Haiti’s Multi-Billion Dollar Humanitarian Aid Problem

By Cynthia Kao

With upwards of 10,000 nongovernmental organizations (NGOs) operating within its borders, Haiti is known as the Republic of NGOs. Yet despite the billions of aid dollars invested in Haiti’s development, this island nation still has an unemployment rate of 40 percent and ranks as one of the poorest countries in the world. Why is international aid to Haiti not more effective? The reality is that a confluence of poor accountability and lack of local partnering by international organizations (IOs) have severely hindered the effectiveness of aid dollars, and hence, Haiti’s development.

International Aid and Local Partnering

Aid to Haiti is vital for many purposes, including economic development, disaster relief, and providing public goods, such as education and healthcare, where the government cannot. Since the devastating 2010 earthquake, USAID has dispensed over $3 billion towards humanitarian aid and reconstruction/development efforts. Most of this was disbursed through contracts and grants to bidding U.S. development agencies and IOs.

However, aid projects often exclude partnering with local businesses and staffing local workers (due to a variety of business partnering issues), consequently disqualifying Haitians from the lucrative money pool. A report by the Center for Economic and Policy Research (CEPR) fixes the blame for excluding Haitian organizations largely on the way that USAID administers its aid, noting that the overwhelming majority of USAID’s funding goes to U.S. companies based in the Washington, D.C., and the Beltway. This practice precludes the tremendous benefits of a direct cash injection into the Haitian economy, which would enable hiring local organizations and the integration of local knowledge into aid projects. So heavy is this bias that in the couple of years following the devastating 2010 earthquake, only 1 percent of aid was given directly to local groups.

However, USAID has defended its aid administration, stating that Haitian organizations often lack the capacity, track work, or business standards to qualify as a contract or grant recipient (though there has been a marked improvement in in recent years of local sourcing for construction projects). While there is certainly a unique set of difficulties that comes with partnering with locals, critics state that USAID has fallen severely short of its own benchmarks for using local labor. A government audit in 2013 found that USAID had severely underestimated its scale for erecting settlements, and had to cut back its goal of building 15,000 houses to 2,649. At the start of 2015, less than a thousand houses have been erected, despite using primarily international partners.

Meanwhile, organizations that have partnered closely with Haitians have achieved success. An external evaluation report on the Netherlands-based NGO Cordaid shows a much brighter picture. For its rural program, the organization contracted and trained local tradesmen to repair 204 houses, thus rehousing 308 returning families by March of 2012: just short of its 340 families rehousing goal. In the same timeframe, 3,003 shelters were provided, which was only 300 shy of its target number. Additionally, most, if not all, housing materials were purchased locally. A focused effort towards improving livelihoods within communities while providing aid was visible in its methodology. Cordaid actively sought to build social capital, a priority that did not hinder aid delivery timeliness, and to engage local partners. This is in sharp contrast to the practices of USAID and Red Cross projects that tend be dismissive or biased against hiring local Haitians for jobs low down on the command chain, let alone positions high up the decision ladder.

Aid Dollar Accountability

A lack of accountability for how NGOs spend their aid dollars also results in a huge waste of aid money. Since there is no actual oversight or well-defined metrics on how well many large NGO programs are run, programs are often run and managed poorly. For instance, a report put out jointly by NPR and ProPublica found that the Red Cross claimed that all $500 million dollars it raised for Haiti went to serving 4.5 million Haitians. However, with only a population of 10 million, this number is highly improbable and the Red Cross has not provided supporting details. The money spent on actual programming was likely far less than claimed. When asked for a list of their specific Haiti programs and their cost, the Red Cross declined. The Red Cross has also stated that it has provided homes for over 130,000 Haitians. Yet on further questioning, the Red Cross acknowledged that the figure included people who attended a seminar in how to fix homes, and those who received temporary rental assistance. Additionally, many managers were not able to speak Creole or French.

Though international cooperation between aid groups and local institutions is bound to have difficulties, groups such as Cordaid have shown that local labor is available, and it is certainly viable to directly partner with them to rebuild their communities. Doing so not only creates jobs, which are so desperately needed, but also cuts down on the high overhead that comes from the convoluted and expensive layers of subcontracting that has been prevalent with large aid dispensers. The hiring of an expatriate to Haiti, in addition to a higher salary, transportation and housing fees, and relocation costs, adds up after all to significantly more than what it would cost to directly hire a Haitian worker.

Looking Ahead

The way that the vast majority of aid was distributed goes to show that simply throwing money at a problem will not make it go away. Rather, there needs to be accountability in how aid groups spend their money; local involvement in the form of labor and decision making need to be an integral part of how aid organizations function. Even though the outpouring of aid in the face of the disaster has winded down, it is still not too late for aid to build up Haiti–by directly and responsibly investing in its citizens.


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