WASHINGTON, CMC- The International Monetary Fund (IMF) Monday said that as of the end of December last year, Haiti has met all the targets under the current end-December 2025, all program targets were met under the existing Staff-Monitored Program (SMP), including on international reserves accumulation, primary balance, revenue collection, monetary financing, and social spending.
The Washington-based financial institution said that reform implementation has advanced, although progress has been slower than anticipated in some areas, reflecting challenging security conditions, capacity constraints, and political uncertainty.
“Persistent insecurity, political fragility, and the recent increase in international oil prices are compounding the country’s dire humanitarian and economic situation. Against this backdrop, we encourage authorities to deploy their accumulated buffers to help mitigate shocks, preserve macroeconomic stability, and protect the most vulnerable.
“The recent oil price shock, in particular, underscores the importance of adapting policy implementation as conditions evolve,” the IMF said, following an eight-day virtual mission that was led by Camilo E. Tovar, a senior economist in the Regional Studies Division of the IMF’s Western Hemisphere Department.
According to the IMF, the Haitian authorities have reaffirmed their commitment to the SMP and have requested an extension until June 19, 2027.
It said this decision will help anchor macroeconomic stability and maintain the reform agenda, and that the Haitian authorities continue to have strong ownership and engage regularly with IMF staff through the high-level SMP Monitoring Committee.
SMPs are informal agreements between country authorities and the IMF to monitor the implementation of the authorities’ economic program and build a track record of policy implementation that could pave the way for financial assistance from the IMF’s upper credit tranche (UCT).
Haiti’s SMP is tailored to Haiti’s context of acute security challenges, institutional fragility, and capacity constraints. It supports the authorities’ economic policy priorities, including stabilizing the economy, strengthening governance, and reinforcing the social safety net. Engagement with the authorities will continue over the coming weeks.
“Haiti is facing an increasingly challenging macroeconomic environment shaped by persistent insecurity and recurrent domestic and external shocks. The oil price shock stemming from the war in the Middle East has emerged as a major headwind, significantly raising the fuel import bill and implicit subsidy cost, and aggravating an already weak fiscal position,” said Tovar.
He said these pressures add to the impact of Hurricane Melissa in October 2025, which disrupted economic activity and exacerbated humanitarian needs, and are taking place amid an ongoing fragile political transition that would allow the country to organize elections later this year, the first in a decade.
Tovar said real gross domestic product (GDP) contracted for a seventh consecutive year in the 2025 financial year, and that inflation has eased rapidly in recent months, reaching 22.1 percent year-on-year after peaking at about 32 percent year-on-year at the end of 2025, and is expected to remain elevated.
“Against the backdrop of weak economic activity and heightened uncertainty, financial intermediation has continued to contract. Retrenchment in bank lending and financial disintermediation have contributed to improvements in non-performing loan ratios, while capital adequacy ratios remain well above regulatory minimums.”
Tovar said that despite a deteriorating external environment, international reserve buffers remain adequate.
“Higher international oil prices are weighing on the external position, but strong remittance inflows partly offset these pressures despite the uncertainty surrounding the potential extension of Haitian’s Temporary Protected Status (TPS) in the United States.”
He said as a result, the current account is expected to remain broadly balanced in the financial year 2026. Gross international reserves are projected to reach about US$3.4 billion by the end of this financial year, 2026, over seven months of prospective imports of goods and services. Tovar said the nominal exchange rate has remained broadly stable, which, given the high inflation, has contributed to an appreciation of the real exchange rate.
“Fiscal policy remains constrained by persistent security challenges, institutional weaknesses, and limited policy space. Revenue performance in the financial year 2026 has been weak, reflecting disruptions to economic activity due to security conditions, administrative fragilities, and institutional paralysis triggered by the termination of the Transitional Presidential Council’s mandate.
“Higher international oil prices are expected to add further pressure through higher implicit subsidy costs. Budget execution has remained uneven amid capacity constraints and heightened uncertainty. These developments have sharpened policy trade-offs and underscore the importance of prioritizing spending while safeguarding support for the most vulnerable.”
