RESTRICTEDWORLD  TRADE
ORGANIZATIONWT/TPR/S/99
8 May 2002
(02-2512)
Trade Policy Review Body
TRADE POLICY REVIEW
HAITI
Report by the Secretariat
This report, prepared for the first Trade Policy Review of Haiti, has been drawn
up by the WTO Secretariat on its own responsibility.  The Secretariat has, as
requested by the Agreement Establishing the Trade Policy Review Mechanism
(Annex 3 to the Marrakesh Agreement Establishing the World Trade
Organization), sought clarification from the Government of Haiti on its trade
policies and practices.
Any technical questions arising from this report may be addressed to Mr Jacques
Degbelo (Tel:  739 5583) or Mr Clemens Boonekamp (Tel: 739 5226).
Document WT/TPR/G/99 contains the policy statement submitted by the
Government of Haiti.
Note: This report is subject to restricted circulation and press embargo until the end of the meeting
of the Trade Policy Review Body on Haiti.Haiti WT/TPR/S/99
Page iii
CONTENTS
Page
SUMMARY OBSERVATIONS vii
(1) THE ECONOMIC ENVIRONMENT vii
(2) INSTITUTIONAL FRAMEWORK vii
(3) TRADE POLICY INSTRUMENTS viii
(4) SECTORAL TRADE POLICIES ix
(5) TRADE POLICY AND TRADING PARTNERS x
I. ECONOMIC ENVIRONMENT 1
(1) MAJOR FEATURES OF THE ECONOMY 1
(2) RECENT ECONOMIC DEVELOPMENTS 3
(3) TRADE PERFORMANCE AND INVESTMENT 7
(i) Trade in goods and services 9
(ii) Investment 10
(4) OUTLOOK 11
II. TRADE REGIME 12
(1) INSTITUTIONAL FRAMEWORK 12
(2) P OLICY FORMULATION AND IMPLEMENTATION 13
(3) T RADE POLICY OBJECTIVES 14
(4) L AWS AND REGULATIONS 15
(5) TRADE AGREEMENTS AND ARRANGEMENTS 17
(i) Multilateral agreements 18
(ii) Regional agreements 18
(iii) Bilateral agreements 22(iv) Other agreements and arrangements 22(v) Trade-related technical assistance 25
III. TRADE POLICIES AND PRACTICES BY MEASURE 31
(1) INTRODUCTION 31
(2) MEASURES DIRECTLY AFFECTING IMPORTS 31
(i) Registration, documentation and procedures 31(ii) Tariffs, other duties and taxes 32(iii) Customs valuation 39(iv) Import prohibitions, restrictions and licensing 40(v) Trade sanctions 42
(vi) Contingency trade remedies 41
(vii) Rules of origin 41(viii) Local content requirements 41(ix) Government procurement 41(x) Other measures 42
(3)
MEASURES DIRECTLY AFFECTING EXPORTS 42
(i) Registration and documentation 42(ii) Export taxes, charges and levies 43WT/TPR/S/99 Trade Policy Review
Page iv
Page
(iii) Prohibitions, controls and export licensing 43(iv) Quotas and voluntary restraints 43(v) Subsidies, duty and tax concessions, promotion, assistance for export 44(vi) Free zones and industrial zones 44
(vii) Other provisions 45
(4)
MEASURES AFFECTING PRODUCTION AND TRADE 45
(i) Incentives 45(ii) Standards and other technical requirements 46(iii) Competition policy and price controls 47
(iv) State enterprises and privatization 48
(v) Protection of intellectual property rights 49
IV. TRADE POLICIES BY SECTOR 52
(1) I NTRODUCTION 52
(2) A GRICULTURE AND RELATED ACTIVITIES 52
(i) Overview 52(ii) Main sub-sectors 55
(3)
MINING AND ENERGY 60
(i) Mining 60
(ii) Energy 63
(4) MANUFACTURING 65
(5) SERVICES 67
(i) Overview 67(ii) Tourism 69(iii) Financial services 71
(iv) Telecommunications and postal services 73
(v) Transport 74
REFERENCES 77
APPENDIX TABLES 79Haiti WT/TPR/S/99
Page v
CHARTS
Page
I. ECONOMIC ENVIRONMENT
I.1 Sectoral breakdown of real GDP, 1995 and 2000 2
I.2 Trend in real GDP, 1970-2000 6I.3 External balances, 1995-00 9
III. TRADE POLICIES AND PRACTICES BY MEASURE
III.1 Breakdown of MFN duties applied, 2002 34
III.2 Breakdown of MFN duties by sector, 2002 35
IV. TRADE POLICIES BY SECTOR
IV.1 Average customs duties by ISIC classification, 2002 68
TABLES
I. ECONOMIC ENVIRONMENTI.1 Main economic indicators 1995-00 5
I.2 Balance-of-payments, 1995-2000 8I.3 Structure of investment, 1999 11
II. TRADE REGIME
II.1 Main Haitian laws and regulations in November 2001 16
II.2 Situation of requirements relating to notifications to the WTO, November 2001 18
