VZCZCXRO2475
PP RUEHQU
DE RUEHPU #1748/01 3571440
ZNR UUUUU ZZH
P 221440Z DEC 08
FM AMEMBASSY PORT AU PRINCE
TO RUEHC/SECSTATE WASHDC PRIORITY 9326
INFO RUEHZH/HAITI COLLECTIVE PRIORITY
RUEHBR/AMEMBASSY BRASILIA PRIORITY 2151
RUEHSA/AMEMBASSY PRETORIA PRIORITY 1906
RUEHQU/AMCONSUL QUEBEC PRIORITY 1312
RUCNDT/USMISSION USUN NEW YORK PRIORITY 1744
RUMIAAA/HQ USSOUTHCOM J2 MIAMI FL PRIORITY

UNCLAS SECTION 01 OF 06 PORT AU PRINCE 001748

SIPDIS

STATE FOR WHA/EX AND WHA/CAR
S/CRS
SOUTHCOM ALSO FOR POLAD
STATE PASS AID FOR LAC/CAR
INR/IAA
WHA/EX PLEASE PASS USOAS

E.O. 12958: N/A
TAGS: PGOV PREL PHUM ECON EINV HA
SUBJECT: POSTCARD FROM CAP HAITIAN: ISSUES, REQUESTS &
MOVING FORWARD

REF: A. A. PORT AU PRINCE 1492
     ¶B. B. PORT AU PRINCE 1359
     ¶C. C. PORT AU PRINCE 1068
     ¶D. D. PORT AU PRINCE 1104
     ¶E. E. PORT AU PRINCE 425

PORT AU PR 00001748  001.2 OF 006

¶1. (SBU) Summary: Cap Haitien officials downplayed security
issues but highlighted economic hardship and municipal budget
constraints as key impediments to progress in Haiti's second
largest city. The delegate for the North Department discussed
the effects of the recent hurricanes on the region and
lamented a perceived reduction of U.S. assistance to the
area. Authorities highlighted the increased presence in Cap
Haitien and surrounding communes of persons displaced by the
hurricanes.  Crime, particularly kidnappings, has increased
in recent weeks.  MINUSTAH is diligently preparing for
one-third senate elections planned for April.
Infrastructural challenges persist for the under-utilized Cap
Haitien port and the Venezuelan-financed electricity plant
and airport.  Despite difficult economic times, the private
sector is rallying together to promote northern Haiti as a
tourist destination and HOPE II is expected to generate 1,000
additional jobs in the nearby Free Trade Zone. End Summary.

Cap Haitien Mayors Speak Out
----------------------------

¶2. (SBU) Cap Haitien, on Haiti's north coast is the capital
of the North Department and the country's second largest
city. Econ/Poloff and USAID Specialist met November 19 with
both Famni Lavalas partisans Deputy Mayors Fritz Joseph and
Philocles St. Fleur who asked why there is no permanent U.S.
Embassy presence in Cap Haitien.  They suggested a Haiti
Stabilization Initiative (HSI) program for Cap Haitien,
modeled after the one in Cite Soleil, but insisted the city's
many needs and problems were not security-related.  Joseph
and St. Fleur claimed that 80 percent of the city's
constituency is satisfied with the work of the Mayor's office
(Mairie).  They said they want to change the Mairie's image
of exclusive association with the Lavalas political party.

¶3. (U) Inactivity at the Mairie was attributed to the fact
that the previous day was the November 18 Battle of Vertieres
holiday. (Note: All other public offices visited on November
19, including the port and the Office of the Delegate of the
North, were open and fully functioning. End note)  The deputy
mayors complained about the lack of Cabinet or high-level GoH
participation at the holiday celebration in Cap Haitien.

¶4. (SBU) Deputy Mayor Joseph said the Mairie's annual budget
is not enough for its approximately 4,000 employees and
therefore runs an annual deficit, citing the police budget in
particular.  Deputy Mayor St. Fleur opined that the economic
downturn in the U.S. is having a negative impact on money
transfers (remittances) to city inhabitants.

