THE LEGAL, POLITICAL, ECONOMIC, AND SOCIO-CULTURAL ENVIRONMENT FOR
COMMUNITY-BASED ENTERPRISE IN RURAL HAITI
A Thesis
Presented to the faculty of the Department of International Affairs
California State University, Sacramento
Submitted in partial satisfaction of
the requirements for the degree of
MASTER OF ARTS
in
International Affairs
by
Damara C. Miller
SUMMER
2013
© 2013
Damara C. Miller
ALL RIGHTS RESERVED
ii
THE LEGAL, POLITICAL, ECONOMIC, AND SOCIO-CULTURAL ENVIRONMENT FOR
COMMUNITY-BASED ENTERPRISE IN RURAL HAITI
A Thesis
by
Damara C. Miller
Approved by:
__________________________________, Committee Chair
David Andersen
__________________________________, Second Reader
Nancy Lapp
____________________________
Date
iii
Student: Damara C. Miller
I certify that this student has met the requirements for format contained in the University format
manual, and that this thesis is suitable for shelving in the Library and credit is to be awarded for
the thesis.
__________________________, Graduate Coordinator ___________________
David Andersen
Date
Department of International Affairs
iv
Abstract
of
THE LEGAL, POLITICAL, ECONOMIC, AND SOCIO-CULTURAL ENVIRONMENT FOR
COMMUNITY-BASED ENTERPRISE IN RURAL HAITI
by
Damara C. Miller
This project looks at the various legal, political, economic, and socio-cultural aspects of
the environment that determine how conducive the environment is for the establishment of
community-based social enterprises (CBSEs) in rural Haiti. This study identifies the factors
hindering and supporting the establishment of CBSEs as experienced by Haitian rural residents
from their own uniquely valuable perspective.
Data is collected during 1) in-depth interviews with leaders and members of the Kokoyer
based CBSE Organisation des Femmes pour l’Avancement de Kokoyer (OFAK) and 2) numerous
interviews with other Trou Chouchou CBO leaders.
The environment is not conducive for CBSEs for primarily legal and political insecurity
reasons resulting from a poorly established rule of law. The most significant findings are the
significance of NGOs in the development of rural areas and the highly valued yet limited crossorganizational collaboration of rural CBSEs.
_______________________, Committee Chair
David Andersen
_______________________
Date
v
ACKNOWLEDGEMENTS
It is with great appreciation that I thank the women of OFAK and the people of Kokoyer for
welcoming me into their community and all those who participated in this study. I would like to
especially thank Madam Nicole Lumaine for her efforts in coordinating interviews and Madam
Michelin for her generous hospitality. Furthermore, this paper would not be possible without the
support of the staff at INURED in Delmas, Haiti whose expertise and social science research
skills have been invaluable to this project. Finally, it is with the deepest gratitude that I thank
Martha Echols for her continuous encouragement and guidance throughout my academic career,
which culminated with this research project in Haiti. Thank you.
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TABLE OF CONTENTS
Page
Acknowledgements................................................................................................... vi
Chapter
1. INTRODUCTION ............................................................................................... 1
2. LITERATURE REVIEW ..................................................................................... 4
2.1 Rural Haiti ................................................................................................ 4
3. SOCIAL ENTERPRISE ....................................................................................... 7
3.1 Social Enterprise ....................................................................................... 7
3.2 History of the Social Enterprise .............................................................. 10
3.3 Advantages of the Social Enterprise ....................................................... 13
3.4 The Community-Based Social Enterprise................................................ 14
4. THE LEGAL ENVIRONMENT ......................................................................... 16
4.1 The Judicial System & The Rule of Law ................................................................ 16
4.2 Land Ownership ........................................................................................................ 17
5. THE POLITICAL ENVIRONMENT .................................................................. 19
5.1 Centralization ............................................................................................................ 19
5.2 Public Sector ............................................................................................................. 21
6. THE ECONOMIC ENVIRONMENT ................................................................. 23
6.1 Private Sector ............................................................................................................ 23
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6.2 Non-Profit Sector ...................................................................................................... 24
6.3 Education ................................................................................................................... 25
6.4 Access to Credit ........................................................................................................ 26
7. THE SOCIO-CULTURAL ENVIRONMENT .................................................... 31
7.1 Inter-organizational Cooperation ............................................................................. 31
8. METHODOLOGY ............................................................................................. 34
9. THE CASE STUDY ........................................................................................... 35
10. CONCLUDING REMARKS ............................................................................ 48
Appendix A. Tables ................................................................................................. 53
Appendix B. Illustrations ......................................................................................... 55
Bibliography ............................................................................................................ 57
viii
1
1. INTRODUCTION
This study is based on data gathered from in-depth interviews with first-hand
sources within the Kokoyer community and the greater Trou Chouchou communal
section, in the l’Ouest department of Haiti. The interviews and focus group discussions
included here are conducted with leaders and members of the CBSE Organisation des
Femmes pour l’Avancement de Kokoyer (OFAK) as well as numerous organization and
community leaders from throughout the Trou Chouchou and the chief political figure of
the communal section.
The purpose of the study is to better understand to what extent is the legal,
political, economic, and socio-cultural environment conducive to the establishments of
CBSEs in rural Haiti. A CBSE is a type of Social Enterprise (SE) that is founded within
and managed by a community while generating funds from commercial activities for the
purpose of furthering their social mission, which may be as broad and simple as
community development. In the case of OFAK the social mission of advancing the
community can be seen as three-fold: empowering women, sending children to school,
and acting collectively to realize the further development of the community’s living
conditions. In order to finance these missions OFAK manages the Kokoyer beach located
within the Kokoyer community. Participants have highlighted the immense value of
collective action in advocating for their rights and development projects while protecting
themselves from an unstable political and legal system. In a particularly poignant
2
example, at the time of this study OFAK is engaged in a legal battle over the right to
manage the Kokoyer beach.
The findings conclude that the environment is not very conducive. While there are
positive aspects that contribute to a more conducive environment, the negative factors
outweigh these positive factors. So while the environment is fairly unconducive it is
clearly not impossible for a CBSE to become established although this is a rare
occurrence in the Trou Chouchou communal section. OFAK’s competitive advantage is
their ability as a CBSE to control the local beach and the tourism generated by it.
Constructive relationships with NGOs have been identified as the main positive
factor. This is also one of the most significant findings of this study. Specifically, the
overwhelmingly positive attitude toward NGOs from the rural inhabitant’s perspective
and active role of NGOs in building capacity among organization leaders and supporting
community development. This finding is surprising and important given the historically
negative criticism targeting NGOs in development in Haiti. The portrait of the NGO
drawn by the participants is that of a provider of expertise and financial assistance paired
with a willingness to support communities in their own projects based on their selfidentified needs.
The negative factors identified are a limited access to education and training, a
neglectful government (either maliciously by design or stemming from indifference), and
a distrust of the private sector. With the most significantly negative factors affecting the
environment being the legal and political environment, which has failed to properly
3
establish a rule of law and uphold equality and justice. In stead these aspects lead to
distrust of the government along with the government’s further marginalization and
neglect of rural populations. The general insecurity and extreme poverty also makes it
difficult for cross-organizational collaboration among community groups and at the
lowest administrative levels responsible for rural development.
The paper is outlined as follows. The literature review explores the condition of
poverty in rural Haiti (section 2), the Social Enterprise (section 3), the legal (section 4),
political (section 5), economic (section 6), and socio-cultural (section 7) aspects of the
environment. Followed by the Methodology (section 8), the Case Study (section 9), and
Concluding Remarks (section 10).
4
2. LITERATURE REVIEW
2.1
Rural Haiti
The urban migration into the Port-au-Prince area has been well documented over
the last few decades leading up to the 2010 earthquake; for political, economic, and
environmental degradation purposes (World Bank, 2006). This migration pattern has only
compounded the very causes which first sparked it; namely, the centralization in the
metropolitan Port-au-Prince area of political activities, jobs and the informal sector,
education, and basic services such as electricity and water provision. Due to
underperforming public institutions in 2012 seventy percent of residents in even the
better-serviced urban areas were not receiving basic services (IOM, 2013).
Political marginalization of rural populations is intensified by physical distance
from the capital and language barriers (i.e. legal processes in French and high illiteracy
rates). Commercial and political activity centralized in the metropolitan area further adds
to the shortage of off-farm employment in rural areas, which intensifies poverty in rural
areas (Smucker et. al, 2002).
The formal job market is extremely limited as a result of nepotism and a labor
pool largely composed of low-skilled labor. Excluded from the formal market many
people (estimated at 40% of the population with widespread unemployment and
underemployment in 2010 and with more than two-thirds of the labor force outside of the
formal market) are either unemployed or operating in the informal sector (United
5
Nations, 2011). Discussing business sector reform and job creation in Haiti the World
