6. HAITI’S ECONOMIC OVERVIEW
GDP PER CAPITA (USD) $846 (2014 est.)
POPULATION Total: 10,110,019
Port-au-Prince: 2.44 million
GDP BY SECTOR Agriculture: 24.7%
Industry: 20%
Services: 55.3% (2014 est.)
UNEMPLOYMENT 40.6%
POVERTY 58.5% (2012 est.)
INFLATION 4.6%
LABOUR FORCE 4.81 million
EXCHANGE RATE $1US = 52 HTG
T&T POPULATION
1.2 million
T&T PER CAPITA
32,100
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7. POLITICAL (IN)STABILITY
Presidential-style Republic with three main arms the Executive, Legislative and
the Judicial branches.
Haiti’s government has changed hands twenty –two times
Presently, there has been isolated acts of violence linked to political campaigns
Presidential Elections- 25th October, 2015
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8. TRADE AGREEMENT
Haiti became a member of CARICOM on July, 2002.
Haiti is NOT member of the CARICOM Single Market and Economy
No preferential treatment/ duty free access into the Haitian Market
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9. TRADING ENVIRONMENT-OVERVIEW
• In the 2015 Ease of Doing
Business Rankings, Haiti
ranked 180
• Haiti’s total non-energy
imports for 2014 valued US$
3,783,334,000
• Haiti’s total non-energy
imports experienced positive
growth of approximately 15%
in 2014 when compared to 2010
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10. FOOD AND BEVERAGE IMPORTS
• Total F&B imports in 2014
valued US$463,715,000
• F&B experienced positive
growth of 36% in 2014
• Top supplying market is
Dominican Republic with 49%
• Local Manufacturers:
• CANEX S.A.
• BRANA
• CARIBBEAN FOOD
MANUFACTURING S.A.
• CARIBBEAN MILLING S.A.
• M&R LUMBER
• REBO S.A.
• TROPICA S.A.
10
11. TOP IMPORTED FOOD AND BEVERAGE PRODUCTS
Code Product label Imported value in 2014
'210390
Sauces and preparations nes and mixed
condiments and mixed seasonings 77389
'170114
Raw cane sugar, not containing added flavouring
or colouring matter (excl. 1701 13) 59517
'190531 Sweet biscuits 43557
'210320 Tomato ketchup and other tomato sauces 30953
'160100
Sausage&sim prod of meat ,meat
offal/blood&food prep based on these prod 25443
'210690 Food preparations nes 23762
'170199
Refined cane or beet sugar, solid, without
flavouring or colouring matter 14372
'190219
Uncooked pasta, not stuffed or otherwise
prepared, nes 14364
'190190
Malt extract&food prep of Ch 19 <50% cocoa&hd
0401 to 0404 < 10% cocoa 14218
'220840 Rum and tafia 12040
TOTAL US$315,615,000 OR 68%
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12. CLEANING CHEMICAL IMPORTS
• Total cleaning chemical
imports in 2014 valued
US$50,427,000
• Cleaning chemical imports
experienced positive growth of
37% in 2014
• Top supplying market of
cleaning chemicals is the
Dominican Republic with 42%
• Local Manufacturers
• MIRAGES INDUSTRIES S.A.
• LA PERLE S.A
• CARRIBEX
• HUHSA(Huilerie Haitiennes)-
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13. TOP IMPORTED CLEANING CHEMICAL PRODUCTS
Code Product label Imported value in 2014
'340220
Surface-active prep, washing & cleaning prep
put up for retail sale 21683
'340111
Toilet soap&prep,shaped;papers&nonwovens
impreg with soap toilet use 11322
'340600 Candles, tapers and the like 5289
'340211 Anionic surface-active agents 4409
'340290
Surface-active preparations, washing and
cleaning preparations, nes 1978
'340119
Soap&orgn surf
prep,shapd,nes;papers&nonwovens impreg w
soap/prep,nes 1419
'340391
Lub/oth prep,not cntg pet oils for treat
textiles,leather,furskins etc 942
'340120 Soap nes 628
'340319
Lubricating & simil prep containing >/=70%
petroleum oils, nes 621
'340213 Non-ionic surface active agents 517
TOTAL US$48,808,000 OR 97%
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14. PAPER PRODUCT IMPORTS
• Total paper product imports in
2014 valued US$72,387,000
• Paper product imports
experienced positive growth of
80% in 2014
• Top supplying market of paper
product is the Dominican
Republic with 60%
• Local Manufacturers
• COFI INDUSTRIES S.A.
