Posted: August 1st, 2022

International Trade Law Between Haiti And The Dominican Republic

TOPIC:
International trade law between Haiti and the Dominican Republic.
However I would like to emphasize on the major issues regarding corruption that goes trough the border between both countries.

INSTRUCTIONS;
Choose a legal issue that was the subject of a lecture and reading (for example, contracts, corporate law, foreign direct investment laws/economic freedom, international trade law, employment and labor law), and prepare a research paper that examines its practical implementation in global business (for example, an international contract law lawsuit; a labor law dispute over workplace discrimination, foreign direct investment promotion).

Include the following aspects of the subject:

Your thesis: the argumentative conclusion you came to based on your research.

Specific legal issue discussed (for example, contracts, workplace discrimination, corporate law, or FDI legal regime).

Case study: the context in which you will discuss this issue (for example, a lawsuit; a dispute before a non-governmental body such as the World Trade Organization; or some legal campaign by a civil society group such as Human Rights Watch, Global March Against Child Labor, or the World Wide Fund for Nature).

Business analysis of the legal issues involved: revenues involved, costs from the legal action, and business outcome.

Other business issues: for example, public relations concerns, impact on employees, community impact in the places where the company operates, and any other issues you think relevant.

Continuing challenges for the case study subjects, with potential solutions.
The primary criteria for assessment of of your research report are as follows. Please consult the rubric for specific details:

Quality of thesis: was it clear and direct.

Clarity of analysis: was it logical and compelling.

Effectiveness of research and use of evidence: what was the quality and extent of research; was evidence presented in a manner that supported the thesis; was the best possible evidence chosen; were generalizations supported with citations; and were opposing arguments considered.

Did the student speak with at least one relevant practitioner or research information source.
Excellent work should speak with at least one relevant person, adopt a cogent thesis, accurately marshal the most convincing available evidence to support it, consider opposing arguments
—