Bank (2012) summarizes the problem of the massive informal market.
Mostly made up of unregulated micro and small businesses, the informal sector pays low
salaries and provide precarious working conditions, a reflection of low-productivity and
lack of economies of scales.
The Organization for Economic Co-operation and Development (OECD)
considers the informality of these markets “above all [as] an expression of the lack of
trust in public institutions, the negative perception of the role of the state and the limited
understanding of the benefits derived from social security. Calling it basically a sign of a
broken social contract” (Jütting and de Laiglesia, 2009). In many ways, there is a lack of
incentives for entering the formal market lacks. Often viewed only used as a means of
identifying businesses in order to extract taxes. The cost of setting up a business in Haiti
(ranked 174 out of 185 by the Doing Business Index in 2012) also discourages
establishment in the formal sector (IMF, 2013). This unfavorable environment
discourages the formation of businesses in the formal sector which would give back to
the state through taxes, employment, and inviting greater investment in the country
(World Bank, 2006).
Community-based political and social organizations are established in lieu of
effective government support institutions. These community-based organizations (CBO)
act as informal social and economic insurance mechanisms. Such groups often act as a
mechanism for collective activism and educating their communities about opportunities
and injustices affecting them. The success of these groups may relate directly to their
6
ability to mobilize community resources by reflecting community values and priorities
(Reinert and Voss, 1997). White and Gregersen (1994) champion collective action in
community organizations for their effectiveness in pooling risk, leveraging resources, and
developing community leadership.
As a model of development, grassroots Community-Based Organizations (CBO)
in general have proven to be a highly effective approach for long-term sustainable
development in poor communities (Lundahl, 2010). Their effectiveness is attributable to
their intimate knowledge of their community’s social needs and the established social
structures through which to meet those needs (Reinert and Voss, 1997). Effective
community leaders are able to depict development in such a way that people are
encouraged and empowered to take matters into their own hands by mobilizing their own
resources, defining their own needs, and deciding for themselves how best to meet them
(Tosun, 2000). This means that the authority for design and implementation are
decentralized to the lowest level possible (i.e. the community level) (Campbell and
Shackleton, 2001). Although CBOs are favorable approaches for development they still
face serious challenges. Primarily, CBOs tend to work at the local level with minimal
financial resources and are therefore limited in their scope and tangible social impact.
7
3. SOCIAL ENTERPRISE
3.1
Social Enterprise
When considering CBSEs as a type of Social Enterprise (SE) it is useful to
understand what a SE is and what it is not. In general SEs are by nature innovative
entities that use business skills to achieve social change in markets disregarded by the
public and private sectors. It is worth noting an exception that is growing in popularity in
the United States. Social Impact Bonds (SIBs), explored in greater detail below, leverage
their innovation and efficiency by replacing traditional contracted government social
service providers. Yet, the SE’s potential has yet to be fully realized. One of the major
problems impeding the growth of the SE sector is the lack of a clear definition. In its
most basic form the SE is an entity that creates both social and economic value and as
such has been coined a Hybrid Enterprise (Alter, 2003). Also referred to as a “Social
Business” or a “Social Economy Enterprise” the SE is driven by a social mission while
generating enough revenue to cover expenses. In CBSEs the social mission may be as
broad as community improvements in health, sanitation, and employment or promoting
gender-based equality.
Beyond the basic definition supplied here three aspects of SEs continue to spark
debate: whether SEs are distinct from Not-for-Profits (NfP) and For-profits; the
hierarchical relationship between social and financial objectives; and the strictness of the
mandate on profit distribution.
8
The distinction is not always clear between NfPs and SEs or For-profits and SEs.
Predominantly U.S. academics and practitioners, view SEs essentially as NfPs that have
taken on commercial activities to fund programs in the absence of traditional funding
sources. Part of the confusion arises when already established NfPs decide to add
commercial activities to their operations. Does the NfP then become a SE? Where legal
status does not make this distinction clear the answer to this question boils down to a
matter of opinion, which may differ between the organization and the observer. Legal
statuses recognizing SEs as distinct from NfPs are slowly beginning to emerge in the
United States following in the footsteps of Europe and the United Kingdom.
The distinction between a For-profit and a SE is not quite as blurred as that of the
SE and NfP but still raises some issues. Corporate Social Responsibility (CSR) is the
strategic implementation of charitable programs or campaigns aimed at positive social
and/or environmental impact undertaken by For-profits for mainly financial or public
image purposes. The argument could be made that all businesses have at least some
degree of positive social impact simply by hiring people and reducing unemployment.
From this perspective almost all businesses can be considered SEs despite the lack of a
clear social mission mandate. However the primacy of the social over financial
objectives, as argued below, challenges this perspective.
While few would argue that financial objectives always surpass the social there is
debate over whether these objectives are equal in importance or whether the social are
clearly and without exception superior. For example, the Canadian Social
9
Entrepreneurship Foundation defines the SE as having strong blended financial and social
goals. Without diminishing the importance of social objectives others point out that
financial performance ultimately undergirds all social mission activities and must
therefore sometimes precede the social in order to continue operating. In contrast, many
highlight the clear priority of the social objectives over the financial and reiterate that in
SEs the social mission is explicit and central to the decision-making process and is the
driving purpose behind the business (Alter, 2003). According to the European
Commission the Social Business pursues objectives geared toward social, ethical or
environmental development, and promote social cohesion, employment, and the
reduction of inequalities that go above and beyond the quest for financial gain (European
Commission WP, 2011). Somers (2005) consider SEs “more than private profit
organizations” that use economic surpluses to drive social and environmental growth. So
while financial concerns may need to momentarily take precedence in times of crisis the
SE is responsible for strategically designing profitable commercial activities so that such
periods can be minimized and the social objectives can remain the priority. For CBSEs
the social mission may often be creating employment and financial gain to alleviate
poverty in the community. While revenue generation is critical to carry out objectives,
the social mission remains the driving force.
The debate over profit distribution results from the thin line between For-profits
and SEs since both raise funds through commercial activities. Maximizing profits and
supplying the shareholders with a return on their investments drive traditional For-profits.
10
On the other hand SE funds remaining after covering operating expenses are instead
reinvested in the commercial activities to increase impact and/or sometimes distributed to
beneficiaries who may, in many cases, also be a part of the SE. Some firmly reject the
idea of returning any excess profits to SE members or employees claiming that this
business practice should be relegated to For-profits and has no place in the charitable or
voluntary sector. Yet the idea of redistributing profits to members has been popular
among co-operatives (a form of SE) for centuries. Therefore profit distribution among
members is not exclusively restricted to the For-profit domain. It is also worth noting that
by definition while SEs must engage in commercial activities they are not forbidden from
receiving partial or supplemental income from the private and public sectors. In such
cases, there may be a stipulation that some of the profits be returned to the financier. As
for CBSEs it is often the case participating members expect some form of profit
distribution, whether through direct payment or employment.
3.2
History of the Social Enterprise
The idea of the Social Business has been around for centuries in various forms. A
well-known example of an early American SE is Goodwill Industries. Established in
1902 in Boston, Massachusetts by Edgar J. Helms, donated goods were collected from
the wealthy and repaired and sold by poorer residents that were hired as employees. The
social mission was to fund community programs and provide job training for
marginalized populations (Doeringer, 2010). The Ford Foundation is often held as
another early example of the modern SE. Established in 1936 with an initial endowment
11
of $25,000, the Foundation, granted funds to be used for “scientific, educational, and
charitable purposes, all for the public welfare” (Ford Foundation).
The 1970s and 1980s experienced a large increase in SEs in both Europe and the
United States, albeit for slightly different reasons. At that time NfPs turned to the SE
model as an alternative funding mechanism as government cutbacks targeted social
programs. On the other hand, the European SE sector budded in response to
unemployment skyrocketing to over 40%. As a result, European SEs have generally
received strong government support as a means of addressing chronic unemployment and
in particular provide employment for disadvantaged populations (Doeringer, 2010). Also
during the 1970s Nobel Peace Prize Laureate Mohammad Yunus began championing the
idea of the SE for alleviating poverty among the world’s poorest populations. These
microfinance loans and community banks have exploded in popularity throughout the last
few decades.
Social Enterprise is increasingly being recognized in political forums, which has
resulted in the adoption of legal forms facilitating the establishment of SEs. In 2011 the
European commission passed the Single Market Act – Twelve levers to boost growth and
strengthen confidence. The Commission recognized the growing importance of these
businesses in the economy and the challenge they face in operating within an increasingly
competitive social economy market (European Commission, 2011). The Act is an attempt
to facilitate the inclusion of these Social Businesses into the economy as key drivers for
future growth. In that same year, the Commission began the creation of the Social
12
Business Initiative, which strives to cultivate an environment conducive to Social
Businesses (European Commission WP, 2011).
In the United States the Benefit Corporation, or B Corp, is a class of For-profit
corporations that strive to make a positive impact on society and the environment while
being held to greater standards of accountability and transparency. The B-Corp is a
relatively new legal form with Maryland as the first U.S. state to recognize its legal
status. As of May 2013, fourteen states had passed B-Corp legislation. The B Corp is