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15. TOP IMPORTED PAPER PRODUCTS
Code Product label Imported value in 2014
'481910
Cartons, boxes and cases, of corrugated paper or
paperboard 20866
'481810 Toilet paper 7602
'482110 Paper labels of all kinds, printed 7182
'481920
Cartons,boxes and cases,folding,of non-
corrugated paper or paperboard 6370
'482020 Exercise books of paper 3421
'481930
Sacks and bags, of paper, having a base of a
width of 40 cm or more 2246
'480100 Newsprint, in rolls or sheets 2193
'480300
Paper,household/sanitary,rolls of a w >36
cm,sheets one side >36 cm 1919
'480269
Uncoated paper and paperboard, of a kind used
for writing, printing or 1530
'481159
Paper and paperboard, surface-coloured,
surface-decorated or printed, 1229
TOTAL US$54,558,000 OR 75%
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16. PERSONAL CARE IMPORTS
• Total personal care imports in
2014 valued US$36,838,000
• Personal care imports
experienced positive growth of
42% in 2014
• Top supplying markets of
personal care are the USA and
China with 23% and 22%
respectfully
• Local Manufacturers
• MIRAGE INDUSTRIES S.A.
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17. TOP IMPORTED PERSONAL CARE PRODUCTS
Code Product label Imported value in 2014
'330499
Beauty or make-up preparations nes; sunscreen
or sun tan preparations 8556
'330610 Dentifrices 8309
'330210
Mixtures of odoriferous substances for the food
or drink industries 6154
'330590 Hair preparations, nes 4223
'330300 Perfumes and toilet waters 2448
'330720 Personal deodorants & antiperspirants 2149
'330510 Hair shampoos 1436
'330119 Essential oils of citrus fruits, nes 853
'330290
Mixtures of odoriferous subst f use as raw
materials in industry,nes 756
'330520 Hair waving or straightening preparations 566
TOTAL US$35,450,000 OR 96%
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18. CONSTRUCTION MATERIAL IMPORTS
• Total construction material
imports in 2014 valued
US$136,249,000
• Construction material imports
experienced positive growth of
37% in 2014
• Top supplying market of
construction materials is the
Dominican Republic with 53%
• Local Manufacturers
• MATPAR S.A.
• TOP HAITI S.A.
• ACTION WINDOWS S.A.
• MATELEC S.A
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19. TOP IMPORTED CONSTRUCTION MATERIALS
Code Product label Imported value in 2014
'850720 Lead-acid electric accumulators nes 12760
'854449
Electric conductors, for a voltage not exceeding
80 V, nes 7609
'850710
Lead-acid electric accumulators of a kind usd f
startg piston engines 7335
'940540 Electric lamps and lighting fittings, nes 5298
'732690 Articles, iron or steel, nes 3011
'731700
Nails,staples&sim art,i or s,ex art of head No
8305&art w/copper heads 2981
'854460
Electric conductors, for a voltage exceeding 1,000
V, nes 2459
'391740 Fittings, plastic 2284
'392590 Builders' ware nes, of plastics 2022
'854420
Co-axial cable and other co-axial electric
conductors 1855
TOTAL US$47,614,000 OR 79%
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33. TIPS/ GENERAL INFORMATION
Air Travel – No Direct Flights ( Copa and American Airlines)
Ground Transportation- Airport/Hotel - $50US
No Time Difference with T&T
Communication: 011+509 + Local Number
Language- French (English widely spoken by businessmen)
Hotels: Marriot and Best Western
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Price of oil is approximately 45$ VS 120$
There is a greater need for exporter more than ever
This presentation is to change the perspective of persons towards the market
HOW MANY OF YOU VISITED IN THE MARKET BEFORE?
How many visited after the 2010 earthquake?
What are your perceptions of the market?
