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Haiti: Relief and Reconstruction

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Op-Ed: Haiti's Fight for Transparency Print
Friday, 04 May 2012 10:52

CEPR Researcher Jake Johnston wrote in the Caribbean Journal yesterday:

In the aftermath of the earthquake in Haiti, donors pledged billions of dollars for reconstruction efforts. With those dollars was a commitment to “build back better”; this time was supposed to be different from previous big aid campaigns. But so far less than half of donor pledges have been disbursed, and it has become clear that “building back better” remains nothing more than a slogan. While there clearly have been successes in Haiti since the earthquake and the hard work of thousands of aid workers shouldn’t be discounted, nearly half-a-million remain homeless and hundreds of thousands more are living in desperate conditions. With a visible lack of results and little hard data with which to assess progress, one question naturally arises: “where did the money go?” At the Center for Economic and Policy Research and together with many other organizations, we’ve been trying to track where exactly the money that did get spent, went. It hasn’t been easy. 

To be sure, aid projects shouldn’t be judged solely on what percent of an aid budget went to overhead, or how much went to American consultants or was spent on American products as opposed to Haitian consultants and products. Ideally, the effectiveness of projects should be based on their outcomes, not just on the breakdown of how funds are spent. But measuring outcomes often isn’t feasible. A nominally independent review of the U.S. government’s response in Haiti attempted to measure the quality and impact of aid, but “a disquieting lack of data on baselines against which to measure progress or even impact” prevented them from doing so.

As taxpayers, we have the right to know how our tax dollars are being used and if they are used effectively.  Specifically, this means looking at the United States Agency for International Development (USAID), which has spent well over a billion dollars in Haiti since 2010.  To their credit, it’s not difficult to obtain the first level of transparency: to which organizations USAID gave funds.  USAID factsheets reveal that close to 100 percent of humanitarian funds for Haiti were channeled through NGOs, U.N. agencies or right back to other U.S. government agencies. Included in this billion-plus dollars hundreds of millions of dollars in contracts which have gone overwhelmingly to “beltway bandits” -- firms located in D.C., Maryland or Virginia. Only 0.02% by our latest tally has gone to Haitian firms.

But this isn’t the end of the line when it comes to transparency.  Once funds are given to an organization, what are they spent on? What were they meant to achieve? How much goes back to the U.S. and how much goes to local firms? In a meeting last October in Port-au-Prince a USAID official defended the awarding of contracts to so-called “beltway bandits”, telling me that while certainly some money goes off the top for their profits, much gets spent in country or is given to local subcontractors. It was a back-of-the-envelope calculation, but he estimated that each international worker sent to Haiti could cost up to $250,000 a year.  The important part, he stressed, was that this money would be spent in Haiti on electricity, security, housing, etc. “He has to live here, eat here, dance here, whatever,” the official reasoned.
Read the rest here.
 
Lack of Data Prevents Measurement of Aid Effectiveness, Impact Print
Wednesday, 02 May 2012 12:39

Yesterday, Vijaya Ramachandran and Julie Walz of the Center for Global Development provided a nice overview of the U.S government’s review of its Haiti earthquake response. Ramachandran and Walz found that while the review includes “some frank and enlightening assessments of USG [U.S. government] response and coordination” it contained “very little discussion of aid accountability.”

As Ramachandran and Walz point out, the authors of the review couldn’t determine the effectiveness or impact of aid because of a “disquieting lack of data.” Part of the problem seems to stem from how data collection and management is viewed by aid workers and USG employees, who made up the vast majority of sources for the review. The report states:

During the Haiti response, limitations related to information management followed two major lines. First, there were limited data available for tactical and operational decisions; and second, there were overwhelming requests for data and information from policy leaders in Washington that made systematic data collection more difficult. These demands were often driven by reports in the media.

Thankfully, the authors note that at least “some” of those they interviewed understood that the former led to the latter: limited availability of data was what generated the “overwhelming” number of requests. Others told the authors that requests for information “detracted from the on-ground response” as they were forced to “’chase down’ facts.”

Of course, data is important to the on-the-ground response as well, as the report points out:

Data collection, through surveys and assessments, is an essential component for managing a disaster response. Surveys and assessments are used to identify the needs of the affected population to direct the response. Ideally, these types of data can be used to measure the overall impact of the humanitarian response.
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A Review of the U.S. Government’s Review of Its Haiti Quake Response Print
Tuesday, 01 May 2012 11:14

This guest post is cross-posted from the Center for Global Development.

