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Article Excerpt
DOING BUSINESS IN OR WITH HAITI: The U.S. Dept. of Commerce has produced a 62-page Country Commercial Guide which offers helpful information on doing business in or with Haiti. Excerpts follow. If you wish to read the complete report, Email me (kalwagenheim@cs.com) and I will Email it to you as a file attachment:
Market Overview: There are few government controls or subsidies. More than 70% of market goods in Haiti are imported through the two major ports, Port-au-Prince and Cap Haitien. Haiti is the poorest country in the Western Hemisphere. Per capita GDP is estimated around US$400.
Market Challenges: Insecurity threatens both capital investments and productivity. Port equipment is in poor condition, and the port fees are the most expensive in the Caribbean. Transportation infrastructure is limited and deteriorating. Provision of electricity is sporadic. Widespread corruption is a constant challenge to doing business in Haiti; investors face significant challenges dealing with officials and government bureaucrats who have grown accustomed to bribes as a way of doing business.
Using an Agent or Distributor: Many foreign firms do business in Haiti through agents. Under Haitian law, two parties are free to negotiate a contractual agreement. Typically, through negotiation, agents are given specific tasks and duties. Agents are almost always compensated on a commission basis, as opposed to a salary system or other compensation packages. Arrangements made with agents are established at the discretion of the two parties and require neither Haitian government supervision nor approval.
Franchising: Franchising exists in Haiti, but there are no specific regulatory laws. The government allows any private citizen to enter into a franchising agreement and does not require the submission of contractual specifications or technical specifications on machinery and equipment used. American companies with franchisees or affiliated local partners in Haiti include Radio Shack, DHL, Federal Express, United Parcel Service, Culligan Water Technologies, Coca Cola, 7Up, NAPA Auto Parts, Domino's Pizza, and Jerry's Subs and Pizza.
Direct Marketing: Direct marketing is a slowly growing sector in Haiti that has been limited by the poor postal system. However, in the last couple of years, the Haitian postal system has improved. DHL now uses it for transporting goods in rural areas. Growing interest in direct marketing has also spurred the establishment of several new companies such as Mail & More, First Class Service and expanded the market for others such as Lynx Air and Haiti Messenger. Some Haitian entrepreneurs have had modest success doing direct marketing through companies such as Amway. These companies market selected products like cosmetics and beauty supplies.
Distribution and Sales Channels: Because Haiti's manufacturing capacity is focused primarily on textiles and apparel for the export market, market prospects for manufactured imports are relatively good. U.S. companies have several options for entering the Haitian market, including direct exporting, franchising, licensing, and wholesaling.
Selling Factors/Techniques: Because the Haitian commercial code does not allow foreigners to engage in wholesale or retail business without first obtaining a professional license, U.S. companies commonly use an official representative or distributor to enter the Haitian market. Such agents or representatives typically work in Port-au-Prince and distribute products throughout the country.
Electronic Commerce: E-commerce is growing sector in Haiti that has been constrained by the poor postal system and limited Internet infrastructure. However, in the last couple of years, the Haitian postal system has improved. Interest in and infrastructure for the Internet has also been growing in Haiti. Haiti's principal cellular companies, Comcel and HaiTel, have been highly successful with wireless Internet services and have helped expand interest in developing them further. Several new Internet service providers have entered the Haitian ISP market and are now providing cellular Internet service. Additionally, the telecommunications environment in Haiti has caused TELECO, the state-owned telephony utility, to expand its services to offer cellular and Internet service. However, the e-commerce revolution is not confined to mail delivery services and telephone and Internet service providers. Companies are investing in local e-commerce infrastructure to expand their marketing efforts. Three Haitian automobile dealers are now direct marketing vehicles from their website. A new Haitian e-mail platform called click expresshaiti.com, allows members to buy products from Haiti online. Thanks to the Haitian community in Miami, Haiti Messenger is expending online service in Haiti.
Trade Promotion and Advertising: Because the literacy rate is approximately 50%, advertising is done primarily through radio. There are 50 AM and FM radio stations in Haiti. Ten radio stations broadcast nationwide. Some advertising is done through daily newspapers such as 'Le Nouvelliste'.
Due Diligence: U.S. firms interested in doing business in Haiti should quickly answer trade opportunities and market research published on U.S. Department of Commerce websites using e-mail addresses of Haitian buyers. The best way for U.S. firms to contact Haitian firms is through the Internet since fax and telephone communication is unreliable due to frequent disruptions. Most people in the business sector have at least one e-mail address.
Local Professional Services: There are a number of business and industry associations in Haiti that offer channels to finding a business partner. Details: Haitian guide to investment--Haitian Embassy Washington, D.C. http://www.haiti.org/ usiness&opportunity/bus_guide_investing.htm
Apparel
Exports in the Apparel Articles and Accessories sector reached US$404 million in 2005, an increase of 22.8% over 2004.Most Haitian firms in the textile and apparel sector work as contractors for U.S. firms. U.S. exports to support this sector come in the form of raw materials and equipment. Typically, Haitian firms in the apparel sector work as contractors for U.S. firms. U.S. firms export raw materials and equipment to support assembly, and Haitian firms provide labor on a contractual basis. Private sector advocates in Haiti contend that preferential trade legislation currently being considered in the U.S. Congress could significantly boost the performance of this sector.
Architecture, Construction and Engineering Services
The building construction sector has always been one of the most important sectors in Haiti. There is a market for low cost housing that ranges in price from US$20,000 to US$40,000 per unit. Construction materials are produced locally and imported. Sand, cement blocks, bricks, gravel, mosaic flooring, some steel and some ceramics are produced locally. The largest single building product imported by Haiti is cement, which is imported at an estimated rate of 1,050,000 tons a year. Steel is imported from Europe...
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