Currency - Haiti Observer Blog

In spite of reassuring statements and intervention of the Haitian Central Bank, the Haitian Gourde kept sliding against U.S Dollar. Today, (December 17, 2015) US$ 1:00 is equivalent to 56.73 Haitian Gourde. The value of one country's currency depreciates mainly on its economic condition which is again vulnerable to domino effect or cumulative effect of several factors like economic fundamentals, political instability, foreign trade imbalance, etc. To understand the severity of the problem few practical examples would be good enough.

Suppose, in 1995, a well-to-do Haitian family had a monthly income of 20,000 HTG. With the prevailing exchange rate of 1995, the family had an income of $1,142.85 in 1995, but in 2015, the same income of 20,000 HTG with the current exchange rate, would be much less, $352.53 only. Similarly, an amount of $1000,000 kept in a bank in 2010 would be presently reduced to $675,000 only. A reduction in one country's value of money is good for an economy which has more export than import, but Haiti heavily depends on import. Its import bill will be more expensive than ever.

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More than 55 Haitian Gourdes for One US Dollar. Election, end of a political reign, debt to PetroCaribe, decision of Haiti to conduct all transactions in Haiti in the Haitian Gourde, these are some of the reasons why you now need more than 55 Haitian Gourdes to buy a US Dollar. By the way you can't even find the US dollars even if you have the money to buy it.

The financial system, regardless of the country, is always considered to be efficient. The same way that the stock market in the more developed world is based on speculation and stability, the financial system in Haiti is no different. It is based on offer and demand in an environment where a reasonable prediction can be made.

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