Haitian Government Raises Minimum Wage to $5.50 per day

May 19th, 2009

By Wadner Pierre-www.haitianalysis.com

Haitian labor activists applauded the Preval administration's decision to raise the minimum wage in Haiti from 70 to 200 gourdes ($5.50 USD) per day. However, the increase has been strongly opposed by Haitian industrialists. Georges Sassine, president of ADIH (an association of Haitian industrialists) warned that the wage increase would cost tens of thousands of jobs. He claimed that similar minimum wage increases in Cambodia have proven disastrous.

HaitiAnalysis asked Jose Cordero, an economist with Center for Economic and Policy Research (CEPR), to respond to the arguments that Georges Sassine and other businessmen have made against the increase. Cordero said ”In the case of Cambodia, I am not sure what disaster they are talking about, but I know that between 2004 and 2007 the country grew at about 11% per year. When inflation rose in 2008, and real wages declined, many factory workers left their jobs to go back to the country or to other informal activities which provide them more revenue than their work at a factory."

Cordero also pointed out that "Workers (especially those making only the minimum wage) have a higher propensity to consume than higher paid workers or company owners. They also have a lower propensity to import. These mean that a higher wage will likely increase aggregate spending, which could stimulate local production, and employment."

Georges Sassine was quoted by the Canadian online journal, the tyee.com, as saying, "Do we want 100,000 jobs paying 200 gourdes (US$5) or 200,000 jobs at 100gourdes (US$2.50)? What's better? 200,000 people working if I were a politician"

Lavarice Gaudin, the leader of Veye-Yo, a Miami-based advocacy group for Haitian immigrants in the United States, also responded to the objections of the Haitian business community. Guadin, who studied economics, said in a telephone interview with HaitiAnalysis "The new bill fixing the minimum wage to 200 gourdes is obviously nothing, but somehow people like Georges Sassine, will, of course, oppose it because they have been made their profits by exploiting people's work."

Paul Chéry, secretary general of the Haitian Confederation of Workers (CTH), one of Haiti's largest labor organizations, recently noted that in- real terms - the Haitian minimum wage (before the increase to 200 gourdes) was actually lower today than it was 25 years ago.

Former President Jean Bertrand Aristride, who was twice ousted in coups supported by the Haitian business community (1991 and 2004), encountered fierce opposition from Haitian industrialists in 1995 when (shortly after being restored to power) he raised the minimum wage from 15 to 36 gourdes per day. Aristide won a second term in 2000 and during that term increased the minimum wage again to 70 gourdes per day. His government also banned some of the practices (like paying workers per piece) that garment factories have used to avoid paying the minimum wage. Others have questioned the strategy that Haitian industrialists have proposed of expanding low wage, export oriented manufacturing.

In 2007, Inter Press Service (IPS) interviewed Jude Bonhomme, a trained agronomist and a member of the Fédération nationale des paysans agricoles (FENATAPAO). Groups like his have argued for years that Haiti remains an agricultural society and that what it most urgently needs is to revise the fortunes of its peasants. Over the past thirty years, international pressure has forced Haiti to reduce its tariffs and open most of its markets to the world. This has strengthened a demographic shift in which poor rural populations, forced out of work, have moved to urban slums.

Haitians peasants also sustained a major blow during the 1980s when, due to pressure from the United States government, the dictatorship of Jean-Claude Duvalier wiped out the Creole pigs (porca) that were indigenous to Haiti. After that catastrophic policy, peasants struggled more than ever to survive. The pigs were crucial to the rural economy, known as the "bank account" of the peasants.

After satisfying local and foreign elites on so many other policy fronts, the Preval administration appears to have the maneuvering room needed to raise the abysmally low minimum wage. It is a positive step from an administration strongly criticized in recent months for its failure to hold legitimate senate elections and clean up Haiti's human rights record.

Ginette Apollon, President of Haiti's National Commission of Women Workers (CNFT), applauded the minimum wage increase while speaking at an annual forum sponsored by the Global Studies Association (GSA) in Florida. She believes that in area of labor reform, the Preval’s administration is doing its best within the constraints imposed on it. However, her talk dealt much more with the human rights situation in Haiti rather than it did with economics.

In 2005, she briefly joined the ranks of Haitian political prisoners under the UN backed Latortue dictatorship. She was arrested after attending a conference in Venezuela where she expressed strong opposition to the coup that deposed Haiti’s democratically elected government in 2004. At the time Apollon was accused of plotting with Venezuela to destabilize Latortue's regime. Her husband and his friend were also arrested when they met her at the airport upon her return to Haiti. The stress that came with the ordeal impacted her health.

Addressing academics and activists at the main lunch panel at the GSA conference, Apollon was passionate about the plight of Haiti's working class and the unemployed. At one point Apollon was heckled by Daniel Michaud, a supporter of Batay Ouvriye - a rival labor organization funded by the US government through the National Endowment for Democracy (NED). In support of Apollon, a number of audience participants criticized the role of foreign funding which they said manipulated Haiti's political landscape and raised the public profile of otherwise marginal groups.

In addition to labor conditions, Apollon spoke about the case of Haitian political prisoner Ronald Dauphin who has been illegally imprisoned since 2004. Due to the presence of appointee holdovers in Haiti's judiciary from the Latortue years, the transition to democracy in 2006 has not liberated Dauphin. In contrast, perpetrators of grave human rights abuses (like death squad leader Louis Jodel Chamblain) are free.

Apollon also spoke about Lovinsky Pierre Antoine, a prominent human rights activist who was an outspoken opponent of the Latortue regime. Antoine has also been a harsh critic of the raids UN troops launched into Haiti's poorest slum - ostensibly to root out common criminals. Antoine disappeared two years ago – shortly after he announced his intention to run for a candidate for the Haitian senate. Prior to his disappearance, Antoine had helped organize a large protest against UN secretary general Ban Kin Moon. The demonstration, which greeted the UN secretary general at the Port-au-Prince airport, declared Ban Kin Moon persona non grata. Preval, who was said to have been deeply embarrassed by the protest, has yet to comment publicly about Antoine's disappearance.