Information about Honduras
Once part of Spain's vast empire in the New World, Honduras became an independent nation in 1821. After two and a half decades of mostly military rule, a freely elected civilian government came to power in 1982. During the 1980s, Honduras proved a haven for anti-Sandinista contras fighting the Marxist Nicaraguan Government and an ally to Salvadoran Government forces fighting leftist guerrillas. The country was devastated by Hurricane Mitch in 1998, which killed about 5,600 people and caused approximately $2 billion in damage. Since then, the economy has slowly rebounded.
Honduras, the second poorest country in Central America, suffers from extraordinarily unequal distribution of income, as well as high underemployment. While historically dependent on the export of bananas and coffee, Honduras has diversified its export base to include apparel and automobile wire harnessing. Nearly half of Honduras's economic activity is directly tied to the US, with exports to the US accounting for 30% of GDP and remittances for another 20%. The US-Central America-Dominican Republic Free Trade Agreement (CAFTA-DR) came into force in 2006 and has helped foster foreign direct investment, but physical and political insecurity, as well as crime and perceptions of corruption, may deter potential investors; about 70% of FDI is from US firms. The economy registered modest economic growth of 3.0%-4.0% from 2010 to 2012, insufficient to improve living standards for the nearly 65% of the population in poverty. An 18-month IMF Standby Arrangement expired in March 2012 and was not renewed, due to the country's growing budget deficit and weak current account performance. Public sector workers complained of not receiving their salaries in November and December 2012, and government suppliers are owed at least several hundred million dollars in unpaid contracts. The government announced in January 2013 that loss-making public enterprises will be forced to submit financial rescue plans before receiving their budget allotments for 2013.
Issues in Honduras
International Court of Justice (ICJ) ruled on the delimitation of "bolsones" (disputed areas) along the El Salvador-Honduras border in 1992 with final settlement by the parties in 2006 after an Organization of American States survey and a further ICJ ruling in 2003; the 1992 ICJ ruling advised a tripartite resolution to a maritime boundary in the Gulf of Fonseca with consideration of Honduran access to the Pacific; El Salvador continues to claim tiny Conejo Island, not mentioned in the ICJ ruling, off Honduras in the Gulf of Fonseca; Honduras claims the Belizean-administered Sapodilla Cays off the coast of Belize in its constitution, but agreed to a joint ecological park around the cays should Guatemala consent to a maritime corridor in the Caribbean under the OAS-sponsored 2002 Belize-Guatemala Differendum
Refugees and internally displaced persons:
17,000 (violence, extortion, threats, forced recruitment by urban gangs) (2013 est.)
Trafficking in persons:
Honduras is a source and transit country for men, women, and children subjected to sex trafficking and forced labor; Honduran women and girls, and, to a lesser extent, women and girls from neighboring countries, are forced into prostitution in urban and tourist centers; Honduran women and girls are also exploited in sex trafficking in other countries in the region, including Mexico, Guatemala, El Salvador, and the US; Honduran adults and children are subjected to forced labor in Guatemala, Mexico, and the US and domestically in agriculture and domestic service; gangs coerce some young men to transport drugs or be hit men
Tier 2 Watch List - Honduras does not fully comply with the minimum standards for the elimination of trafficking; however, it is making significant efforts to do so; the government maintains limited law enforcement efforts against child sex trafficking offenders but has held no offenders accountable for the forced labor or forced prostitution of adults; most trafficking offenders are prosecuted under non-trafficking statutes that prescribe lower penalties; government efforts to identify, refer, and assist trafficking victims are inadequate, and most services for victims are provided by NGOs without government funding (2013)
transshipment point for drugs and narcotics; illicit producer of cannabis, cultivated on small plots and used principally for local consumption; corruption is a major problem; some money-laundering activity