Economy of Honduras: Wikis

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Corner Store in La Ceiba


The economy of Honduras is based mostly on agriculture, which accounted for 22% of its gross domestic product (GDP) in 1999. Leading export coffee ($340 million) accounted for 22% of total Honduran export revenues. Bananas, formerly the country's second-largest export until being virtually wiped out by 1998's Hurricane Mitch, recovered in 2000 to 57% of pre-Mitch levels. Cultivated shrimp are another important export sector.

Banana: Continues to be One of Honduras' Main Exports

Honduras has extensive forest, marine, and mineral resources, although widespread slash and burn agricultural methods continue to destroy Honduran forests. Unemployment is estimated at around 28%. The Honduran economy grew 4.8% in 2000, recovering from the Mitch-induced recession (-1.9%) of 1999. The Honduran maquiladora sector, the third-largest in the world, continued its strong performance in 2000, providing employment to over 120,000 and generating more than $528 million in foreign exchange for the country. Inflation, as measured by the consumer price index, was 10.1% in 2000, down slightly from the 10.9% recorded in 1999. The country's international reserve position continued to be strong in 2000, at slightly over $1 billion. Remittances from Hondurans living abroad (mostly in the U.S.) rose 28% to $410 million in 2000. The lempira (currency) was devaluing for many years but stabilized at L19 to the US dollar in 2005. The minimum wage is USD150 a month (probably obsolete datum). The people of Honduras are among the poorest in Latin America; Gross national income per capita (2007) is $US 1,649; the average for Central America is $US 6,736.[1] Honduras is the third poorest country in the Western Hemisphere; only Haiti and Nicaragua are poorer. Utilizing alternative statistical measurements in addition to the Gross Domestic Product can provide greater context for the nation's poverty.

Economic activity map of Honduras, 1983

The country signed an Enhanced Structural Adjustment Facility (ESAF) -- later converted to a Poverty Reduction and Growth Facility (PRGF) with the International Monetary Fund in March 1999. Honduras (as of about year 2000) continues to maintain stable macroeconomic policies. It not been swift to implementing structural changes such as privatization of the publicly owned telephone and energy distribution companies -- changes which are desired by the IMF and other international lenders. Honduras received significant debt relief in the aftermath of Hurricane Mitch, including the suspension bilateral debt service payments and bilateral debt reduction by the Paris Club -- including the U.S. -- worth over $400 million. In July 2000, Honduras reached its decision point under the Heavily Indebted Poor Countries Initiative (HIPC), qualifying the country for interim multilateral debt relief.

Linkages to United States

As with most Latin American countries, Honduras's economy is closely tied to the United States. The United States is Honduras's primary trading partner and the source of about two-thirds of the country's foreign direct investment (2009 information [2]). United States multinationals Dole and Chiquita control a large portion of Honduras's agricultural exports.[3] Hondurans working in the U.S. send home more than US$ 2 billion each year to their families in Honduras; these remittances account for 28.2% of Honduras's GDP (2007 information [4]).

Statistics

  • GDP

L 233 billion (2007.)
US$ 12.3 billion (2007.)
International dollars (purchasing power parity method) $24.69 billion (2007 est.)[5]