Tovar said that the risks to the outlook are tilted to the downside.
He warned that a further deterioration in security conditions, together with persistently higher global oil prices, could further strain economic activity, aggravate humanitarian conditions through higher food prices, and intensify fiscal pressures.
“Potential shifts in foreign immigration policies could slow remittance inflows, with adverse implications for the external position. On the upside, the deployment of the Gang Suppression Force, supported by the newly established United Nations Support Office for Haiti, could help restore confidence and boost economic activity.
“All program targets were met at the end of December 2025. Reserve accumulation has been strong, with net international reserves reaching US$1.76 billion in December 2025. The revenue, primary balance, and social spending targets all remained on track. The monetary financing target was also met despite an increasingly constrained fiscal space.
The reform agenda, covering governance, public financial management, safeguards, and data provision, continues to advance, albeit with delays in some areas.
Tovar said that the SMP will continue to emphasize several priorities, including strengthening governance to address fragility and rebuild trust in public institutions.
He said reforms anchored in the Governance Diagnostic Report aim to improve the integrity and effectiveness of public institutions, including more transparent management of public finances, stronger safeguards in revenue administration, and more effective mechanisms to deter and address corruption, organized crime, and illicit financial activities.
“Efforts to further strengthen the anti-money laundering and combating the financing of terrorism framework—including through the publication of the recently concluded national risk assessment and closing remaining gaps—are also critical to reinforcing financial integrity and supporting Haiti’s exit from the Financial Action Task Force grey list.”
Tovar spoke of the need to step up revenue mobilization efforts given Haiti’s low revenue base and large security and development needs.
He said higher international oil prices are straining fiscal space, reinforcing the importance of accelerating tax and customs administration reforms, including operationalizing the new tax code, strengthening digital infrastructure, and improving compliance, particularly among large taxpayers.
“The authorities’ decision to increase domestic fuel prices at the pump will reduce foregone revenues resulting from the oil price shock. IMF staff reiterates the importance of reinforcing measures to protect the most vulnerable, including by leveraging the remaining resources from the IMF 2023 Food Shock Window.
“Staff welcomes the new decree putting in place a more predictable framework for domestic fuel price setting. At the same time, staff stresses the importance of ensuring that this fuel price setting framework is accompanied by a well-prepared communication strategy to ensure public support.”
The IMF official said improving budget execution to ensure that limited public resources are effectively directed toward priority social, humanitarian, and security spending amid rising needs.
“ In line with the recommendation from one of the most recent IMF Technical Assistance, this requires stronger cash management, tighter commitment controls, and better preparation and prioritization of public investment projects.
“These reforms are also critical to ensure the timely and effective delivery of public assistance, strengthen social spending execution, and safeguard support to vulnerable households. Together, they will help improve spending efficiency, improve the management of fiscal risks, and enable public spending better to support development and reconstruction efforts in a constrained environment.”
Tovar said there is a need to consolidate the Bank of the Republic of Haiti’s (BRH) policy framework and credibility, given that the central bank remains committed to preserving price and exchange rate stability.
“This commitment continues to underpin macroeconomic performance and reinforces policy credibility under the SMP. Exchange rate stability has provided an important nominal anchor for the economy, which is supported by a prudent and sustained accumulation of international reserves.
“Governance at the central bank has been strengthened through the adoption of a new reserve management framework, including updated investment policies and guidelines that better align reserve management with safety and liquidity objectives.”
He said the Haitian authorities are making progress in strengthening risk-based banking supervision, including through the continued rollout of on-site inspections and enhancements to off-site monitoring of banks’ risk profiles.
“Efforts are underway to operationalize the new supervisory framework, integrate risk assessment tools into the BRH’s supervisory architecture, and finalize a new chart of accounts for financial institutions. These reforms are intended to safeguard financial stability and reinforce the resilience of the banking system amid a challenging operating environment,” Tovar added.
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