III. TRADE POLICIES AND PRACTICES BY MEASURE
III.2 Annual quotas for exports of textile products (SL) by Haiti to the United States 44
III.3 Annual quotas for exports of textile products (GAL) by Haiti to the United States 44III.4 Main Haitian legislative texts on intellectual property rights 50
IV. TRADE POLICIES BY SECTOR
IV.1 Food imports 53
IV.2 Farm size 53
IV.3 Production of certain cash crops 55IV.4 Exports of certain cash crops 56
IV.5 Production of certain food crops 57
IV.6 Exports of marine products 58IV.7 Breakdown of tourism 1997-1999 69WT/TPR/S/99 Trade Policy Review
Page vi
APPENDIX-TABLES
Page
III. TRADE POLICIES AND PRACTICES BY MEASURE
AIII.1 MFN tariff statistics, by HS 2-digit, 2002 81
AIII.2 List of imported products subject to excise duty, February 2002 84
IV. TRADE POLICIES BY SECTOR
AIV.1 MFN tariff statistics, by ISIC Rev.2 category, 2002 86Haiti WT/TPR/S/99
Page vii
SUMMARY OBSERVATIONS
(1) THE ECONOMIC ENVIRONMENT
1. The reforms undertaken by Haiti since
1986 make it one of the most liberal
economies in Latin America and theCaribbean today.  These reforms have created
an environment that has allowed Haiti to
improve its economic performance.  After
shrinking by almost 20 per cent between 1991
and 1994, Haiti's real GDP grew at anaverage annual rate of around 2.5 per cent
between 1995 and 2000.  Nonetheless, socio-
political problems continue to make Haiti one
of the poorest countries in the world.  A large
part of its population lives below the povertythreshold and the unemployment rate is almost
60 per cent.
2. Budgetary reforms helped to limit the
public deficit to 4.3 per cent in 1995, 0.6 per
cent in 1997 and 2.2 per cent in 2000.  The
monetary financing of the public deficit and
the dollarization of the economy constrain theeffectiveness of Haiti's monetary policy.  With
the exception of 1998 and 1999, the inflation
rate has usually exceeded 15 per cent.  Interest
rates remain high, 27.5 per cent for loans in
gourdes.  Gross fixed capital formationremains at around 13 per cent of GDP
because of high interest rates, the low level of
financial deepening, risks caused by socio-
political instability, administrative problems
and the high cost of production exacerbated bythe inadequacy of the infrastructure and the
high charges for basic services (electricity,
water and transport), whose supply is
unreliable.  These are a number of the factors
that explain in particular the low level offoreign direct investment.
3. The agricultural sector employs
almost 45 per cent of the working population.
It only accounts for 29 per cent of real GDP,
however, because of its low level of
productivity.  The manufacturing sector
accounts for some 7 per cent of real GDP andfor a number of years it has shown steady
annual growth of around 2 per cent.  The
services sector's share of real GDP is thelargest important (around 63 per cent).  It is
dominated by non-market services which, in
the main, are supplied by the State, non-
governmental organizations and non-profit-
making bodies.  Another typical feature of
Haiti's economy is the informal sector, whoseactivities represent an alternative to the mass
unemployment prevailing in Haiti.  Crafts
activities (especially painting) have become
principal or secondary activities.
4. Haiti's external debt remains within
reasonable limits.  Nevertheless, Haiti depends
on foreign assistance, particularly to finance
its various development and structural
adjustment programmes.  Consequently, the
downward trend in international aid in recentyears has compounded its problems.  Foreign
trade in goods (around 30 per cent of GDP) is
not very substantial for an open economy such
as Haiti's.  The external balances in goods and
services show chronic deficits that are partly
offset by current transfers, the vast majority of
which come from Haitians living abroad.
