The International Monetary Fund (IMF) Executive Board has completed its Article IV consultation with Haiti, assessing the country's ongoing challenges and economic outlook. The IMF highlighted Haiti's "unprecedented multidimensional crisis," which includes humanitarian, economic, social, and security issues. These challenges have been exacerbated by a low tax base and reliance on volatile remittance flows.
Since the last consultation in 2019, Haiti has faced numerous setbacks such as the COVID-19 pandemic, a devastating earthquake in 2021, cholera outbreaks, and economic impacts from the war in Ukraine. These events have contributed to a food crisis leading to acute hunger and further destabilized security within the country.
The IMF noted that Haiti's macroeconomic outlook remains challenging with high uncertainty. Growth is projected to be minimal in 2025 at just over 1 percent due to supply-side shocks from ongoing security issues. Fiscal revenues are slowly recovering but remain crucial for rebuilding infrastructure and addressing development needs.
Executive Directors of the IMF recognized "the severity of Haiti's multidimensional crisis" and acknowledged efforts made by Haitian authorities to implement reforms aimed at strengthening economic resilience. They emphasized that improving security is essential for better economic prospects and stressed the importance of international support for reform efforts.
Directors commended Haitian authorities for passing a timely budget and increasing fiscal revenue. They encouraged further advancement in revenue mobilization through implementing a new tax code to broaden the tax base. Efforts were also urged towards enhancing public spending efficiency and transparency while maintaining debt sustainability by avoiding non-concessional lending.
Additionally, Directors called for continued monetary policy efforts to maintain price stability, highlighting vulnerabilities in the banking sector from non-performing loans. They stressed improvements in regulatory frameworks and further strengthening of anti-money laundering measures.
Progress on structural reforms was deemed critical by Directors to enhance potential growth. They welcomed initiatives on governance improvement, digitalization leverage, natural disaster resilience building, financial inclusion fostering, data adequacy improvement for surveillance purposes, along with ensuring quality monetary data.
Haiti continues facing significant hurdles amid its complex crisis landscape; however, with targeted reforms supported by international collaboration and careful policy implementation under IMF guidance through programs like Staff Monitored Program could potentially stabilize some aspects of this fragile economy moving forward.