considered a step towards creating an enabling environment in the U.S. that supports
businesses striving for positive social change (Benefit Corp Information Center).
More recently states have begun adopting statues for registering Low-Profit
Limited Liability Companies (L3C), the first American legal form that specifically
encourages SE establishment. Like other LLCs, the L3C is able to issue equity to raise
capital. However, it is unique in that it is also able to receive Program Related
Investments (PRI), which permits investments from foundations to support charitable
programs that involve have the potential to provide a return for investors (Doeringer,
2010).
The governments of the UK and the U.S. are increasingly contracting innovative
SEs that can provide social services with greater resource and financial efficiency. These
government contracts, known as Social Impact Bonds (SIB), Pay for Success Bonds or
Social Benefit Bonds, are awarded to innovative SEs in the areas of housing, prison
recidivism, employment, geriatric care, and health care. The SE is then paid an agreed-
13
upon amount based on expected savings for the government agency but only after
concrete and measurable social outcomes have been demonstrated. The concept was first
developed in the UK in 2010 with a $13 million deal to reduce recidivism rates. Pleased
with the outcome, the UK has since approved an additional 14 contracts. In April 2013,
Illinois became the second U.S. state, after New York, to launch a SIB program (Shah
and Costa, 2013).
3.3
Advantages of the Social Enterprise
Social Enterprises generally emerge in markets where social services are
inefficient or non-existent. These markets are generally considered failed markets
meaning that private and public sectors lack the incentive or the capacity to provide
services to these marginalized populations. In order for SEs to grow and for new ones to
develop they must meet an unsatisfied social need, deliver a superior social good or
service, or offer better value to their target beneficiaries (Somers, 2005). SEs are able to
create “novel business models, organizational structures, and strategies for brokering
between very limited and disparate resources to create social value “ (Seelos and Mair,
2005). Financially backed by their own commercial activities SEs step into these markets
and specifically target these vulnerable populations by providing services such as
employment training and job opportunities, education, sustainable and/or alternative
energy sources, housing, health care, and much more.
Effectiveness can be attributed to the SE’s ability to draw employees from the
public, private, and charitable sectors. The blending of this expertise allows for highly
14
innovative solutions to the problems commonly associated with social service provision
(i.e. budgets, scope, quality and quantity of services). Innovation is especially critical in
SEs where the innovative nature of Entrepreneurship is compounded by the limited
resources and profitability in these failed markets.
Emphasis on measuring the social and environmental impact, as explained above,
is another key benefit of the SE. Organizations are able to link the day-to-day processes
with their goals more quickly and thus realign their future strategy for greater positive
social impact beyond the short-term horizon.
3.4
The Community-Based Social Enterprise
Community-based social entrepreneurship is when people act corporately in
pursuit of a common purpose (Lundahl, 2010). Defining Community-based enterprises
(CBE) Peredo and Chrisman (2006) assert:
A community acting corporately as both entrepreneur and enterprise in pursuit of the
common good. CBE is therefore the result of a process in which the community acts
entrepreneurially to create and operate a new enterprise embedded in its existing social
structure. Furthermore, CBEs are managed and governed to pursue the economic and
social goals of a community in a manner that is meant to yield sustainable individual and
group benefits over the short and long term (Emphasis in original).
CBSEs tend to emerge amid crisis conditions when no alternative support is
available such as inadequate food, water, education, healthcare, employment
opportunities, physical safety of self and property, etc. (Reinert and Voss, 1997). While
these conditions can be found throughout Haiti they are particularly intensified in rural
15
areas. The social mission, or societal change goal, varies but is often community public
goods projects
Income generating commercial activities in CBSEs tend to be low- to mediumskilled handicrafts and agricultural cooperatives. Rural communities with control over
natural resources may be able to manage those resources and capture the profit from
them. Marketing and networking are key areas for these CBSEs to flourish. Revenue is
used for community improvement but may also be reinvested into CBSE to augment
operations for greater future social impact. Tourism presents another valuable type of
CBSE. There is rich literature on Community-Based Tourism and Natural Resource
Management (CBNRM) initiatives. Case studies can be found throughout African and
Latin American countries such as Tanzania (Nelson, 2004), Kenya (Manyara and Jones,
2007), South Africa (Campbell and Shackleton, 2001), Peru (Mitchell and Reid, 2001),
and Aborigine tribes (Tapsell and Woods, 2010; Overall et al., 2010).
16
4. THE LEGAL ENVIRONMENT
4.1 The Judicial System & The Rule of Law
A sound judicial system and the rule of law are essential for maintaining an
enabling environment that attracts investments needed for social and economic
development (World Bank, 2006). Even prior the earthquake, the Haitian justice system
was ill equipped to carry out justice with untrained and unsupported administrators, a
neglect of checks and balances, and poor infrastructure. Such an environment leaves
room for corrupt governments in poor countries to disregard citizen rights by abusing the
court system for their benefit, using the system to punish opponents and reward political
supporters. Under such conditions failure to provide equal justice further marginalizes the
poor and disenfranchised (World Bank, 2006). The rural poor are particularly
discriminated against in the justice system by language barriers (political and legal
forums are in French while it is common for rural populations to be illiterate and speak
only Creole) and an inability to afford an attorney. In 2013 the justice system had four
judges per 100,000 persons with access disproportionately limited in rural areas (IOM,
2013). Additional contributing factors are long periods of pre-trial detention, poorly kept
legal records, and failure to codify laws for collective learning of past cases for future
reference (Perito, 2010).
CBSEs can exist outside of the formal structure but only to the extent that their
interests do not threaten or contradict that of those in power. Those “in power” does not
necessarily refer to those with political appointments but to all forms of relative power
17
such as: the landowner who holds power over his tenants; the wealthy business class that
creates jobs; those with strong connections to policemen and judges and commercial
interests to protect.
4.2 Land Ownership
Conflict over land use and private sector agreements may reflect a national
business environment for CBSEs that is generally unsupportive and restrictive (Nelson,
2004). There has been a decline in the importance of, and subsequent observance of, land
title possession and transfer in Haiti. Smucker et al.’s 2002 study revealed some factors
contributing to this decline. First, land is bought and sold regularly without updating title.
Second, in Haiti formal title is not necessarily more secure than informal arrangements.
Rather, informal arrangements based on social capital can assure stable and affordable
access to land for most people.
On the topic of agricultural practices and land tenure in Haiti White and Smucker
(1998) have found that:
Informal land tenure does not really constrain investment by itself. Strong
peasant organizations can counteract the uncertainties associated with informal
tenure arrangements and peasants are willing to adopt low-input, short-term
yielding practices, even if they do not have formal title to the land.
This generalization is subject to an important caveat. The risk may be too great
for poor communities to invest precious resources for land improvements on shared or
public land without formal title. This risk is particularly steep when those improvements
are made on land with great potential for wealth (i.e. a popular tourist beach). Those with
18
the power to capture the revenue from these lands are likely to wrestle control of the land
from less politically powerful rural communities.
Other case studies (i.e. Nelson, 2004) highlight the ability of CBSEs to
successfully navigate the political process as foundational to the rise of community-based
ecotourism in Northern Tanzania. This ability is key when land ownership is called into
question or seized by the government unlawfully.
19
5. THE POLITICAL ENVIRONMENT
5.1 Centralization
All major political and legal administrations are highly centralized in Port-auPrince. Despite the declarations set forth in Haiti’s 1987 Constitution, few steps have
been taken to implement decentralization. As a result basic service provision has been
limited to urban areas generally and the metropolitan Port-au-Prince area in particular.
Rural populations lack educational facilities at all levels, healthcare and basic
infrastructure (i.e. electricity, access to clean water, sanitation). Legal services are highly
centralized forcing rural residents to travel great distances to obtain birth certificates,
visas, and statuses needed to formally incorporate an organization.
Campbell and Shackleton (2001) describe decentralization as:
The process by which bundles of entrustments (e.g. regulatory and executive powers,
reasonability and authority in decision making) are transferred to local groupings (e.g.
local governments or communities). Decentralization can occur through devolution, in
which case the entrustments are transferred more or less completely to the local users…
This transfer of authority can manifest as the control of decision-making; the control of
income, expenditure, and benefits; the control of developments such as tourism ventures;
the transfer of ownership and property rights; and improved status amongst the
individuals and organizations involved.
20
In Haiti limited decentralization has occurred at the lower political levels of the
communes and communal sections. The constitution names the Administrative Council
of the Communal Section (CASEC) responsible for carrying out the decisions of the
Assembly of the Communal Section (ASEC). The CASEC’s role is that of an
administrator at the local level who maintains infrastructure and participates in local
development (World Bank, 2006). Campbell and Shackleton’s (2001) observation about
African community-based natural resource management organizations can be readily
applied to the Haitian context. In environments where development at the local level is:
… Largely based on organizations or authorities outside of the state hierarchy… the lack
of external support and the absence of any clear policy and legal framework for
community-based natural resource management (CBNRM) [and community development
more broadly] are limiting the achievement of sustainable natural resource management
(NRM).
Decentralization is important for encouraging entrepreneurship and CBSE
establishment. Sara and Minard (2009) points out that entrepreneurs will become more
prominent as governments decentralize. Nelson (2004) succinctly draws the connection
between decentralization and community empowerment.
Local government legislation can give villagers the right to develop their own by-laws
