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Virtually ignored by the international media, the massive protests against Haitian President Jovenel Moïse are closely related to the crisis in Venezuela , where the Bolivarian governments of Hugo Chávez and Nicolás Maduro subsidized the island’s oil imports during a decade, in an effort to support its development and strengthen their relations.
Last week, the turmoil resulted in the brief detention of five American and two Serbian mercenaries by the Haitian police in Port-au-Prince , highlighting the interventionist strategy decided behind closed doors to maintain the unpopular Moïse in power, yet the roots of the unrest go far beyond.
As the journalist and political commentator Ariel Fornari has explained, Haiti and Nicaragua joined in 2007 Petrocaribe , a cooperation instrument established two years before by Caracas and 14 neighboring countries that allowed governments to pay only 60% of the oil shipments they purchase from Venezuela .
The remaining 40% could be financed over 25 years at 1% interest , as long as oil prices stayed above USD $40 per barrel , said the Dominican Republic-based Fornari.
As of 2017 , Petrocaribe accounted for 40% of the total oil imports from its 18 members (plus Venezuela), or 301 millions of barrels of oil which represented USD $16 billion in revenues for the South American nation until that year.
According to official sources, Venezuela also received in compensation as of 2013 nearly 1.410,000 tons of basic foods and textile products , along with 62,000 heads of cattle .
Earlier, Mexico , Venezuela , and 11 countries —including future beneficiaries of Petrocaribe —signed the San Jose Pact in 1980 to provide oil to Central America and the Caribbean at low-interest payments over extended time periods.
Under its terms, Mexico and Venezuela supplied up to 130,000 barrels of oil a day ( bopd ) to each country, “in accordance with net requirements and subject to periodic evaluation.”
A portion of the payments was financed by the Venezuela Investment Fund ; Venezuelan loans were made at 8% interest annually up to five years and at 6% interest over 12 years .
It should be stressed that the San Jose Pact was created in a context of regional destabilization due to the civil wars in El Salvador , Guatemala , and Colombia , as well as the military and economic blockade i mposed by the United States against Nicaragua .
However, successive conservative governments in Mexico rejected Chávez’ plans to include Cuba in the scheme, worried about the threat of U.S. sanctions under the Torricelli and Helms-Burton laws .
The San Jose Pact ended in 2008
, amidst the ideological confrontation of Mexican President Felipe Calderón and his Venezuelan counterpart, along with the declining Mexican oil production.
Pétion and Bolivar
The solidarity between Haiti and Venezuela has its roots in the nineteenth century, when the first president of the Republic of Haiti , Alexandre Pétion , gave sanctuary, arms, and men to Simón Bolívar to liberate the territory of future Gran Colombia (present-day Colombia , Ecuador , Panama , Venezuela , and parts of Peru , Guyana , and Brazil ).
In recent history, Chávez denounced the 2004 U.S.-backed coup against President Jean-Bertrand Aristide and fully forgave the Haitian debt after the earthquake that killed about 200,000 people in 2010 .
The western side of the Hispaniola island received in total USD $4 billion in subsidized oil through Petrocaribe .
The 2015 oil glut , nevertheless, dealt a blow to the Venezuelan economy, which the following year later only managed to export to its Caribbean partners 28,100 bopd compared with 121,000 bopd during the boom of high prices in 2012 .
Facing a new energy crisis in 2017 , Haiti released a Senate report on Petrocaribe funds stressing that at least 14 officials in the former President Michel Martelly’s administration had stolen millions of dollars supposedly meant to trigger social development in the country, where 60% of people live below the poverty line .
Scott T. Patrick
, a Washington D.C.-based expert on the matter, has detailed in his research that Haiti had to resort to the International Monetary Fund ( IMF ) for USD $96 million in loans and grants needed to pay its fuel imports at market prices to U.S. companies such as Novum Energy .
In return, the government announced a price hike of 38% for gasoline , 47% for diesel , and 51% for kerosene .
Riots erupted on July 2018
, leading to the resignation of Prime Minister Guy Lafontant , days after he suspended the unpopular measure.
However, prices have doubled for food , gas , and other basic goods while more than seven people died during demonstrations demanding the resignation of Moïse last week.
Jean-Henry Ceant
, the new Prime Minister , vowed to investigate the embezzlement of USD $3.8 billion of Petrocaribe funds and said he has requested that a court audit all state-owned enterprises.
The government , Ceant added, would boost revenue cutting certain expenses by 30% , yet many Haitians remained wary of those promises.
The IMF still supports the gradual rise of fuel prices , arguing that public subsidies unfairly privileged the citizens of the neighboring Dominican Republic, who cross the border in search of cheaper fuel prices.
For its part, a World Bank report said that the richest 20% of Haitians were receiving 93% of the subsidies.
As Patrick noted, “so even though ordinary Haitian did not waste or steal the Petrocaribe money; did not bring cholera to the island; did not ask for the earthquakes that have devastated the country… the IMF in its wisdom made them suffer by eliminating fuel subsidies.”
Editing by Sofía Danis
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