Honduras - Commercial Guide
Market Challenges

Learn about barriers to market entry and local requirements, i.e., things to be aware of when entering the market for this country.

Last published date: 2019-10-13

Fiscal Imbalance – According to the Central Bank of Honduras, the balance of external public debt is 30.5% of the country’s Gross Domestic Product, 0.6% less than 2017. The country’s focus on macroeconomic stability is perceived as instrumental to improve conditions for sustainable economic growth, strengthening its external commercial position, and bolstering investors’ confidence.

Lengthy Due Process – While open to foreign investment with limited restrictions and performance requirements, companies have experienced long waiting periods for regulatory and legislative approvals. Although starting a business is fairly easy and efforts are underway to streamline administrative procedures through the government’s “Transformation Unit,” obtaining some licenses can still take a few months. Honduras dropped several positions in the World Bank’s 2019 Doing Business report, which measures a country’s regulatory quality and efficiency, and is currently ranked at 121 out of 190 economies.

Social Investment – Honduras’ business climate is hampered by low education levels and a weak healthcare system.

Large Informal Economy – Firms in different sectors may often be pushed into competition with informal firms for market share.

Corruption – U.S. firms and citizens have found corruption to be a continued constraint to successful commercial activities in Honduras. The country’s judicial system is perceived to be subject to outside influence and the resolution of investment and business disputes is largely perceived as nontransparent. Honduras scored 20 in Transparency International (TI) 2018 Corruptions Perceptions Index, which ranks perceived levels of public sector corruption by experts and businesspeople (using a scale of 0 to 100, where 0 is highly corrupt and 100 is very clean). In early 2016, the Government of Honduras and the Organization of American States approved the Mission to Support the Fight Against Corruption and Impunity in Honduras (MACCIH), a team of international judges, prosecutors, and legal experts who provide technical assistance to the Public Ministry and judiciary. It also supports a civil society-led “observatory” to monitor the performance of the justice system.

Security – While citizen security is the government’s highest priority, it faces difficult challenges and personal security remains a major concern in Honduras. Although the homicide rate has dropped significantly (by 51 percent from 2011 to 2017), it remains high by international standards. Theft, pickpocketing, and armed robberies can occur in urban areas.

Civil Unrest –Honduras has witnessed several periodsof civil unrest since the reelection of President of Honduras Juan Orlando Hernandez in December 2017. Immediately following the president’s reelection, country-wide protests erupted across the country in some cases resulting in the looting and vandalizing of stores as well as roadblocks intended to choke off transit routes. In June 2019, similar protests began as a result of the Honduran government’s intended reforms to the health and education sectors. While Honduran protests are largely pacific in nature, on multiple occasions these events have turned violent and resulted in significant damage to property.