¶5. (U) The deputy mayors complained that Cap Haitien does not
have its own garbage collection truck and depends upon the
Ministry of Public Works and Transportation's National Center
for Equipment (CNE) to collect the trash.  (Comment:
Econ/PolOff saw two CNE trucks cleaning drainage canals. End
comment)

Delegate's Perspective on USG Assistance
----------------------------------------

¶6. (SBU) North Department Delegate Georgemain Prophete met
with embassyoffs to discuss developments in the northern
region.  (Note: Prophete is the equivalent of a U.S. state
governor, holds executive power and coordinates all
government actions in the Department, comprised of
approximately 1.2 million people in 19 communes, including
the city of Cap Haitien.  End note) He said his northern
delegation is committed to carrying out elections in April
2009, but questioned the international community's level of
engagement. He lamented the diminishing number of
USAID-funded projects, citing the Cooperative Housing
Foundation's (CHF) budget cuts in Cap Haitien in response to
the need to address severe flooding in the Artibonite
Department (and Gonaives, its largest city).  He said the
U.S. has not done enough for Haiti and he was not surprised
with the lack of USG assistance, especially in Cap Haitien.

¶7. (U) Prophete has changed his FY 08 priority of trash
collection to a focus on electricity, the airport, and
tourism development (ref A). He complained that the people in
Cap Haitien, known as Capois, do not have the will to clean
up the city.  Speaking at length on northern tourist
potential, Prophete emphasized the importance of
rehabilitating key sites, such as the Palais Sans Souci in
nearby Milot.  He hoped that ten percent of Royal Caribbean
cruise line (RCCL) passengers who disembark at the private
site in Labadee would also visit Milot and Cap Haitien during
their one-day visit to the country -- perhaps as part of a
pilot program.

¶8. (U) Prophete noted that there are only 400 police officers
assigned to the entire North Department.  His plans for the
region include pushing the GoH to conduct a feasibility study
for a fuel tanker stop in Cap Haitien to prevent fuel
dependency on Port-au-Prince, especially in cases of natural
disaster and high fuel prices. (Note: Cap Haitien was cut off
from Port-au-Prince for several weeks following the
hurricanes of August and September due to the collapse of a
vital bridge at Ennery and which is now a major USG
post-hurricane reconstruction project. End Note)

Post Hurricane Condition
------------------------

¶9. (U) Deputy Mayors Joseph and St. Fleur said there was some
damage in the communes surrounding Cap Haitien, but no major
damage in the city itself due to the August and September
storms.  Delegate Prophete said the storms had
affected towns, such as Plaissance, Pilate, Le Borgne, Limbe,
Port Margot, Limonade and Quartier Morin.  Prophete added
that many internally displaced persons (IDPs) from the
Artibonite region -- the area hardest hit -- were fleeing to
Cap Haitien and the North Department.  He complained that the
central government had not helped the Northern Department to
accommodate these IDPs.

¶10. (U) Fuel prices have stabilized after nearly six weeks of
increases due to the North being cut off from Port-au-Prince
and the subsequent limited supplies of fuel following the
storms. Private sector reps said that they were forced to
purchase Dominican fuel at nearly USD 8 per gallon on the
black market.

MINUSTAH: Security, the Economy, Elections
------------------------------------------

¶11. (SBU) MINUSTAH Civil Affairs Director Nuhzat Ahmad
reported that crime had increased in Cap Haitien.  She said
that three kidnappings occurred during the week of November
¶17. (Note: Media has also since reported an increase in
kidnappings in Cap Haitien. End Note) She attributed the
uptick in kidnappings to usual holiday season desperation and
the general weak economy.  MINUSTAH is working with the
Haitian National Police (HNP) on their kidnapping response.
Ahmad noted that MINUSTAH has a good rapport with the HNP.
MINUSTAH is currently working with the HNP on an applicant
vetting system and helping to organize and prepare for new
recruits.  In contrast to Prophete's statistics, Ahmad
admitted there were a few problems with the HNP such as
report-writing.  Ahmad reported that there are 535 police
officers in the North Department (Note: This discrepancy may
be due to whether CIMO riot control police and judicial
police are counted.  End Note)

¶12. (U) Ahmad suggested a need for better international donor
coordination, especially given tighter donor budgets
resulting from the current economic recession.  She said that
coordination is particularly required to overcome the current
assistance ''vacuum.''  Ahmad said many northern Haitians are
angry that Gonaives received most of the GoH and
international community attention after the hurricanes.  She
added that many NGOs stationed in Cap Haitien, employing
local residents, had left town to respond to the humanitarian
crisis in Gonaives.