By Vijaya Ramachandran and Julie Walz

Last week, USAID finally published an evaluation report on its activities in Haiti: “Independent Review of the U.S. Government Response to the Haiti Earthquake”.  The report is dated March 28, 2011. Yes, 2011. It took over a year to post the document on the USAID website.  The review was conducted by MacFadden and Associates – which operates an $80M Indefinite Quantity Contract from USAID.  There are some frank and enlightening assessments of USG response and coordination, but very little discussion of aid accountability.

Here are some impressions of the report:

Let’s start with the good.

Strengthen USAID. The report very clearly calls for a strengthening USAID: improved institutional structures, more staff and capacity, investments in new technology, and a reduction in reliance on outside contractors.  It is a call that has been made many times before, as USAID has evolved from a development implementer into an organization that manages contractors and grantees.  For example, USAID’s direct-hire workforce has decreased from around 8600 in 1962 to 2900 in 2009, despite an increase in foreign assistance. The report says that USAID’s weaknesses were especially apparent because the President appointed USAID as the lead agency in the USG Haiti response.

Nix the “whole of government” approach in disaster response. The report recommends that a “whole of government” approach should not be used in future international disaster response.  It is a concern that our colleague Todd Moss has previously discussed.  Although the idea of having all federal agencies at the table seems logical, it also creates parallel chains of command and further constrains the USG’s ability to get things done.  This is especially true in a disaster situation where rapid response is needed.  After the quake, more than 12 federal agencies sent staff to Haiti.  This created problems in terms of clear lines of authority, with specific reporting structures and delineated functions between agencies.

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Donor Disbursements Slowing According to Latest Data from Special Envoy Print
Wednesday, 25 April 2012 13:42

The Office of the Special Envoy for Haiti released updated data this week on public sector donor disbursements since the earthquake in Haiti. The Special Envoy has been instrumental in holding donors accountable for pledges they made at the March 2010 New York donor’s conference. For the period 2010-2012, 55 public sector donors pledged $5.48 billion dollars with $2.48 billion, or 45.3 percent being disbursed so far. This represents an increase of $96 million since the last update in December 2011, the smallest such increase since the Special Envoy has been tracking donor disbursements.

Overall, the $2.48 billion has been disbursed through four main channels:

-          $1.65 billion (66.6 percent) in grants to multilateral agencies, NGOs and private contractors
-          $337.2 million (13.6 percent) in budget support to the Government of Haiti
-          $295.6 million (11.9 percent) to the World Bank, IDB and UN through the Haiti Reconstruction Fund (HRF)
-          $196.9 million (7.9 percent) in loans to the Government of Haiti

The vast majority of these funds were disbursed in 2010. According to the Special Envoy (PDF), $1.61 billion was disbursed in 2010, $843.1 million in 2011 and just $27.8 million thus far in 2012.  An important qualifier is that disbursed does not mean spent. For example, of the $295.6 million that has gone to the HRF, only $55.7 million has been spent on the ground.

As can be seen in Figure 1, many of the top donors have failed to live up to their pledges (PDF).

Figure 1.

alt

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Haiti Using Funds from PetroCaribe to Finance Reconstruction Print
Tuesday, 17 April 2012 12:17

"The cooperation with Venezuela is the most important in Haiti right now in terms of impact, direct impact," President Martelly told the Associated Press in December. The most important channel for this cooperation is the PetroCaribe agreement, which most Caribbean countries are currently a part of and which the government of René Préval joined in 2006. Through the agreement Venezuela finances part of Haiti’s fuel import bill, allowing for a portion to be paid up front and the remainder to be used as a loan with a long maturity and low rates. The funds made available through PetroCaribe are, as the International Monetary Fund (IMF) explains, “under the control of the central government”. This makes PetroCaribe assistance drastically different from aid provided by traditional donors, which by and large bypasses the government. In fact, traditional budget support to the Haitian state was lower last year than the year before the earthquake.

Over the duration of the agreement, which began in 2008, Venezuela has provided nearly $1.9 billion (PDF) in petroleum products, with over $800 million being paid up front. Following the earthquake, Venezuela cancelled some $400 million of PetroCaribe debt, yet with large disbursements since the earthquake Haiti still owes some $580 million. While significant resources have already been spent, Haiti maintains a balance of $350 million in PetroCaribe funds.

The government of Haiti has predictably turned to one of its only pools of un-restricted funds to finance reconstruction and development programs. The IMF notes that the GOH has “committed to only use PetroCaribe resources to finance growth-enhancing investment projects.” The spending with PetroCaribe funds represents a significant portion of capital spending undertaken by the central government. In the latest IMF review of Haiti’s economy, the IMF estimates that PetroCaribe funds will account for nearly half of domestically-financed capital spending in 2012, amounting to 4.7 percent of GDP. While foreign financed capital spending still overshadows this (it is projected to be 14.9 percent of GDP in 2012), the PetroCaribe funds are unique in that they are directly under the control of the government.