  • GDP - real growth rate 6% (2007 est.)
  • GDP - per capita purchasing power parity - $2,050 (1999 est.)
  • GDP - composition by sector
    • agriculture 20%
    • industry 25%
    • services 55% (1998 est.)
  • Population below poverty line 22% (2006 est.) [6]
  • Household income or consumption by percentage share
    • lowest 10% consume 1.2%
    • highest 10% consume 42.1% (1996)
  • Inflation rate (consumer prices) 14% (1999 est.)
  • Labor force 2.3 million (1997 est.)
  • Labor force - by occupation agriculture 29%, industry 21%, services 60% (1998 est.)
  • Unemployment rate 12% (1999); underemployed 30% (1997 est.)
  • Budget
    • revenue $980 million
  • expenditures $1.15 billion including capital expenditures of $NA (1998 est.)
  • Industries bananas, sugar, coffee, textiles, clothing, wood products
  • Industrial production growth rate 9% (1992 est.)
  • Electricity - production 2,904 GWh (1998)
  • Electricity - production by source
    • fossil fuel 34.44%
    • hydro 65.56%
    • nuclear 0%
  • Electricity - consumption 2,742 GWh (1998)
  • Electricity - exports 16 GWh (1998)
  • Electricity - imports 57 GWh (1998)
  • Agriculture - products bananas, coffee, citrus; beef; timber; shrimp
  • Exports $1.6 billion (f.o.b., 1999 est.)
  • Exports - commodities coffee, bananas, shrimp, lobster, meat; zinc, lumber
  • Exports - partners US 73%, Japan 4%, Germany 4%, Belgium, Spain (1998)
  • Imports $2.7 billion (f.o.b., 1999 est.)*Imports - partners US 60%, Guatemala 5%, Netherlands Antilles, Japan, Germany, Mexico, El Salvador (1998)
  • Debt - external $4.4 billion (1999)
  • Economic aid - recipient $557.8 million (1999)
  • Currency 1 lempira (L) = 100 centavos
  • Exchange rates lempiras (L) per US$1 - 19.00 (October 2005), 14.5744 (January 2000), 14.5039 (1999), 13.8076 (1998), 13.0942 (1997), 12.8694 (1996), 10.3432 (1995) .... 1.00 (1980)
Honduras economy
year gdp annual growth (%) inflation (%)   year gdp annual growth (%) inflation (%)   year gdp annual growth (%) inflation (%)   year gdp annual growth (%) inflation (%)   year gdp annual growth (%) inflation (%)
1960 n.d. n.d.   1970 3.6 4.4   1980 0.7 13.2   1990 0.1 21.2   2000 5.7 30.8
1961 1.9 4.2 1971 4.0 -2.8 1981 2.5 7.2 1991 3.3 26.0 2001 2.7 8.1
1962 5.8 2.9 1972 5.8 3.9 1982 -1.4 4.4 1992 5.6 9.1 2002 3.8 5.1
1963 3.6 2.1 1973 7.9 5.3 1983 -0.9 7.0 1993 6.2 13.6 2003 4.5 5.8
1964 5.4 5.7 1974 -1.2 14.8 1984 4.3 3.4 1994 -1.3 28.9 2004 6.2 6.5
1965 9.0 2.1 1975 2.1 6.4 1985 4.2 5.2 1995 4.1 24.9 2005 6.1 7.3
1966 5.4 2.6 1976 10.5 8.5 1986 0.7 3.9 1996 3.6 22.9 2006 6.3 4.8
1967 6.0 2.6 1977 10.4 12.2 1987 6.0 2.8 1997 5.0 22.3 2007 6.3 7.0
1968 6.6 1.4 1978 10.0 5.1 1988 4.6 6.5 1998 2.9 11.6 2008 4.0
1969 0.7 2.6 1979 4.7 11.5 1989 4.3 7.1 1999 -1.9 11.6 2009    

Notes:
GDP annual growth is growth of real (constant lempiras) GDP, not nominal (current) GDP.
The inflation measure used is the GDP deflator, not consumer price index (CPI). Since they differ somewhat, please do not add CPI data here as it will cause entries to be uncomparable.
2008 GDP annual growth datum is from Banco Central de Honduras Memoria Anual 2008, retrieved July 2009.
Other data is from the World bank >> Data and Research >> Key Statistics:Data by topic >> Macroeconomics and Growth >> Quick Query >> select "Honduras", "GDP growth" and "Inflation".
   ------------------------

Real GDP annual growth rates (%)
region 2007 2008 ratio:
2008/2007
World 5.2 3.4 0.654
United States 2.0 1.1 0.550
Central America 5.6 3.3 0.589
Honduras 6.3 4.0 0.635
Source: Banco Central de Honduras, Memoria anual 2008, p 23, retrieved July 2009.

The slowed rate of growth in 2008 (4%, vs. 6.3% in 2007) reflected the general downturn in the world economy that year. The Banco Central de Honduras (central bank) named the debilitation of global demand, and loss of dynamism in final consumer demand, as important factors in the slowing of Honduras's economic growth in 2008.[7] The table here shows the slowing of growth in 2008 versus 2007 in various economies.

References

  1. ^ United Nations data, National Accounts Estimates of Main Aggregates, Per capita GNI at current prices -- US dollars.
  2. ^ [http://www.alternet.org/world/140966/obama_must_strongly_and_unequivocally_condemn_the_coup_in_honduras/?page=2 "Obama must stronly and unequivocally condemn the coup in Honduras"], Alternet, 29 June 2009; retrieved July 2009.
  3. ^ "Honduran president ousted in army coup", The Militant, 1 July 2009; retrieved July 2009.
  4. ^ NotiCen, 29 November 2007, excerpted in University of California at San Diego libraries Latin american election statistics, retrieved July 2009. NotiCen's source is probably the Latin American Development Bank.
  5. ^ L and US$ data are from United Nations data, National Accounts Estimates of Main Aggregates. World bank (www.worldbank.org) says 2007 GDP was $US 12.2 billion. The international dollar datum is from a previous version of this Wikipedia article and no source was given. World bank says 2007 GNI (not GDP) was 25.6 billion in international PPP dollars.
  6. ^ WFP Interactive Hunger Map
  7. ^ Banco Central de Honduras, Memoria Anual 2008, p 28, retrieved 2009.

See also

Winner country

External links

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