¶13. (U) Ahmad stated that Cap Haitien has been relatively
calm and quiet since the April 2008 food riots.  There were
some calls for protests but usually only 10-20 people
participated.  The friction between President Preval and new
Prime Minister Michelle Pierre-Louis is also on the minds of
residents, according to Ahmad.

¶14. (SBU) Regarding April elections, Ahmad said there were
1135 applications for 57 Communal Electoral Bureau (BEC)
posts.  The applications will be sent to Port-au-Prince upon
completion of the recruitment process.  Delegate Prophete
adamantly stated that the electoral process would not be
corrupt.  The Chilean battalion of MINUSTAH is checking all
radio communication equipment needed for the election.

More Workers Needed for Underutilized Port
------------------------------------------

¶15. (SBU) Emboffs met November 19 with National Port
Authority (APN) Deputy Port Director Claude Lamothe and
Director of Security Pierre Gerald Gay to discuss port
developments in Cap Haitien.  The port is compliant with
International Ship and Port Security (ISPS) codes.  APN
focuses on maintaining port infrastructure to safeguard its
certification.  Gay stated that maintenance is sometimes
difficult due to meager resources.  Both officials lamented
poor communication with Port-au-Prince and no communication
with international ports, such as Miami.  They also
complained about receiving the ''leftovers'' from what the
GoH and international community contribute to the main port
in Port-au-Prince.  Port officials do not have internet
access.  They complained that the radios provided by USAID
suffer from technical problems.  Generators are often not
functioning, and electrical power in the area is
unpredictable.

¶16. (SBU) Lamothe stated that Mayor Michel St. Croix does not
understand the ISPS certification and is therefore suspicious
of it.  According to Lamothe, the mayor believes that port
personnel work for the USG and are not involved in port
modernization or security.  Port Director Jean Renal
Latortue, who fled the city one year ago following threats
from fired APN employees, reportedly "manages" the Cap
Haitien port from Port-au-Prince.  (Comment:  Port Security
Director Gay is a close ally of Latortue, and Emboffs
perceived tension between Lamothe and Gay when discussing
Latortue. End comment)

¶17. (SBU) Lamothe said the hurricanes and economic crisis
have not severely affected business at the Cap Haitien port,
as it was under-utilized prior to the hurricanes.  The port
has an extraordinary amount of debt and APN owes large sums
of money to the GoH Tax Authority (DGI).  APN only recently
paid its January 2008 tax bill.  It also owes money to the
state-owned electricity company, EDH.  Gay said the port's
financial constraints prevent it from having a stronger
security force.  The security staff works long hours (12-hour
shifts) without overtime compensation.  APN employs 83
personnel, after having fired 170 workers during the past
year.  (Note: During the Aristide era, the payrolls of APN
and public utilities were packed with Lavalas supporters,
many of whom allegedly did not go to work. End note)  After
complaints of bloated staffing in July 2007 (ref B), the APN
now needs additional employees to carry out daily tasks.  Gay
stated that because of a lack of modern equipment, APN needs
more workers to carry out tasks that could otherwise be
accomplished by fewer workers.

¶18. (SBU) There is a team of approximately 40 immigration,
customs, port, and police personnel who board ships for
inspection in an effort to crack down on drug trafficking and
smuggling.  The team uses unsophisticated methods, such as
knocking on containers to hear if they are hollow, in an
effort to determine the contents. Gay explained that port
efficiency would improve if the APN used dogs, an X-ray
machine, and/or a patrol boat.  The APN does get some
assistance from the Haitian Coast Guard.