5. Haiti's main exports are manufactures
(around 76 per cent of the total value of
exports of goods), especially products of the
textile industries and clothing.  Agricultural
products make up the remaining 24 per cent.The majority of imports are food products and
manufactures, whose share of imports is
continually rising.  Haiti's main trading
partner is the United States of America, which
takes over 90 per cent of Haiti's total exportsin terms of value.  The other important
partners are the European Union (EU) and the
Dominican Republic.
(2) 
INSTITUTIONAL FRAMEWORK
6. According to the 1987 Constitution,
the Republic of Haiti is a multiparty
parliamentary democracy.  Haitian law
follows the monistic principle of supremacy of
international legal instruments (including the
WTO Agreements) over domestic law.  Haiti's
legislation is gradually being brought into line
with these instruments.  The legislative processis slow, however, because of the political
problems facing Haiti.  This explains why aWT/TPR/S/99 Trade Policy Review
Page viii
large part of Haitian legislation is out of date
and the reforms undertaken in many sectors
have not been underpinned by the necessary
legislative amendments.
7. The Ministry of Trade and Industry
(MCI) plays a key role in the formulation andimplementation of Haiti's trade policy.  It is
responsible for drawing up draft legislation in
the areas of trade and industry.  The private
sector is not systematically consulted on the
formulation of trade policy, but itsrepresentatives sometimes take part in the
joint committees working on the introduction
of a legislative framework for trade and
industry.  Trade policies are neither analysed
nor evaluated, but are debated on certainparticular occasions.
8. The Government has drawn up a draft
Investment Code to complete the incentive
framework provided in the current Code and
to afford the guarantees and the institutional
and legal framework that will encourage
investment.  The draft Code is intended todevelop the sectors deemed strategic,
particularly export-oriented sectors.
9. Haiti became a contracting party to
the GATT on 1 January 1950 and has been a
member of the WTO since 30 January 1996.  Itgrants most-favoured-nation (MFN) treatment
to all its trade partners.  It has not signed any
plurilateral agreement.  Haiti attaches great
importance to multilateral trade negotiations
in the agricultural and services sectors.  Itwould like to receive technical assistance to
allow it, inter alia, to respect its commitments
on notification, to bring its trade legislation
into line with the provisions in the WTO
Agreements, and to implement certainAgreements, especially those on customs
valuation, sanitary and phytosanitary
measures, technical barriers to trade, and
trade-related aspects of intellectual property
rights.
10. Haiti also participates in other
multilateral organizations, including theUnited Nations and its agencies, the
International Monetary Fund (IMF) and theWorld Bank group.  It also belongs to regional
groups such as the Caribbean Community and
Common Market (CARICOM) – subject to
ratification of the treaty by the Haitian
Parliament -, the Association of Caribbean
States (ACS) and CARIFORUM.  TheGovernment intends to pursue its integration
efforts, especially with countries that are
geographically close.  For this purpose, Haiti
is taking part in the process to create the Free
Trade Area of the Americas (FTAA).
11. Under the Generalized System of
Preferences (GSP), Haiti enjoys non-
reciprocal preferential treatment by developed
countries.  A broad range of Haitian products
has preferential access (duty-free) to theUnited States market.  This non-reciprocal
preferential treatment is granted in particular
under the Caribbean Basin Initiative (CBI),
the expanded CBI and the textiles programme.
Haiti has also signed the Cotonou Agreement
under which the European Union (EU) gives
non-reciprocal preferential treatment and aidto developing countries in Africa, the
Caribbean and the Pacific (ACP).  Lastly,
Haiti also benefits from the "Everything but
Arms (EBA)" initiative es tablished by the EU,
which grants duty-free access to EU marketsfor products from least-developed countries,
with the exception of arms and ammunition.
(3) 
TRADE POLICY INSTRUMENTS
12. Since 1986, Haiti has greatly
liberalized its trade regime by abolishing themajority of quantitative restrictions on trade
(with the exception of those maintained for
security, health, moral or environmental
reasons) and eliminating export duties and
taxes.  Tariffs are currently the major tradepolicy instrument and their structure has been
simplified to arrive at six rates (zero, 3, 5, 10,
15 and 57.8 per cent) whose levels have been
noticeably lowered.  The maximum rate of
57.8 per cent only applies to imports of
gasoline.