The reconstruction projects financed with PetroCaribe funds have come under scrutiny recently as allegations emerged that Martelly received some $2.5 million in kickbacks related to contracts awarded by the Haitian government. Yet it is also true that the PetroCaribe funds represent some of the largest infrastructure related investments in Haiti since the earthquake. Overall, $380 million has been awarded to firms for infrastructure-related work (PDF) and the most recent data shows that over 73 percent has already been spent. For comparison, the Government Accountability Office found in November that of $412 million in infrastructure projects approved by USAID, only 0.8 percent had been disbursed. It is no wonder then that Martelly told the AP that Venezuela aid stacked up favorably with US assistance, which often takes more time:

"Sometimes for a simple project, it might take too long for the project to happen," he said. "If you're asking me which one flows better, which one is easier, I'll tell you Venezuela."

Amazingly, despite the clear benefits of the PetroCaribe agreement for Haiti, a steady supply of oil, concessional financing, unrestricted funds, it almost never happened.

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Haiti Reconstruction Fund: Building Back …When? Print
Thursday, 12 April 2012 16:24

The Haiti Reconstruction Fund (HRF) was a center piece of the international community’s pledge to “build back better”, yet its latest financial report reveals that despite receiving a significant share of donor disbursements, very little has thus far been spent on the ground. Additionally, without the Interim Haiti Recovery Commission (IHRC), unallocated resources from the HRF remain unutilized, collecting interest in bank accounts.

The HRF, established in March 2010, aims to coordinate and fund priority projects for Haiti’s reconstruction. The Fund has received 18 percent of all donor disbursements as of December 2011 and describes itself as the “largest source of unprogrammed funding for the reconstruction of Haiti”. The HRF allocates funding to projects that have been approved by the now defunct IHRC.

According to its February 2012 financial report, the HRF has received $377 million from donors, allocating $274 million (73 percent) to 16 projects. When the HRF allocates money for a project, the funds are transferred to a “partner entity”; either the UN, World Bank or Inter-American Development Bank, which then carries out the project. The financial report shows that while the Fund has transferred a large amount of resources, the partner entities have disbursed very little of it on the ground.

Figure 1 (click to enlarge)

haiti-recon-fund-4-2012

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USAID's Disclosure of Local Partner Info Raises Troubling Questions Print
Friday, 30 March 2012 16:27

Following a request from HRRW, USAID yesterday released information on the amount of relief and reconstruction funds that have gone to local partners in Haiti. The info, available here, is a positive step towards transparency and provides the only official information on the level of local contracting by USAID in Haiti. As can be seen in figure 1, about $9.5 million has gone to local organizations and firms since the earthquake. An additional $18.3 million has been awarded to Haitian-American firms, according to USAID data.

Figure I

Firm Name Sector Amount
GHESKIO
Health
 $       3,589,938
St. Damien Hospital
Health
 $       1,081,000
Hopital Adventiste d'Haiti
Health
 $         990,000
La Fondation Héritage pour Haïti (Transparency International)
Non-Profit
 $         800,000
Mérové-Pierre - Cabinet d'Experts-Comptables (MPA)
Auditing
 $         740,208
L'Hôpital de la Communauté Haïtienne
Health
 $         400,000
Hopital l'Ofatma
Health
 $         400,000
Experts Conseils & Associates
Auditing
 $         393,890
Jurimedia
Non-Profit
 $         300,000
Inter-American Institute for Cooperation on Agriculture
Non-Profit
 $         250,000
The American Chamber of Commerce in Haiti
Non-Profit
 $         238,420
PAGS Cabinet d'Experts-Comptables
Auditing
 $         145,000
ECCOMAR
Construction
 $           63,000
National Transport Service (Natrans)
Transportation
 $           60,000
TOTAL
TOTAL

 $      9,451,45

Source: USAID

Although ascertaining the total spending by USAID in Haiti since the earthquake is not an easy feat, the $9.5 million that has gone to local firms represents a small fraction of total spending by USAID. In fiscal years 2010 and 2011, USAID reported spending over $700 million on humanitarian programs (not counting funding through USAID/OTI, which is included in Figure II). Additionally, the most recent data compiled by HRRW reveals nearly $400 million in contracts that have been awarded since the earthquake. As can be seen in figure II, only 0.02 percent of these contracts have gone directly to local firms, while over 75 percent have gone to firms located in the Beltway (DC, Maryland, Virginia). The largest of these beltway contractors is Chemonics International, which has received $173.7 million from USAID since the earthquake. The company came under criticism in recent weeks regarding the temporary parliament building that was constructed under a Chemonics contract. Haitian lawmakers told GlobalPost that the building was nothing more than a “shell”, and that it would cost the government as much to finish it as USAID had spent on building it. The building remains vacant four months after it was inaugurated by USAID and Haitian officials.