IMPACT OF THE 12 JANUARY EARTHQUAKE
7.0 Magnitude Quake struck near Port au Prince
3,500,000 people were affected by the quake
220,000 people estimated to have died
300,000+ people were injured
Over 188,383 houses were badly damaged and 105,000 were destroyed by the earthquake (293,383 in total), 1.5m people became homeless
After the quake there were 19 million cubic metres of rubble and debris in Port au Prince – enough to fill a line of shipping containers stretching end to end from London to Beirut.
4,000 schools were damaged or destroyed
25% of civil servants in Port au Prince died
60% of Government and administrative buildings, 80% of schools in Port-au-Prince and 60% of schools in the South and West Departments were destroyed or damaged
Over 600,000 people left their home area in Port-au-Prince and mostly stayed with host families
At its peak, one and a half million people were living in camps including over 100,000 at critical risk from storms and flooding
Unrelated to the earthquake but causing aid response challenges was the outbreak of cholera in October 2010. By July 2011 5,899 had died as a result of the outbreak, and 216,000 were infected
Haiti is the poorest country in the Americas and is among the least developed in the world with a GDP per capita of US$ 846 dollars (The World Bank, 2015). Its open economy can also be described as one that is extremely vulnerable to shocks and as a result its capita per income is severely impacted. Coupled with poor structural reform and the absence of strong institutions, Haiti has experienced stagnant growth in its economy. Inflation was at 4.6.% in 2014 (The World Bank, 2015) and is expected to increase given the high dependence on food and energy imports and the depreciation of Haiti’s exchange rate .
While the economy expanded at its slowest pace in four years in 2014 (Focus Economics, 2015) it lost momentum and contracted in the first quarter of 2015 due to its ongoing political crisis and impoverished conditions. The average growth rate in GDP is recorded at 2.7% in the fiscal 2014, which is a fall from 4.2% in 2013. This slow down was due mainly to set backs with budget approvals and debilitating drought conditions that impaired agricultural production which is the second largest contributing sector.
World Bank depicts Haiti’s current account balance as a percentage of GDP for the period 2010- 2014. For this period, the balance of payments deteriorated significantly with a decrease over time falling from -2% in 2010 to -4% in 2011 ending with -6% GDP in 2013, it is expected that this trend will continue into the future unless, there is in increase in production, foreign investment and export diversification.
As such Haiti’s trade balance unless stabilized by these in the shortfall will continue to run in a deficit, imports of goods increased to 43% of GDP for the period 2010-2013, whereas exports remained stagnant at 10% of GDP for the same period (International Monetary Fund, 2015)
Haiti’s services sector is the largest contributor to GDP with a contribution of 55%, followed by the fledgling agricultural sector with 25% and the industrial sector with 20%. The services sector is mainly comprised of tourism services, commercial services such as financial, insurance and other business services, communication services, construction services and transport services. Haiti’s services sector is still however largely inefficient and plagued by informal procedures and unsanitary conditions. Output from the agricultural sector is still very limited due to the inability of producers to mechanize its operations and the industrial sector is still plagued by a lack of diversification away from its garment and assembly factories.
Haiti’s government has changed hands twenty –two times since independence with an intervention by the United States following civil unrest in 1915. Presently, there has been a number of isolated acts of violence, accompanying legislative elections which saw a new Lower House elected and a renewal of seats in the Senate. Over one hundred and twenty-eight (128) parties took part in the elections for one hundred and thirty- nine (139) positions.
Presidential elections campaigning is under way in Haiti with a total of 54 candidates vying for the country’s top office. The record number of candidates are all hoping to replace current president Mr Michel Martelly as leader of the poorest country in the Caribbean on October 25th 2015 for the first round of voting. In light of the violence and fraud taking place during the election campaign, Verite, Haiti’s largest opposition party has decided to withdraw from the election race due to the “electoral mess” taking place in the country.
CANEX S.A.- Evaporated Milk, nutrition shake
BRANA- beers (prestige kinam, Guinness, Heineken), malta, water, soft drinks ( 7up, pepsi) energy drinks Toro wines, champagne and spirits.