Power and Transportation
------------------------

¶19. (SBU) Haiti is part of a Venezuelan-Cuban-Haitian
tripartite cooperative agreement.  Cuba and Venezuela provide
assistance to improve EDH electricity output and to upgrade
the Cap Haitien airport.  EDH Director James Norca told
Emboffs that fuel consumption averages more than 24,000
gallons per year and this cost alone exceeds revenue.  Norca
reported that the Venezuelan-constructed and Cuban-trained
electricity plant in Cap Haitien is running on a trial basis.
 The trial period offers limited electricity to three zones
(excluding Labadee) until about 11 pm: city center of Cap
Haitien receives 4 megawatts (MW); the zone near the airport
receives 2.5 MW, and zones toward some provinces such as
Limbe receive 2 MW.  The plant has eight turbines (1.7 MW
each) amounting to 13.6 MW (the maximum for Cap is 15 MW)
(ref. C) (Note: Only six of the eight turbines are currently
operating, per MINUSTAH. End note.)  The plant currently
operates on diesel fuel, but EDH plans to change to heating
fuel (mazout) in two to
three months.  Cuban technicians trained eight Haitians as
plant operators in Cuba for two months; eight others were
trained in Haiti. Cuban technicians are supervising the
transition to full-power operation.  Although the plant is
generating increased electricity, officials reported to NAS
Director that it is also emitting a large amount of
pollution. End note)

¶20. (SBU) There are extensive electrical system logistical
problems such as grid networking and cable repair.  Norca
said that EDH urgently needs additional equipment and
requested U.S. assistance to purchase vehicles and
transformers.  Norca added that 75 transformers were
destroyed during 2000 and were never replaced.  He has not
received a response for replacement equipment from
Port-au-Prince.  MINUSTAH Civil Affairs Director Ahmad
believes EDH headquarters in Port-au-Prince has the financial
resources available to help, but will not part with them.
She said EDH should assess the dilapidated state of
electrical cabling.  Norca said electricity is often stolen
and was concerned about the safety of the illegal tappers.
Ahmad said MINUSTAH recently extinguished a transformer fire,
and that her greatest fear for Cap Haitien is fire.  MINUSTAH
purchased three fire trucks for Cap Haitien in 2005 of which
Ahmad said none are operable.  She deplored the lack of
equipment repair and encouraged donors to identify funding
for this purpose.

¶21. (U) The Cap Haitien International Airport is Haiti's
second busiest airport (ref D).  Delegate Prophete told
Emboffs that authorities are waiting for perimeter fencing to
be completed.  Additional gaps in security to accommodate
international flights remain to be addressed.  Members of the
private sector believe that 40 percent of outbound passengers
leaving Port-au-Prince's international airport are traveling
from Cap Haitien.  A high proportion of the Haitian Diaspora,
particularly those settled in south Florida, originated from
Cap Haitien and the northern region.

Tourism: Selling the North as a Destination
-------------------------------------------

¶22. (U) The Association for Tourism of the North (ATH)
presented to Emboffs its plans to promote the north as a
tourist destination.  Members disclosed that the EU's
development agency, PRIMA, plans to give to the ATH USD
100,000 to hire a marketing consultant.  The ATH also plans
to conduct a feasibility study of each business to create a
tourism package.  The ATH says it needs USD 10 million to
implement the study.  The ATH has considered borrowing to
finance this but it is concerned about high interest rates
ranging from 14 to 17 percent.  There are currently 200 hotel
rooms in Cap Haitien.  The ATH hopes to expand that number to
600 rooms.  The Minister of Tourism, Patrick Delatour,
supports development of the region and pledged USD one
million for the marketing project, pending submission of
ATH's budget.  The members expressed concern over the U.S.
State Department travel warning, complaining that it
discourages tourism and economic development.

¶23. (U) The hotel industry has been severely affected by the
hurricanes.  The Cormier Plage Resort manager, Jean Bernard
Simmonet, explained that the hotel (32 rooms) is normally at
40 percent capacity.  Since the storms, the hotel is at only
4 to 5 percent of its capacity.  He said it was nearly
impossible to meet employee payroll and pay for fuel.  ATH
said that hundreds of jobs were lost when several NGOs left
Cap Haitien to provide post-hurricane relief.