that can be used to create and enforce local rules and regulations… These institutional
arrangements were critical for the initial development of community-based tourism [in
Northern Tanzania], and have since played an important role in facilitating the
establishment of a range of community-based natural resource management efforts.
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5.2 Public Sector
The Haitian government’s incapacity to provide the necessary level of basic
service provision is the result of years of government neglect; predatory policies targeting
natural resources and other opportunities for exploitation; and foreign intervention
(Lundahl, 2010). The growing influence of NGOs whose funding and implementation
approaches often circumvent government channels further reduces the already limited
capacity of the state. In one example, after a 2009 donors’ conference donors pledged
more than $350 million; US$40 to $70 million of which was directed through NGOs
rather than the government (Perito, 2010). Collier (2010) foresees the dangers of this
marginalization, which increasingly characterizes the relationship between the
government and its citizens with severe implications for poor rural populations in
particular. Collier asserts that:
…If the state is not visibly providing services, its predominant interface with citizens is
as a tax collector, regulator, and bribe taker. This has already bred a cycle of citizen
disengagement from government with very low turnout at elections and extreme cynicism
about politicians. People get little and so they expect little; they expect little so they get
little.
According to White and Gregersen (1994), in order to operate effectively the
Haitian government should view its role as a provider of a framework for action. From
that vantage point the government should subsidize the activities of local groups working
toward rural development through rural infrastructure, rural training centers to improve
agricultural productivity and local organizational, and entrepreneurial skills and rural
22
credit programs. Instead, Lundahl (1989) finds that the “ruling politicians have acted on
the assumption that the nation exists for the sake of the polity, and not vice versa.”
Sara and Minard (2009) recognizes the fundamental importance of having
political institutions in place to manage and organize the increasing competition and
greater deposit of wealth in communities experiencing social and economic growth.
According to standard economic theory, economic and social competition will
temporarily lead to a rise in imbalances within communities, societies, and among
regions. The unavoidable social differentiation which will ensue from the increasingly
competitive organization of society will be a source of potential conflict, and the
institutions necessary to resolve issues and underpin the rule of law will be needed,
recalling that progress in development is inherently conflicted but need not be violent.
Nelson (2004) found that the greatest challenges arose from all levels of
government whenever high-value resources were at stake, as is the case with Kokoyer
beach tourism. Policy plays an important role in poverty alleviation and natural resource
management. For example allowing communities to develop and enforce their own bylaws, subject to government approval, can effectively:
Increase local control over community resources, as well as to foster participatory
decision-making and planning processes within the village… By-laws have proven
important in the development… [by providing] legally binding mechanisms for the use
and management of tourism revenues. Reporting and accounting by-laws can be
important in institutionalizing transparency and enabling the village assembly to hold
their leaders accountable (Nelson, 2004).
23
6. THE ECONOMIC ENVIRONMENT
6.1 Private Sector
There has been a lack of government support in developing rural microenterprises that would generate off-farm employment. Therefore the most common types
of private sector investment in rural areas are those involving access to natural resources
(i.e. tourism destinations, sources of mineral wealth, sites of historical importance, etc.).
These types of investments are reflective of the limited local market demand in poverty
stricken rural areas.
Entering into partnerships with private enterprises is one way for CBSEs to gain
access to capital, develop business capacity, or simply earn profits from the leasing of
land or renting access to natural resources (i.e. wildlife reserves, beach access, etc.).
Particularly attractive to investors are the deposits of mineral wealth that continue to be
discovered throughout Haiti. CBSEs must first be capable of entering into legally binding
agreements with the private sector before they can begin to establish beneficial
partnerships. In Haiti, CBSEs must obtain a Status from the Ministry of Social Affairs to
formally incorporate as a community organization capable of entering into commercial
agreements. Beyond the process for obtaining a basic Status formal business registration
process in Haiti is highly inefficient. For the 2012-13 period the Doing Business
Indicators ranks Haiti 174 out of 185 countries while the Global Competitiveness Index
ranks it 142 out of 144 countries (IMF, 2013). Depending on the size of the CBSE,
cumbersome processes for formal business registration may hinder establishment.
24
Laws are important to deter illicit private sector dealings and to aid CBSEs in the
case of legal recourse. Statuses are highly valued among community organizations who
must present one in court in order to be heard by a judge. Assistance (i.e. formal
registration, education, and technical assistance) could help to avoid inequitable
arrangements and ensure that any appropriate social and economic benefits reach the
community level (Klapper et al., 2009).
6.2 Non-Profit Sector
Even before the 2010 earthquake the 10,000 NGOs operating in Haiti (the highest
per capita in the world) have bestowed upon Haiti the nickname of a “republic of NGOs”.
The World Bank estimates that the numerous NGOs provide 70% of healthcare and
education services in rural areas (Aliprantis, 2012).
NGOs in Haiti have received strong criticism for their work over the last few
decades but especially since the devastating 2010 earthquake. Critics accuse the many
International NGOs (INGOs) of flooding the market with free products and agricultural
producers that undermine the local producers (Reinert and Voss, 1997), and
implementing shortsighted and uncoordinated aid projects to the neglect of long-term
development oriented approaches (Katz, 2013). Critics have also pointed out that the
current structure of NGOs makes them: responsible above all to their donors; strive for
the quickest results for marketing purposes to attract more donors; measure success in
terms of fundraising and expenditures above social impact.
25
Nevertheless many of these NGOs are considered in rural areas to be the best
avenue for development given their resistance to political turmoil, technical expertise,
and their ability to draw from a pool of motivated individuals committed to maintaining
services even during crisis and in areas neglected by the government (World Bank,
2006). NGOs also have a competitive advantage when it comes to marketing,
fundraising, and mobilizing people and resources for a cause. There is a segment of
NGOs that focus on Business Development for both individuals and community groups
(i.e. the Yunus Social Business, the Lambi Fund, and Fonkoze). These services teach
financial management, bookkeeping, and organizational management.
In the short-term circumventing national channels may enable NGOs to more
effectively implement projects for social change. From the NGO’s development-oriented
perspective the government’s corruption and inefficiencies present a challenge to be
avoided whenever possible. Yet in the long-term this exclusion of the government
forgoes an opportunity to build government capacity.
6.3 Education
Education at the most basic level (literacy and numerology) is essential for any
commercial venture. The Haitian government spends less than one percent of their
national budget on education, which designates the country as one of the lowest
government expenditures measured at US$82.9 million or 1.97% of GDP in 2006 on
education in the Caribbean (Wolff, 2008). Eighty-three percent of the half million
children unable to attend school live in rural areas (IOM, 2013). As critical as a basic
26
education is, the additional skills of entrepreneurial and organizational management as
well as some production-oriented vocational training are needed for CBSE establishment.
International pressure is growing to incorporate entrepreneurial and
management skills into secondary and higher education curriculum. Without
business-minded training there tends to be a reactive rather then a strategically
proactive entrepreneurial mindset. Opportunities are exploited as they come but there
is no capacity for creating and pursuing opportunities for greater benefit or developed
for long-term sustainability and growth. Limited access to business and leadership
training and basic education in Haiti results in a reactive, as opposed to a proactive
entrepreneurial mindset. Once opportunities are identified they are exploited without
any conscious strategic effort towards long-term development and sustainability
(Austin et al., 2006).
When speaking of organizational management in rural CBSEs the most
commonly referred to duties are conflict management, inter-organizational collaboration,
and the ability of a visionary to mobilize a community into action.
6.4 Access to Credit
Access to credit is an important pre-requisite for establishing a business. Credit in
the form of micro-loans is one preferred option among small businesses in developing
countries. Until the 1980s micro-finance in the Haitian financing sector was extremely
limited to cooperatives and credit unions. It was during the early 1980s that these finance
institutions began to diversify in form (associations, NGOs, and foundations) and
27
products and services (credit, insurance, currency exchange, and remittance transfers). It
wasn’t until the 1990s that finance institutions began offering micro-credit. In 1997 the
Haiti branch of the First National Bank of Boston was the first to offer this type of loan
program. The loan program specifically favored mobile merchants selling clothing
imported from Panama and the United States (USAID, 2012).
The legal and regulatory framework has been slower to adapt to the growing
industry. Until 2002, credit unions were considered to be cooperatives and businesses
under the control of the National Council of Cooperatives (CNC). Non-bank institutions
(i.e. foundations, associations, and NGOs) were considered NGOs and under the control
of the Ministry of External Cooperation and Social Affairs. At that time all control was
limited to legal recognition and grant permits. It wasn’t until early 2000s that the ad hoc
2002 Law CEC (Savings and Credit Accounts) was created in response to a series of
bankruptcies in 2001 of financial pyramids disguised as cooperatives. The law created a
specialized unit of supervision and regulation of CECs within the Bank of the Republic of
Haiti (USAID, 2012).
The following information is based on the 2006-07 census of the Microfinance
Industry in Haiti from the United Nations Office of the Secretary-General’s Special
Advisor. At that time there were 196 formal micro-finance institutions (MFIs) operating
in the country (albeit functioning at varying degrees) with a total credit portfolio of HTG
3.8 billion (approx. US$95 million). Of these micro-finance borrowers only twelve
percent resided in rural areas with 41 percent residing in Port-au-Prince alone and the
28
remaining 47 percent in other departments and provinces. By 2011 the number of formal
