FEATURE-Food dependency is poverty trap for quake-hit Haiti
* Farming sector crushed by cheaper rice, sugar imports
* Calls for farm investment to boost post-quake recovery
* Lone working sugar mill hamstrung by shortage of cane
LEOGANE, Haiti, March 26 (Reuters) - Laborers at Haiti's only working sugar mill, the Jean Leopold Dominique de Darbonne, chew on sugar cane stalks to sustain themselves as they prepare the factory for another grinding season.
But it is foreign imported sugar and rice, besides dirt-poor subsistence farming, that sustains Haiti's nearly 10 million population -- an underdevelopment dilemma that has been highlighted as the Caribbean nation struggles to rebuild after the devastating earthquake in January.
More than two centuries ago, Haiti was Saint Domingue, France's Caribbean jewel built on sugar and slavery, and the richest colony in the world. A bloody slave revolt won independence from France in 1804.
But the Haiti that was bludgeoned by the Jan. 12 earthquake had the unenviable identity of being the poorest state in the Western Hemisphere, unable to feed itself and spending a staggering 80 percent of its revenues to pay for food imports.
Since the disaster, which Haiti's government believes may have killed more than 300,000 people, foreign relief groups have brought in vast quantities of food aid to feed more than 1 million people left homeless by the quake.
But as the government and foreign experts prepare for a donors' conference to be held in New York on March 31, they are calling for a complete reform of Haiti's decrepit farm sector to break the crippling dependency on food imports and aid.
"We won independence 200 years ago but ... not really, because we're begging consistently," Regine Barjon of the Haitian-American Chamber of Commerce, who is pressing for private investment in Haiti's agriculture, told Reuters.
She said foreign donors, multilateral lenders and aid groups must concentrate on making Haiti economically self-sustainable, especially in food, after the quake, if the country can ever hope to escape from its poverty trap.
Barjon said imports of rice, sugar and poultry, largely from the United States, were $550 million a year. "If Haiti was able to produce all these things, and it can ... we would reduce our annual trade deficit by 50 percent," she said.
"The mills and plants for sugar, rice and poultry are there. What they need are investments to restart."
One example is the Darbonne sugar mill, located southwest of the capital Port-au-Prince outside Leogane, a town near the quake epicenter which was devastated. Most of its inhabitants live in tent camps situated between the ruins of their homes.
LACK OF SUGAR CANE
Built in the early 1980s with Italian cooperation, the mill was closed after two years because it could not compete with cheaper imports of sugar. Left prey to neglect and vandalism, it was restarted with Cuban help in 2001 following a request to Cuban leader Fidel Castro by Haitian President Rene Preval.
But the factory has been producing well below its full capacity, even though a team of Cuban technicians has kept it operational for nearly a decade.
It produced 2,607 tonnes of sugar in 2005, its best year since restarting, but made no sugar in 2009, instead manufacturing syrup for alcohol distillers.
This meager output compares to the 250,000 tonnes of sugar that Haiti imports each year, from the United States, the neighboring Dominican Republic and other sugar producers.
Experts now acknowledge that the influx over the past two decades of subsidized cheaper farm imports, ushered in by World Bank and International Monetary Fund free-trade policies that obliged Haiti to open its markets, delivered a virtual death blow to Haitian agriculture from which it has never recovered.
"Haiti should be producing its own sugar," said Dominique Volcin, the Darbonne mill's technical director since 2003.
"We need to modernize, because agriculture is the economic base of our country," he added, saying the sugar sector needed a combination of determined state support and private investment to allow it to replace the cheaper imports.
The Haitian-American Chamber of Commerce's Barjon is also the CEO of BioTek Solutions Inc, a U.S.-based company that is proposing a public-private partnership for the Darbonne mill.
The team of Cuban technicians who maintain the factory say it is technically sound but the main obstacle to increased output is the lack of sufficient sugar cane.
The factory sustained only minor damage in the earthquake and was to open the 2010 grinding season on Friday.
"We think the biggest problem is the supply of cane," said one of the Cubans, Jorge Luis Perez.
Most of the cane growers in the surrounding area of Leogane and Gressier are peasant farmers working tiny half-hectare plots with poor resources. This means they cannot produce the sufficient quantities of high-yielding cane the mill needs.
"WRONG-HEADED" PAST GLOBAL POLICY
On a visit to quake-stricken Haiti this week, former U.S. President Bill Clinton recognized that the United States and international financial institutions like the World Bank, albeit well-intentioned, had been wrong to push developing states into opening their markets to cheap subsidized imports.
During his presidency from 1993 to 2001, he said he had signed legislation that had effectively increased the penetration of American rice into Haiti, which decimated that country's own rice production.
"I think it was a mistake, I think it was part of a global trend that was wrong-headed," Clinton told reporters, adding he was now looking to boost Haitian farm output by providing seeds and fertilizer through his own charitable foundation.
The U.N. Food and Agriculture Organization (FAO), in collaboration with the Haitian government, has prepared a $721 million investment blueprint for the agricultural sector aimed at developing rural areas and production and boosting distribution channels and agricultural services.
But achieving the food self-sufficiency goal will clearly take time and political will, and also involve loosening the grip of past alliances between powerful importing impresarios and the country's political rulers.
"So as to not import, you have to produce enough to feed everyone, and if you don't produce enough, you have to buy it from somewhere else ... that's life," said Volcin. (Editing by Vicki Allen)
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