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FOR IMMEDIATE RELEASE
April 7, 2010
5:10 PM

CONTACT: CEPR

Dan Beeton, 202-239-1460

International Community Can Boost Haiti's Self-Sufficiency by "Buying Local" Rice

Purchasing Entire Haitian Rice Crop Would Cost Aid Donors Just Over 2 Percent of Total Committed Funds

WASHINGTON - April 7 - The international community could, in the words of former President Bill Clinton, help Haiti "become more self-sufficient" by purchasing the entire Haitian rice crop over the next two years for just 2.35 percent of total current committed aid funds. A new issue brief from the Center for Economic and Policy Research (CEPR) finds that buying up all of Haiti's rice should be close to the amount of food aid for rice that the international community is likely to provide this year, and would provide a tremendous boost to Haitian farmers, who currently are unable to compete with low-cost rice imports from the U.S.

"The international donors have said that they do not want to repeat the mistakes of the past, which have destroyed much of Haiti's agriculture," said Mark Weisbrot, economist and CEPR Co-Director, and lead author of the paper, "Using Food Aid to Support, Not Harm, Haitian Agriculture". "It would be very easy and inexpensive for them to keep this promise. Now we will see if they mean it."

There has been a growing recognition that past food aid to Haiti has had a significant negative impact on local food production and contributed to the sharp decline of Haiti's rice sector. Last month, Bill Clinton told the Senate Foreign Relations Committee that exporting cheap rice to Haiti "was a mistake ... I had to live everyday with the consequences of the loss of capacity to produce a rice crop in Haiti to feed those people because of what I did."

The paper notes that while there is much that can and should be done to support Haitian agriculture and the rebuilding of the economy, it is most important to immediately reduce the harm caused by imported, subsidized rice. The authors propose that this can be done by having the international community immediately commit to buying Haitian rice for the next two years. Since food aid was 13 percent of the total rice supply last year, and Haitian rice production is about 15 percent of total supply, buying up all of Haiti's rice would be close to the amount of food aid for rice that the international community would be expected to provide this year.

The paper also suggests the aid donors buy the rice at a price that is high enough to encourage local production. Even though this would have to be somewhat higher than an average of past years' market prices, the cost would only be between $62.1million and $82.8 million per year. Since international donors have committed $5.3 billion in aid for the next 18 months, or $3.53 billion annually, the cost of buying Haiti's rice crop would be only 1.76 to 2.35 percent of committed international aid funds.

Since there are funds allocated to bringing in a similar amount of rice in any case, the additional cost of buying the Haitian rice crop would actually be considerably less than the high estimate of $82.8 million, or 2.35 percent of committed funds.

On March 25, former President Clinton and UN special envoy to Haiti told representatives of aid groups: "Every time we spend a dollar in Haiti from now on we have to ask ourselves, 'Does this have a long-term return? Are we helping them become more self-sufficient? ... Are we serious about working ourselves out of a job?"

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The Center for Economic and Policy Research (CEPR) was established in 1999 to promote democratic debate on the most important economic and social issues that affect people's lives. In order for citizens to effectively exercise their voices in a democracy, they should be informed about the problems and choices that they face. CEPR is committed to presenting issues in an accurate and understandable manner, so that the public is better prepared to choose among the various policy options.



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