What next for Haiti after its president was assassinated?

What’s happened?

On 7 July Haitian president Jovenel Moïse was assassinated in his bedroom. Haitian authorities say that a group of up to 28, largely Colombian, mercenaries broke into his home near the capital Port-au-Prince. The president was shot 12 times. His wife was also shot in the attack, although she survived. Police have since apprehended most of the alleged attackers and paraded them before the press. Many details of the murder remain unresolved, not least the reason why the president’s own security detail appears to have offered no resistance to the mercenaries.

Was Moïse popular?

No. A one-time banana exporter, Moïse had assumed office in 2017. Things got off to a bad start after he was implicated in an embezzlement scandal: at least $700,000 of public money had allegedly been diverted to his banana business. Security worsened during his tenure: most of the country is now too dangerous for foreigners to visit due to the risk of kidnapping. Moïse also had an autocratic streak. He refused to hold new parliamentary elections last year and had effectively been ruling by decree at the time of his death. He also insisted that his term should end in 2022, a year later than the constitution seemed to allow. Moïse had made so many enemies that, as Michael Stott puts it in the Financial Times, it is still “not entirely clear which side his bodyguards were on” during the assassination raid.

Does the country have a history of this?

Haiti is the only state in the world to have been founded by a successful slave revolution. The country gained independence from France in 1804. Over the turbulent centuries since there have been a few constants: coups, foreign intervention, poverty and some astoundingly corrupt and brutal leaders. The country was occupied by the United States between 1915 and 1934. Between 1957 and 1986 it suffered under the successive dictatorships of François “Papa Doc” Duvalier and his son, Jean-Claude “Baby Doc” Duvalier. The pair are thought to have stolen hundreds of millions of dollars of public funds. In 1991 Haiti turned towards democracy, but it has been a rocky ride, with disputed elections and two more coups since then.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

What’s happened since the killing?

Moïse’s assassination created a power vacuum, sparking fears that the country was heading for outright anarchy. For now the elite seem to have coalesced behind new prime minister and acting president Ariel Henry. Elections are due in September, although it is anyone’s guess whether they will happen or not.

But the country is poor?

Yes. With a GDP per capita of just $1,279, Haiti is the poorest country in the Americas and one of the poorest in the world. The World Bank reports that the poverty rate approached 60% last year as the Covid-19 pandemic worsened an already dire economic situation. Two-fifths of Haitians depend on agriculture, making for a precarious existence in a mountainous country that is prone to natural disasters. Textiles make up the bulk of exports, but the economy is overwhelmingly dependent on external help. More than 20% of the government’s annual budget comes from foreign donors. More than a quarter of GDP comes from remittances from the Haitian diaspora, says Rocio Cara Labrador for the Council on Foreign Relations. Millions of Haitians live and work overseas and send money home.

Why is it so poor?

Some blame a long history of meddling by the US. Others point to its colonial heritage. In 1825 Haiti was forced to pay a 90 million franc (about $22bn today) indemnity to France in return for recognition of its independence. The debt took more than a century to clear. Yet that doesn’t seem to explain Haiti’s current predicament, says Noah Smith in his Substack newsletter. By 1960, the debt was long paid off and Haiti had a similar living standard to the Dominican Republic, its neighbour on the island of Hispaniola. In the ensuing decades the latter grew rapidly and is today “eight times as rich… Haiti’s standard of living hasn’t advanced at all since 1950”. That is one of the most dramatic economic divergences in recent history, “perhaps surpassed only by North and South Korea”. Some blame environmental degradation – Haiti is heavily deforested. Others argue that while the Dominican Republic has had its own share of brutal dictatorship, its leaders were at least more focused on development and less intent than the Duvalier duo on robbing their own people. All of these factors have probably contributed, but “the short answer is that no one exactly knows” why Haiti’s economy has done so badly.

What should be done?

Haiti needs stable political institutions and an end to pervasive corruption and organised crime. But previous efforts have achieved little. As the Financial Times notes, the country has been “in essence an international protectorate” for much of this century. UN peacekeepers were present between 2004 and 2017, but accidentally helped spread a cholera epidemic. The international community poured in $13.5bn of aid after an earthquake in 2010 that killed 220,000 people and left 1.5 million homeless. The money helped rebuild damaged infrastructure, but it didn’t build the nation’s institutions. Some argue that too much aid creates perverse incentives, encouraging local elites to focus on the demands of foreign donors at the expense of their own people. As Elise Labott puts it in Foreign Policy, for all the “misbegotten aid” that has been sent over the years, “the one thing the world never taught Haiti was to govern – and make decisions for itself”.