Holidays on coffee fincas are offered by cooperatives in western Honduras

Honduras Economic Policy

The economic policy in Honduras aims at a neoliberal market economy, which is characterized by free trade, investment facilitation and the granting of concessions. The initiative of the current government for the creation of jobs – “Programa 20/20” – does not follow the plan of the previous government, but aims at quick measures, especially in the areas of textiles, tourism, the partial manufacturing industry (maquilas) as well as in the entrepreneurial service sector. The necessary economic reforms are missing; instead, Hernández’s economic policy underpins the country’s existing economic structure and strengthens the position of the oligarchy and the actual power groups. Hernández relies even more on foreign investment than his predecessors.

The problems of the agriculture and forestry sector (such as land distribution, resource protection) as well as the precarious working conditions in many areas are not included in this initiative, just as small and very small businesses are not taken into account. “Programa 20/20″ has a similar strategy to the programs already launched in the history of Honduras, which, however, did not achieve the desired effect of poverty reduction.

Since the coup in 2009, a number of business-friendly laws and legislative changes (including in the energy, water, communications sectors, flexible working hours, investment protection, privatization of public goods) have been passed, especially in the last month of Lobo’s term of office, as the PN under Hernández does not have a majority in parliament Has. The tax package (paquetazo fiscal) is one of these new or reformed laws. This should help to lead Honduras out of the economic crisis and high debt. Tax policy in general has been heavily criticized because the costs of the crisis are passed on to the population through tax increases, among other things.

The fight against unemployment is one of the priorities of the current government. His program ” Con Chamba Vivís Mejor ” (“You live better with a job”) aims to create around 100,000 jobs, especially for young people. So far, the government has relied on the government for low-wage jobs. In a report by IG Bau, Honduras is one of the 10 countries in the world with the worst working conditions.

According to ethnicityology, the European Union is funding several programs in Honduras, including the job creation euro lab (EUR 10 million) and a food security program (EUR 30 million).

Juan Orlando Hernández is continuing efforts to create economic zones similar to the Charter Cities (Ciudades Modelo). In September 2012, a contract to build such a controversial charter city was signed by MPs and international investors. Complaints were filed against the constitutional reform required for this, and the majority of the Supreme Court decided against the decree, which would have changed Articles 304 and 329. After the removal of some justices from the Supreme Court, Parliament decided in January 2013 to amend Articles 294, 303 and 329 of the Constitution to pave the way for model cities. In June 2013 a law was passed decree that the creation of so-called ZEDEs (Zonas de Empleo y Desarrollo Económico) allowed anywhere in the country with their own legal form. There are significant legal concerns about this law.

The government hopes for an economic upswing from the ZEDEs; but as is so often the case in Honduran politics, the people living in the regions are not considered. The first ZEDE will be created on the island of Roatán.

The government’s economic policy is reflected in major projects in various economic sectors such as the mining and energy sectors, tourism and infrastructure. Renewable energies are promoted by wind parks and dams and investors are attracted by concessions for rivers and mines. Infrastructure projects are intended to facilitate the export of economic goods.

An important instrument in the government’s economic policy is the public-private partnership. In Honduras, Coalianza was the government agency overseeing the area. Coalianza’s work was very controversial because it led to further privatization of state-owned companies. Coalianza has meanwhile been wound up and is being replaced by a new institution. However, this will not change the policy of privatization. This policy is closely related to the demands of the IMF. In addition to the partial privatization of the state energy authority, civil society organizations fear the privatization of the telecommunications authority.

Honduras participates in the “Proyecto de Integración y Desarrollo de Mesoamérica” (” Proyecto Mesoamérica ” for short). Both the previous project, the “Plan Puebla Panamá”, and the current project have been criticized for their too strong focus on large-scale projects, some of which are environmentally harmful and socially unbalanced, and the lack of opportunities for the population to participate.

For job creation, especially for the poorer population, there is development potential in promoting micro, small and medium-sized enterprises. As an agricultural state, Honduras can develop a great deal of potential in the agricultural sector. On the one hand, agriculture would have to be modernized; on the other hand, land rights, especially for women, must be clarified and landless people have access to land. State support for the agricultural sector is to be provided through the armed forces in a new program. This contributes to further destabilization of state institutions, especially against the background that the Ministry of Defense is the ministry least committed to transparency.

Many people without training are precariously employed in the informal sector. A lack of adequate jobs and inadequate vocational training lead to high youth unemployment. The NGO FOSDEH assumes that around 800,000 young people are currently neither working nor in training. On the other hand, according to Casa Alianza, 400,000 minors are forced to work to earn a living.

The Honduran economy is very crisis-prone due to its high dependency on exports. Price fluctuations on the world market for important export goods, such as coffee, are reflected immediately and have fatal consequences, especially for socially precarious classes in the relevant economic sectors.

Together with its neighbors Guatemala and El Salvador, Honduras has presented a regional development plan (Plan de la Alianza para la Prosperidad del Triángulo Norte) in which the three countries want to address the issues of security, governability and economic growth together. The US will provide partial financial support to the plan. The social sector is not included in the plan. Criticism from civil society relates primarily to the fact that the plan encourages foreign investment, does not hold current governments accountable and supports militarization-based security policies.

Holidays on coffee fincas are offered by cooperatives in western Honduras