* 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
By Pascal Fletcher
LEOGANE, Haiti, March 26 (Reuters) - Laborers at Haiti"sonly working sugar mill, the Jean Leopold Dominique deDarbonne, chew on sugar cane stalks to sustain themselves asthey prepare the factory for another grinding season.
But it is foreign imported sugar and rice, besidesdirt-poor subsistence farming, that sustains Haiti"s nearly 10million population -- an underdevelopment dilemma that has beenhighlighted as the Caribbean nation struggles to rebuild afterthe devastating earthquake in January.
More than two centuries ago, Haiti was Saint Domingue,France"s Caribbean jewel built on sugar and slavery, and therichest colony in the world. A bloody slave revolt wonindependence from France in 1804.
But the Haiti that was bludgeoned by the Jan. 12 earthquakehad the unenviable identity of being the poorest state in theWestern Hemisphere, unable to feed itself and spending astaggering 80 percent of its revenues to pay for food imports.
Since the disaster, which Haiti"s government believes mayhave killed more than 300,000 people, foreign relief groupshave brought in vast quantities of food aid to feed more than 1million people left homeless by the quake.
But as the government and foreign experts prepare for adonors" conference to be held in New York on March 31, they arecalling for a complete reform of Haiti"s decrepit farm sectorto 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 theHaitian-American Chamber of Commerce, who is pressing forprivate investment in Haiti"s agriculture, told Reuters.
She said foreign donors, multilateral lenders and aidgroups must concentrate on making Haiti economicallyself-sustainable, especially in food, after the quake, if thecountry can ever hope to escape from its poverty trap.
Barjon said imports of rice, sugar and poultry, largelyfrom the United States, were $550 million a year. "If Haiti wasable to produce all these things, and it can ... we wouldreduce our annual trade deficit by 50 percent," she said.
"The mills and plants for sugar, rice and poultry arethere. What they need are investments to restart."
One example is the Darbonne sugar mill, located southwestof the capital Port-au-Prince outside Leogane, a town near thequake epicenter which was devastated. Most of its inhabitantslive in tent camps situated between the ruins of their homes.
LACK OF SUGAR CANE
Built in the early 1980s with Italian cooperation, the millwas closed after two years because it could not compete withcheaper imports of sugar. Left prey to neglect and vandalism,it was restarted with Cuban help in 2001 following a request toCuban leader Fidel Castro by Haitian President Rene Preval.
But the factory has been producing well below its fullcapacity, even though a team of Cuban technicians has kept itoperational for nearly a decade.
It produced 2,607 tonnes of sugar in 2005, its best yearsince restarting, but made no sugar in 2009, insteadmanufacturing syrup for alcohol distillers.
This meager output compares to the 250,000 tonnes of sugarthat Haiti imports each year, from the United States, theneighboring Dominican Republic and other sugar producers.
Experts now acknowledge that the influx over the past twodecades of subsidized cheaper farm imports, ushered in by WorldBank and International Monetary Fund free-trade policies thatobliged Haiti to open its markets, delivered a virtual deathblow to Haitian agriculture from which it has never recovered.
"Haiti should be producing its own sugar," said DominiqueVolcin, the Darbonne mill"s technical director since 2003.
"We need to modernize, because agriculture is the economicbase of our country," he added, saying the sugar sector neededa combination of determined state support and privateinvestment to allow it to replace the cheaper imports.
The Haitian-American Chamber of Commerce"s Barjon is alsothe CEO of BioTek Solutions Inc, a U.S.-based company that isproposing a public-private partnership for the Darbonne mill.
The team of Cuban technicians who maintain the factory sayit is technically sound but the main obstacle to increasedoutput is the lack of sufficient sugar cane.
The factory sustained only minor damage in the earthquakeand was to open the 2010 grinding season on Friday.
"We think the biggest problem is the supply of cane," saidone of the Cubans, Jorge Luis Perez.
Most of the cane growers in the surrounding area of Leoganeand Gressier are peasant farmers working tiny half-hectareplots with poor resources. This means they cannot produce thesufficient 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 andinternational financial institutions like the World Bank,albeit well-intentioned, had been wrong to push developingstates into opening their markets to cheap subsidized imports.
During his presidency from 1993 to 2001, he said he hadsigned legislation that had effectively increased thepenetration of American rice into Haiti, which decimated thatcountry"s own rice production.
"I think it was a mistake, I think it was part of a globaltrend that was wrong-headed," Clinton told reporters, adding hewas now looking to boost Haitian farm output by providing seedsand fertilizer through his own charitable foundation.
The U.N. Food and Agriculture Organization (FAO), incollaboration with the Haitian government, has prepared a $721million investment blueprint for the agricultural sector aimedat developing rural areas and production and boostingdistribution channels and agricultural services.
But achieving the food self-sufficiency goal will clearlytake time and political will, and also involve loosening thegrip of past alliances between powerful importing impresariosand the country"s political rulers.
"So as to not import, you have to produce enough to feedeveryone, and if you don"t produce enough, you have to buy itfrom somewhere else ... that"s life," said Volcin. (Editing by Vicki Allen)
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