Honduras is a country in Central America with a population over 9.1 million people. Data from the International Monetary Fund indicated that the nation's GDP was $21.79 billion in 2017. According to the 2016 Human Development Report, the Human Development Index in Honduras was estimated at 0.625, and the nation was considered a middle-level economy. The World Bank estimated that close to 66% of the Honduran people lived below the poverty line with most of them living in rural areas. The data also indicated that close to 20% of the rural Hondurans survive on less than $2 daily which is considered living in extreme poverty.
During the colonial era, Honduras was under the control of the Spanish, and at the time silver mining was one of the key economic activities in the country. The economy of present-day Honduras relies heavily on the natural resources which include arable land and minerals, and some of the leading industries in the state include agriculture, mining, and the textile industry. Trade is an essential component of the Honduran economy, and some of their main trading partners include the US, Guatemala, and Mexico.
Agriculture is one of the main industries in Honduras since it contributed 14% of the country's GDP in 2013. In 1999, more than 60% of the Honduran workforce held agricultural jobs. Data from the Honduran government indicated that about 6,563 square miles of the land in Honduras, which is approximately 15% of the country's area, is suitable for growing crops. Data collected in the 1980's suggested that land used for crops accounted for less than half of the total arable land in the country. The rest of the arable land in the country was either used for forestry, pastures or other government use. One of the main crops during this period was bananas, and due to the importance of bananas to the nation's economy, the country was referred to as a "banana republic". The growth of banana cultivation in Honduras attracted investment from foreign governments and several companies such as the Standard Fruit Company, and the United Fruit Company were established. Apart from bananas, other crops grown in the country included coffee, melons, and pineapples. The Nations Encyclopedia indicated that roughly 70,000 farmers grew coffee in about 14 provinces.
Problems Facing Agriculture
Some of the challenges that faced the Honduran agricultural sector included soil erosion, lack of adequate finances to develop the industry, and poor farming practices such as slash and burn agriculture. Another challenge that faced the sector was the insufficient use of modern farming technology and poor infrastructure in the agricultural areas. The government of Honduras has put in place several strategies to increase agricultural production in the country such as giving farmers title deeds for their land and improving infrastructure in the agricultural regions. Despite the reforms implemented by the government, constant violence in the country has slowed down agricultural development.
The Fishing Industry
The Honduran fishing industry is one of the nation's most vital industries in the country since it employs a large section of the workforce. The well-developed component of the fishing industry in the country is shrimp and lobster fishing. Major developments in Honduras' shrimp and lobster sector were put in place in the 1980's. Data from the Honduran government indicated that during 1992, shrimp exports contributed close to $97 million to the nation's economy. The value of the exports had increased by more than 33% from 1991. One of the major challenges that faced the Honduran agricultural sector was the unstable natural supply, and they relied on larvae got from the US. To reduce reliance on American larvae large shrimp fishing companies employed Taiwanese technicians to improve the Honduran larvae. However, the small-scale fishermen got into a feud with the larger companies because they believed that the companies were damaging the natural Honduran shrimps.
Tourism is an important sector in the Honduran economy; however, it has faced a significant number of challenges. Data from the Honduran government indicated that more than 250,000 tourists visited Honduras in 1987. Tourists mainly visit Honduras to see the remains of the Mayan civilization in Copan. Copan is a major tourist attraction site since it was the capital of a major kingdom that rose to prominence during the Classic Period.Apart from archaeological sites, tourists also visit Honduras to explore the coral reefs around the Islas de la Bahía. The tourism industry in Honduras has faced some challenges such as poor infrastructure and insecurity. The Honduran government has put in place several measures to improve tourism such as enhancing the security and the infrastructure.
The textile industry is one of the fastest growing industries in Honduras and experts believe that Honduras could become the leading textile producer in South America. Textile products from Honduras are mainly exported to foreign nations such as the US and Guatemala. To stimulate the growth of the Honduran textile industry, the government and the private sector have invested vast sums of money in reducing the environmental impact of textile production. The government has also improved the working conditions of workers in the textile industry to improve their productivity.
Trade is also an essential component of the Honduran economy with the primary trading partners being the US, Japan, and other nations in Central America. Data from the government indicated that the top 10 exports contributed to more than 80% of the country's top exports. Some of the main products exported from Honduras include agricultural products such as coffee and bananas, textile products and fish.
Economic Growth Of Honduras
In 2017 the Honduran economy grew by approximately 4.8%. The World Bank expects the Honduran economy to grow by approximately 3.6% in 2018. Some of the main drivers of economic growth in Honduras include foreign investment and exports as well as remittance from citizens in diaspora.Despite the expected economic growth, the Honduran economy still faces some challenges with the main one being insecurity. Economic inequality is also a major challenge facing the Honduran economy.