micro-finance institutions had risen slightly from 196 in 2007 to 200 in 2011.
The actual borrowers only accounted for ten percent (239,474 people) of an
estimated 40 percent (2.8 million) of the population qualifying for a micro-loan.
Although only a quarter of qualifying borrowers successfully obtained these loans this
number is significant in light of the fact that the formal banking sector loans qualified
only one percent of the population (approx. 90,000).
This structural pattern has continued and is reflected in a recent 2013 International
Monetary Fund (IMF). The IMF reports that “banks dominate the financial sector in Haiti
in terms of assets and volume of loans and deposits, but play a limited role in financial
inclusion, lending to few sectors and clients” to the exclusion of rural populations. It is
worth noting that women have historically accounted for nearly 75% of borrowers
(USAID, 2012).
Micro-finance institutions and Financial Cooperatives (FCs) are two types of
financial service providers growing in rural areas (IMF, 2013). Small loans from these
institutions (as low as US$25 up to hundreds of dollars) come with variable interest rates
(ranging from zero to 100 percent). Nobel Peace Prize laureate Muhammad Yunus, often
considered the Father of modern microfinance, proposed the concept as a means to
alleviate poverty in the 1970s.
Introduced in Haiti in 2010 Yunus’ Social Business program includes microfinance loans and business development services. By that time another similar prominent
29
microfinance institution, Fonkoze, had already been successfully operating in Haiti since
its inception in 1994. Fonkoze distinguishes itself from competitors as Haiti’s
“Alternative Bank” offering group loans and business development services specifically
to groups of rural-based poor women through their solidarity groups program. Zafèn is
another lending source offering loans to business people that would otherwise not qualify
for a traditional loan.
Revolving community loans (known as cengle or sang) are historically popular
among rural communities. Funds are collected from community or organization
members, often in small amounts at regular meetings, which are pooled together and
provided to individual members. The members then repay the loan with minimal interest.
The interest can be added to the original sum in order to augment the loan principal for
the next borrower or placed in another account (or caisse) to be used for community
needs. With community or group-wide accountability, advising, and/or labor sharing
these loans have a high repayment rate. This type of loan is popular among groups of
women in communities where women are typically socially and economically excluded.
Remittances may represent another option for initial capital and ongoing
supplemental income for CBSEs. A 500 person-study conducted by the Inter-American
Development Bank (IDB) of Haitian remittance recipients shows that transfers are
received regularly and at least ten times per year. A specific focus on rural remittances
from a 2001 Haitian household census reveals that while half of the money goes to rural
areas only twelve percent of rural recipients have bank accounts. The study also shows
30
that of all the remittances used by Haitian recipients on financial products, 73.6% went
into savings, 12.9% repaid business loans, and only 11.6% was invested in a small
business (Orozco, 2006). The IDB identifies one critical area of donor assistance as the
enabling of rural financial institutions to have the capacity to work with these remittances
and provide financial services (Orozco, 2006).
In order for these loans to be effectively leveraged they must be complemented by
financial literacy and a viable business plan. Minimal gains from the less risky
alternative of women’s community revolving loans may be preferable to risk
adverse CBSEs.
31
7. THE SOCIO-CULTURAL ENVIRONMENT
7.1 Inter-organizational Cooperation
Public services, while underdeveloped in urban areas, are largely absent
altogether from rural areas. Groups, social and civic, have arisen to fill the needs left
unsatisfied by the poor provision of public services. The sense of cohesion that
determines the depth and breadth of these spontaneous social conglomerates may be
attributed to social capital. Social capital refers to the “degree of connectedness and the
quality and quantity of social relations in a given populations” (Jones, 2005).
Reflecting specifically on Haiti, White and Smucker (1998) characterize rural
community groups by heavy reliance on social capital that allows the use of:
Complicated interpersonal relations to meet labor requirements, gain access to land,
protect clientship in the marketplace, promote mutual aid, assure protection from state
authorities, and generally manage risk… These horizontal forms of social capital are
indigenous, autonomous, local, and specialized in function [tending] to have a democratic
character and emphasize collective activities… among social peers. The groups are selfselecting, self-governed, stable and repetitive, and based on the rule of reciprocity.
Social capital can be categorized as bonding, bridging, or linking capital. Bonding
social capital is characterized by shared norms and values, deep trust and dense networks
and is commonly found in families and close-knit groups. Bridging capital tends to be
weaker, forming more fragile networks, between different groups. Linking social capital
refers to the connection between groups (i.e. communities) with groups of a higher socioeconomic order (Basu, 2012).
32
When considering Haitian cooperation and social capital a major concept that
must be addressed is that of the “lakou”. The “lakou” is a physical communal locale (i.e.
courtyard) and socio-political structure where close groups (i.e. extended families and
groups of families) would meet both for social interaction and to discuss important
community concerns.
In a 1994 U.S. Agency for International Development (USAID) report, White and
Gregersen, who write extensively on Haiti, expresses the importance of the “lakou”
structure.
Family networks and labor exchange groups are the primary social organizations in
which peasants produce, market, debate, and formulate responses to the changing
conditions of life. The extended family household (“lakou”) is the primary production
and consumption unit. These indigenous cooperative institutions provide cultural and
social meaning to life. In addition, they control uncertainty, share risk, and assure
member production and subsistence. The extended family also increases individual
access to production factors (such as, land, labor, tools, and credit). It guards against
individual member failure from loans and by sharing food and other necessities. Families
operate according to the cultural ethics of the right to survive and the duty to reciprocate.
The “lakou” and other social structures built on the notion of reciprocity act as
social safety nets in the face of risk associated with collective enterprises (Lundahl,
2010). The “lakou” has been embedded in Haitian culture for centuries but is now loosing
some of its institutional value as people emigrate to the cities for employment (White and
33
Smucker, 1998). This social structure is founded primarily on bonding capital, which is
arguably the strongest among rural Haitian communities.
34
8. METHODOLOGY
The data presented in this study has been collected first-hand over a week long
period in March 2013 via 1) in-depth interviews with ten community and organization
leaders including Madam Nicole of OFAK, 2) three focus group discussions with OFAK
members, and 3) one focus group with the youth in the Kokoyer community. The
interviews were conducted in Creole, a language with which the author has a beginner’s
working proficiency, and with the aid of a research assistant/translator. The researchers
reached the community via a hike over the mountain with the assistance of Madam
Nicole and Madam Michelin, women of OFAK, who also providing lodging during the
time spent in the field.
All interviews were held outdoors in the Kokoyer community in between the
community’s lakou and the entrance to the beach. Interviews and focus group discussions
were first recorded using electronic voice recorders and then transcribed verbatim. Photo
documentation was also used to preserve official documents (i.e. OFAK’s Status and
Attestation) and organizational records maintained by OFAK.
35
9. THE CASE STUDY
The following case study presents an in-depth examination of the women’s
community-based social enterprise Organisation des Femmes pour l’Avancement de
Kokoyer (OFAK). OFAK is located in the rural community of Kokoyer inside of the
Trou Chouchou communal section located inside of the Petit-Goave commune in the
l’Ouest department of Haiti. The Kokoyer community boasts the relatively popular tourist
beach of the same name. The organization was established in 2010 shortly after the
massive earthquake that struck the country. Before OFAK was established the living
conditions in the community were horrendous. The community lacked access to the most
basic health and sanitation necessities including a clean water source and didn’t have
even a single latrine. The people felt “forgotten” by their government and felt “hopeless”
in those days, infamously remembered as the “dark days”. At the time of this study, the
communal section (containing Kokoyer community) is still void of a health clinic,
secondary education facility, and basic infrastructure (save one road currently under
construction that extends from the southern base of the mountain north into the Martin
community falling short of the Kokoyer community).
Four major catalysts proceeded the establishment of OFAK, namely the desire to
empower women, the need for collective action in development, the desire to send
children to school, and the power vacuum resulting from the death of the previous land
owner.
36
Before the earthquake the women in the community suffered disproportionately
relative to men. Women were treated very badly and often received little respect and
considered useless, “like gas… without anything in their hand”. One of the major
catalysts for the establishment of OFAK was a desire to improve the situation of the
women. “We [knew] that the women are very important… [and so] we wanted to create
the organization to see if we could ameliorate their situation”.
Another major catalyst for the establishment of OFAK was a shared realization
that an official organization is essential for realizing beneficial community projects in
partnership with NGOs active in development of the Trou Chouchou communal section.
“We judged that without making any organizations, nothing could be done. So we put our
heads together and we made the organization named OFAK.”
A third catalyst was the revelation by the founding women of OFAK that many of
the children in the community could not afford their school tuition fees. Faced with this
problem the women saw an opportunity to manage funds from the tourism of the
Kokoyer beach to send children to school.
The event that opened the opportunity for OFAK to claim management of the
beach was the death of the land owner during the 2010 earthquake. In the wake of his
death a power vacuum was created that allowed OFAK to “raise up” and challenge the
authority of the “Big Five”. The “Big Five”, a term coined by Kokoyer community
members to describe a group of five Kokoyer community members who were bestowed
with the authority to manage the beach in the absence of the land owner who lived in
37
Port-au-Prince. Under the authority of the “Big Five” the beach saw very little investment
in the way of tourism development and little to no benefit shared with the people living in
the community directly connected to the beach. Presented with the opportunity OFAK
