Honduras 

Honduras country policy

Policy established 14 July 2010

• ILC, bank guarantee or central public guarantee (unconditional)
• The country ceiling is 1000 mln euro
• Early warning signal 100 mln euro
• - of which was used as at 2011-08-31 47 mln euro
• Public buyers: ORIO facility

Country class: 6

Publieke kopers : good governance control

Honduras country facts

Atradius Dutch State Business Economic Research
Country Report last updated :  18 May 2011
Country :  HONDURAS 

Political Situation
More Stable After The Disputed 2009-Coup

Head of state
President Porfirio Lobo.

Form of government
Unity government headed by the Partido Nacional.

Internal Economic Situation
Economic Recovery

General situation
Honduras’ economy is relatively small and open. The global recession and the domestic political crisis (sanctions, suspended aid) caused investments, consumption and exports to fall in 2009: real GDP-declined by 2%. Since then economic recovery (2010 +2.6%), driven by  private consumption (higher workers’ remittances, credit growth) and exports. Agricultural output is subject to periods of heavy rains and floodings. Inflation continues to exceed the informal 6%-target set by the Banco Central de Honduras (BCH), largely due to risen food and fuel prices. Although financial soundness has improved, the banking sector remains vulnerable because of the currency misalignment in a highly dollarised economy and weak supervisory and regulatory mechanisms.

External Economic Situation
Despite Better Solvency, Still Weak

Main sources of foreign exchange
Workers’ remittances, bananas, coffee, textiles, minerals.

Main foreign markets
United States (65%), Latin America, EU.

Main expenses of foreign exchange
Raw materials/fuels, construction material.

Balance of payments
Preferential trade access to the USA and to the region ensures a steady flow of income from exports of maquila-products and workers’ transfers. A more flexible exchange rate is adopted to counter the increasing overvaluation of the lempira.