Marriott's Exit from Haiti Highlights Risks of Investing in Fragile States

PORT-AU-PRINCE, Haiti — Marriott International’s decision to close its sole hotel in Haiti by late 2025 marks a stark acknowledgment of the escalating risks of operating in politically unstable regions. The move, driven by persistent gang violence, political turmoil, and a lack of government control, underscores a broader challenge for investors in fragile states: balancing potential returns with existential risks to security and stability.

The Marriott Hotel Port-au-Prince, which opened in 2001, has weathered decades of instability. It temporarily closed in 2004 amid violent protests after the overthrow of President Jean-Bertrand Aristide and reopened in 2005. However, the hotel’s most recent suspension in 2020—and now its planned permanent closure—reflects a deterioration far beyond past crises. Gang clashes, kidnappings, and assassinations have surged in recent years, with 2023 alone seeing over 200 politically motivated killings, according to the Haitian Institute for the Training of Elected Officials.

Security Challenges and Operational Costs
Marriott’s exit follows years of escalating costs to maintain security for its guests and staff. The hotel had long employed armed guards, restricted access to certain areas, and coordinated with local authorities—a costly and ultimately unsustainable strategy. Recent incidents, such as the 2022 assassination of President Jovenel Moïse and ongoing clashes between gangs like the G9 and 400 Mawozo, have eroded what little stability remained.

The Haitian government’s inability to project authority has further deterred businesses. The World Bank’s Governance and Management Indicator for Haiti ranks among the lowest globally, with a score of 2.4 out of 6 in 2022—a reflection of weak institutions and rule of law.

Broader Implications for Investors
Marriott’s decision is not an isolated case. Over the past five years, international businesses, NGOs, and diplomatic missions have increasingly withdrawn from Haiti. The U.S. Embassy relocated its staff to a fortified compound in 2021, and oil giant Shell suspended operations in 2022. These exits highlight the difficulty of sustaining commercial activity in environments where security cannot be guaranteed.

For investors, the case underscores the need to factor geopolitical risk into valuations. While Haiti’s tourism potential—boasting beaches and cultural heritage—might tempt investors, the reality is that without security, even low-cost ventures face insurmountable hurdles. A 2023 World Bank report estimates that violence and instability have cost Haiti over $1 billion annually since 2019, or roughly 10% of its GDP.

Conclusion: Fragile States Require More Than Capital
Marriott’s exit from Haiti serves as a cautionary tale for investors eyeing opportunities in fragile states. While regions like Haiti may offer low labor costs or untapped markets, the risks of operating in environments with weak governance and chronic violence can outweigh potential gains.

The data paints a clear picture: countries with high insecurity, such as Haiti, see diminished foreign direct investment (FDI). FDI inflows to Haiti dropped to just $60 million in 2022, down from $220 million in 2019—a 73% decline. Meanwhile, neighboring Dominican Republic, which maintains political stability, attracted over $3 billion in FDI during the same period.

For investors, the lesson is unequivocal: capital alone cannot stabilize a fractured state. Without sustained improvements in security, governance, and institutional capacity—factors Marriott’s closure shows are lacking—the cycle of instability will persist. Until then, Haiti’s Marriott will remain a symbol of the high stakes of investing in fragile states.