My neighbors are blasting Ed Sheeran’s Perfect. Our bedroom windows are only feet apart and in the two months I’ve been here, the neighbor’s musical tastes have gone from their native Haitian tunes to mimicking the pop US songs I play. It’s just a little bit of home and because their speakers are much louder than my laptop’s, our whole compound can hear those sweet acoustic melodies. The situation in Haiti however is far from perfect. For the past four weeks, there has been a fuel shortage. I would now categorize it as a fuel crisis. Major western media outlets are just starting to report it. The past week there was a nationwide strike – schools, government facilities, and businesses were shutdown. Organized protests and riots occurred. Not knowing some of the history, I first thought fuel was hard to come by because Hurricane Dorian was rolling through. We filled a couple five-gallon gas tanks for our generator and got another 10 gallons of diesel for our vehicles. Dorian rolled through over a week before it hit the US, and for a few days it looked like everything would return to normal. Gas was being rationed at the pumps and there were lines, but everyone could get a little bit of gas. I did notice that traffic jams, or blokis, were much less frequent, but the country’s situation was about to get a whole lot worse.

So, gas stations in Haiti are a bit different than in the US.  First, like the states of New Jersey and Oregon, gas is pumped by an attendant.  This obviously makes things a little more challenging for a non-fluent Creole speaker such as myself, but if I tell them to “Pale dousman,” or speak slowly, this usually helps.  Second, and more important economically, prices are the same throughout the country at every station.  There is no shopping around for the best prices at the local Costco, Shell, 7-11, or Wawa.  There are different branded stations, but the government sets the price.  The price of a gallon of gas has been set at the equivalent of about $2 for over a year.  (The price is actually in the local currency, Haitian Gourde which is in fact very volatile.)

PetroCaribe

The process of getting gas to the pumps on this tropical island involve the Haitian government, or the Bureau of Monetization of Programs and Development Aid (BMPAD), buying gas from importers and then selling the gas to five distributors.  These distributors then deliver gas to the stations.  In 2005, then Venezuelan President Hugo Chávez instituted Petrocaribe, an oil program that provides oil to 17 countries in Central America, South America, and the Caribbean.  Countries pay up to 50% of the price of the oil within 3 years of receiving it and then pay the remainder over the next 17-25 years at 1% interest.  The benefit to poor countries is that it allows them to invest the savings into further economic development while allowing Venezuela greater influence in the Americas.  Unfortunately, in places like Haiti, this savings appears to be funneling into corrupt officials’ pockets.

Before the 2010 earthquake that devastated Haiti, they had amassed $396 million in Petrocaribe debt.  Venezuela, in an effort to help, forgave Haiti the debt.  By November 2017, Haiti had accumulated $2 billion in new Petrocaribe debt.  In 2018, Petrocaribe’s agreement with Haiti fell apart due to late payments and Venezuela’s own declining economy.  Haiti turned to other avenues to provide fuel and signed with Novum Energy in Houston.  BMPAD has once again been increasing its debt to a fuel provider and now Novum requires cash on delivery and payment plans before they will dock their ships.  Sometimes the ships sit out in the bay for days waiting to be paid.  Haiti’s new fuel debt in the past year, post-Petrocaribe, is about $130 million.

Attempted Fuel Price Hikes

Unfortunately, the price that BMPAD is paying for the fuel is actually higher than it is being sold to customers at the pumps.  Obviously, this is not sustainable.  In July of 2018 the Haitian Prime Minister, Jack Guy Lafountant, resigned after days of riots due to planned fuel price hikes.  The government backed down and the prices stayed fixed.  Since Lafountant resigned, there have been 3 more Prime Ministers in less than a year.  The top position has been a revolving door with votes of no-confidence ushering the newest officials out of office as quickly as they have arrived.  Early this year BMPAD attempted to raise the price per gallon about $0.85 from the current rate.  Again, protests and riots ensued and the prices stayed the same.

With this being the longest fuel shortage, I think the Haitian people would accept a price increase if they had stability in knowing gas would be available.  Or maybe Haiti could go to a free market system that allowed the distributors to buy directly from importers and gas stations could set their own price with some regulation.  There are multiple solutions to be had, but the status quo clearly isn’t working.