In the last note on Monetary Policy for the 1st quarter of fiscal year 2020 (October-December 2019) the Bank of the Republic of Haiti (BRH) notes that "[...] on the national level, the economy has severely affected by the slowdown in activities during the months of October and November 2019. At the same time, for 65% of the companies surveyed, this situation led to the layoff of 10 to 25% of their workforce. It should also be noted that 35% of the companies questioned indicate that they suffered material damage during the 'peyi lòk' period [...]"

"[...] As of December 31, 2019, the taxes and levies collected by the Haitian state increased by 4.5% compared to the previous quarter, amounting to just over 19.6 billion Gourdes At the same time, spending increased by 37.7% compared to the previous quarter to reach a little over 42.7 billion, which increase particularly reflects a seasonal effect linked to disbursements intended for end-of-year activities.

The slight quarterly increase in government revenues, however, could not compensate for the increase in government spending and consequently, a deterioration in the government's overall net position vis-à-vis the BRH was recorded, materialized by a level of monetary financing of 15.8 billion at December 31, 2019 compared to 5.3 billion in the previous quarter. [...] In terms of assets on the Central Bank’s balance sheet, net claims on the State increased by 22.19% as of December 31, 2019, compared to 8.18% in the previous quarter [...]"

An increase in the deficit of more than 300% over the quarter, despite the economic and financial governance pact signed between the BRH and the Ministry of Finance in November 2019 https://www.haitilibre.com/en/news-29375-haiti-flash-the-state-signs-an-economic-governance-pact-with-the-brh.html aiming to maintain the balance between the expenses and the available resources and to reduce the increase in the needs for financing of the State

One do not yet know the forecasts for the current fiscal year 2019-2020, the budgetary framework is still not available.

Regarding the economic outlook for the next quarter, the BRH explains, "The outlook for the Haitian economy remains mixed. The evolution of the economic situation for the next three months will be highly dependent on the socio-political climate. The negative shocks recorded in the country during the previous quarters still have an impact on the macroeconomic framework. Despite a relative recovery in activity towards the end of the first quarter, a wait-and-see attitude continues to prevail with regard to investment and production decisions; which affects the employment situation and the state’s ability to mobilize resources.

At the same time, the likely rise in international commodity prices, particularly those of petroleum products, could worsen the budgetary imbalance with continued price subsidies at the pump. Nevertheless, the forecasts made by the technical services of the BRH project a relative stabilization of inflation in the second quarter of the 2019-2020 fiscal year insofar as, unlike the previous quarter, the movement of people and goods s 'improved.

A stabilization of the socio-political situation should encourage a more sustained recovery in activity, which could have a positive effect on public finances and a reduction in the government’s funding requirements from the BRH [...]"

Download the complete BRH Note (French PDF) : https://www.haitilibre.com/docs/note_polmon1t20.pdf

See also :

https://www.haitilibre.com/en/news-29375-haiti-flash-the-state-signs-an-economic-governance-pact-with-the-brh.html

HL/ HaitLibre