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Wednesday, March 2, 2011

Honduran-U.S. Relations

Peter J. Meyer
Analyst in Latin American Affairs

On January 27, 2010, Porfirio “Pepe” Lobo Sosa was inaugurated President of Honduras, assuming power after seven months of domestic political crisis and international isolation that had resulted from the June 28, 2009, ouster of President Manuel Zelaya. While the strength of Lobo’s National Party in the legislature has enabled the government to secure passage of much of its policy agenda, the Lobo Administration has made only limited progress in addressing the challenges inherited as a result of the political crisis. Several efforts to foster political reconciliation, including the creation of a truth commission and the passage of a measure to enable constitutional reform, have done little to lesson domestic polarization. Moreover, human rights abuses have continued, and the country has failed to secure recognition from some sectors of the international community.

In addition to the political problems inherited as a result of the 2009 ouster, Lobo has had to contend with a weak economy. Honduras suffered an economic contraction of 2.1% in 2009 as the global financial crisis, together with the domestic political crisis, led to significant declines in tourism, remittances, and export earnings. Lobo has pushed a number of reforms through Congress designed to restore macroeconomic stability, strengthen public finances, and encourage sustained economic growth. Although these reforms have generated considerable opposition from some sectors of Honduran society, they have the support of the international financial institutions, which are now providing Honduras with access to much needed development financing. The economy picked up in 2010, with estimated growth of 2.8%, and is expected to grow by 3.7% in 2011. Nonetheless, significant development challenges remain. Approximately 60% of Honduras’ eight million citizens live under the poverty line and the country continues to perform poorly on a number of social indicators.

Although relations were strained during the political crisis, the United States has traditionally had a close relationship with Honduras. Broad U.S. policy goals include a strengthened democracy with an effective justice system that protects human rights and promotes the rule of law, and the promotion of sustainable economic growth with a more open economy and improved living conditions. In addition to providing Honduras with substantial amounts of foreign assistance ($51 million in FY2010) and maintaining significant military and economic ties, the United States cooperates with Honduras on transnational issues such as migration, crime, narcotics trafficking, trafficking in persons, and port security.

The 111
th Congress expressed considerable interest in Honduras as a result of the 2009 political crisis and its aftermath. Several resolutions were introduced and multiple hearings were held. Issues such as ongoing human rights abuses, reintegration of Honduras into the international community, and U.S. policy toward Honduras may continue to be of interest to the 112th Congress.

This report examines current political and economic conditions in Honduras as well as issues in Honduran-U.S. relations. For a more detailed examination of the Honduran political crisis, see CRS Report R41064, Honduran Political Crisis, June 2009-January 2010.

Date of Report: February 17, 2011
Number of Pages: 28
Order Number: RL34027
Price: $29.95

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