While Haiti is returning to calm after the government reversed a sharp hike in fuel prices that triggered days of violent civil unrest, the International Monetary Fund is not backing down from its insistence that Haiti needs to raise prices.
The Washington-based IMF, which helps countries stabilize their finances, said Thursday that the Haitian government’s current below-market fuel prices “disproportionately benefit the well-off” and prevent spending on badly needed social programs.
“Generalized fuel subsidies put a significant strain on Haiti’s fiscal accounts,” IMF spokesman Gerry Rice said during a briefing.
Earlier this year, Haiti signed a six-month, staff-monitored agreement with the IMF that would have given Haiti access to $96 million in low-interest loans and grants from the Inter-American Development Bank, World Bank and European Union, initially. The country is facing double-digit inflation, a depreciating currency and slow growth. It also has a budget deficit of more than $150 million.