Archive for: Haiti

When I traveled to Haiti to study savings in 2008, I found very little savings. Poor people saved in modest amounts. Some were depositing in clubs called mutuelles de solidarité or in local rotating savings and credit associations (or ROSCAs).

But after asking around bit, I found that there was significant money in borlettes. Read the rest of this page »

I wanted only silence on January 12. Yesterday was the one year anniversary of a terrible natural disaster that set back an already fragile and weakened nation, Haiti—and one that’s very dear to me. The coverage of the 7.3 magnitude earthquake was clamoring.  In Washington, DC it snowed on the eve of the 12th and the calm, serene, and silent snow seemed fitting to usher in the anniversary of the day that changed Haiti.

Finding the right words to reflect on where Haiti is one year later is hard because of the temptation to either peddle the “bad news” story or to inspire with the “good news” story.  The stark reality is that at the macro level, the news is bad.

There is no real strategic recovery planning to speak of, and consequently even less implementation. And this is true for the Haitian government, the donor community, the Haitian private sector, and the Interim Haiti Reconstruction Commission (IHRC) that was supposed to align all these actors. But equally real are individual—and some institutional—good news stories. Since I work in microfinance, I could simply highlight microfinance institutions, their staff, and their clients as an example of good news, a beacon of light where there is so much failure.  And it would be easy to do. 

On Monday, I attended the moving “Haiti, One Year Later” event in New York organized by Fonkoze, Haiti’s largest microfinance institution. Fonkoze is remarkable.  Its management team stayed and persevered, though many could have left the country and found jobs in the United States. Within one day of the earthquake and before some commercial banks, Fonkoze opened up half of its branches to ensure that clients who had lost everything had access to their savings to buy food and water.  It also continued its already challenging work of targeting the very poor—the destitute—through its program Chemen Lavi Miyo so that they can gain the confidence, life skills, and livelihoods to create their own pathways out of poverty.

And Fonkoze is just one institution in a vibrant microfinance sector in Haiti. Organizations primarily in and around Port-au-Prince like ACME, institutions serving the poor affiliated with commercial banks like Sogesol and Microcredit National (MCN) as well as credit unions assessed the extent of the damage, provided for their staff, reached out to development partners, reconstituted files, and very importantly reached out to find their clients and let them know that they were still standing by them to meet their needs.  In a country with few functioning institutions, the more serious and strong microfinance institutions emerged from the rubble—bruised, with serious fault lines, but standing.

But the fault lines run deep, and the bruises are ugly and raw. The financial hit of losing fixed assets like buildings and equipment and writing-off loans, the difficulty of keeping strong credit discipline with the influx of not-always-so-smart subsidies, the offer of higher salaries to staff by relief organizations and NGOs, and the short attention span of funders for long-term institution building are all real challenges. And these are simply additions to the pre-existing challenges of an imperfect regulatory framework, poor management information systems, high costs due to poor infrastructure, etc., etc.

So, on balance, just focusing narrowly on microfinance—which is of course only one part of Haiti’s development and future—is the news good or bad?  I’m afraid, as I emerge from my silence of the 12th, that my answer is a long and complicated run-on sentence with many clauses, buts, and ifs. It is the reality of clients, staff, and management of microfinance institutions who press on, everyday. It is mourning still on many days. And it is, thankfully, also celebrating on several.

My final words go to the friends of Haiti and Haitian microfinance.  Think long-term, leave egos aside, be patient yet rigorous and exacting, do your homework, listen, be creative, and support steady performance. It’s not glamorous or tragic, and it won’t make the front pages of the newspapers around the world. It’s a long hard slog to building a beloved country: Haiti Cherie.

—- Alexia Latortue

Click here for OXFAM’s latest report,”From Relief to Recovery: Supporting Good Governance in Post-Earthquake Haiti.”

A summary of the World Bank’s work after the earthquake in Haiti can be found here.

Fonkoze started  Chemin Levi Miyo, or Pathway to a Better Life in Haitian Creole, in 2008 to tackle rural Haiti’s extreme poverty in a holistic manner. The program is one of the nine pilots in the CGAP-Ford Foundation Graduation Program, a global effort to understand how safety nets, livelihoods, and microfinance can be sequenced to create pathways for the poorest out of extreme poverty, adapting a methodology developed by BRAC in Bangladesh.

The face of extreme poverty in Haiti is multifaceted, and this reality holds strong for the rural poor in Haiti. Macro-level constraints such as limited access to markets, a dearth of employment opportunities, absence in social safety nets, and virtually no social accountability at the local level contributes to the complexity of Haiti’s deprivation. Fonkoze’s graduation program provides five main areas of support: a cash stipend and provision of productive assets to help build sustainable livelihoods and food security; access to health services and savings to reduce vulnerability, close support of program staff who provide enterprise training, advice, and most important, moral support to help participants build skills, confidence and “agency”; provision of housing renovations, water filters, and school uniforms to improve social conditions;  social links with village elites to help build up social networks for the poorest.

Our final evaluation of the program six months after its end shows that poverty levels of members has reduced, and this is directly attributable to increased ownership of livestock (which went up by from 5% to 39%), improved housing conditions, and greater land cultivation. A very promising result is that the percentage of members suffering from food insecurity with hunger has declined by over 50% since the program start. In addition, health seeking behaviour (going to a health clinic in case of illness) has improved for over 40% of members. The number of participants reporting that all or most of their children are regularly attending school increased from 27% to 70%. In depth qualitative interviews also show that most members gained self-confidence, and say they have greater status within the household.

