The Investment Facilitation Center (IFC) is a key component of the Haitian Government’s efforts to streamline the business regulation and investment environment in Haiti. Implemented by Chemonics, the Investment-Trade and Association Development (I-TRADE) project is a 3-year, USAID-funded initiative aimed at supporting the Haitian Government and private sector efforts to increase investment in the Haitian economy.
The IFC’s objective is to increase the ease of business entry and provide information to potential investors. However, the survey conducted by AGRITECH and Management Systems International (MSI) found that most businesses surveyed were not knowledgeable about the IFC. Only 76 percent of the businesses said they were aware of the IFC’s existence, and only five percent of respondents were aware of its services, which none had used.
The businesses that were familiar with the IFC generally liked the idea of it, but thought the organization could be improved. Six of eight firms that responded to the question said they thought the IFC’s services are useful, but only one respondent out of seven said those services were completely satisfactory. The main grievances given were delays, lengthy procedures, a narrow sector focus, and inadequate human resources.
The Investment Code of 2002 is another key component of the Haitian Government’s efforts to streamline the business regulation and investment environment in Haiti. The survey found that most businesses surveyed were not knowledgeable about the Investment Code, either. Only 20 percent of the firms were familiar with the stipulations of the Investment Code. Again, larger and older companies were more likely to know about the Code.
Of the firms that knew the Code, six were eligible for its incentive advantages. Knowledgeable and eligible businesses said the Code facilitates investment, but respondents agreed that it could be improved. Thirty-one percent of all respondents said that the Code could be improved, citing issues such as complexity, lack of transparency, and inadequate human resources.
The survey also found that most businesses surveyed were small, with roughly half having 10 or fewer employees. The businesses were also fairly new, with half being 10 years old or younger, and almost all were locally owned. The survey team encountered several data limitations, including lack of information on businesses outside of the Port au Prince metropolitan area, lack of information on which businesses registered in 2008, and a low response rate.
Overall, the survey suggests that there is a need for improvement in the IFC and the Investment Code to make them more effective in facilitating business entry and investment in Haiti. The Haitian Government and private sector stakeholders should consider addressing the issues raised by the survey, such as delays, lengthy procedures, and inadequate human resources, to improve the business environment in Haiti.
The survey was conducted by AGRITECH and MSI from October 1, 2008 to January 30, 2009. The survey consisted of four modules: (1) profile of businesses surveyed; (2) satisfaction with the work of IFC; (3) businesses’ experience with Haiti’s Investment Code of 2002; and (4) business registration. From a sample frame of 5,281 businesses, 243 were selected using a multi-stage sampling process based upon the businesses’ legal status (publicly traded/private) and industry sector.
The survey team encountered several data limitations, including lack of information on businesses outside of the Port au Prince metropolitan area, lack of information on which businesses registered in 2008, and a low response rate. Therefore, overall trends, rather than specific pieces of data, should form the basis for decision-making based upon this report. The analysis contained in this report is consistent with this guidance.
The survey found that most businesses surveyed were not knowledgeable about the IFC and the Investment Code. However, the businesses that were familiar with these institutions generally liked the idea of them, but thought they could be improved. The survey suggests that there is a need for improvement in the IFC and the Investment Code to make them more effective in facilitating business entry and investment in Haiti.
The Haitian Government and private sector stakeholders should consider addressing the issues raised by the survey, such as delays, lengthy procedures, and inadequate human resources, to improve the business environment in Haiti. The survey provides a baseline analysis of businesses’ experience and interaction with the IFC and the Investment Code, which I-TRADE can use to plan the specifics of its interventions.