organized and “stood up” to take over control of the beach.
In order to formerly establish OFAK the leadership asked some friends to draft a
Status for OFAK. The Status is a formal document that permits an organization to operate
as a legal entity and represent itself in court in the case of legal disputes. An organization
is able to approach a NGO with a Status in order to secure community project and
advocate on behalf of their communities or stakeholders. The process of formerly
registering as an organization requires making a 500HTG (approx. USD$12) deposit with
both the mayor’s office and the office of Social Affairs in Port-au-Prince for a second
piece of documentation, an Attestation. Equipped with an approved Status and an
Attestation, formerly recognizing OFAK, the organization began carrying out its plans
for beach and community development projects.
OFAK has also designed a strategy for developing the beach and attract more
visitors. For example every Thursday through Sunday the sixty members of OFAK, with
the help of community members, join together to clear the beach of debris that has
washed ashore from the Port-au-Prince bay. OFAK has also partnered with NGOs to
plant over fifty palm trees along the shore and is in the process of constructing a more
modern latrine for tourists.
38
Along
with
cleaning
the
beach,
OFAK
welcomes
tourists,
provides
complementary coconuts, and in return charges visitors a beach day access fee of
US$5/person and offers tent rental services for US$10/night and home-made meals of
freshly caught lumbi (conch) and/or fish with fried plantains for US$8.75/plate. Kokoyer
beach is a popular destination among foreign development aid workers seeking a
beautiful and secluded beach only three hours from the crowded Port-au-Prince
metropolitan area. The beach (and community) can only be reached by either a one hour
(two hours round-trip) boat ride from Petit-Goâve or by hiking one hour down the
mountain from the end of the road in Martin. The seclusion of the beach enhances the
beauty and relaxed atmosphere of the beach but also presents a challenge for attracting
tourists.
OFAK also uses funds from the beach to invest in developing the community
itself. For example, OFAK has constructed a public latrine and partnered with the NGO
GVC to carry out a public water project that gives the entire community access to clean
water and provides an enclosure for two public showers. One of the biggest
accomplishments has been OFAK’s initiative paying school tuitions that enables twenty
children from the community to attend school that would otherwise not have access to an
education.
A lack of access to quality, affordable, education is just one of the many
challenges that rural citizens face as a result of an “unengaged” government. The
government’s involvement in rural areas is highly limited. The residents described the
39
government’s attitude toward them as either intentionally malicious, “taking pleasure in
our pain” or simply indifferent to the plight of the rural residents using words such as
“forgotten” and “abandoned”. It is perceived that the only “well-connected” people who
are able to benefit from the services of the government (i.e. being awarded government
contracts for public infrastructure jobs, being hired, having a grievance addressed, having
a project proposal approved, etc.).
The 1987 Haitian Constitution calls for decentralization yet little has been seen
except for at the lowest administrative levels (i.e. the CASECs responsible for the
communal sections). The role of the CASEC is to be a conveyor of community needs.
Yet the government entity charged with supporting development is not given the
resources necessary to carry out the task. Without effective decentralization CASECs can
be easily ignored by their superiors. When CASEC Jison describes the breakdown in
communication as if his requests for “realizing a project” or a need are “put in a drawer”
without even being looked at no matter how many letters are written or visits made to the
capital. Even the mayor [of the department] is not concerned [with development for the
people], “he doesn’t come down here [into the communities]… if I call the mayor on the
phone he will not take my call… it is only by accident that you would see the mayor
passing by here to come visit the commune, or the community”.
Additionally, without a decentralized court system the CASECs are continually
distracted from their development goals in order to mediate community conflicts. CASEC
Jison describes his duties as forty percent conflict-management, forty percent meeting
40
with communities to discuss needs and helping to write up development project reports to
give to his superiors, and twenty percent office work and completing necessary
paperwork.
Distrust of government is bred and fueled so that the government becomes the
nemesis keeping the people oppressed by denying their legal rights for justice and
economic opportunity. The government becomes a repressive force to be worked around
whenever possible. This is greatly due to the failure of the government to properly
establish a rule of law. OFAK leadership has recognized that there is a double standard
where the written laws have little applicability to the citizens since they are not enforced.
Laws are generally used against the impoverished when necessary and can be ignored
whenever it is convenient. The example was given that “even the CASEC can be arrested
at anytime for anything”.
It is from within this neglectful and discriminatory environment that OFAK
leaders identified three main avenues for pursuing justice or getting the attention of the
government. All three of which favor residents of the Port-au-Prince metropolitan area
and further marginalize rural citizens. The most popular methods are to stage a
demonstration, go on the radio to plead your case or advocate for your cause, or hire a
journalist from Port-au-Prince to publish your grievance in a newspaper. There is general
mistrust in the legal and political systems that make the formal channels perceived as
ineffective or unattainable.
41
At the time of this study OFAK and the Kokoyer community are locked in a legal
battle with the aforementioned “Big Five” over the right to manage the beach and collect
the revenue from it. The tension had been growing since OFAK began managing the
beach with OFAK leaders reporting threats of bodily harm. The conflict has culminated
in the arrest of six people in January 2013 including four OFAK leaders, a male
community member, and CASEC Jison, the chief political figure of the communal
section who is supportive of OFAK and development efforts of community-based
organizations. The “Big Five” and policemen came to stop OFAK from finishing
construction on a latrine on the beach for tourists. OFAK members were imprisoned and
were released after hiring a lawyer and posting bail at 3,000HTG each (approx. US$70).
This is a large sum even for OFAK who has access to the beach and an amount which
few other organizations would be able to afford.
According to community leaders, including former CASEC Sanon of the Trou
Chouchou communal section, beaches in Haiti are considered public property and feel
that money from the beach should be returned to the community for the “greater good”.
This is one example of the ambiguity over laws concerning ownership, management, and
benefit distribution from natural resources.
Those interviewed demonstrated a distrust of the private sector as well. When
asked whether organization leaders were interested in engaging the private sector, all
respondents assumed that any engagement would be in the form of loans rather than
private sector investment in local initiatives or organizations. All leaders also stated that
42
they were hypothetically open to private sector investment and recognized that such
investments would be highly beneficial in providing the financing desirable for
community development. However, each confession of openness was quickly followed
by the caveat that companies from the private sector sought an unfair upper hand in any
arrangement and demanded “at least half of any future profits”.
Only one instance of private sector investment in the area could be recalled by the
participants. That of an American mining company who made an initial exploration of a
neighboring community’s mineral resources. The firm unsuccessfully attempted to
negotiate with Tapion leaders in 2011. The company offered to build a much-needed
medical clinic in the isolated community (which would still need to be staffed and
supplied), but negotiations stalled when the company refused to invest in extending the
nearest road down to the community. The company abandoned the project along with its
initial exploratory mining equipment (i.e. tractors, a boat, etc.) at the potential excavation
site. Tapion community members received support and counsel from other community
organizations and the communal section’s Casac in an act of solidarity and community
advocacy. The brief interaction is recalled with a sense of pride for the community’s
ability to avoid exploitation and affirmation of the threat of private sector engagement.
Advocacy is just one of the major benefits of collective action mentioned by
organization leaders. Other benefits include greater access to finances and a stronger
ability to repay loans. At the time of the study OFAK had made the conscious decision to
not take out a loan. Instead OFAK relies on funds generated from tourists as well as the
43
interest generated from revolving loans. The women of OFAK keep accurate records both
of meeting attendance and weekly dues paid as well as loan disbursements, repayments,
and interest. At each bi-weekly meeting OFAK leaders collect 10 HTG (approx.
US$0.25) totally approximately 1,200 HTG (approx. US$30) monthly from the OFAKS’s
60 members. With these funds OFAK leaders provide low interest loans to its members
on a revolving basis. Each loan of 500 HTG is expected to be repaid with 60 HTG in
interest.
OFAK leadership has decided against taking out a loan for two primary reasons
which reflect the insecurity of the area given a poorly established rule of law and the
legal uncertainty of the pending legal case. First, a loan is considered too risky given the
threat of thievery or robbery in the rural areas or at the market. Second, if OFAK is not
able to retain control of the beach they would not have a viable means of repaying the
loan. According to OFAK leadership, if a loan would be taken out the money would be
spent to invest in building more permanent lodging for tourists.
Another major benefit of collective action is having greater access to educated
people which is widely acknowledged as an invaluable asset, “without having welleducated people inside of the group we can do nothing at all”. Sharing ideas and
networking are both very important for an organization to have their desired impact.
Several references were made to the notion of “putting our heads together” and building
good friendships as trustworthy. Great pride is taken in being well acquainted with people
that have a reputation for “getting things done”. There are a number of supra-
44
organizational bodies that reside at the communal section and commune levels of Trou
Chouchou and Petit-Goâve respectively. COCIPEG (Coordination Initiative de PetitGoâve) and MODET (Mouvement des organisations pour le développement de Trou
Chouchou) are examples of two such supra-organizational bodies. It is common for one
leader to be involved in a two or three organizations simultaneously.
However, collaboration between organizations also has its limitations. Two norms
inherent in the culture result in a cautious position against collaboration. The first norm
flows from the following logic. The bonds between organizations (i.e. bridging capital)
