Why is cross-border commerce such a mess at the Haitian-Dominican border?

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The border at Elias Pina-Belladere

Transporting goods across the Dominican-Haitian border is a mess. Large trucks are queued from the border far down the road into the Dominican Republic.

There is no clear process to the inspections.

Haitian market women stream through the border with goods on their heads.

Little documentation is provided to anyone.

Whereas Dominican airports quickly and efficiently process large numbers of people, the border is a mess. This mess and confusion is also a significant source of conflicts.

Both Haitian and Dominican exporters complain of arbitrary fees, excessive delays, and expropriation of merchandise.

Haitian market women complain of their treatment by Dominican authorities and Dominican exporters complain of their treatment by Haitian ones. The arbitrariness of the treatment stems from the lack of clear rules governing cross-border trade.

Although both countries have clear rules for imports, these rules were written for the ports in the main cities and require inspections and approvals that are not available in the border-this is the result in the odd process through which the border went from being a wall to being porous.

Without clear policy guidance and in violation of their own laws, each country has developed procedures to allow for goods to flow through their border.

These procedures are neither documented nor fixed.

This lack of transparency and consistency creates confusion for importers and makes it easy for officials to solicit bribes.

Last year, we convinced the US Agency for International Development (USAID) to give us a grant to study this mess. We told them that we wanted to find out the rules that govern imports and exports on both sides so that we can publish them in Creole and Spanish.

We figured if everyone knew what the rules were; it would be easier to insist on fair treatment.

USAID agreed and we conducted the study.

Rather than finding a clear set of rules that we could publish, we found a complicated set of requirements which could not be fulfilled by the officials in the border region.

On the Dominican side, we found that most of the goods that Haitians are importing are prohibitied by different rule:
• Animals: Can only be imported through the airport and seaport in Santo Domingo as per law 43-55.
• Fruits: Can only be imported through either Santo Domingo or Puerto Plata as per resolution 84-96 from the Secretary of State for Agriculture (SEA).

• Vegetables: Prohibited except with specific authorization from the SEA which is no available in the border.

• Beans and chickpeas: Prohibited except with specific authorization from the SEA which is no available in the border.

• Used textiles (re-exported from the United States): Prohibited as per law 458-73.
• Rice (re-exported from the United States and elsewhere): Prohibited except with specific authorization from the SEA, which is not available in the border.

The Dominican government also prohibits the re-export of fuel. The full report can be downloaded by clicking here (PDF document in Spanish).

The Haitian government does not have specific laws that ban certain products.

Instead, the process for clearing customs is very complicated and requires many approvals that are not available in the border.

They also require that payment be made only at the Banque de la République d'Haiti which does not have any offices in the borderlands.

We went back to our donor and said that we had a problem.

We couldn't publish a simple guide to importing and exporting across the Haitian-Dominican border because too much of the commerce is illegal.

Rather than helping to facilitate cross-border trade, our study would provide ammunition for officials seeking bribes.

As we discussed our findings with our donor, the Trade Office of the Organization of American States, and representatives from both governments; we came to realize that the path towards transparent trade will be a complicated one. Both countries will need to revise their own laws and regulations to create a workable structure that could be implemented at the border.

However, before they can revise their laws, both countries need to understand the current flow of goods across the border and to decide how they wish to manage it.
Improving management of commerce is a win-win situation for both countries.

The governments' should be able to recover more customs duties from a larger flow of legitimate goods.

Exporters should be able to export more efficiently.

Consumers in both countries would be better protected by a better phytosanitary controls.

Finally, by reducing the amount of legitimate goods that are smuggled across the border, the officials in both countries will be better able to focus on the smuggling that threatens national security--that of drugs and weapons.

In my next series of posts, I will explore how the border currently works, what goods are imported and exported, and finally the steps that both countries would need to take to establish fair and transparent rules for managing cross-border commerce.

We are helping the Haitian government to build a new complex at the Belladere-Elias Pina border that will allow Haitian officials to properly supervise this border crossing
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Daniel O Neil, February 1 2011, 11:40 PM

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