Haiti will impose stiff tariffs on 22, mostly Dominican products

Posted by LeNouvelliste on Thursday, June 21, 2018 Under: Economy
Related image

A document of the Ministry of Economy and Finance (MEF), titled "Customs Policy: Encouraging National Production", whose electronic version has been drafted, informs the Haitian executive's willingness to give a boost to domestic production by raising tariffs on generally imported products.

This document circulated by the MEF at the beginning of the week lists 22 families of products (food, beverages of all kinds, paint, tobacco, etc.), imported for years, and which could be supplied by companies in Haiti, claims for the most part an installed capacity able to satisfy the local demand.

Thus, in an attempt to stem the massive and unrestrained importation that Haiti is making - as the local productive fabric is shrinking - and encouraging local investors to produce locally, the MEF is proposing a tariff adjustment, ranging from 10 % to 40, on food products (flour, pasta, Corn Flakes, couscous), drinks (water, sodas, energy drinks, beer, rums, whiskey, etc.), paint, plastic and other products, detergents and cleaning products as well as tobacco.

According to the MEF, these tariff adjustments are intended to discourage the importation of manufactured goods already produced or able to be produced locally. And if these new tariffs were to be applied, the tobacco would undergo the strongest adjustment (40%) because the ministry proposes a rate of 60% against that of 20% currently in force. The result is a 35% adjustment proposal on whiskey, vodka, cognac and brandy (from 25% applied to 60% of the proposed rate); 30% on detergents and cleaning products (bar and liquid soaps, etc.); 25% on bagged flour and plastic and other products (plates, cups and other plastic containers).

This tariff adjustment proposal comes three years after the ground import ban of 23 products from the Dominican Republic. "These measures should lead to a reduction of the pressure on the currencies, the development of the capacity of local producers to export to the economic spaces open to our products (improved trade balance), as well as a more rational evolution of our economic choices ( both public and private), " reads the MEF in this document.
"The decree of March 2018 to strengthen the position of the gourde as a privileged medium of transactions on the national territory (monetary policy) will only achieve its objective if it is accompanied by measures to encourage domestic production," continued the document, explaining that the proposed tariff adjustment measures are part of a comprehensive economic policy (both fiscal, fiscal and customs).

Haitian President signed executive order requiring all financial transactions in the country to be done in Gourde

In addition to the tariff adjustment applied to 22 product families, with a waiting list of at least 15 more, MEF's proposal includes parallel strengthening of internal controls as well as import controls (quality , tariff heading, contraband). To this must be added the convergence of interministerial and interinstitutional public policies, and particularly the harmonization of customs policy with measures to promote investment.

Contraband, illicit competition, rupture with connivance, bureaucracy are some of the risks and challenges that the MEF must master to achieve the following objectives: coherence between public policies; improvement of the trade balance; structuring growth; reduction of the country's financial dependence; and monetary stability.

These new tariffs are proposed as an alternative to the invasion of the national territory by products from the Dominican Republic, to the chagrin of some economic agents and local producers. Dominican exports are responsible for 42% of Haiti's total trade deficit, an article in the magazine Economic Rythme on bi-national trade revealed.

"On average, during 2014-2015, Dominican exports to Haiti account for 13% of total Dominican exports and 31% of Haiti's total imports, reaching more than 1.2 billion US dollars [...] While Haiti exports only 1 or 2 million dollars to the Dominican Republic, "said the magazine devoted to the reflection on the bilateral relations between the Haitian people and Dominican.

Faced with this gloomy reality, the MEF felt it necessary to solicit the "collaboration of the actors of the system to confront the challenge of growth and build a structuring economic future, namely a sustainable growth focused on the strengthening of the national production, with the benefit of the community ".

According to the MEF, the proposal for this new package, developed in the margins of the finalization of the 2017-2018 amending budget, responds to the progressive agenda of the private sector for domestic production (presented by the Private Sector Economic Forum May 29, 2017); to the decree published on March 7, 2018 by the government and requiring the commercial transactions to be declared in the national currency which is the gourd and the signature on April 27, 2018 of a pact between the private sector and the government to strengthen the fight against corruption.

In : Economy