Economy

Haiti: Maxime Charles Explains Liquidity Problem in Banking System

PORT-AU-PRINCE, Haiti (defend.ht) - On Thursday the President of the Professional Association of Bankers (PAB) explained the liquidity problem within the banking system to be cash for work programs that are paying in checks. He suggested Haitians adopt modern forms of money handling.

Maxime Charles, President of the PAB, a day earlier said there was not a liquidity problem but on this day said there was a problem and described it as an imbalance.

Speaking on Radio Metropole, Charles said the currency coming in and the currency going out are out of line because of the reconstruction.

Maxime Charles says the banks were tendering out so much U.S. currency into the Haitian economy that a hold was put on U.S. bills. Charles did not clarify the reasons why the bills are returned to the banks.

Economist and President of the Haitian Association of Economists (AEH), Eddy Labossière explained a possible reason why the bills aren't being returned is because Haiti does not export many products but instead imports. There for much of the currency leaves to other countries. But Labossière also said that significant amounts of dollars entering from the Haitian Diaspora and international donors should offset.

Modern Money Handling

Maxime Charles would like to see Haitians adopt a new lifestyle of using electronic means of purchasing and exchanging. Charles says that businesses need to begin to accept credit cards and consumers need to use them.

It would be a difficult transition for Haitians because of a higher frequency of person to person exchanges as oppose to business to consumer. Many Haitian are independent businesses themselves. Whether selling goods or offering services self-employment is the lifestyle, a lifestyle that is dependent on cash.