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In 2014, GDP grew by 3.5% (versus 4.3% in 2013), driven by expansions in manufacturing (7.3%), construction (9.2%) and commerce (12.8%), as well as the expected good performance of the agricultural sector. The fiscal deficit rose to 4.6% of GDP (on a cash basis), but remains below expected levels set out in the Extended Credit Facility arrangement with the International Monetary Fund (IMF), whose eighth and final review was completed in November.
Average annual inflation between October 2013 and September 2014 (3.7%) was half of that in the corresponding period between 2012 and 2013, attributable to a significant drop in the prices of certain imported products (rice, wheat and cooking oils) and a supply-side improvement in domestic agricultural production.
A slowdown in exports and imports (which grew by 5.3% and 1.1%, respectively) and buoyant remittances (up by 11%) led to a slight narrowing (-4%) in the balance-of-payments current account deficit to 6.2% of GDP.
Tax receipts grew by 5.3% in nominal terms —despite the reduction (of 5.8%) in tariff revenues— on the back of a rise (of 19.7%) in direct collection. Current expenditure was up by 15%, driven by increased outgoings in wages (13%) and operating expenses (17%). In stark contrast to the forecast acceleration in public investment, spending on public works from Treasury resources was slashed (-45%) as the public investment programme was frozen pending the adoption of the new budget. This was, however, partially offset by payments (to the tune of US$ 175 million) made under the Petrocaribe energy cooperation agreement and untied aid contributions (US$ 98 million) in the last quarter of the year.
The Bank of the Republic of Haiti (BRH) continued to implement a contractionary monetary policy, limiting growth in the monetary base to just 0.1% by tightening legal reserve requirements, although the M1 monetary aggregate, at 9.8%, was almost double that of 2013.(Preliminary Overview of the Economies of Latin America and the Caribbean 2014)