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More People at Risk Due to Red Tape, Under-funding of Emergency Relief Print
Wednesday, 28 March 2012 14:13

The rainy season is returning to Haiti, and so is an expected increase in cholera infections. There have been as many deaths – 13 –  in the last eight reported days as there were in all of January or February this year. Yet red tape and funding shortfalls are hampering prevention and treatment efforts.

NPR health correspondent Richard Knox presented a lengthy report yesterday on a cholera vaccination program that has yet to be implemented, despite consensus from the Haitian government, the World Health Organization, the Pan American Health Organization, and the CDC that it could be effective. The program, which will provide vaccines to some 100,000 people, is now awaiting the conclusions of a national ethics committee, “which wants assurance that the vaccine is no longer considered experimental.” The organizations administering the program, Partners in Health and GHESKIO, had hoped to get it underway in January.

Knox reports:

Meanwhile, the spring rains are beginning. Cholera cases are starting to climb, because the floods spread the cholera bacterium around.

"We know it's going to rain, we know it's going to flood," says Dr. Vanessa Rouzier, "so we are afraid we are wasting precious time."

Rouzier works with GHESKIO, a Haitian medical group that is organizing the vaccination project in Port-au-Prince, Haiti's capital. The rural arm is sponsored by Partners in Health in the Artibonite River valley, where cholera first appeared.

The two groups have been planning the demonstration project for more than a year.

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Will the Red Cross Put Shelter for Paying Tourists and Aid Workers Before IDP's? Print
Tuesday, 27 March 2012 16:12

A new report by AP investigative reporter Martha Mendoza and Haiti correspondent Trenton Daniel sheds light on the Red Cross' plans to possibly build a hotel on the 10 acres of land near the Toussaint L’Ouverture airport that it uses for its base camp.

The article reports:

The International Federation of Red Cross and Red Crescent Societies is considering building a hotel and conference center in Haiti on part of a $10.5 million property that it bought after the 2010 earthquake.

The hope is that profits could sustain the work of Haiti's local Red Cross in the coming years, the head of the international group's Haitian delegation said Monday.

The 10-acre compound, known as the "Hilton Property," was purchased from Comme Il Faut, Haiti's local cigarette company, in the months after the quake, Eduard Tschan told The Associated Press in a telephone interview.

The charity paid in a single payment, using funds donated by national Red Cross agencies for quake recovery. At the time, Haiti's recovery was the largest operation in the organization's history, with 3,000 people working here.

Now that its work is winding down, the international Red Cross is putting together an exit strategy and as part of that process is trying to figure out what to do with this property.

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Kolbe: Political and Social Marginalization Behind Increases in Crime Print
Thursday, 22 March 2012 10:08

In early March, social scientists Athena Kolbe and Robert Muggah released a study, backed by Canada’s International Development Research Centre and the Igarapé Institute of Brazil, showing increasing crime rates in the capital of Port-au-Prince. Based on household surveys, the authors found that “[f]or the first time since 2007, the incidence of violent crime and victimization has shown a consistent increase”. While the homicide rate in Haiti’s capital is lower than in many other Caribbean cities, the authors note the current rate in Haiti makes it one of the highest recorded rates since the post-coup period of 2004. At the same time, the authors found a reversal in citizens’ support for the Haitian National Police.

In an interview with HRRW, Kolbe, a clinical social worker affiliated with the University of Michigan, explains the social context of the current study and explores some of the causes and implications of the results. Kolbe finds that most of the victims of violence and criminal activities were residents of low-income neighborhoods where the population has experienced “social and political marginalization.” The ending of aid programs has also had a “profound impact on the people who need the services the most.” Kolbe notes that the bypassing of the Haitian government by NGOs and donor governments has created a situation where these entities and not the Haitian state “provide basic social and municipal services.” With a government that cannot guarantee its citizens access to services, Kolbe notes that “simply increasing the number of police on the street isn’t going to solve Haiti’s crime problem.” What is needed is to “focus efforts on improving the conditions in society that create the climate where crime is a viable option.”

Read more for the full interview:

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