Haiti’s economy recorded modest growth of1.5% in Fiscal Year1 (FY) 2017-18. The agriculture sector continued its recovery, increasing by 1.0%, a slight improvement over 0.8% in the previous FY. Output from the other main sectors increased modestly. The current account deficit improved slightly, but remains high at 4.0% of gross domestic product (GDP). The fiscal deficit widened to2.2% of GDP as efforts to improve tax collection and remove energy subsidies were foiled by social unrest. As access to concessionary finance is slowly declining, public debt has been rising. The Government of Haiti (GOH), while cognisant of the population’s sensitivity to economic shocks, will need to find ways to raise revenue and reduce subsidies in order to achieve debt and fiscal sustainability.
Political instability remains a significant challenge. GOH’s removal of fuel subsidies in July resulted in mass protest, a policy reversal, and the resignation of the Prime Minister. Social unrest continued in October. Political and policy uncertainty are downside risks that constrain the ability of GOH to attract investment and create jobs.