Le Nouvelliste Speech by the Minister of Economy and Finance at the International Finance Summit

Each year, the International Finance Summit opens up space for relevant reflection and debate that can generate innovative financial solutions for national development. As Minister of Economy and Finance, I have to extend on behalf of the Government my sincere congratulations and sincere thanks to all the organizers of this great event for the tremendous efforts they have always made. able to deploy and the number of sacrifices made for the success of this activity.

This is the 12th publication, which unites political authorities, institutional actors, entrepreneurs, and Haiti’s technical and financial partners around the same vision, and should bring new hope to its results. The new hope of developing new financial instruments is likely to respond to the multifaceted shocks that continue to weaken the resilience of our people today and that risk hampering the growth of our economy in the long run.

Ladies and Gentlemen,

The government is well aware of the seriousness of the country’s economic and financial situation. It is here and now, through this new edition of the International Financial Summit, that it is our duty to unite all our energy and our minds to work to improve it and, by doing so, open the horizon to our community. better tomorrow.

Micro, small and medium-sized enterprise (SME) financing is certainly a promising topic that we need to look at much more deeply today to identify real problems that hinder the creation and growth of micro, small and medium-sized enterprises. Haitian companies the size of Haitians to expose them to smart and sustainable solutions. But it is also a goal that we must address, taking due account of the challenges and opportunities that currently exist in both the national and international contexts.

2020 and 2021 were particularly difficult for the world after the health crisis caused by COVID-19, which had a major impact on the global economy. The brutal shock caused by the pandemic and the cessation of most activities plunged the world economy into recession, recording a decline of -3.2% [FMI : WEO de juillet 2021], the largest reduction in forty years. The effects were mainly on production and trade in both developed and developing countries.

Haiti, which has already experienced socio-political crises, has been hit hard by this pandemic, as evidenced by deteriorating economic growth of -3.3 and -1.8 in 2020 and 2021, respectively. Indeed, the shock caused by the health crisis for public finances has accelerated the widening of the budget deficit in 2020 and 2021. This is due to the combined effect of reducing tax pressures and increasing spending within the government. attempts to mitigate the effects of the pandemic. Similarly, economic uncertainty caused by the pandemic has led to a slowdown in private investment, including foreign direct investment.

Along with the socio-political crisis affecting the private sector, the health crisis has significantly contributed to the deterioration of economic activity. Most Haitian companies are not only young, but their productivity is also low, on the one hand, due to company-specific factors such as weak management capacity, and on the other hand, due to external factors related to political instability, lack of access to energy and, above all, to financing.

In 2020, domestic loans to private sector banks accounted for only 9.7% of GDP, well below the Latin American and Caribbean average of 59.78%. Indeed, Haitian companies, including micro, small and medium-sized enterprises (SMEs), discussed at today’s meetings have credit constraints that are a real brake on the continuity or even expansion of their business.

SMEs have difficulty accessing bank loans, as most of them work in the informal sector. However, microfinance institutions (MFIs) and savings and loan cooperatives (MCOs) support this category of limited coverage due to the low level of loan portfolios.

Ladies and Gentlemen,

The development of small and medium-sized businesses is one of the government’s priorities. This involves creating an ecosystem of support for micro, small and medium enterprises. Measures initiated by the Government are aimed at improving the business environment, access to finance and markets, as well as developing the capacity of SMEs. It is in this spirit that the Government of Haiti, through the Ministry of Economy and Finance (MEF) and with the support of the World Bank, is implementing the Private Sector Employment and Economic Transformation Project (PSJET).

The aim of this project is to support IHR in the face of recurring socio-political crises, Covid-19 and the August 14, 2021 earthquake for six (6) years through programs to increase labor demand, while supporting the resilience and growth of micro -, small and medium-sized enterprises (SMEs) and value chains through improved business development services and access to financial resources.

As part of the PSJET launch, priority will be given to companies operating in agencies affected by the August 14, 2021 earthquake. For the government, it is about supporting these companies through support services and support tools. access to finance.

It is estimated that PSJET will have an impact on 4,000 enterprises, and the main results include increasing the resilience of 51,000 jobs and creating approximately 10,000 jobs. It should be noted that the project will be especially supported by enterprises run by women.

Ladies and Gentlemen,

It is time to introduce you to other government initiatives related to the development of the private sector, including SMEs, which are considered the engine of growth and development of our country. In this regard, the Economic Recovery Plan after Covid-19 for the period 2020-2023 identifies 5 sectors for diversification and transformation of the economy, namely agriculture, digital technology, tourism, industry and real estate. At this stage, we have taken a number of measures to support the development of these sectors:

Implementation of the capacity building project with the International Finance Corporation from February 2021, which aims to improve further services for existing investors and awareness of new investors in the clothing and textile sector;

Implementation of the Digital Acceleration Project, which aims to expand access to high-speed Internet services and lay the foundations for digital resilience to respond to shocks such as covid19 and earthquakes.

Creation in 2020 of a guarantee fund for companies-exporters of agricultural products;

Establishment of the Haiti Autonomous Electricity Fund in the Industrial Development Fund (IDF), which aims to ensure reliable and high-quality renewable energy services by financing providers of access to commercially viable energy suppliers capable of providing these services in rural and suburban areas. countries;

Establishment of a guarantee fund of 500 million gourds for the residential sector of the southern peninsula, which was significantly affected by the earthquake of August 14, 2021;

Develop a National Digital Economy Strategy that will set priorities and goals that will allow the country to take full advantage of the digital revolution to accelerate growth and job creation.

Ladies and Gentlemen,

As part of the government’s efforts to improve the macroeconomic base, we have been holding discussions with the International Monetary Fund since March 2022 to sign the Reference Program (SMP). Through this program, we seek to implement policies that restore macroeconomic stability and growth, strengthen governance, and contribute to poverty reduction.

It should be noted that the budget for 2021-2022, which is currently being developed, will take into account all administrative, tax and social measures that will result from the SMP. Thus, the Government has taken all measures to ensure that in early May 2022 the Council of Ministers approves the budget for 2021-2022.

At the same time, the Government is working on the implementation of social measures that will be in force in the coming days until September 2022 (ie during the next 5 months of the financial year 2021-2022).

From the management’s point of view, efforts to increase transparency and accountability have been noted through the implementation of the Decree of 5 November 2021, which establishes an obligation to provide information that allows identifying beneficial owners of public contracts and concessions. On the other hand, the government intends to continue reviewing the regulatory framework of the main controlling institutions, namely the Anti-Corruption Unit, the National Procurement Commission and the High Court of Accounts and Administrative Affairs.

I am delighted with the partnership between MEF and Group Croissance to organize this event. In this regard, I am committed to strengthening this partnership to ensure that economic information is better disseminated for the benefit of the people of Haiti. I also welcome the participation of the Croissance Group in strengthening the public-private dialogue on the problems and priorities of our country’s development.

Ladies and Gentlemen,

Finally, I sincerely hope that the holding of this 12th International Financial Summit will help identify the many opportunities that exist for IHR in Haiti, as well as formulations for concrete action to address the challenges that hinder their development, to make them real tools. wealth to fight poverty and thus offer the vast majority of our fellow citizens hope for a better tomorrow.

Thank you !

Michelle Patrick Bouavert