$84 Million Pledged to Pay Haiti Loans; New Aid Now Likely

In its first display of concrete progress, even before its formal opening, the Summit of the Americas produced an $84-million bailout for Haiti on Friday that will allow the stricken Caribbean nation to qualify for a series of loans reaching $250 million.

American officials said Haiti was so far behind in paying off previous international loans that without the new aid it would have been unable to gain access to crucial assistance from the major international lending institutions.

As the result of an agreement signed by Treasury Secretary Lloyd Bentsen and Marie-Michele Rey, Haiti’s finance minister, the United States will pay off $25 million of the previous debt, which totaled slightly more than $84 million; nine other nations will contribute $41 million more. Haiti will also turn over $18 million from its reserves held in New York.

While the sums are hardly staggering, Administration officials were encouraged that so many nations were willing to pay off the outstanding loans. Besides the United States and Haiti, Japan, Mexico, Argentina, the Dominican Republic, Sweden, Switzerland, the Netherlands, France and Canada agreed to contribute.

“This will unlock about $250 million in new lending to support Haiti’s economic recovery and development,” Bentsen said.

He said the World Bank was expected to resume the flow of loans with a $20-million package likely to be made available by Christmas.

“Our efforts today will allow Haiti to move on the road to economic recovery,” he said.

The program was announced as Haitian President Jean-Bertrand Aristide joined 33 other leaders at the Summit of the Americas, making his first visit outside Haiti since he was restored to power, protected by U.S. troops, on Oct. 15.

Aristide met privately with Secretary of State Warren Christopher and with activist Randall Robinson, who went on a hunger strike to press for American intervention in Haiti while a military regime ruled the country.

Aristide also visited with the Haitian exile community in Miami. About 1,200 people cheered him wildly during his foray into the Little Haiti neighborhood and a visit to the Toussaint L’Ouverture elementary school with several of his Cabinet members.

The loan bailout completed Friday stemmed from negotiations conducted over the last year and a half by senior U.S. Treasury officials as they prepared for the possibility that the military rulers would eventually be ousted. Rey and Treasury officials said the $250 million would be used for basic needs, such as to repair roads and for communications, health programs and agriculture.

“The infrastructure is falling to pieces,” a Treasury official said.

In theory, at least, 2,400 miles of roads cross Haiti, which is about the size of Maryland. But only 600 are paved in even a rudimentary fashion.

Agricultural areas have been idled--70% of the population ekes out a living in the rural economy--and farming areas are barely, if at all, connected to markets. Health needs are equally dramatic, with 10% of babies dying within their first year of life. Overall life expectancy has never been greater than 45 years.

But besides beginning to address these problems, the new international aid can “help create jobs, which will help stabilize the nation,” the Treasury official said.

A senior Treasury official noted that Latin American nations had not previously taken part in such debt-clearing efforts. Their assistance reflected the maturing of their economies, as well as a demonstration that “Haiti was no longer lost between Africa and the Western Hemisphere, but was indeed part of the Western Hemisphere,” he said.

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The official said that after Aristide was ousted in a military coup on Sept. 30, 1991, Haiti stopped paying off its debt to the three major international financial institutions that had lent it money over the years: the World Bank, the International Monetary Fund and the Inter-American Development Bank.

Haiti’s political instability made it such a poor loan risk that private banks halted lending there. But it has outstanding loans from international institutions of several hundred million dollars--apart from the $84 million covered in Friday’s agreement--and Haiti’s responsibility to meet those payments is unaffected by the action announced Friday.