Gourde - 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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The Haitian gourdes has been losing its value fast for the past few Months.At the beginning of the Month, the exchange rate was 46 gourdes for a US dollar. Today, you need 47 Gourdes for a dollar.

With the current level of political instability in the country will Haitians need 50 gourdes to buy one one US dollar by the end of the year?

Central Bank Governor Calms Fears about Gourde Devaluation

Governor of Haiti's Central Bank, Charles Castel, addressed a growing alarm the gourde might depreciate too quickly before the end of the year. It is now trading at 47 gourdes for each U.S. dollar and worries are depreciation of Haiti's currency may reach 50 gourdes by years' end.

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The preliminary estimate of "Economic Accounts 2013" by Haitian Institute of Statistics and Informatics (IHSI) has revealed that the Gross Domestic Product (GDP) in Haiti has increased in volume by 4.3% to 48%. The previous year the same increase rate in volume was by 2.3% and that was corresponded by a revised GDP growth rate of 3.4% measured in the middle of the year. The projected growth rate for 2012 was estimated at 6.5% earlier. Every sector in the country has contributed positively with additional growth towards country's GDP.

The agricultural sector has contributed additional 4.6% by value against 1.3% in 2012. The building and public works which consists the works of reconstruction of public buildings, major infrastructure and certain private sector initiatives have also added 9% more. The catering and hospitality sectors have added 5% value. Other industries, although have smaller contribution in GDP, have shown upward trend. The domestic consumption in the year 2012 was less by 5% over its previous year and that too had experienced an increase in volume by 2.8% in 2013. This was the result of foreign remittances by the migrant citizens and transfers by government to the households in cash and kind. Last year, the country enjoyed a stable business environment and the economy was further boosted by government spending.

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We in the Diaspora are being hit once again. After levying a tax on the money I send to Haiti to pay for my children's education. After taxing the phone call I make to my family to make sure they received the money. Now it's the turn for the government to take part of the money I send to my family itself. The latest scam by the Haitian government is the decision that will require all money transfers in direction to Haiti to be delivered in Haitian Gourdes.

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