Fuel prices shoot up in Haiti as effort to boost public finances begins

The government in Haiti has increased the price of fuel by 20% in an effort to add to the country’s unstable public coffers.

Officials have been negotiating with transport unions for more than a week so the move was expected.

But people still rushed to gas stations yesterday to beat the increase today.

‘Failed investments’

Haiti exports only about US$1 billion worth of goods each year and imports more than three times that.

The trade deficit is made worse by poor tax revenues, leaving the government unable to keep up with interest on its debt.

One of the country’s biggest creditors is Venezuela.

Under the late socialist leader Hugo Chavez the South American neighbour provided petroleum products at a low price, with bills payable over 25 years and with an interest rate of only 1%.

Almost US$2 billion of loans has been given to Haiti by the Venezuela since 2008.

But the Port-au-Prince administrations have failed to implement strong economic development projects and have been unable to raise living standards.

Previous Haitian governments have avoided changing fuel prices reflect global market prices, fearing inflation that would anger its citizens.