CARIBBEAN FOOD MANUFACTURING S.A.- corn flakes
CARIBBEAN MILLING S.A.- Semonlina
M&R LUMBER- pasta (spaghetti, macaroni)
REBO S.A. – coffee, peanut butter, Jams and Jellies
TROPIC S.A.- energy drinks, malta
ARLEQUIN S.A. - snack foods & pasta
BARBANCOURT - World-reknowned iconic Rhum of Haiti
BARLIN - Rhum Liqueurs
BRACOUR (Brasserie de La Couronne) - Soft Drinks and power drinks (COCA COLA bottler), wines and Champagne
CHDPA(Compagnie Haitienne de Production Agricole)- Rice, Cornmeal, Beans
COMME-IL-FAUT-Cigarettes
CULLIGAN- Bottled Water
Ets. NOVELLA (in Cap-Haitien, Haiti)- coffee, cacao, dried orange peels (ships to Grand Marnier & Cointreau)
Ets. Pierre LEGER (in Les Cayes, Haiti)- Vetiver essential oil
Georges WIENER & Co.- coffee, cacao
HUHSA(Huilerie Haitiennes)- cooking oil
LMH (Les Moulins d'Haiti)- flour mill
SHAISA-tomato paste, ketchup, local mango juice, pear and peach juices (from imported concentrate)
SPIA-pasta
STANCO-snack foods
SUNFOODS-bouillon cubes (condiment)
MIRAGES INDUSTRIES S.A.- Pine Oil and Flora, window cleaner, dishwashing liquid, laundry detergents
LA PERLE S.A.- Pine Oil and Flora, window cleaner, dishwashing liquid, laundry detergents
CARRIBEX- soaps, powdered detergents, cooking oil, lard
HUHSA(Huilerie Haitiennes)- soaps, powdered detergents
MATPAR S.A.- Paints
TOP HAITI S.A.- Steel Sheets
ACTION WINDOWS S.A.- Aluminium windows
MATELEC S.A- Electrical cables
MATPAR(Manufacture Nationale de Peinture)- paints , varnishes
PEINTURES CARAIBES-paints and varnishes
ACIERIE D'HAITI
ALLIANCE Distribution
CK Hardware
CLOXA Import Export
EKO Depot
ETG
MATELEC
FLAMENGO Import Export
MSC Trading/MSC-Plus
PEINTURES CARAIBES
The Haitian market is segmented into two distinct income segments:
Low Income (80%)
High Income (20%)
The formal retail trade in Haiti is targeted mainly at the high income earns in the Haitian market. The retail network is mainly composed of small retail shops and there are few hypermarkets/ supermarkets, most of them in the urban centre of Port-au-Prince. The major supermarkets are Big Star, Giant, Caribbean, Deli Mart and Delmont. These are the largest and most development supermarket in Port au Prince. They all carry a wide range of products including both international and local Haitian brands.
Based on observations in the supermarkets, there has been a trend towards private label products. For example, in Giant Supermarket, one can find a wide range of Giant branded products mainly in the food and beverage sector including but not limited to flour, beans etc.
Haitian consumers who are part of the top 20% with the purchasing power gravitate to premium products, all the major brands can be found on the supermarket shelves.
Locally manufactured products are usually on the bottom shelves in the supermarket. In one supermarket namely Giant there were no one ply toilet paper on the shelves.
Formal trade in the Haitian construction sector is very well developed with hardware stores being stocked with a wide range of products including paints, cements, PVC pipes and fittings, windows, doors, electrical fixtures etc. The major hardware stores and construction distributors are MSC Plus, CK, Alliance, Eko Depot, Matelec and Top Hardware. All prices are quoted in US$ with a major percentage of products being imported from China.
There is major potential and increased demand for products in the construction sector as the country is trying to rebuild. According to Market Dynamics, there are many construction projects taking place in the Haitian market and these include:
Projected building of 400,00 homes over the next 5 years
restoration of a historical building in Jacmel has been issued by the Ministry of Creative Industries values €750k
Major infrastructure projects are underway in the Southeast region of Haiti, including two new bridges and a 200 bed hospital.
The reconstruction of the educational institution Basile Moreau costing $3MM
The construction of a high school in Coteaux
The informal trade or “trade on the streets” is very strong in Haiti. Most street vendors flourish especially in the urban areas. This type of trade is targeted to the low income earners which is represented by approximately 80% of the total population.
