Haiti’s capital, Port-au-Prince, is on the verge of a takeover by armed rebels. And a fiscal crisis is threatening Colombia
Armed groups near full takeover of Haiti’s capital
Haiti’s presidential chair has been empty since July 2021, when Jovenel Moïse was assassinated inside his residence. Since then, a series of failed transitional governments have barely held on to power amid catastrophic deterioration of Haitians’ everyday lives, with armed groups seizing large parts of the country while committing horrific acts of violence.
👉 Why it matters. Reports indicate that gangs now dominate approximately 90% of Haiti’s capital, Port-au-Prince, with both local media and international organizations agreeing that the likelihood of the capital falling entirely under their control is higher than ever — and there are few credible avenues to reverse this grim trend.
Losing ground. The loss of state power is so massive that the most recent Miami Herald report on Haiti chose to list the areas of the capital that are not yet dominated by gangs.
- These are the almost entirely closed Toussaint Louverture International Airport, the seaport (but not most routes leading to it), the main police headquarters and the National Palace, even though it was partially destroyed in the 2010 earthquake and has not been fixed since.
- Other than that, only a few relatively affluent residential neighborhoods, the offices of the nine-member Transitional Presidential Council and very little else remain outside of the rebels’ reach, with more than 100 government offices destroyed, relocated or forced to close.
New horrors. The loss of territory has been coupled with an incessant string of dramatic news about the toll of the crisis. According to the UN, 60,000 Haitians have been displaced every month since its start, while ActionAid denounced that 88% of Haitians had a family member go an entire day without eating in the past month.
Gang crimes. Meanwhile, gangs have set Haiti’s main public hospital on fire. They are now attacking the Kenya-led multinational security mission, killing two police officials so far and turning their assault into a spectacle. Disturbing footage on social media showed gang members mocking the ambushed Kenyan officer’s body.
Vacuum. The roughly 800 foreign police officers deployed to Haiti have made little difference so far in a country where local cops are constantly on strike and pleading for extra protection. As gangs grow stronger, different groups have merged into a larger coalition that is now seen as having more firepower than the state itself.
- “Emboldened by their growing dominance, gangs have expanded attacks to previously less-affected sectors, targeting health workers and diplomats with alarming frequency,” analysts say, leading to the exit of foreign aid and missions.
Out of answers. During a conference in Geneva last week, UN High Commissioner for Human Rights Volker Türk foresaw darker days, saying gangs “are implementing their own rule across wider parts of the capital and beyond” and that a parallel state is taking root in Haiti.
- With so much uncertainty, one potential path would be to elevate the current Kenyan mission to a full-scale peacekeeping operation, similar to the 2004-2017 Minustah experience led by Brazil. However, the idea lacks international consensus, and its precedent was not particularly successful either.
Fiscal deficit threatens Colombia with a debt crisis
When President Gustavo Petro of Colombia appointed Diego Guevara to his cabinet, nobody expected him to bring economic orthodoxy to the left-wing administration. An admirer of Greek economist Yanis Varoufakis, Guevara had championed new taxes on capital and landowners during the 2022 tax reform, pushing for expanded public spending and wealth redistribution — even at the risk of a fiscal deficit.
- Yet, just three months into his role as finance minister, Guevara issued a stark warning of an impending fiscal crisis, proposing significant budget cuts to avert disaster. His recommendation for austerity was quickly dismissed by Petro, whose focus on election-year spending led to Guevara’s abrupt dismissal.
👉 Why it matters. Guevara has warned that without spending cuts in the coming months, the government could face “judgment day” by June, when it may lack the funds to cover anything beyond salaries and basic services — the most inflexible items in the budget.
Lula redux? If deficit spending continues, analysts have cautioned that Colombia could follow in Brazil’s footsteps, where last year a currency crisis and a massive selloff in bond markets were triggered by concerns over budget sustainability.
By the numbers. Before his departure, Guevara proposed cuts totaling 37 trillion Colombian pesos (USD 9 billion) — roughly 2% of Colombia’s GDP and 7% of its total budget.
- The figure was still short of the COP 46 trillion demanded by the Autonomous Committee of Fiscal Rules (CARF), an independent public budget watchdog, and even shorter than the COP 90 trillion deficit registered in 2024.
Reaction. In a speech after his discussion with Guevara, Petro said that the Economy Ministry was “full of Uribistas,” a reference to former right-wing president Álvaro Uribe. “They hide our projects in the drawers so that we can’t move forward. And the same is true of the Planning Ministry,” Petro argued.
Debt crisis? As the crisis progressed, Colombia’s bonds sold off. Its 10-year note currently offers yields of 12% per year, up from 9.5% six months ago and closing in on Brazil’s 15%. Before the Covid crisis, which forced most governments to significantly increase their public spending, they traded at just 5%.
- Bonds have moved in the opposite direction to the country’s stock market this year, which has soared as investors believe that a more business-friendly administration is likely to replace him next year.
Yes, but … Colombia’s financial struggles should not be placed solely on Petro’s shoulders. Debt and public spending increased sharply under his predecessor, right-winger Iván Duque. And this was not just due to Covid-linked expenses, but also because of increased subsidies to keep gas prices low, which Petro’s team partially unwinded during his presidency, bringing some temporary relief to bond markets.
What next. Guevara’s exit raised the number of cabinet ministers who have been part of Petro’s government to 52, as his administration has been in constant tension between left-wingers and liberals.
- As his replacement, Petro appointed Germán Ávila, a close ally of more than 30 years since their days together in the M-19 left-wing guerrilla. Analysts see him as less likely to contradict Petro’s budget demands, with former Economy Minister Mauricio Cárdenas warning that Colombia could be going down Argentina’s dangerous path of fiscal profligacy.
Read also: Duque’s tax reform brings only temporary relief for Colombia (Sep. 2021)
Quick catch-up
🇨🇳 Chinese regulators said they will review the BlackRock purchase of a Hong Kong firm controlling two strategic ports near the Panama Canal.
🛢️ Ecuador experienced its worst oil leak in three decades, which led to a landslide, compromised over 240,000 hectares of land and affected roughly 500,000 people, according to UN estimates.
🌊 Bolivia declared a state of national emergency over devastating floods that killed at least 50 and compromised almost 2% of the country’s arable land.
👍 Argentina’s Javier Milei celebrated as official poverty rates plummeted from 53% to 38% in the last six months, following an economic bounceback.
🤝 Amid increased border tensions with Venezuela, Colombian President Gustavo Petro hosted US Secretary of Homeland Security Kristi Noem in Bogota, where they agreed on biometric data cooperation.
🚔 Former Medellín cartel capo Carlos Lehder was briefly arrested over decades-old charges as he set foot in Colombia but was freed shortly after as a judge deemed the charges had reached the country’s statute of limitations.
✂️ Pro-Palestine groups marched in Uruguay asking newly sworn-in President Yamandú Orsi to follow some of his South American peers and sever ties with Israel due to its military campaign in Gaza.
🕵️ Brazil blamed the former administration of Jair Bolsonaro for spying on Paraguayan officials in the context of negotiations over the Itaipu binational dam. Read more in today’s Brazil Daily newsletter.