13. The simple arithmetic average of the
Haitian tariff is 2.9 per cent, with broad
dispersion.  The modal rate is zero and appliesHaiti WT/TPR/S/99
Page ix
to around 67 per cent of tariff headings in the
eight-digit Harmonized System.  With the
exception of the modal rate, the 5 per cent rate
is the most frequently used and applies to
around 14 per cent of tariff headings.  Overall,
tariffs decline from the first to the secondstage of processing and then rise from semi-
finished products (second stage of processing)
to finished products.  Agriculture (Major
Division 1 of the ISIC Revision) is the sector
that enjoys the highest tariff protection, with asimple average tariff of 4.5 per cent, followed
by manufacturing industry, in which the simple
average tariff is 2.8 per cent.  The mining and
quarrying industry is the least protected sector
with a simple average tariff of 2.1 per cent.
14. Inspection fees of 4 per cent of the
c.i.f. value of goods are levied, bringing the
average rate of import duty up to 6.9 per cent.
A tax of 2 per cent is levied on the import
duties and taxes paid, together with a turnover
tax of 10 per cent and excise duty on both
imports and domestic products.  Excise dutyon cigarettes, cigars, tobacco and alcoholic
beverages is usually higher on imports than on
domestic products.
15. During the Uruguay Round, Haiti
bound its import tariffs on all agriculturalproducts (WTO definition) and on some non-
agricultural products.  The tariffs on non-
agricultural products have been bound at
rates ranging from zero to a ceiling of 30 per
cent.  Tariffs on agricultural goods have beenbound at rates ranging from zero to a ceiling
of 50 per cent.  Other duties and levies on all
these products (agricultural and non-
agricultural) have been bound at 16 per cent,
except for certain edible products of animalorigin (20 per cent) and some types of grape
must and cider, as well as vinegar (21 per
cent).  The tariff applicable to gasoline,
however, is well above the level bound.
Furthermore, the tariff bindings by Haiti
during the Annecy Round in 1949 have not yet
been transposed into the Harmonized System.This makes it more difficult to undertake an
overall evaluation of the range and scope of
Haiti's commitments in this area.  In addition,
Haiti has obtained a waiver to delayapplication of the WTO Customs Valuation
Agreement until 30 January 2003.
16. Haiti has never imposed any
antidumping, countervailing or safeguard
measures and does not at present have any
relevant legislation.  It does not have anylegislation either on competition or
standardization.  The concession regimes in
the Investment Code are intended to promote
certain types of investment deemed to be
priorities and strategic for Haiti's economicdevelopment.  They allow exemption from
duties and taxes on certain imported inputs,
equipment and raw materials needed for
production.  Exemption from income tax may
also be granted for a limited period.  Ingeneral, access to these concessions requires,
inter alia, the use of imputs of Haitian origin,
even in export-oriented enterprises.
17. In 1996, a programme to modernize
State enterprises was launched in order to
overcome their financial and management
problems and to scale down the State'sparticipation in production.  The privatization
process has not, however, gone ahead as
planned (only two enterprises have been
privatized).  The inefficiency of State
enterprises facing difficulties, particularly inthe services sector (electricity,
telecommunications, postal services, water
supply, management of ports and airports, and
banking services) has a negative impact on
other branches of economic activity.
18. The draft trademark law underlines
the Government's determination to revise its
intellectual property legislation and bring it
into conformity with its multilateral
commitments.
(4) 
SECTORAL TRADE POLICIES
19. In recent decades, the role played by
the agricultural sector in Haiti's economy has
steadily declined.  This can be attributed to the
growth in the services sector and the drop in
agricultural output due to the rural exodus,
the impact of the international embargoagainst Haiti (following the coup d'Etat inWT/TPR/S/99 Trade Policy Review
Page x
1991) on the production of exportable
foodstuffs, and to adverse climatic conditions.
Agricultural production is not sufficient to
meet the population's food needs, which are
partly covered by imports.  Coffee remains the
main export crop, followed by mangoes, cacaoand essential oils.  Agriculture is facing a
number of problems, including the uncertainty
concerning title deeds, the division of arable
land into smaller units, and the lack of
infrastructure, especially for irrigation.  Therehas also been large-scale deforestation, which
has greatly accelerated soil erosion.  For
farmers, access to credit is limited and loans
are often taken out at extremely high rates of
interest.
