Banking & Finance, Economic Development, and Higher Education

Geographic resources as economic linchpins

Haiti native explains his country’s inability to maximize potential of assets.

November 18, 2016
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Daniel Jean-Louis
Daniel Jean-Louis, CEO of Haitian investment firm Bridge Capital, explains the difficulty of handling a sudden outpouring of support for disaster-plagued countries. Courtesy Calvin College

When Daniel Jean-Louis was a younger man, he sought out an answer to a question that had been nagging him for his entire life — what makes countries poor?

In his research, which turned into the impetus for Jean-Louis’ book “From Aid to Trade,” the Haiti native found the answer actually was quite simple. Countries are poor because of an inability to maximize the potential of their assets.

“Each country is born with a set of assets,” Jean-Louis explained at a Nov. 9 presentation at Calvin College. “A Caribbean country has a beach, warm climate, mountains. Other (countries) have large amounts of land. Each country is basically born with a number of resources and assets they have, and what makes them poor is the (lack of) ability to turn those assets into business opportunities.”

Political instability has played a large role in Haiti’s inability to maximize those resources. The country has been in election session for about 18 months, and because there is so much uncertainty in the Haitian government, Jean-Louis said the “resource generators” who would replenish the country’s assets have been unable to perform their duties.

In Haiti, that inability has been compounded by the country’s vulnerability to natural disasters. And in a cruel twist of fate, Jean-Louis, who also is a co-founder and CEO of Haitian investment firm Bridge Capital, said the outpouring of support for Haiti in the wake of the 2010 earthquake actually caused more problems than it resolved.

“For a country to go from Point A to Point B, all the entities in a society, including the government, have to support the business sector that is creating in that society,” Jean-Louis said. “For a country to get better, it needs better policies and better partnership, which is one of the key solutions. Because after the earthquake, the biggest liability to Haiti was the foreign aid being sent into Haiti.”

Following the Haiti earthquake, about $12 billion was pledged to help rebuild the country’s infrastructure, six times the amount of the country’s less than $2 billion budget at the time. However, Jean-Louis said only about 1.6 percent of that $12 billion was spent in the Haitian economy.

Jean-Louis then took it upon himself to help connect nongovernmental organizations with Haitian businesses, organizing four conferences to help facilitate those meetings.

“Basically, the NGOs had not been supporting the business sector enough, so the key solution is to promote the partnership between the NGOs and the businesses,” Jean-Louis said.

And when the country was ravaged once again by a natural disaster, this time in the form of Hurricane Matthew, that connection proved to be a difference maker in how the country is recovering. The Category 5 storm crashed into Haiti last month, killing hundreds and leaving behind a trail of devastation, which early estimates place at about $2 billion in damages. But Jean-Louis said the partnership model has been working, and the message is being heard.

“Today, after Hurricane Matthew, almost every single organization has been buying stuff from Haiti,” Jean-Louis said.

Jean-Louis then recalled a recent conference he attended, the same conference he attended six years earlier following the earthquake. At the 2010 conference, attendees were discussing how much they could import into Haiti. This time around, the discussion was how to source those materials from Haiti.

“This is how wealth is created — one transaction at a time, one intention at a time and one action at a time.” Jean-Louis said.

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