Was the ‘fuel shortage’ in Haiti an excuse to increase the price?

On the second day of the protests over shortage of fuel in the country, Haitian government announced an increase in the price of diesel.

September 19, 2019 by Tanya Wadhwa
Several important roads and highways have been blocked by barricades and burning tires across Haiti. Photo: Prensa Latina

For the past three weeks, Haiti has been experiencing severe fuel shortage. There are rows of hundreds of cars, motorcycles and people carrying cans outside the gas stations, but there is apparently no fuel in the country. At the end of last week, Haiti ran out of its fuel supply. In response, on September 16, protests broke out across the country. Thousands of people took to the streets, demanding an end to the economic crisis and the immediate resignation of President Jovenel Moïse. The call for the mobilization was given by the opposition, social movements and trade unions in anticipation of a possible increase in fuel prices that would directly impact transport and food costs.

In the capital city, Port-au-Prince as well as in other important cities of the country, several roads and highways were closed by barricades and burning tires. All kinds of activities, transportation, education, banking, businesses and markets were completely paralyzed. Clashes between protesters and police were registered across the city and Vladimir Phebe, a young protester, was shot dead during a protest in Port-au-Prince and reports indicate several others have also been killed.

Despite the strong popular indignation, on September 17, on the second day of the protests over shortage of fuel in the country, Interim Prime Minister Jean Michel Lapin announced an increase in the prices of diesel. The prime minister said that there would be no increase in the price of petrol, which is used in most public transport. Whereas, he said that diesel, which according to him is used by people who do not require subsidy, would see a significant rise. He added that the increase in fuel prices would help the government pay 80% of its debt owed to private companies. Regarding the fuel shortage, Lapin confirmed that 140,000 barrels of oil had reached the country and another 20,000 barrels would reach soon.

Last year, when the government tried to raise the price of fuel, following the orientations of the International Monetary Fund with whom the government had signed an aid agreement, the people of Haiti participated en masse a series of anti-government protests, which continue today. These mobilizations forced the resignation of former Prime Minister Jack Guy Lafontant. With this context in mind, the current ‘fuel shortage’ seems to be a strategic move by the neoliberal government of Moïse.

The latest embargo on the Bolivarian Republic of Venezuela by the United States, has prevented the entry of subsidized crude oil into the country. Since 2005, Haiti was receiving oil at a low cost with favorable pay-back schemes, under the Petrocaribe energy integration agreement initiated by Commander Hugo Chávez. Now the country will have to buy fuel from American companies at a much higher price.

The social and economic condition of the country is already precarious. Haiti is one of the poorest countries in Latin America, around 60% of the country’s population live below the poverty line and 24% in extreme poverty. At the same time, inflation exceeds 18%. Years of dictatorships, systematic corruption, political instability, vulnerability to natural disasters and harsh international sanctions have aggravated poverty and inequality in the country.

The call for the mobilizations was also a part of the strategies discussed and decided last month, during the Patriotic Forum for a National Agreement against the Crisis in Haiti. The conference was attended by over 250 national and international social and political leaders in the rural town of Papaye in order to come up with strategies to confront the crisis and decide on an action plan to force a resignation by president Moïse.

Corrupt government officials

In the first week of February this year, the Superior Court of Auditors and Administrative Disputes (CSCCA), issued an audit report on the mismanagement and embezzlement of 3.8 billion dollars of Petrocaribe funds, offered to Haiti by the Bolivarian Republic of Venezuela to finance its economic and social development. According to the report, over 15 ministers and senior officials of the former president Michel Martelly’s administration and a company then run by the current president Jovenel Moïse benefitted from the funds directed to public programs.

In its second investigation report, released in May, the CSCCA revealed that an amount of around 1 million USD for the rehabilitation of Borgne-Petit Bourg de Borgne road section in northern Haiti was paid twice. In 2014, the state signed two identical contracts with two separate companies, Agritrans and Betexs. The two companies share the same tax identification number, government patent and technical staff in their portfolio with the only difference being the names of their heads. Agritrans listed Jovenel Moïse as its head and Betexs listed someone else.

Last week, senator Sorel Jacinthe accused Fritz William Michel, the designated Prime Minister, of paying 500,000 USD as bribe to five parliamentarians to ensure their vote in his ratification by the Senate as the Prime Minister.

This week, Youri Latortue, the president of the Ethics and Anti-Corruption Committee of the Upper House, accused Michel of over-invoicing of animal sales to the State, while serving as the General Accountant of the Ministry of the Treasury. Latortue said that Michel supplied some 200 goats to the Agriculture portfolio for 6.3 million gourdes (almost 68,000 USD), a price much higher than the market. However, Michel has denied allegations in both the cases.

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