Impact Assessment and Support Program for Financial Institutions and Debtor Enterprises of the Financial System Victims of the Socio-Political Crisis
Summary — This document analyzes the impact of Haiti's socio-political crisis on financial institutions and their debtor enterprises from 2018-2024. It proposes support mechanisms to help these entities recover post-crisis.
Key Findings
- Haiti's real GDP has recorded only negative growth rates since 2019 due to persistent socio-political crisis.
- Most commercial banks and non-bank financial institutions have been victims of pillaging and vandalism, with some having entire safes stolen.
- The financial sector has experienced significant deterioration in loan portfolio quality across all institution types.
- Business operations have been severely disrupted with reduced operating hours, limited operational areas, and increased security costs.
- The crisis has led to widespread displacement of population and emigration of Haitian professionals.
Full Description
This comprehensive evaluation examines the devastating impact of Haiti's ongoing socio-political crisis on the financial sector and debtor enterprises from 2018 to 2024. The crisis, characterized by widespread gang violence, 'peyi lòk' lockdowns, and severe security deterioration, has severely disrupted the business environment and financial system operations.
The document reveals that Haiti's real GDP has recorded only negative growth rates since 2019, while inflation and exchange rates reached their highest levels in over twenty years. The financial sector has been particularly affected, with most commercial banks and non-bank financial institutions experiencing pillaging and vandalism, including theft of entire safes from branch offices.
The analysis covers three main categories of financial institutions: banks and non-bank credit establishments, credit and savings cooperatives (CEC), and non-mutualist microfinance institutions (IMF). It examines the sectoral distribution of affected loans, the operational challenges faced by debtor enterprises, and the overall deterioration in loan portfolio quality across all institution types.
Based on these findings, the document proposes comprehensive support mechanisms including recovery and recapitalization funds, specific support for regulated CECs, and other assistance mechanisms for affected individuals and entities. The report emphasizes the need for coordinated efforts with stakeholders to calibrate optimal fund sizes and establish operational frameworks for implementation.