The street trade is very dynamic with hundreds if not thousands of persons lined up along the streets. A wide variety of products can be purchased including food and beverage products (snacks, sauces and condiments, cereal, sausages), paper products among others. It is cheaper to purchase on the street when compared to supermarket who will add their mark ups and other charges to the products. Customers shopping on the streets of Haiti have the ability to purchase in small quantities to match their specific need and most importantly suit their pocket. One such example is the purchase of cereal, a customer of the street can purchase a cup of cereal as opposed to an entire bag from the supermarket which may be out of their spending range.
Using a Distributor
Exporters can choose the option of using a distributor in the market. This is where in-market distributors purchase the product(s) and are responsible for the payment of the goods. In being responsible for the payment of the goods, the in-market distributor also assumes the financial risk and provides the support and customer service needed for the products.
Good distributors normally carry a range of complementary products which are non-competitive in nature and this allows for the focus to be on a particular product type without sacrificing a similar or a competing brand at the same time. The advantage of using a distributor is that they usually have a much wider market reach when compared to direct sales. Thus given the size of the Haitian market it will be very effective to have to use the right distributor to ensure effective coverage of the market.
6.3 Establishing an Office
Through the Center for Facilitation and Investments (CFI) attracting investments to Haiti is of significant importance to drive the Haitian economy forward. Exporters can consider setting up an office in the market which would validate all legitimate operations of the company and be able to benefit from very competitve labour and at the same time creating employment for locals.
According to the World Bank’s “Doing Business 2015, Going Beyond Efficiency” report, Haiti is ranked 180th out of 189 countries. It moved up one spot from 181ST in 2014. This is comparatively low to the rankings of other members in Latin America and the Caribbean. Starting a business in Haiti requires a number of bureaucratic procedures, Haiti is ranked 188TH out of 189 countries in starting a business (The World Bank Group, 2015).
In Haiti, best practice with respect to business procedures is not effective and in some cases a basic need like getting electricity to establish a business is difficult. Haiti is ranked 94th out of 189 countries, in this area (The World Bank Group, 2015). Haiti’s business environment can be described as archaic and inadequte and as a result is indicative of these features:-
When starting a business, for example, the average length of time for setup in Latin America and the Caribbean is 30 days, whereas the length of time in Haiti is 97 days which is more than three times the average length.
In trading across borders, Haiti has improved in its ranking moving up five spaces from 147 to 142 in 2015. The import procedures takes a total of twenty-six (26) days whereas the rest of the region takes an average eighteen (18). These procedures include document preparation, customs clearance and inspections, ports and terminal handling, inland transportation and handling
The two main container ports of entry into the Haitian market and they are as follows:
Port of Port au Prince
Port of Cap Haitian
The port of Port au Prince accounted for 91.5% of total container volume into the Haitian market in 2013. This was then followed by the Port of Cap Haitian with 8% and other ports accounted for 0.5%. The image above identifies carriers that ship to the port of Port au Prince.
As mentioned above, Haiti is not a member of the CARICOM Single Market Economy (CSME) and as such products exported to Haiti from T&T are subject to customs duties and taxes. The value of imported goods, based upon either the "Free on Board" (FOB) or "Cost, Insurance Freight" (CIF) valuations, is converted into Haitian gourdes at the prevailing daily rate, prior to the application of duties and taxes.
Please see below for a list of other taxes charged on imported products
Value Added Tax (TCA)
Verification Fee
Contribution to Management Funds for Territorial Collectives (CFGDCT)
Excise Duties
Value Added Tax (TCA) - This is a 10% general tax on local sales of goods, supply of services, and imports. The tax is CIF value in addition to the customs duty, inspection fee, and excise duties. The following products are exempted from the TCA:
Petroleum products
Newspapers, Books, Magazines and paper used for school materials
Local agricultural products
Agricultural
Livestock breeding, and fishing inputs
Inputs used to manufacture medicines sold in pharmacies;
Agricultural, fishing, and livestock breeding machinery and equipment
Goods entering the country in transit, storage, or temporary entry regimes
Verification Fee- Is an inspection fee of 5% based on the CIF value.
Contribution to Management Funds for Territorial Collectives (CFGDCT) - The territorial tax is of 2% on all imported products with the following exceptions:
Petroleum products
Pharmaceuticals
Parcel posts
Some food products
Agricultural inputs
Paper
Excise Tax: The government imposes an excise tax on a series of imported or locally produced goods, such as tobacco, alcohol, sugar, flour, aerated water, and some "luxury food products." Excise taxes may be either specific or value-added.