At the pilot stage, the program has demonstrated significant positive impact upon the lives of its members with 97% per cent of the 150 women that participated “graduating” out of the program. Seventy-five percent of them have continued on into TiKredi, a small loan program. In one site, all of the program members who graduated into TiKredi have already successfully moved on into Fonkoze’s larger loan product. However, things aren’t so bright for those who didn’t move into microcredit: we saw a slight decline in indicators for the 25% of participants who did not join TiKredi since our mid-term evaluation. This could well mean that, in the absence of other options, self-employment is the only real exit gate out of poverty in rural Haitian context.

Although the program’s achievements have been remarkable, the challenge of sustaining improvements is stark. When it scales up the programme, Fonkoze will have to address other challenges such as identifying more sustainable livelihoods for participants; for example, the most viable strategy pursued by many program participants in one site is charcoal production in an already heavily deforested land.  For those who are not ready to integrate into microcredit, finding alternative graduation pathways poses another challenge. Given the intense vulnerability of the population, there is always a demand for Fonkoze to do and provide more. While most graduation programs rely on the government to deliver health, education and welfare benefits, Fonkoze does not have this luxury. One can only hope that the silver lining amidst the tragic earthquake is an opportunity to re-build Haiti and provide the country’s most vulnerable with basic entitlements.

Haiti receives between $1.5-1.8 billion in remittances each year. In the immediate term, it’s vital to ensure that remittance flows to Haiti are not disrupted for people’s very survival.

It’s not often that an account of financial systems and money transfers reads like a tale of derring-do. But Anne Hastings’ account of a middle-of-the-night airlift of cash co-ordinated by the US Department of State to Haitian MFI Fonkoze is a true Hollywood-style action-adventure. Anne details the hour-by-hour progress of ten boxes of cash ($2 million originating from Fonkoze’s accounts in City Bank of New Jersey) as they are transported from JPMorgan Chase in Miami in armoured trucks to a C17 diverted from Langley, Virginia to Homestead Air Force Base, and from there flown to the newly-functioning airport in Port-au-Prince.

Read the rest of this page »

After the devastating earthquake that struck Haiti three days ago, here is what we know from Fonkoze, our Graduation Program partner, implementing Chemen Lavi Miyo in Haiti.

Anne Hastings, director of Fonkoze, wrote to our colleagues at BRAC on Tuesday saying “Am ok but bodies everywhere. Destruction massive. Very little communication gets through even in-country. Headquarters demolished. Need to figure out how to get operational again.” You can read more excerpts from her distressed email on BRAC’s blog.

Gauthier Dieudonné, the program manager for Chemen Lavi Miyo, sent a text message to his colleagues saying he is safe. Fonkoze is also reporting that both Fonkoze and Sèvis Finansye Fonkoze staff in the HQ in Port au Prince are secure. However, the building cannot be used, the wall surrounding the property is demolished, and apparently securing the property is a concern. Fonkoze doesn’t yet know the status of the Port au Prince Branch, the status of other branches, the safety of their staff, families, and borrowers. They also don’t know when they will be able to get more information. You can read their frequent updates on their earthquake news page.

Fonkoze staff in Haiti is establishing an emergency operations center—their “Earthquake Relief and Rehabilitation Fund” is soliciting donations. In addition Fonkoze suggests that anyone interested in going to Haiti as a volunteer or that has assets that “would be usable in Haiti,” describe their skills or assets here. Fonkoze’s Haiti staff will determine what is needed and match the needs with the offer.

The popular Huffington Post recently published an article by BRAC USA’s CEO, Susan Davis, focused on the Graduation Pilot in Haiti. Susan explains how the “Chemen Lavi Miyo” program is “creating hope and opportunity in Haiti for extremely poor women and their families”.

I posted a link to the film that CGAP just produced on Fonkoze’s “Chemen Lavi Miyo” program, because I think its shows this hope and opportunity in a very tangible way.

At the end of the pilot Fonkoze identified three absolute criteria to qualify for graduation, and several general criteria.

There is probably no need to convince any reader of this blog that microcredit can be useful for those with the stability and skills to operate a microenterprise. But what about the very poorest people? Last week I was in Haiti to review a pilot program CGAP and the Ford Foundation has started to see how a careful combination of safety nets, livelihoods activities, and financial services can create pathways out of extreme poverty. This sequencing, that we call the “graduation model” because the aim is to move people out of extreme poverty, is being tested in nine pilot sites.

“Chemen Lavi Miyo” –or “Pathway to a Better Life”–implemented by Fonkoze in Haiti is the furthest along with 95 percent of the women having graduated in early 2009–18 months after they began in the program. But how to measure what it takes to “graduate” out of poverty?

One-hundred fifty families in Boukan Kare, Twoudino, and Lagonav in Haiti participated in the pilot. Fonkoze selected only women-headed households with several children but none of them in school. Families had to be food insecure and often hungry; totally lack assets; and without access to health care to qualify for the program. The picture for the women initially selected was pretty grim.

Over the course of the 18-month pilot, women were provided with assets necessary for two of income-generating activities, materials to build tiny homes with sturdy roofs, and latrines. Fonkoze also provided small, short-term cash stipends to create some “breathing space” for new entrants in the program. In one location people were also directed to a free healthcare provider. Participants were trained how to make the best use of their asset, and most important, each member got weekly visits from Chemen Lavi Miyo staff to help boost their self-confidence.

The idea was to determine “success” as something achievable for the ultra-poor on the program. Although the “graduation indicators” used in Haiti are context-specific, they resonate with a set of concerns we are seeing in other sites across the globe. Graduating out of extreme poverty seems to mean achieving food security, stabilizing income, accessing healthcare, and having a plan for your-own future.