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Before fall of Aristide, Haiti hit by aid cutoff
WASHINGTON -- For three years, the US government, the European Union, and international banks have blocked $500 million in aid to Haiti's government, ravaging the economy of a nation already twice as poor as any in the Western Hemisphere.
The cutoff, intended to pressure the government to adopt political reforms, left Haiti struggling to meet even basic needs and weakened the authority of President Jean-Bertrand Aristide, who went into exile one week ago.
Today, Haiti's government, which serves 8 million people, has an annual budget of about $300 million -- less than that of Cambridge, a city of just over 100,000. And as Haitians attempt to form a new government, many say its success will largely depend on how much and how soon aid will flow to the country.
Some banking officials said loans could resume in a matter of weeks, but others familiar with the process say it could take years.
"It is important to understand that we need help because we are the poorest country in the hemisphere," said Claude Roumain, a key opposition leader who has called for a special international fund to rebuild Haiti and an audit of the central government. "The main concern is where we stand now. To know exactly and to tell the truth to the people."
Many of Aristide's supporters, in Haiti and abroad, angrily contend that the international community, particularly the United States, abandoned the fledgling democracy when it needed aid the most. Many believe that Aristide himself was the target of the de facto economic sanctions, just as Haiti was beginning to put its finances back in order. "This is a case where the United States turned off the tap," said Jeffrey Sachs, an economist at Columbia University. "I believe they did that deliberately to bring down Aristide."
Many Haitians agree. "They left Aristide alone, on his own, and that's how we got into this predicament," Frankie Charles, 36, said last week as he wandered outside the National Palace now occupied by US Marines. "I know they didn't like him. But they could have let him stay and finish his five-year term."
Aristide's critics, including some human rights groups, counter that he was to blame for failing to build a transparent, functioning government and for failing to break a political stalemate with the opposition parties.
"The reason why the aid was withheld was because of bad government . . . corrupt government, and violent government," said James Morrell, executive director of Haiti Democracy Project, a nonprofit think tank based in Washington.
Financiers also cited practical reasons for withholding aid.
"Some viewed Haiti as a failed state like Somalia or Afghanistan," said an official at an international bank that suspended funds who asked not to be identified. "It doesn't make sense to give loans to a failed state."
Since Aristide left Haiti in a US-chartered plane, questions have surfaced about his final hours in office and how much pressure US officials put on him to flee. Aristide has asserted he was forced to go; US officials deny it. But many say his downfall was years in the making -- and that Haiti's deep-rooted poverty played a crucial role.
"Every element that shaped the final drama has been in play for years," said Dan Erikson, of the Inter-American Dialogue, a center for the analysis of Western Hemisphere affairs.
The cutoff began as a few lines on a foreign operations bill in November 2000, six years after US Marines restored Aristide to power following a military coup. Passed by a Republican Congress and signed by President Clinton, the clause said no money would be given to Haiti's government until it remedied the flawed parliamentary elections that had taken place that spring.
Aristide was still a lightning rod of partisan debate in the United States. Republicans, most of whom opposed the 1994 US intervention, accused him of political violence, corruption, and an inability to work with the opposition. Democrats, some of whom had become friends with Aristide in their fight to restore the democratically elected leader, had hoped to protect Haiti's fragile progress toward democracy.
Aristide's Lavalas Party and his foes had hit a stalemate in 1997, which virtually shut down the government. Between 1997 and 2000, the deadlock cost the country about half of $2.8 billion in promised international aid because donors felt the government did not meet conditions calling for audits and other oversight.
The 2000 parliamentary elections were the last straw: eight Senate seats were awarded to pro-Aristide candidates in a process widely criticized as rigged, and an outraged opposition boycotted further elections. The opposition insisted that Aristide step down and the leader's backers insisted that he serve out his term. Despite Aristide's efforts to convince the international community that he had remedied the election, US aid to his government never resumed.
The World Bank and the International Monetary Fund also closed up shop in Haiti, citing poor governance. The Inter-American Development Bank held up a $145 million loan for years, partly because Haiti had not been paying interest on past debts but also because of the political crisis.
The IDB loan was earmarked for drinking water, health, and road-building initiatives, and its delay incited the bitterness of American Democratic congressmen and Haiti activists.
The American lobby for Haiti, strongly supported by the Congressional Black Caucus, put much of the blame for the impasse on the Haitian political opposition. They accused it of slowly suffocating Aristide's government to bring him down -- and enable the well-to-do Haitian elite to supplant the former slum priest.
The sanctions imposed after the 2000 elections aggravated the economic troubles, and made Aristide's job harder, and worsened conditions for ordinary Haitians, local people say. Inflation jumped after 2000.
Sachs, a prominent architect of Third World development initiatives for the United Nations and other agencies, said he met with Aristide in Haiti in January 2001 -- around the time that both President Bush took office and Aristide was elected a second time. During that meeting, Aristide persuaded Sachs to ask the World Bank and the IMF to restore funding.
Sachs tried to do so. But he recalls now: "I was shocked when I came back and spoke to senior officials in Washington. . . . They basically told me the essence of it, which is that the United States is freezing aid right now."
Sachs said the move to block Haiti was unfair because US funds had flowed in recent years to far more problematic governments: Chad, Egypt, Pakistan -- even the Taliban regime before Sept. 11.
But Roumain hailed the action.
"I think the sanctions helped to restore democracy because [otherwise] maybe the government would continue business as usual and people wouldn't realize the situation is serious with the democratic process," he said in a telephone interview from Haiti. "Certainly, people suffered," he said; most survived on donations from relatives abroad.
Karen Harbert of the US Agency for International Development, said aid was more effectively administered by international humanitarian organizations. She noted that the US government has given about $204 million to these nonprofit groups for projects in Haiti since 2000. "The institutions of Haiti were not capable of delivering that type of result for these programs," she said.
The halt in funding took its toll. According to the CIA, Haiti's economy shrunk about 1.2 percent in 2001 and 0.9 percent in 2002.
In 2003, Haiti made a drastic attempt to restart the aid, draining its central bank reserves to pay about $32 million in back payments to reactivate the loans from the Inter-American Development Bank. It received an initial $47 million.
The World Bank, too, was set to lend again, partly due to US efforts, Harbert said, adding that Roger F. Noriega, US assistant secretary of state for Western Hemisphere affairs, asked the Organization of American States to encourage international institutions to restart the funding.
But just as it appeared money was about to start again -- and just as Aristide agreed to a power-sharing plan designed to break the impasse -- rebel fighters attacked. The international community did not intervene because the democratic opposition rejected the power-sharing plan, which did not stipulate that Aristide resign.
Meanwhile, Haitians are struggling to get by. The capital's morgue has no electricity, so a stench wafts into the street. The General Hospital is nearly empty.
"We have nothing to give them," said Dr. Alexis Joseph Vilaime, a resident at the hospital. "Everybody who comes in, we just give them a prescription and they go out" to get it filled elsewhere.