20. The aim of Haiti's agricultural policy
is to ensure food security, modernize
agriculture, and improve production for
export.  As a large part of the external
financing to be used for agricultural
development has been frozen by donors
because of the political deadlock in Haiti, theGovernment has had to focus on certain
strategic priorities with a view to expanding
the hydro-agricultural infrastructure and
exploiting new farmland, as well as increasing
production.  Quality controls are carried outon domestic sales, imports or exports of
certain products such as coffee, mangoes and
cacao.  The authorities also conduct
phytosanitary and animal health controls on a
range of agricultural goods and regulatetrade, including the export of animal and plant
products.  Farmers are exempt from income
tax and enjoy other advantages such as loans
on concessional terms, which are granted
under the development programmes.  Theaverage tariff protection in the agricultural
sector (Major Division 1 of the ISIC Revision
2) is 4.5 per cent.
21. Mining and quarrying plays a
marginal role in Haiti's economy.  A permit
must be obtained for any mining activity
relating to metal resources (three types ofpermit are in effect).  For non-metal
resources, only an operating permit is
required.  Haiti's principal mining resources
are non-metal ores, especially clay, buildingstone, marble, calcium carbonate, lignite, and
gold.  In export terms, these resources are
largely under-exploited.  In Haiti, the main
sources of energy are wood, petroleum
products and electricity.  Petroleum products
are all imported, and the electricity supply isthe responsibility of the State enterprise,
l'Électricité d'Haïti (EDH) (Haiti Electricity) .
The average tariff protection for the mining
and quarrying industries is 2.1 per cent.
Electricity is imported duty free, whereasgasoline is subject to the highest tariff rate
(57.8 per cent)
22. The importance of the manufacturing
sector has seriously diminished since the
international embargo against Haiti wasdeclared in 1991.  This sector nevertheless
accounts for the majority of exports,
particularly textiles, clothing and leather
goods, amounting to 55 per cent of Haiti's
exports of manufactures to the United States,
which takes more than 90 per cent of these
exports.  The average customs tariff onmanufactured goods is 2.8 per cent.  In
addition, tariff concessions are allowed in
order to offset to some extent the negative
impact of the degressivity in customs duties on
certain manufacturing industries, particularlythose making semi-finished products.
23. Under the General Agreement on
Trade in Services (GATS), Haiti bound certain
measures affecting education, financial,
construction and related engineering, hoteland restaurant, and veterinary services.
Measures affecting the supply of other types of
services were not bound.  Tourism and trade
services are the sub-sectors that make the
largest contribution by far to real GDP andthe Government is making great efforts to
develop them.  Haiti is a net importer of
services.  Unlike other sectors, the
Government plays a predominant role in
supplying services.
(5) 
TRADE POLICY AND TRADING
PARTNERS
24. Haiti's trade policy underlines its
attachment to the multilateral trading system.Haiti WT/TPR/S/99
Page xi
Moreover, Haiti is gradually becoming
integrated in the economic groups within its
region in order to increase its trade flows and
enhance cooperation in areas such as health,
education and the prevention of natural
disasters.
25. Haiti has implemented reforms that
have greatly liberalized its economy and made
it one of the most open in Latin America and
the Caribbean.  Nevertheless, the
implementation of the structural component ofthe reforms has not followed and this has had
a negative impact on the economy's
performance because the majority of State
enterprises facing difficulties provide the basic
services needed for production.
26. The priority would currently appear to
be socio-political stability that would allow
Haiti to proceed with its reforms.  Adapting
domestic legislation to the reforms already
implemented, some adjustments in taxation
(import duties and domestic taxes), and
transposing Haiti's former tariff bindings intothe Harmonized System , would improve the
transparency and credibility of its trade
regime and would underline its attachment to
the principles of the WTO.  Improving Haiti's
multilateral commitments on both goods andservices would also help.  Such measures
would create a more favourable environment
for investment and would allow better
distribution of resources so that Haiti could
fully exploit its potential and the opportunitiesopen to it due to its geographical situation
and, as a least-developed country, through the
various regimes giving preferential access to
the markets of developed countries.
27. It is important for the international
community to support the liberalization efforts
made unilaterally by Haiti under difficult
socio-political conditions and to give it all the
assistance needed, particularly in training and
information on the multilateral trading system,
institutional support, legislative reform,
notification, implementation of the WTOAgreements, and multilateral and regional
negotiations.