International Trade Law Between Haiti And The Dominican Republic

Introduction
The republic of Haiti is classified as a lower income economy, while the Dominican Republic is designated as an upper middle income country. Dominican Republic is currently regarded as the second largest economy in the Carribean. According to research the economy of the Dominican Republic (DR) grew by 7% in 2018, an above average growth rate, and also among the highest in the world (US Department of State, 2019). Foreign direct investment (FDI) plays a very special role in the economy, as it has worked to bolster sectors such as banking, tourism and the service industry. The FDI into the DR has been relatively huge, from $1.2 billion in 2016 to about $2.1 billion in 2017 but a 30% decrease in 2018. Some of the major sectors in the economy include tourism, real estate, telecommunication, mining, free trade zones and the service sector. The State Department (2019) identifies that the United States, followed by Canada, Brazil and then Spain have been some of its main trading partners and continue working in defining its growth. Haiti remains to be an integral trading partner of the dominican republic since they share a land border and do direct trade.
Haiti on the other hand has 80% of its citizens living below the poverty line. This is a situation that has been aggravated by the 2010 earthquake as well as constant political infightings which have worked to slow down FDI. UNCTAD (2020)identifies that it received far less FDI totalling a total of $75 million in 2019, a reduction from the high of $105 million it had received in 2018. It has a total stock of $1.9 million dollars of FDI as of 2020. Like DR most of the investment went to construction, textile, automotive, tourism. The US and China as well as countries from Europe are some of the main investors in Haiti. UNCTAD (2020) identifies that it has also partnered with the DR to increase its FDI. One critical challenge affecting international trade between Haiti and the DR is the increased inefficiency and corruption at the border. This significantly works to reduce trade volumes between the countries and create tension. The Haitian side of the border has been cited to lose significantly more in uncollected taxes and custom receipt because of t[he perpetual existence of illicit trade alongside legal trade on both sides of the border. Lack of adequate government control has been identified, to be more emphasized in Haitian side of the border leading to manifestation of large flow of contraband and tension between authorities and communities at the border regions.
Corruption at the Border Between Haiti and The Dominican Republic
The ability of both governments to tackle corruption and show political will in the process of reform is a key aspect in increasing a country’s competitiveness. This is because it brings more transparency to the international trade process and shows a commitment that it is willing to bring corrupt public officials and activities to justice. In evaluating the international trade between the two caribbean nations the Central American Free Trade Agreement (CAFTA-DR) and the Carribean Basin Trade Partnership Agreement (CBTPA) become two key aspects to focus on in order to understand why there is increased trade between the two nations. CAFTA-DR was consequential in opening up more markets for the DR especially in textile and other manufactured products to America.
The CBTPA was also vital in boosting partnerships between caribbean nations in production and export to the US. American and other international officials have however shown great concern in the higher levels of corruption in both Haiti and the DR. The culture of corruption has permeated through most institutions central to trade and international trade development. Trade between the two countries is significantly lower. According to researchers “Total registered exports from Haiti to the DR are $4 million (0.02% of DR’s total imports, 0.4% of Haiti’s total exports)” (Powell et al., 2016). This implies lower trade volumes between direct neighbors.
The US Department of State (2019) identities that this is partly due to poor policy formulations and under development in Haiti. It additionally reinstated that US investors among others faced continuous systemic problems in the DR. At the border Foreign investors identify and cross border traders at both sides cite a clear lack of standardized rules. These rules affect and contribute to complete lack of enforcement at the border points, identify widespread corruption based on different authorities, request for bribery for service completion, weak IP rights enforcement, bureaucratic hurdles and slow and biased judicial and administrative process (Matera, 2019) The non standard procedure in customs valuation affecting classification of imports. The high levels of corruption become problematic when you conceptualize the two nations, demographics, population and economies side by side. Matera et al (2018) identifies that while the DR has experienced uninterrupted growth for decades, natural disasters, political corruption and a civil war have raged in its next door neighbor Haiti. While the two island nations have a similar population, the DR has an economy 10 times bigger than Haiti. Here products worth hundreds of millions of dollars originating from the DR, manage to cross the poorly controlled border of Haiti resulting in the Haitian government losing millions of dollars in taxes, which implies less jobs and lower government revenue. This implies limited government services in Haiti.
Corruption and increased lack of standardized laws and trained law enforcement to implement regulations play a role in exacerbating the situation especially in Haiti. Powell et al (2016) identifies that any attempts made by both governments to stop illicit flow of goods has been curtailed by law enforcement corruption at the border. Banning certain imports and cross border movement has worked to only increase corrupt practices. Haitian custom agents are bribed and intimidated by powerful politicians and businessmen to allow cheap imports. Dominican Soldiers stationed at the border on the other hand are compelled to take bribes so as to allow Haitian immigrants to work in the DR and also to allow DR products access to Haitian market for profit without taxation. Matera (2016) identified that effective and efficient cross border regulations would be beneficial for both states. He states that “Haiti needs Dominican products and know-how; the Dominican Republic needs Haitian workers and foreign market access. Facilitating formal trade would stimulate investment, creating jobs on both sides of the border” (3). Legitimate services will be beneficial for more government revenue, more job creation and social development.
Summarily these factors that prevent growth of legitimate trade from policy and direct government failures include (Powell et al, 2016):
1. Volatile Haitian Currency: The HTG is always volatile against the dominican peso and lack of the central bank regulatory schemes to reign in the volatility sees the value of the HTG constantly fluctuating. This sees Haitian buying less dominican goods for a larger percentage of money. This sees imports vary in quantity from time to time.
2. Constant Border Conflicts: Political relation deterioration has also played a significant role in addition to poor economic relationships. Lack of citizenship for Haitian immigrant children in the DR has contributed greatly to the deteriorating relationship between the two countries.
3. Restriction of people and goods: Sharing a land border but not allowing citizens from one country to access the other country either for work, leisure or business has played a significant role in pushing people to illegitimate activities. This is DR’s policy towards Haiti and has constantly worked to promote corruption at the border crossings.
Conclusion
There is a culture of corruption that has manifested across the two nations on Hispaniola Island born out of unequal growth registered by the DR and Haiti. While having the same population and Haiti being independent longer, the DR shines economically, and has an economy 10 times larger economy than Haiti. With poor government control and a culture of corruption in both countries from bottom up continues to promote illicit businesses.

References
Matera. (2019). Report Roll-out: Illicit Trade and the Haiti-Dominican Republic Border. Retrieved 12 December 2020, from https://www.csis.org/analysis/report-roll-out-illicit-trade-and-haiti-dominican-republic-border
Matera, M., Speck, M., Schneider, M., CSIS AMERICAS PROGRAM, & Sandin, L. (2020). Cross-Border Trade and Corruption along the Haiti-Dominican Republic Border. Retrieved 12 December 2020, from https://do.usembassy.gov/wp-content/uploads/sites/281/190320_Haiti_DR_layout_WEB.pdf
Powell, Kuperberg, Kett, & Boereau. (2016). TRADE FLOWS BETWEEN HAITI AND THE DOMINICAN REPUBLIC. Retrieved 12 December 2020, from https://www.ceintelligence.com/files/documents/flux.pdf
UNCTAD. (2020). World Investment Report. Retrieved 12 December 2020, from https://unctad.org/system/files/official-document/wir2020_en.pdf
United States Department of State. (2019). Dominican Republic – United States Department of State. Retrieved 12 December 2020, from https://www.state.gov/reports/2019-investment-climate-statements/dominican-republic/

Order | Check Discount

Tags: International Trade Law Between Haiti And The Dominican Republic