¶24. (U) Members of the private sector anticipate that the
revitalized airport will allow American Eagle flights to
operate from Cap Haitien.  The strategy would be to market
tourism to Caribbean travelers since American Eagle already
flies to several Caribbean islands. Private sector members
are confident that the new EU-financed road between the
border town of Ouanaminthe to Cap Haitien will also boost
tourism from the Dominican Republic.  Cognizant of competing
beaches and resorts across the Caribbean, the tourism
industry would like to position Haiti for its culture,
history and natural beauty. Adequate security remains an
issue.

¶25. (SBU) Haiti's most successful tourism is the Royal
Caribbean Cruise Line's (RCCL) private destination of Labadee
(30 minute drive from Cap city center).  RCCL employs 235
workers daily and approximately 640 employees and 40
expatriate contractors on the two to three days per week the
cruise ships dock in Labadee.  RCCL pays the government USD
6.00 per person in taxes.  RCCL recently lost USD 500,000 due
to an employee strike that prevented three ships from entry.
RCCL Manager Broder Schutt told Emboffs that employees make
more than four times the Haitian minimum wage (USD 1.75 per
day).  RCCL explained that employees were upset because they
were not granted a salary increase despite RCCL's USD 54
million infrastructural investment project.  Schutt confirmed
that the dispute had been resolved.

¶26. (U) RCCL invested USD 54 million for pier construction
and Labadee development.  RCCL expects up to 7,000 passengers
on their new cruise ship Oasis, of which will stop in
Labadee.  Construction projects include the expansion of the
beach, living quarters for expatriate employees, and general
aesthetic improvements.  Schutt said RCCL expects more
passengers after pier completion in October 2009.  RCCL is
exploring the possibility of tours to the Palais Sans Souci
in Milot, provided security and infrastructure are in place.

HOPE in the Free Trade Zone
----------------------------

¶27. (SBU) Emboff visited CODEVI apparel plant (owned by
Fernando Capellan of Grupo M) in the Free Trade Zone --
situated in Ouanaminthe on the Haitian/Dominican border -- on
November 21. CODEVI exports to the U.S. from Santiago in the
Dominican Republic and employs approximately 3,000 workers in
Haiti at its Dockers, Levi, Nautica, and Hanes-producing
factories.  CODEVI takes advantage of the Haitian Hemispheric
Opportunity through Partnership Encouragement Act (HOPE)
trade preference program for items produced for Dockers, Levi
and Nautica trousers.  CODEVI applies the CAFTA-DR
preferences to T-shirts produced for Hanes.  As a result of
the 10-year HOPE Act extension, CODEVI will soon open a fifth
factory in Ouanaminthe with an estimated 1,000 additional
workers and manufacture women's undergarments for Fruit of
the Loom.

¶28. (U) Delegate Prophete is anxious for new investments in
the northern region.  He requested that those companies and
individuals interested in building factories in the region
contact him.  Members of the Cap Haitien private sector share
his enthusiasm, but appear to discourage the idea of plant
construction in the city of Cap Haitien to avoid
overpopulation, which they believe was the case in
Port-au-Prince.

Comment
-------

¶29. (SBU) Major challenges remain for Cap Haitien but,
despite numerous requests for USG assistance, most of the
tools for development are nearly in place.  The question
''what can the U.S. do for us'' came up repeatedly during
meetings with public sector authorities, who appear
frustrated with perceived central government indifference and
lack of support.  Given its close proximity to the U.S., the
northern region is of strategic importance since many
Haitians attempt to reach the U.S. from this area. (Note:
1,043 Haitians attempted to reach American soil by boat in FY
2008, the majority of them from the northern claw. End note)
The building blocks for development exist: a completed
electricity plant, prospects for a modernized airport, a
port, a new road, numerous beaches, a labor force, and
historical sites such as the Palais Sans Souci and the
Citadel.  The question remains:  who will take the lead and
convert Cap Haitien's assets and opportunities into better
economic and social conditions for its residents.
TIGHE