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By Karen E. Klein

6.17.99  
Starting a Venture in a Struggling Land
A well-meaning plan to export food to Haiti would hurt local producers

Q: I'm a Haitian living in the U.S. and currently researching a project of exporting and direct-selling groceries to lower- and middle-class consumers in Haiti, creating an environment of reasonable prices, jobs, and a teaching format in free enterprise. Is there any advice you can give to the business, which I'm calling Marche de Dieu (Market of God)?
--J.N., Jacksonville, Fla.

A: Your intentions sound good, but experts say that in an economy as weak as Haiti's, a plan to bring in cheap, imported food from the U.S. could devastate the already fragile market for local producers. And investing in a country that is the poorest in the Western hemisphere, where the political situation is unstable and crime rates are high, promises to be an extremely risky business move.

"The best thing for Haiti is to encourage the poor people there to develop their own products that they can consume on the island, so that the cash stays in the region, the local currency circulates throughout the country, and their economy becomes independent and self-sustaining," says Mildred Robbins Leet, president of a New York-based nonprofit organization called Trickle Up, which has helped establish 75,000 small businesses in 115 countries.

"Bringing in goods and business from abroad is difficult in an economy that is largely informal and lacking in the basic infrastructure, including electricity and viable ports," says Leigh Carter, executive director of Fonkoze USA, a fund-raising arm for the Fonzoke ("shoulder-to-shoulder" in Creole) alternative Haitian bank, established to assist street vendors and small, mostly rural enterprises. "The country is still struggling with the concept of democracy. The economy has declined in recent years. There's continued political instability and crime. It's a pretty desperate situation," Carter says.

You might consider getting involved with a group called The Haiti Projects in Partnership, which exists to provide opportunities for U.S. and Haitian-American investors to put funds into the island nation's homegrown business ventures. "We have half a million in assets now, which is substantial given the low capitalization of the country," says Steeve Coupeau, who heads up the project. "We provide relatively high returns to investors, and the funds we receive fuel a pool of low-interest loans to Haitians running their own small businesses." Coupeau says he can provide information on the project if you contact him at (212) 961-0686 or by E-mail at scoupeau@gte.net.

In any case, when a businessperson invests in an overseas venture, it's important to research the nuances of the local economy and political situation and establish in-country business contacts. When a developing country is the target for investment, those steps are even more crucial, experts say.

Mark Siegelman, international trade specialist for the U.S. Commerce Dept.'s Office of Latin America & the Caribbean, advises U.S. businesses to take advantage of myriad programs, information, and services provided to assist exporters.

The International Trade Administration has a one-stop trade information center in Washington that can be reached at (800) USA-TRAD, or on the Internet at www.ita.doc.gov. Country information, databases, introductions to overseas business partners and leads, and data from U.S. trade missions are available there, Siegelman says. The ITA has a district office in Miami, at (305) 526-7425 that might also be helpful. Businesses planning to export food should contact the U.S. Agriculture Dept.'s Trade Assistance & Promotion office at (202) 720-7420, Siegelman advises.

There are a number of Web sites offering information about doing business in Haiti. Here are a couple of places to start:
www.itd.org/51eng_links/region/cac/haiti.htm gives trade and development links to Web pages that offer a wealth of information and links to market research, country reports, and the nongovernmental organizations involved in the Haitian economy. The International Development Network, www.idn.org, gives information and resources about sustainable development in Haiti. The Haitian embassy in Washington also has a Web page, www.haiti.org.

Have a question about running your business? Ask our small-business experts. Send us an E-mail at editors@businessweekmail.com, or write to Smart Answers, BW Online, 46th Floor, 1221 Avenue of the Americas, New York, NY 10020. Please include your real name and phone number in case we need more information; only your initials and city will be printed. Because of the volume of mail, we won't be able to respond to all questions personally.

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