Island Of Hispaniola Has Two Varied Economies
RENEE MONTAGNE, host:
Now, we're going to look at a couple of economies in the Caribbean. Even a casual glance out the window of an airplane tells a story. Haiti and Dominican Republic share an island, but seemingly little else. Haiti is deforested and shockingly underdeveloped. The Dominican Republic is lush and green, its big cities filled with modern buildings.
Our Planet Money team has been wondering how two countries so close together could have such radically different economies. They found part of the answer in the tale of two men who make T-shirts for a living. Here's Chana Joffe-Walt and Adam Davidson.
CHANA JOFFE-WALT: George Sassine was on TV the night before the earthquake. And he said this. He said, this is the closest I have ever been to satisfying my dream. In fact, George Sassine said, this is the single best moment in Haitian economic history.
George owns a T-shirt factory in Port-au-Prince. And he said a couple of years of political stability in Haiti, that counts for a lot, and a new focus on jobs instead of aid meant thousands of Haitians would get new jobs making even more T-shirts.
George said this as he walked through rows of women sitting at sewing machines making three, four bucks a day in a country where most people live on less than $2 a day. It was a dream George had been working on for 35 years, and it felt like it was finally happening.
Mr. GEORGE SASSINE (President, Haitian Association of Industrialists): Things are moving. The fans were turning. The lights were on. People are walking back and forth, sewing...
JOFFE-WALT: Busy and bustling.
Mr. SASSINE: ...and all my phones were going at the same time. I was planning on a visit by Irish businesspeople on that Sunday - coming Sunday. I just had the Koreans and before that, Brazilians. So things were moving, you know, and I had so many things to do. And now, as you can see, it looks like death.
JOFFE-WALT: The earthquake tore apart one of the factory walls. Everyone had gone home for the day, but George's office is now a pile of rocks.
ADAM DAVIDSON: OK, Chana, now I want to take us across the border into the Dominican Republic and introduce you to another man with a dream about T-shirts. His name is Fernando Capellan. He's the CEO of a company called Grupo M. They're now a full-service business. That means they turn yarn into cloth. They dye that cloth. They cut that cloth into shape, sew it into T-shirts that they themselves have designed. And then their logistics experts get those T-shirts from the Caribbean to your store in Nebraska. His business now is, as they say, several steps up the value chain from the dream he started with.
When Fernando started out, his dream was exactly what George's is: to build a simple, cut-and-sew factory where people with low skills make low wages, simply sewing T-shirts.
When Grupo M was a baby, was it where Haiti is today? You know how to sew. You know how to cut.
Mr. FERNANDO CAPELLAN (CEO, Grupo M): Yeah, we know how to...
Unidentified Man: It was a cut, sew, fit shop.
Mr. CAPELLAN: Yeah. It was only cut and sew, basically. Cut and sew.
DAVIDSON: If I came to you in 1986 and said, I don't need cut and sew. I need you to design it. I need a logistics plan. I need...
Mr. CAPELLAN: I couldn't make it because it had - everything in life evolved.
JOFFE-WALT: When George and Fernando were young, 1960, Haiti and the Dominican Republic had the same per capita real GDP. It was equally likely that they would both get their dreams fulfilled.
DAVIDSON: By 2005, per capita GDP in the Dominican Republic had tripled.
JOFFE-WALT: In Haiti, it was half what it had been in 1960.
Mr. SASSINE: And look at me, look at him.
JOFFE-WALT: Here's George Sassine again, in his empty factory.
Mr. SASSINE: I've had a - coup d'etats. I've had hurricanes. Now, I have an earthquake. So...
DAVIDSON: It's not that he's smarter than you?
Mr. SASSINE: No, he's not smarter than me, no. It's just - it's...
JOFFE-WALT: He works harder than you?
Mr. SASSINE: No. No, on the contrary. I work harder because he - fortunately, for him, his country, his government was behind him. Me, I've been having governments against me all my life.
DAVIDSON: Fernando now has all sorts of new big dreams. He wants to design and make more expensive clothes, move into higher-end stores in the U.S. He wants the Dominican Republic to become the preeminent apparel producer in the Western Hemisphere.
JOFFE-WALT: George has adjusted his dream, too. Today, he just wants to reopen sometime soon, and he wants to get back to where he's already been.
I'm Chana Joffe-Walt.
DAVIDSON: And I'm Adam Davidson, NPR News.