appear much more fragile and less likely to occur given the necessity for selfpreservation and an unwillingness to share the few resources available. There is also an
awareness that cross-organizational cooperation (i.e. linking capital) poses problems (i.e.
jealousy, competition, etc.) since it is not possible to forge partnerships with all the
organizations desiring a beneficial partnership. In other words the mentality is “if I
cannot work with all it is better not to work with any rather than to offend them all”.
The second norm pertains to hospitality. In Haitian culture if a guest is asked to
stay for longer then two hours it is expected that the guest would be given refreshments.
Limited economic means make this type of hospitality impractical for any large groups or
regular meetings. Since the entire area is subject to extreme poverty, each group
protectively guards their own funds and is generally unwilling to share those funds or
allow another group to dictate how those funds would be used.
45
Collaboration at the lower administrative levels among CASECs is also
constrained. According to CASEC Jison collaboration at the local political level among
CASECs is discouraged since the communal section residents may interpret the act as the
CASEC abandoning them or putting the interest of other communal sections above their
own. Each December the CASECs are given minimal budgets of 50,000 HTG (approx.
US$1,200). This small sum is divided up among community groups to spend according to
their individual needs throughout the year. The community leaders have grown
accustomed to receiving this small sum annually and may charge the CASEC with
corruption or favoritism if the CASEC retains any funds to be used for his or her
development strategies or pools together funds collaboratively with CASECs in other
communal sections.
In the face of neglect, distrust, and suspicion NGOs represent a viable opportunity
for organizations to partner with in order to build capacity for CBSEs and implement
projects that improve the quality of life within communities. The majority of projects
accomplished by the organizational leaders interviewed from the Trou Chouchou
communal section were completed as a result of partnering with these charitable
organizations such as GVC, ADRA, HELP, Samaritan’s Purse, and Food for the Poor.
Many of the leaders admitted that working with other community organizations would be
ideal but that these relationships tend to be fragile and rare because of a lack of finances.
The second most desirable relationship identified is with NGOs that have the finances
and expertise to execute community projects. The NGO ADRA has been active in
46
training farmers to grow seedlings and live off of sales of the produce as well as the
produce itself. It is important to note that two of the community leaders interviewed
prefer to work with their own government but also recognize the impracticality of this at
the current time given the state’s lack of economic means and general interest in rural
development projects.
NGOs active in the area are known for both searching for projects themselves and
welcoming community leaders to come to them with their proposals. In the Kokoyer
community alone GVC (in coordination with OFAK) constructed a water project that
provides water for the entire community. The project consists of an enclosed water source
controlled by a tap ready for drinking and cooking (after chlorine purification). The
cement water station is designed with enclosures functioning as two shower stalls. Before
this water station the community walked twenty minutes to the nearest water source; an
uncovered still water well near ground level, which they shared with the Tapion
community and any wandering livestock.
Another incredibly successful operation by the NGO known as NDI in 2008
equipped two of the most successful leaders interviewed in this study. Both leaders
attributed many of their most useful skills to the conflict management and organizational
skills gained from the seven month training that taught them “how to lead a society to
advance”.
There is a strong desire to pursue such educational and training opportunities
whenever possible. At the time of this study OFAK is funding three girls from the
47
community to go to a training school outside of the area to learn how to manufacture
tomato sauce and mayonnaise. OFAK’s strategy is to raise funds to continue sending
these three girls to as many trainings as possible (including the manufacturing of cleaning
supplies, liquid soap, charcoal, etc.). The hope is to prepare the next generation for the
future when the community can house a small manufacturing center. Paying for the
twenty children from Kokoyer to go to school is also identified as OFAKs most important
success.
48
10. CONCLUDING REMARKS
There is a great need for poverty alleviation in rural Haiti that is not currently
being met by either the Haitian government or the private sector. In lieu of these actors,
community-based organizations have arisen to answer this call. However, without
adequate funding (i.e. access to credit, fundraising, donations, commercial activities, etc.)
many CBOs are not able to establish sustainable organizations capable of meeting the
extensive need. Furthermore, the widespread extent of the poverty makes access to credit
and collaborative initiatives across organizations difficult.
This study has examined the various legal, political, economic, and socio-cultural
aspects that are at work in determining how easily CBSEs can establish themselves in
Haiti. Based on the limited scope of this study it is not prudent to make sweeping
generalizations applicable to every rural area in Haiti. Nevertheless, important insights
can be gleaned from the case study and are presented here, summarized in the following
propositions.
The legal environment is unconducive given the overwhelming insecurity that
exists in the land without the establishment of rule of law and an equipped justice system.
Rural populations, and CBSEs, rarely receive adequate representation from the justice
system. The challenges in the legal system also create major difficulties in resolving land
ownership conflicts.
49
Proposition 1 The Legal Environment
Amidst prevalent corruption, without the rule of law, the Haitian government does not
uphold the civil or property rights of its rural citizens. Therefore, CBSEs and other SMEs
can operate outside of the formal economy but incur conflict when their rights are
violated and are unenforceable without the rule of law or are subject to ambiguous laws
discriminating against the rural poor.
The political environment and extreme centralization in the capital exclude rural
residents from political representation and public service provision. Administrative units
(i.e. CASECs) in the rural areas that are charged with local development are deprived of
adequate budgets and are frequently denied support from individuals at the higher
administrative levels.
Proposition 2 The Political Environment
Centralization disempowers local authorities and communities by
withholding funding, diminishing decision-making capacity, and making it
more difficult for rural populations to hold their government accountable.
The economic environment is limiting to CBSEs in both the areas of educational
training and access to credit. The inability to access basic education (i.e. primary and
secondary school, literacy, numerology) among rural populations diminishes community
organization’s ability to manage CBSEs. Revolving community loans are popular
mechanisms for financing among community groups with strong social capital, trust, and
cohesion. Yet, these funds are often minimal and insufficient for attaining the necessary
50
seed capital. Micro-finance institutions (MFIs) are increasingly targeting social
enterprises and small businesses in rural areas by offering business development services,
technical assistance, and financing. While the MFI industry in Haiti has been growing
and is useful for promoting equity in social and economic development some CBSEs
might still consider it too risky to borrow loans given the general insecurity without an
established rule of law (i.e. inability to deter or persecute theft, legal recompense, etc.).
Proposition 3 The Economic Environment - The Private Sector
The current unfavorable business environment and limited market demand
is unlikely to attract any private sector investment in rural areas aside from
exploitative ventures pursuing opportunities at the expense of local
populations.
Proposition 4 The Economic Environment - NGOs
Unlike the Haitian government, which currently lacks the funds and the
capacity to support rural-based organizations in community development
projects, NGOs represent the greatest source of material wealth and
willingness to invest in community development. NGOs looking to spur
development by partnering with local organizations may be highly
beneficial to CBSEs by promoting their products and services to external
markets, providing funding, leadership training, business development
services, and technical expertise.
51
Proposition 5 The Economic Environment - Education
Educational
training
on
organizational
leadership
and
conflict
management as well as skilled labor, business knowledge, and financial
literacy necessary for establishing commercial activities are key in
establishing a CBSE.
Proposition 6 The Economic Environment - Access to Credit
Micro-finance loans are increasingly accessible to women in rural
communities but may still be considered too risky without a security
system and an established rule of law to protect property and sufficiently
deter theft.
Collective action is recognized as highly valuable for community development
and advocacy and has been identified as one of the major catalysts for OFAK’s
establishment. Brainstorming together, sharing ideas, and receiving counsel from
educated people, are motivation for cross-organizational collective action. However,
cooperation between groups and between political figures in different zones is limited
primarily because of the area’s widespread poverty which heightens competition and
discourages hospitality.
Proposition 7 The Socio-Cultural Environment
Organizations may share ideas and advocate together through supraorganizational bodies and personal relationships among leaders but
financial strain and rivalry limits the depth of interaction between
52
community organizations. Advisory and advocacy roles are important for
supporting the establishment of new venture such as a CBSE.
Therefore, after closely reviewing the case study findings in light of the political,
legal, economic, and socio-cultural environment in the Trou Chouchou communal section
of the Petite-Goâve commune this study concludes that the current environment in Haiti
overall is not conducive to CBSE establishment.
53
Appendix A. Tables
Table 1. Participants listed chronologically according to order interviewed
Participant Name
*Mme. Nicole Lumaine
Mme. Georges & Mme. Gustave
Exantus
Focus Group Discussion #1 (n11)
Title / Position / Organization (gender)
Secretary, OFAK (women’s)
Leadership, OFAK
Leadership & Members, OFAK
Coordinator, CIDT (mixed)
*M. Sanon
Vice-Coordinator of COCIPEG (mixed)
Former CASEC, Trou Chouchou
M. Anaïs Sagai &
Church & Community Leader, Kokoyer
M. Exantus
Church Youth Leader, Kokoyer
Focus Group Discussion #2 (n12)
Leadership & Members, OFAK
Focus Group Discussion #3 (n9)
Leadership & Members, OFAK
Focus Group Discussion #4 (n7)
Youth (ages 16-25), Kokoyer
M. Antonio Lafontant
Leadership, Unité Nord 3ème (mixed)
M. Jean-Ralto &
Delegate, ASPADET (mixed)
M. François Laurant
Coordinator, ASPADET (mixed)
M. Jison
CASEC, Trou Chouchou
M. Fremond
Director, John Wesley School, Kokoyer
* M. is the French and Creole prefix for Monsieur (Sir)
*Mme. is the French and Creole prefix for Madame (Mrs./Ms.)
Table 2. Sample Interview Questions
Legal
Political