SGS issues a verification certificate, which the importer submits to Customs for shipments $5000US and over . The inspection certificate, with the declared value and the document, is affixed to the other shipping documents.
Cross Border Trade
The Dominican Republic is Haiti’s largest trading partner. There are many reports where cross border trade for goods from the Dominican Republic entering the Haitian market pay relatively little to no duties. Haiti’s Government has asked the Dominican Republic to close 55 of 59 border crossings between the two countries, as a way for Port-au-Prince to exert stricter tariff controls and boost revenue from the goods that enter its territory.
Haiti’s proposal, which came during the high level talks held between the two countries, also coincides with many Dominicans’ demand for tighter border controls. Haiti’s officials asked that only the crossings at Ouanaminthe-Dajabón, Anse a Pitre-Pedernales, Malpasse-Jimaní and Belledere-Elias Piña should be kept open.
Despite this, many goods are still entering the Haitian market illegally through the borders which makes it challenging for local manufacturers to compete with goods coming in “duty free” in the Haitian market.
4.2 Price Sensitivity
Price has been identified as a major negotiating point among the major retailers and distributors. Given the high level of poverty in the Haitian market and the very low purchasing power of customers’, buyers seek products that are of good quality at a reasonable price. Trinidad and Tobago manufacturers must be able to offer products that are competitively priced when compared to both locally manufactured and imported products.
4.3 Port Fees
The earthquake destroyed most of the port facilities on the western side of Haiti. In Port-au-Prince the main pier at the northern end of the port was destroyed and the terminal collapsed. The south pier was severely damaged. The public quays collapsed as well as the private quays of Les Moulins d’Haiti, Thor and Terminal Varreux S.A. (Tevasa) were functional but suffered minor damages . Although efforts has been put in place to help rebuild the port, port fees are the highest in the Western Hemisphere. With the first 150-meters (of 400-meters) of the newly reconstructed North pier being delivered next month (October 2015)
There is Wharfage TAX on ONLY COMMERCIAL import cargoes of $310.- per TEU (Twentyfoot-Equivalent-Unit or $620.- per 40-ft and $697.50 per 45-ft container)... Manufacturing companies for EXPORT are NOT subject to said import Wharfage Tax (only up to 30% of their production can be sold onto the local market, subject to the product's normal import taxes and duties). This is what projects the image of one of the highest port fees in this
4.4 Corruption
Transparency International's Corruption Perception Index for 2013 ranked Haiti the most corrupt country in the Caribbean region, ranking 163th out of 177 countries, with little improvement from the past year. Corruption can be a challenge to doing business in Haiti; businessmen face significant challenges in dealing with the Haitian government and private sector businessmen. Foreign business persons, functioning on their own, face challenges dealing with some public and private sector institutions. Joining Professional Busines Associations, such as ADIH (Association des Industries d'Haiti),AMCHAM (Haitian-American Chamber), CCIH (Chambre de Commerce et d'Industrie d'Haiti) is, as elsewhere, recommended, highly encouraged.
Are there opportunities in the Haitian market for local exporters?? YES
Given the level of poverty In the country products must be competitively priced to compete in the market
With a direct shipping line to Haiti, it makes it much faster to purchase goods from T&T vs China and other current supplying markets to Haiti
It is important to note that products of interest are not limited to those mentioned above. Price is the most important factor given the economic climate of Haiti to determine the viability of a sale taking place
Long Term, VALUE is an important criteria in the market, namely finding an optimal Quality/Price ratio.
Individual Entry Requirements
Valid Passport (should not be expiring in 6 months)
Visa: Required for nationals of Trinidad and Tobago in transit through Miami
Airline Ticket
Tourist Visa USD $10.00 upon arrival
Taxi service in Haiti can be very expensive with compared to other Caribbean islands. Taxi services are readily available and can be easily requested through the hotel’s front desk
The cost for daily rentals ranges from $53 to $137
Haiti’s taxis are collective taxis which are called publiques. This means that they will continue to pick up customers until the taxi is full. These cost US$.75.
