North America

Honduras Economy

ECONOMY: INDUSTRY AND MINERAL RESOURCES

The industrial activity, concentrated in San Pedro Sul and Tegucigalpa, is focused on the processing of agricultural products (sugar refineries, breweries, tobacco factories, oil mills, canneries, rum distilleries) and on the production of basic necessities, such as cotton fabrics and footwear.. The manufacture of panama hats, national and quality products in the districts of Copán and Santa Bárbara, is also of considerable commercial importance. The maquiladoras are in development, manufacturing industries that assemble materials from the United States. The sector is affected by the scarcity of investments, which translates into an incomplete enhancement of production capacities: however, 30% of GDP overall comes from it. There are many minerals found in the country, which once had a considerable mining industry; currently only lead, zinc and antimony are extracted to an appreciable extent and, to a lesser extent, gold and silver. In the Mosquitia, wells have been opened that supply small quantities of oil. Since 1985 the activity of the El Cajòn hydroelectric plant has significantly reduced the oil requirement; the production of hydroelectric energy today almost completely covers the needs of the country. An electricity cogeneration plant has been built in El Porvenir that uses waste from sugar factories as fuel.

ECONOMY: TRADE AND COMMUNICATIONS

According to itypeusa, the economic stagnation and the austerity policies adopted are also reflected in the low level of consumption, the trade balance remains clearly in deficit. The financial system is weak and underdeveloped. Exports are mainly represented by bananas and coffee, then by shrimps, lobsters, fruit, palm oil, sugar, timber, clothing and gold, while imports essentially concern machinery and means of transport, chemicals, various manufactured goods, foodstuffs; trade takes place mainly with the United States (which account for almost three quarters of exports and more than half of imports), followed at a considerable distance by Guatemala and El Salvador, plus Costa Rica and Mexico for imports. The ways of communication are completely inadequate. The railways (699 km, Puerto Cortés, the main one of Honduras, La Ceiba, Tela, Ampala, Trujillo, San Lorenzo and Roatán. Of the roads, which develop for a total of 13,720 km, only 2,970 km (the Puerto Cortés-Choluteca axis and a few others) are asphalted; the major hub of communications is the capital connected to the Pan-American Carretera (paved) which affects Honduras for 243 km. Some areas can only be reached by air; various local airlines operate in the country, including SAHSA, Servicio Aéreo de Honduras SA, which also makes connections with neighboring Central American countries and the United States; Tegucigalpa, La Ceiba and San Pedro Sula are home to international airports, but the country has numerous other airfields at major plantation centers. Honduras has been part of the CACM (Central American Common Market, a free trade area with Costa Rica, Guatemala, El Salvador and Nicaragua) since 1994 and since 2006 of the CAFTA (Central American Free trade Agreement, an agreement for a free trade between the CACM countries and the United States).

Honduras Economy