 without major political or economic reforms):\n  - Growth would improve but remain negative in 2020 and below 1.5 percent over the medium term.\n  - Inflation is expected to decline slightly before eventually falling to below 10 percent by 2025.\n- Risks:\n  - Primarily on the downside if political instability persists.\n  - Upside potential if political stability is restored, a new government committed to reforms is appointed, and international support returns—leading to higher investment and potential growth."
    },
    {
      "heading": "Executive Board assessment and policy recommendations",
      "content": "- Overall concerns and priorities:\n  - Urgency of restoring political and macroeconomic stability, addressing poverty and inequality, and tackling corruption.\n  - Call for a broad‑based national dialogue and continued close cooperation with donors and the Fund, including through technical assistance.\n  - Welcome of the Country Engagement Strategy as a basis for future Fund engagement.\n- Fiscal policy:\n  - Severe fiscal constraints necessitate shifting scarce resources away from non‑priority spending toward social programs and investment.\n  - Importance of limiting monetary financing of fiscal deficits and preparing a notional budget for FY2020.\n  - Encourage measures to boost domestic revenues and reduce exemptions in the near term.\n  - Strengthen tax administration, prepare a resolution plan for budget arrears, and bolster public financial management.\n  - Commendation for progress on the new national plan for social protection and emphasis on advancing its approval and focusing on a limited number of cash transfer programs.\n- Governance and anti‑corruption:\n  - Urgency of updating anti‑corruption policy priorities, including setting up the steering committee envisioned in the 2009 anti‑corruption strategy.\n  - Need to enforce the asset declaration system and conduct regular audits of state‑owned enterprises and other public entities.\n- Monetary and financial sector:\n  - Encourage authorities to allow the exchange rate to adjust in an orderly fashion.\n  - Recommend setting a quantitative monetary target and advancing other institutional reforms.\n  - Support for the central bank’s efforts to deepen financial intermediation and inclusion, including via fintech.\n- Energy and structural reforms:\n  - Well‑sequenced reform of the energy sector is crucial for fiscal sustainability and higher growth; must be accompanied by clear communications and measures to offset the impact on vulnerable groups.\n  - Encourage overhaul of the management and performance of EDH, work with stakeholders to reduce electricity costs, improve reliability and efficiency of energy supply, and lower the related fiscal burden.\n  - Broader structural reforms needed to improve competitiveness: streamline regulations, remove infrastructure bottlenecks, strengthen property rights, and enhance governance.\n  - Building resilience to natural disasters is a priority.\n- Data and capacity:\n  - Urged steps to improve the quality and timeliness of economic data, with the help of further Fund technical assistance."
    },
    {
      "heading": "Key statistics (Selected Economic and Financial Indicators)",
      "content": "- Nominal GDP (2018): US$9.7 billion\n- GDP per capita (2018): $890\n- Population (2016): 10.847 million\n- Percent of population below poverty line (2012): 58\n\n- Output — Real GDP growth (%):\n  - 2017: 1.2\n  - 2018: 1.5\n  - 2019: -1.2\n  - 2020 (proj): -0.4\n  - 2021 (proj): 0.9\n\n- Prices — Inflation, (end of period) (%):\n  - 2017: 15.4\n  - 2018: 13.3\n  - 2019: 20.1\n  - 2020 (proj): 17.5\n  - 2021 (proj): 14.5\n\n- Central Government Finances (In percent of GDP):\n  - Revenue and grants:\n    - 2017: 17.7\n    - 2018: 17.3\n    - 2019: 13.6\n    - 2020 (proj): 13.4\n    - 2021 (proj): 14.2\n  - Domestic Revenue:\n    - 2017: 14.0\n    - 2018: 13.0\n    - 2019: 10.8\n    - 2020 (proj): 10.0\n    - 2021 (proj): 11.1\n  - Grants:\n    - 2017: 3.7\n    - 2018: 4.3\n    - 2019: 2.8\n    - 2020 (proj): 3.4\n    - 2021 (proj): 3.0\n  - Expenditures:\n    - 2017: 19.0\n    - 2018: 16.1\n    - 2019: 15.6\n    - 2020 (proj): 16.2\n    - 2021 (proj): (not provided)\n  - Current expenditures (percent of GDP):\n    - 2017: 12.2\n    - 2018: 12.7\n    - 2019: 12.5\n    - 2020 (proj): 11.5\n    - 2021 (proj): 11.4\n  - Capital expenditures (percent of GDP):\n    - 2017: 5.3\n    - 2018: 6.2\n    - 2019: 3.6\n    - 2020 (proj): 4.1\n    - 2021 (proj): 4.8\n  - Overall balance of the nonfinancial public sector, incl. grants2:\n    - 2017: -0.9\n    - 2018: -2.9\n    - 2019: -3.8\n    - 2020 (proj): -3.4\n    - 2021 (proj): -3.1\n  - Total public sector debt:\n    - 2017: 38.3\n    - 2018: 39.9\n    - 2019: 47.0\n    - 2020 (proj): 46.1\n    - 2021 (proj): 44.9\n\n- Money and Credit:\n  - Broad money (% change):\n    - 2017: 12.9\n    - 2018: 13.7\n    - 2019: 18.9\n    - 2020 (proj): 18.6\n    - 2021 (proj): 17.0\n  - Credit to private sector (% change):\n    - 2017: 4.5\n    - 2018: 9.9\n    - 2019: 14.6\n  - 3-month BRH bond interest rate (%):\n    - 2017: 12.0\n    - 2018: 22.0\n    - 2019: 19.4\n    - 2020 (proj): 16.4\n\n- Balance of Payments:\n  - External current account balance (incl. official grants):\n    - 2017: -1.0\n    - 2018: -3.9\n    - 2019: -2.0\n    - 2020 (proj): -1.1\n  - External current account balance (excl. official grants):\n    - 2017: -5.6\n    - 2018: -7.9\n    - 2019: -4.8\n    - 2020 (proj): -3.2\n    - 2021 (proj): -4.1\n  - Foreign direct investment (FDI):\n    - 2018: 1.1\n    - 2019: 1.3\n  - Reserves (in months of imports of the following year):\n    - 2017: 4.4\n    - 2018: 4.7\n    - 2019: 4.9\n  - External public debt:\n    - 2017: 24.2\n    - 2018: 23.5\n    - 2019: 27.4\n    - 2020 (proj): 25.4\n    - 2021 (proj): 24. 2\n\n- Exchange Rate:\n  - Real effective exchange rate (% change) (+ appreciation):\n    - 2017: -10.8\n\n- Nominal GDP:\n  - Nominal GDP (millions of gourdes):\n    - 2017: 551,911\n    - 2018: 631,829\n    - 2019: 732,545\n    - 2020 (proj): 868,582\n    - 2021 (proj): 1,015,809\n  - Nominal GDP (millions of U.S. dollars):\n    - 2017: 8,409\n    - 2018: 9,658\n    - 2019: 8,708\n    - 2020 (proj): 8,533\n    - 2021 (proj): 8,842\n\nSource: Press Release No. 20/21, IMF Executive Board Concludes 2019 Article IV Consultation with Haiti, January 28, 2020.\n\n---\n\n\n References\n\n- https://www.imf.org/-/media/images/imf/bios/imfboard.jpg\n- The Executive Board\n- Haiti and the IMF\n- IMF Policy Advice -- A Factsheet\n- The IMF and Good Governance -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- http://www.imf.org/external/np/sec/misc/qualifiers.htm\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2020/01/28/pr2021-haiti-imf-executive-board-concludes-2019-article-iv-consultation"
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    "Published: January 28, 2020",
    "Since March 2019, Haiti has been experiencing a protracted political crisis and prolonged civil unrest that has at times shut down most economic activity.",
    "Economic effects during FY2019 (ending September 30):",
    "Policy responses:",
    "Baseline projection (assuming some political stabilization in 2020 without major political or economic reforms):",
    "Risks:",
    "Overall concerns and priorities:",
    "Fiscal policy:",
    "Governance and anti‑corruption:",
    "Monetary and financial sector:",
    "Energy and structural reforms:",
    "Data and capacity:",
    "Nominal GDP (2018): US$9.7 billion",
    "GDP per capita (2018): $890",
    "Population (2016): 10.847 million",
    "Percent of population below poverty line (2012): 58",
    "Output — Real GDP growth (%):",
    "Prices — Inflation, (end of period) (%):",
    "Central Government Finances (In percent of GDP):",
    "Money and Credit:",
    "Balance of Payments:",
    "Exchange Rate:",
    "Nominal GDP:",
    "[https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg)",
    "[The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)",
    "[Haiti and the IMF](http://www.imf.org/external/country/HTI/index.htm)",
    "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)",
    "[The IMF and Good Governance -- A Factsheet](https://www.imf.org/en/about/factsheets/sheets/2023/the-imf-and-good-governance)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[http://www.imf.org/external/np/sec/misc/qualifiers.htm](http://www.imf.org/external/np/sec/misc/qualifiers.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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