Is there any value in becoming an official organization,
recognized by the government, in order to have legal
rights?

What benefits/protections does your legal status offer you?

Have you had any experience interacting, as an
organization representative, with the government?

If so, given the opportunity, would you be willing to work
with them (again)?

What does the local government think of OFAK and
54
organizations like it?
Economic
Socio-Cultural
OFAK

What would your reaction be if your organization pursued
greater political affiliation?

Have you found the government and laws to be supportive,
neutral, damaging, or inapplicable to your organization?

Is there anybody outside of the community who would
benefit if your organization is successful? Is there anybody
who would benefit if your organization is unsuccessful?

Is it necessary to interact with the government for your
organization to accomplish their goals?

Have you had any experience interacting, as an
organization representative, with businesses in the private
sector?

Have you had any experience interacting, as an
organization representative, with NGOs?

If so, given the opportunity, would you be willing to work
with them (again)?

Have there been any risks associated with managing or
participating in OFAK?

Why was your organization established as a women’s,
men’s, or mixed organization?

Does gender play a role in your organization and the
community?

What would be your reaction OFAK if they decided to
partner with other communities?

How would you describe OFAK to somebody who doesn’t
know about it?
55
Appendix B. Illustrations
Illustration1. OFAK Status page excerpt
56
Illustration2. OFAK Attestation
57
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