What a Broken Windshield Says About Haiti’s Economy

On Monday of last week, a Capital Coach Line bus left Port-au-Prince bound for the southern city of Les Cayes as part of a new route that began this month. The company’s 50-passenger coaches are equipped with televisions, toilets, A/C, and reclining seats – standard services that it’s been offering since 2003 between Haiti’s capital and Santo Domingo in the neighboring Dominican Republic.

Not far west of Port-au-Prince, about a quarter of the way through the four-hour trip, vandals pelted the bus with rocks and broke one its windshields as it passed the town of Grand-Goâve.

The week before the attack, Capital Coach Lines had gotten word that a drivers union in Les Cayes wasn’t happy about its new route. “We received a threat from a third-party,” says Hugo Jean-Francois, the company’s general manager. “The message that we got was that they were going to stop us on Monday.” On the coach’s return leg, it was again attacked near Grand-Goâve.

Jean-Francois doesn’t see Capital Coach Line’s service as direct competition to existing transportation providers. “Other companies use small buses that are OK, but not the same service,” he says.

I’ve used one such service to travel from the capital to Cayes. It cost 400 gourdes, about $10, for a not-quite-cramped seat in an air-conditioned mini-bus. There are also many tap-tap alternatives that are much cheaper. Capital Coach Line’s current price to Cayes is $12. That $2 difference might “not be a big deal for a foreigner,” says Jean-Francois, but for locals who travel every week or two and don’t have a great deal of purchasing power, it’s significant. In any event, even if Capital Coach Lines doesn’t see itself as a direct competitor to existing players, someone apparently does.

“I imagine that [the people behind the attack] thought we would stop right there,” says Jean-Francois. “But we continued.” There were no incidents along the Port-au-Prince-Cayes route on Tuesday, but on Wednesday, a coach was attacked in the same spot, by rock-throwing “bandits,” as Le Matin labeled them.

The concentration of economic power and political influence in a few players is one reason that many sectors of Haiti’s economy have ossified. While intimidation like that aimed at Capital Coach Line does happen, Jean-Francois says that it’s more common for those with a vested interest in the status quo to use softer means to stifle competition and innovation. “You could find more paperwork to fill out, lose more time in customs,” he says. “If someone’s in a business and they want to do harm, there are many ways to do it.

“The thing is, if the institutions are strong enough, it’s going to be more difficult, but if the institutions are weak, they may find a way to use their influences more easily.”

“I think we’re at a corner with that level of ossification that you’re talking about,” Olivier Barrau says when I ask him about the issue, “and that forces you to see differently.” Barrau is president and CEO of Alternative Insurance Company, which honored every one of its claims after the 2010 earthquake. The company’s stellar reputation has helped it attract capital from investors including the Inter-American Development Bank and the Clinton Bush Haiti Fund.

“What I can say is the few – or those that don’t realize that the business models that they had in the last 15 years that used to work – are bound to die,” he says. “But it will take time, because those establishments are strong.”

Capital Coach Line reported the attacks to the Haitian National Police and local media, and police are now escorting the company’s coaches as they pass Grand-Goâve on National Highway No. 2. Police are also investigating the attacks and planning to meet with the Les Cayes drivers syndicate, according to Jean-Francois.

“It’s a place where tourism is growing,” he says of Haiti’s southern region, “and there are hotels over there, it’s a nice place to visit.” He notes the Haitian government’s big tourism push, which includes a proposed international airport in Cayes and an intricate development on the nearby island Île à Vache. “Offering a coach service, we’re going to bring more people to visit, either foreigners or people living in Port-au-Prince to visit another part of their own country.” But he has reservations about the government’s rhetoric given the realities of running a company in Haiti.

“The government says that ‘Haiti is open for business,’” he says. “If they can’t even defend the people already in business, how are they going to attract new investment?”

UPDATE — July 23, 2013 4:45 p.m. ET: Jean-Francois emails to say that someone fired at a Capital Coach Line bus on the Port-au-Prince-Cayes route this afternoon with a pistol. He says a bullet was stopped by the windshield’s support bar and remains lodged in the bus. The company will suspend its service on the route “because lives are now in danger,” he adds.