The 1991 coup and the irresponsible economic and financial policies of the de facto regime resulted in a sharp economic decline from 1991-94. Following the coup, the United States adopted mandatory sanctions, and the OAS instituted voluntary sanctions aimed at restoring constitutional government. International sanctions culminated in the May 1994 UN embargo of all goods entering Haiti except humanitarian supplies, such as food and medicine. The assembly sector, heavily dependent on U.S. markets, employed nearly 80,000 workers in the mid-1980s. During the embargo, employment fell below 17,000. Private domestic and foreign investment has returned to Haiti slowly. Since the embargoís end, assembly sector employment has gradually recovered to about 30,000, but further growth has been stalled by investor concerns over safety and political instability.

Under President PrÈval (1996-2001), the country's economic agenda included trade/tariff liberalization, measures to control government expenditure and increase tax revenues, civil service downsizing, financial sector reform, and the modernization of two out of nine state-owned enterprises through their sale to private investors, the provision of private sector management contracts, or joint public-private investment. Structural adjustment agreements with international financial institutions (IFIs) intended to create conditions for private sector growth proved only partly successful, however.

Haiti's real GDP growth turned negative in FY 2001 after six years of growth. Following almost 4 years of recession ending in 2004, the economy grew by 1.5% in 2005. GDP growth is projected to reach 2.5% in 2006. But significant improvement in living standards would require an estimated doubling of the growth rate.

Since the departure of President Aristide, the financial situation has stabilized. Inflation has fallen from 42.7% at end-2003, to 15% by end-April 2006.

The IGOH has conducted a largely sound fiscal policy. But the traditional low revenue collection rate (roughly 9% of the GDP) constrains its ability to provide social services and invest in physical and human capital. External assistance (approximately $965 million from July 2004 through March 2006) as well as diaspora remittances (estimated at over $1 billion) will remain critical to keep the economy afloat.

Workers in Haiti are guaranteed the right of association. Unionization is protected by the labor code. A legal minimum wage of 70 gourdes a day (about U.S. $1.70) applies to most workers in the formal sector.