Abstract

PIP: Honduras has an area of 112,088 square km or 43,277 square miles with a population of 4.8 million in 1991 of whom 90% are mestizos. Literacy is 68%, the infant mortality rate is 60/1000, and life expectancy is 63 years. After independence from Spain in 1821 the Central American Federation collapsed in 1938. There have been 300 internal rebellions since independence. With an inadequate economic infrastructure, sociopolitical integration has been fragile. In 1982 the Suazo government relied on US support to face the economic recession, the threat posed by the Marxist government in Nicaragua, and civil war in El Salvador. USAID sponsored ambitious social and economic projects. A peaceful transfer of power between civilian presidents occurred in 1986 despite an electoral quirk. In 1990 President Callejas introduced reforms to reduce the deficit, and to stimulate investments and exports. After initial higher inflation and low growth in 1990 and 1991, modest progress is forecast for 1992 and 1993. The powerful military has been kept in check, and human rights have been better protected. The country is among the poorest in Latin America with underemployment of 30-40% and a mostly agricultural economy. The 1990 reforms of deregulation of prices, liberalization of trade, less protectionism, and export orientation is expected to produce longterm benefits not only in agriculture but also in manufacturing. The US is the primary trading partner, and the main direct foreign investor (fruits, refining, and mining). The slash-and-burn agricultural cultivation has created environmental destruction, and as a sign of public awareness the armed forces have engaged in reforestation and fighting forest fires.