Cancel Haiti's debt

Posted By Annie Lowrey Wednesday, January 13, 2010 - 8:04 PM Share

Haiti, as a nation, has suffered violence, unrest, juntas, and natural disasters. One thing it need not suffer anymore, given the earthquake? Its debt obligations. This Times of London article explains how Haiti became so indebted in the first place.

The appalling state of the country is a direct result of having offended a quite different celestial authority -- the French. France gained the western third of the island of Hispaniola -- the territory that is now Haiti -- in 1697. It planted sugar and coffee, supported by an unprecedented increase in the importation of African slaves. Economically, the result was a success, but life as a slave was intolerable. Living conditions were squalid, disease was rife, and beatings and abuses were universal. The slaves’ life expectancy was 21 years. After a dramatic slave uprising that shook the western world, and 12 years of war, Haiti finally defeated Napoleon’s forces in 1804 and declared independence. But France demanded reparations: 150m francs, in gold.

For Haiti, this debt did not signify the beginning of freedom, but the end of hope. Even after it was reduced to 60m francs in the 1830s, it was still far more than the war-ravaged country could afford. Haiti was the only country in which the ex-slaves themselves were expected to pay a foreign government for their liberty. By 1900, it was spending 80% of its national budget on repayments. In order to manage the original reparations, further loans were taken out -- mostly from the United States, Germany and France. Instead of developing its potential, this deformed state produced a parade of nefarious leaders, most of whom gave up the insurmountable task of trying to fix the country and looted it instead. In 1947, Haiti finally paid off the original reparations, plus interest. Doing so left it destitute, corrupt, disastrously lacking in investment and politically volatile. Haiti was trapped in a downward spiral, from which it is still impossible to escape. It remains hopelessly in debt to this day.

This September, Haiti qualified for the cancellation of $1.2 billion of its $1.9 billion in external debt.  To ensure the recovery of the nation and the livelihoods of its 9 million citizens, the IDB and any other lenders should fully cancel any remaining debt obligations. 

 

CBROWN1492

3:37 AM ET

January 14, 2010

Who forced them to pay the reparations?

I was just wondering how Haiti was forced to pay the reparations? Why couldn't they just refuse if they had already defeated the French?

 

JENSIVERSON

11:55 AM ET

January 18, 2010

Who forced the Haitians to pay? The French Navy.

While Haitians efforts, in combination with the wars in Europe, convinced the French to abandon Haiti, the Haitians did not have the strength to resist extortion.

From:
http://www.nathanielturner.com/haitimakescaseforreparations.htm

Finally in 1825, France, which was being encouraged by former plantation owners to invade Haiti and re-enslave the Blacks, issued the Royal Ordinance of 1825, which called for the massive indemnity payments. In addition to the 150 million franc payment, France decreed that French ships and commercial goods entering and leaving Haiti would be discounted at 50 percent, thereby further weakening Haiti's ability to pay.

According to French officials at the time, the terms of the edict were non-negotiable. And to impress the seriousness of the situation upon the Haitians, France delivered the demands by 12 warships armed with 500 canons.

The 150-million-franc indemnity was based on profits earned by the colonists, according to a memorandum prepared by their lawyers. In 1789, Saint Domingue - all of Haiti and Santo Domingo - exported 150 million francs worth of products to France. In 1823 Haitian exports to France totaled 8.5 million francs, exports to England totaled 8.4 million francs, and exports to the United States totaled 13.1 million francs, for a total of 30 million francs.

The lawyers then claimed that one half of the 30 million francs went toward the costs of production, leaving 15 million francs as profit. The 15 million franc balance was multiplied by 10 (10 years of lost revenues for the French colonists due to the war for liberation), which coincidentally totals 150 million francs, the value of exports in 1789.

To make matters worse for Haiti, the French anticipated and planned for Haiti to secure a loan to pay the first installment on the indemnity. Haiti was forced to borrow the 30 million francs from a French bank that then deducted the management fees from the face value of the loan and charged interest rates so exorbitant that after payment was completed, Haiti was still 6 million francs short.

The 150-million-franc indemnity represented France's annual budget and 10 years of revenue for Haiti. One study estimates the indemnity was 55 million more francs than was needed to restore the 793 sugar plantations, 3,117 coffee estates and 3,906 indigo, cotton and other crop plantations destroyed during the war for independence.

By contrast, when it became clear France would no longer be in a position to capitalize on further westward expansion in the Western hemisphere, they agreed to sell the Louisiana Territory, an area 74 times the surface area of Haiti, to the U.S. for just 60 million francs, less than half the Haitian indemnity.

Even though France later lowered the indemnity payment to 90 million francs, the cycle of forcing Haiti to borrow from French banks to make the payments chained the Black nation to perpetual poverty. Haiti did not finish paying her indemnity debt until 1947!

See also
http://www.ijdh.org/articles/article_recent_news_8-2-06.html

 

SIRCHIROL

8:17 AM ET

January 14, 2010

Sorry, no

There's absolutely no reason the American taxpayer should lose any money the US has lent to Haiti because of long past history with the French. Despite the fact that debt cancelation encourages the already inrresponsible behavior of many 3rd world countries, if the decision is made to do so anyway, France should do so, not the US, or if ohe is hell bent on it, France should repay other lenders for their losses.

 

KIRBYM

12:14 PM ET

January 14, 2010

sorry, yes

Sirchirol, if you did any reading you would know that Haiti's current situation is one of the most dire in the world is in no small part due to U.S. military and trade policies.:

"In 1986, under U.S. military supervision, an army junta took over. Its finance minister, Leslie Delatour, imposed a series of neoliberal measures, including currency devaluation, trade liberalization, and lowering Haiti’s tariffs. Today, Haiti is the most “open” economy in the hemisphere.3

In the 1990s, USAID gave hundreds of millions of dollars in direct food aid. The implementation of this aid weakened Haiti’s economy, with free or heavily subsidized U.S. rice underselling the local peasantry; food-for-work programs arriving during harvest when farmers needed hired help the most; and conditionalities such as even lower tariffs and further trade advantages for U.S. businesses.

While it can be argued that Haitian governments can choose to refuse this aid, the majority of their funding comes from international institutions, a situation Haitians call “politics of the stomach.” Not surprisingly, U.S. assistance to Haiti is still laced with conditionalities that benefit U.S. corporate interests."

Sorry that you as a taxpayer don't want any of your hard-earned money to go to those 3rd world countries with their 'irresponsible behavior' but tough luck. Your hard-earned paycheck sits comes from the backs of those irresponsible countires.

 

FIX IT B4 IT BREAKES FOOL

12:47 AM ET

January 16, 2010

sorry, yes and yes

you nailed it kirbym.

 

SHERIFFFRUITFLY

2:03 AM ET

January 15, 2010

Wow - like making a rape victim pay for her rape examination kit

but on a much larger scale.

:(

 

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